**Exhibit 10.10**

 

**Silicon Valley Bank**

 

**Amendmentto Loan Documents**

 
| **Borrower:** | **Unify Corporation**                                                        |
|---------------|------------------------------------------------------------------------------|
|          |                                                                         |
| **Date:**     | **As of June 5, 2005 (the “June 2005  Amendment Date”)** |

 

**THIS AMENDMENT TO LOAN DOCUMENTS**is entered into between Silicon Valley Bank (“Silicon”) and the borrower namedabove (“Borrower”).

 

Silicon and Borrower agree to amend the Loanand Security Agreement between them, dated June 6, 2003 (as otherwiseamended, if at all, the “Loan Agreement”), as follows, effective as of the datehereof.  (Capitalized terms used, but notdefined, in this Amendment shall have the meanings set forth in the LoanAgreement.)  The term “June 2005Amendment Date” as defined above hereby is incorporated into the LoanAgreement.

 

**1.****                                      Amendmentsto Loan Agreement.**

 

**(a) Modification of Advance Raterelative to Eligible Accounts.**  The portion of Section 1 of the Schedule toLoan Agreement that currently reads as follows:

 

1.  RevolvingLoans.  An amount equal to: (A) thelesser of:  (i) $1,000,000 at anyone time outstanding (the “Maximum Credit Limit”), or (ii) the sum of (a) 75%(an “Advance Rate”) of the amount of Borrower’s Eligible Accounts (as definedin Section 8 above) plus (b) 30% (an “Advance Rate”) of the amount ofBorrower’s unrestricted cash in investment accounts maintained at Silicon minus(B) the Term Loans (as defined below).

 

, hereby is amended and restated in its entirety to read as follows:

 

1.  RevolvingLoans.  Subject to the terms andconditions of this Agreement, Silicon agrees to make revolving advances(individually and collectively, “Revolving Loans”) up to an aggregate amountequal to: (A) the lesser of: (i) $1,000,000 at any one timeoutstanding (the “Maximum Credit Limit”), or (ii) the sum of (a) 80%(an “Advance Rate”) of the amount of Borrower’s Eligible Accounts (as definedin Section 8 above) plus (b) 30% (an “Advance Rate”) of the amount ofBorrower’s unrestricted cash in investment accounts maintained at Silicon minus(B) the then aggregate outstanding amount of Term Loans (as definedbelow).

 

1

----

 

**(b) Modification of Definitionof Eligible Accounts.  **Clause (viii) of the Minimum EligibilityRequirements set forth in the definition of “Eligible Accounts” in Section 8of the Loan Agreement, which currently reads as follows:

 

(viii) the Account mustnot be owing from an Account Debtor located outside the United States or Canada(unless pre-approved by Silicon in its discretion in writing, or backed by aletter of credit satisfactory to Silicon, or FCIA insured satisfactory toSilicon),

 

, hereby is amended and restated in its entirety toread as follows:

 

(viii) the Account mustnot be owing from an Account Debtor located outside the United States or Canada(a “Foreign Account”), except for (A) Foreign Accounts in an aggregateamount (up to $250,000) determined by Silicon in its discretion from time to time,and (B) any other Foreign Accounts otherwise pre-approved by Silicon inits discretion in writing, or backed by a letter of credit satisfactory toSilicon, or FCIA insured satisfactory to Silicon,

 

**(c) Modificationof Term Loans (including moving the Term Loan principal amortization provisionsformerly in Section 4 of the Schedule to Section 1 of theSchedule).  **The portion of Section 1 of the Schedule toLoan Agreement that currently reads as follows:

 

2.  TermLoans.  An amount equal to theaggregate unpaid principal balance from time to time outstanding of the Loans (“TermLoans”) made from time to time by Silicon to Borrower in a total amount not toexceed $500,000 for the purchase by Borrower of new or used Equipmentacceptable to Silicon in its sole discretion, including computer equipment,office equipment, lab equipment, test equipment and furnishings.  To evidence each of the Term Loans, Borrowershall deliver to Silicon, at the time of each Term Loan request, an invoice forthe Equipment (a) to be purchased or (b) which was previouslypurchased by the Borrower.  The Loanrequest with respect to any particular Equipment must be made within 90 days ofthe date such Equipment was purchased.  TheTerm Loans shall be used only to (a) purchase Equipment or (b) reimbursethe Borrower for previously purchased Equipment and shall not exceed 100% ofthe invoice amount of such Equipment approved from time to time by Silicon.  Subject to and upon the terms and conditionsof this Agreement, Term Loans shall be available through December 31,2004.  The Term Loans shall be repaid asprovided for herein.  Interest shallaccrue from the date of each Term Loan at the rate provided for herein and ispayable monthly as provided for herein.  TermLoans shall be made in disbursements of not less than $100,000.

 

2

----

 

, hereby is amended and restated in its entirety toread as follows:

 

2. Term Loans. Subject to the terms andconditions of this Agreement: (a) Silicon previously made the followingterm loans (individually and collectively, the “First Tranche Term Loans”): (i) thatcertain term loan designated internally by Silicon as Loan #UNI-06, which hasan outstanding principal balance of $16,666.60 as of June 5, 2005; (ii) thatcertain term loan designated internally by Silicon as Loan #UNI-07, which hasan outstanding principal balance of $20,833.27 as of June 5, 2005; and (iii) thatcertain term loan designated internally by Silicon as Loan #UNI-08, which hasan outstanding principal balance of $68,021.59 as of June 5, 2005; and (b) Siliconagrees to make additional term loans (individually and collectively, “SecondTranche Term Loans”), in an aggregate original principal amount not to exceedthe result of (i) $250,000, minus (ii) the aggregate outstandingprincipal amount of the First Tranche Term Loans as of the June 2005Amendment Date; for the purchase by Borrower of new or used Equipmentacceptable to Silicon in its sole discretion, including computer equipment,office equipment, lab equipment, test equipment and furnishings.  As used herein, the term “Term Loans” means,individually and collectively, the First Tranche Term Loans and the SecondTranche Term Loans.  To evidence each ofthe Term Loans, Borrower shall deliver to Silicon, at the time of each TermLoan request, an invoice for the Equipment (a) to be purchased or (b) whichwas previously purchased by the Borrower.  The Loan request with respect to anyparticular Equipment must be made within 90 days of the date such Equipment waspurchased.  The Term Loans shall be usedonly to (a) purchase Equipment or (b) reimburse the Borrower forpreviously purchased Equipment and shall not exceed 100% of the invoice amountof such Equipment approved