EXHIBIT 10.2
 

FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT
 
THIS FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is
entered into this 26th day of September, 2012, by and between SILICON VALLEY
BANK, a California corporation (“Bank”), and CIMETRIX INCORPORATED, a Nevada
corporation (“Borrower”), whose address is 6979 South High Tech Drive, Salt Lake
City, Utah  84047-3757.
 
Recitals
 
A. Bank and Borrower have entered into that certain Loan and Security Agreement
dated as of September 27, 2011, (as the same may from time to time be amended,
modified, supplemented or restated, the “Loan Agreement”).
 
B. Bank has extended credit to Borrower for the purposes permitted in the Loan
Agreement.
 
C. Borrower has requested that Bank amend the Loan Agreement to (i) extend the
Revolving Line Maturity Date, and (ii) make certain other revisions to the Loan
Agreement as more fully set forth herein.
 
D. Bank has agreed to so amend certain provisions of the Loan Agreement, but
only to the extent, in accordance with the terms, subject to the conditions and
in reliance upon the representations and warranties set forth below.
 
Agreement
 
Now, Therefore, in consideration of the foregoing recitals and other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, and intending to be legally bound, the parties hereto agree as
follows:
 
1. Definitions.  Capitalized terms used but not defined in this Amendment shall
have the meanings given to them in the Loan Agreement.
 
2. Amendments to Loan Agreement.
 
2.1 Section 4.1 (Grant of Security Interest).  Section 4.1 of the Loan Agreement
is hereby amended by adding the following two new paragraphs immediately after
the first paragraph of Section 4.1 as follows:
 
Borrower acknowledges that it previously has entered, and/or may in the future
enter, into Bank Services Agreements with Bank.  Regardless of the terms of any
Bank Services Agreement, Borrower agrees that any amounts Borrower owes Bank
thereunder shall be deemed to be Obligations hereunder and that it is the intent
of Borrower and Bank to have all such Obligations secured by the first priority
perfected security interest in the Collateral granted herein (subject only to
Permitted Liens that may have superior priority to Bank’s Lien in this
Agreement).
 
 
 
 

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If this Agreement is terminated, Bank’s Lien in the Collateral shall continue
until the Obligations (other than inchoate indemnity obligations) are satisfied
in full, and at such time, Bank shall, at Borrower’s sole cost and expense,
terminate its security interest in the Collateral and all rights therein shall
revert to Borrower.  In the event (x) all Obligations (other than inchoate
indemnity obligations), except for Bank Services, are satisfied in full, and (y)
this Agreement is terminated, Bank shall terminate the security interest granted
herein upon Borrower providing cash collateral acceptable to Bank in its good
faith business judgment for Bank Services, if any.  In the event such Bank
Services consist of outstanding Letters of Credit, Borrower shall provide to
Bank cash collateral in an amount equal to one hundred five percent (105%) of
the Dollar Equivalent (or one hundred ten percent (110%) if the Dollar
Equivalent is denominated in Foreign Currency) of the face amount of all such
Letters of Credit plus all interest, fees, and costs due or to become due in
connection therewith (as estimated by Bank in its good faith business judgment),
to secure all of the Obligations relating to such Letters of Credit.

2.2 Section 4.2 (Priority of Security Interest).  The second  paragraph of
Section 4.2 of the Loan Agreement is hereby deleted in its entirety.
 
2.3 Section 8.2 (Covenant Default). Section 8.2(a) of the Loan Agreement is
hereby amended by deleting it in its entirety and replacing it with the
following:
 
(a)           Borrower fails or neglects to perform any obligation in Sections
2.2, 6.2, 6.4, 6.5, 6.6, 6.7, 6.8(c), 6.10 or violates any covenant in Section
7; or
 
2.4 Section 9.1 (Rights and Remedies).  Section 9.1 of the Loan Agreement is
hereby amended by adding Sections 9.1 (j) and 9.1 (k) immediately after Section
9.1 (i) as follows:
 
(j)           for any Letters of Credit, demand that Borrower (i) deposit cash
with Bank in an amount equal to one hundred five percent (105%) of the Dollar
Equivalent (or one hundred ten percent (110%) if the Dollar Equivalent is
denominated in Foreign Currency) of the aggregate face amount of all Letters of
Credit remaining undrawn (plus all interest, fees, and costs due or to become
due in connection therewith (as estimated by Bank in its good faith business
judgment)), to secure all of the Obligations relating to such Letters of Credit,
as collateral security for the repayment of any future drawings under such
Letters of Credit, and Borrower shall forthwith deposit and pay such amounts,
and (ii) pay in advance all letter of credit fees scheduled to be paid or
payable over the remaining term of any Letters of Credit; and
 
(k)           terminate any FX Contract.
 
2.5 Section 12.8 (Survival).  Section 12.8 of the Loan Agreement is hereby
amended by deleting it in its entirety and replacing it with the following:
 
All covenants, representations and warranties made in this Agreement continue in
full force until this Agreement has terminated pursuant to its terms and all
Obligations (other than inchoate indemnity obligations and any other obligations
which, by their terms, are to survive the termination of this Agreement) have
been paid in full and satisfied.  Without limiting the foregoing, except as
otherwise provided in Section 4.1, the grant of security interest by Borrower in
Section 4.1 shall survive until the termination of all Bank Services Agreements.
The obligation of Borrower in Section 12.2 to indemnify Bank shall survive until
the statute of limitations with respect to such claim or cause of action shall
have run.
 
 
 
 

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2.6 Section 13 (Definitions).
 
(a) The following terms and their respective definitions set forth in
Section 13.1 of the Loan Agreement are hereby amended by deleting them in their
entirety and replacing them with the following:
 
“Credit Extension” is any Advance, or any other extension of credit by Bank for
Borrower’s benefit under this Agreement.
 
“Loan Documents” are, collectively, this Agreement, the Perfection Certificate,
any Bank Services Agreements, the IP Agreement, the SVB Control Agreement, any
subordination agreement, any note, or notes or guaranties executed by Borrower,
and any other present or future agreement between Borrower and/or for the
benefit of Bank in connection with this Agreement, all as amended, restated, or
otherwise modified.
 
“Obligations” are Borrower’s obligations to pay when due any debts, principal,
interest, Bank Expenses and other amounts Borrower owes Bank now or later,
whether under this Agreement, the Loan Documents, or otherwise, including,
without limitation, any interest accruing after Insolvency Proceedings begin and
debts, liabilities, or obligations of Borrower assigned to Bank, and to perform
Borrower’s duties under the Loan Documents.
 
“Revolving Line Maturity Date” is September 25, 2013.
 
(b) The following terms and their respective definitions are hereby added in
alphabetical order to Section 13.1 of the Loan Agreement as follows:
 
“Bank Services”  are any products, credit services, and/or financial
accommodations previously, now, or hereafter provided to Borrower or any of its
Subsidiaries by Bank or any Bank Affiliate, including, without limitation, any
letters of credit, cash management services (including, without limitation,
merchant services, direct deposit of payroll, business credit cards, and check
cashing services), interest rate swap arrangements, and foreign exchange
services as any such products or services may be identified in Bank’s various
agreements related thereto (each, a “Bank Services Agreement”).
 
“Dollar Equivalent” is, at any time, (a) with respect to any amount denominated
in Dollars, such amount, and (b) with respect to any amount denominated in a
Foreign Currency, the equivalent amount therefor in Dollars as determined by
Bank at such time on the basis of the then-prevailing rate of exchange in San
Francisco, California, for sales of the Foreign Currency for transfer to the
country issuing such Foreign Currency.
 
“FX Contract” is any foreign exchange contract by and between Borrower and Bank
under which Borrower commits to purchase from or sell to Bank a specific amount
of Foreign Currency on a specified date.
 
“Letter of Credit” is a standby or commercial letter of credit issued by Bank
upon request of Borrower based upon an application, guarantee, indemnity, or
similar agreement.
 
 
 
 

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3. Limitation of Amendments.
 
3.1 The amendments set forth in Section 2, above, are effective for the purposes
set forth herein and shall be limited precisely as written and shall not be
deemed to (a) be a consent to any amendment, waiver or modification of any other
term or condition of any Loan Document, or (b) otherwise prejudice any right or
remedy which Bank may now have or may have in the future under or in connection
with any Loan Document.
 
3.2 This Amendment shall be construed in connection with and as part of the Loan
Documents and all terms, conditions, representations, warranties, covenants and
agreements set forth in the Loan Documents, except as herein amended, are hereby
ratified and confirmed and shall remain in full force and effect.
 
3.3 In addition to those Events of Default specifically enumerated in the Loan
Documents, the failure to comply with the terms of any covenant or agreement
contained herein shall constitute an Event of Default and shall entitle the Bank
to exercise all rights and remedies provided to the Bank under the terms of any
of the other Loan Documents as a result of the occurrence of the same.
 
4. Representations and Warranties.  To induce Bank to enter into this Amendment,
Borrower hereby represents and warrants to Bank as follows:
 
4.1 Immediately after giving effect to this Amendment (a) the representations
and warranties contained in the Loan Documents are true, accurate and complete
in all material respects as of the date hereof (except to the extent such
representations and warranties relate to an earlier date, in which case they are
true and correct as of such date), and (b) no Event of Default has occurred and
is continuing;
 
4.2 Borrower has the power and authority to execute and deliver this Amendment
and to perform its obligations under the Loan Agreement, as amended by this
Amendment;
 
4.3 The organizational documents of Borrower delivered to Bank on the Effective
Date remain true, accurate and complete and have not been amended, supplemented
or restated and are and continue to be in full force and effect;
 
 
 
 

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4.4 The execution and delivery by Borrower of this Amendment and the performance
by Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, have been duly authorized;
 
4.5 The execution and delivery by Borrower of this Amendment and the performance
by Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, do not and will not contravene (a) any law or regulation binding on
or affecting Borrower, (b) any contractual restriction with a Person binding on
Borrower, (c) any order, judgment or decree of any court or other governmental
or public body or authority, or subdivision thereof, binding on Borrower, or
(d) the organizational documents of Borrower;
 
4.6 The execution and delivery by Borrower of this Amendment and the performance
by Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, do not require any order, consent, approval, license, authorization
or validation of, or filing, recording or registration with, or exemption by any
governmental or public body or authority, or subdivision thereof, binding on
Borrower, except as already has been obtained or made; and
 
4.7 This Amendment has been duly executed and delivered by Borrower and is the
binding obligation of Borrower, enforceable against Borrower in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, liquidation, moratorium or other similar laws of
general application and equitable principles relating to or affecting creditors’
rights.
 
5. Integration.  This Amendment and the Loan Documents represent the entire
agreement about this subject matter and supersede prior negotiations or
agreements.  All prior agreements, understandings, representations, warranties,
and negotiations between the parties about the subject matter of this Amendment
and the Loan Documents merge into this Amendment and the Loan Documents.
 
6. Counterparts.  This Amendment may be executed in any number of counterparts
and all of such counterparts taken together shall be deemed to constitute one
and the same instrument.
 
7. Effectiveness.  This Amendment shall be deemed effective upon (a) the due
execution and delivery to Bank of this Amendment by each party hereto,
(b) Borrower’s payment of a non-refundable amendment fee in an amount equal to
Five Thousand Dollars ($5,000) and (c) payment of Bank’s legal fees and expenses
in connection with the negotiation and preparation of this Amendment.
 
[Signature page follows.]
 

 
 

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In Witness Whereof, the parties hereto have caused this Amendment to be duly
executed and delivered as of the date first written above.
 
BORROWER:

CIMETRIX INCORPORATED

By_/s/ Jodi M. Juretich_________________________
Name: Jodi M. Juretich_________________________
Title: Chief Financial Officer____________________

BANK:

SILICON VALLEY BANK

By_/s/ Gary Jackson__________________________
Name: Gary Jackson__________________________
Title:__Deal Team Leader_____________________
 
 
 
 

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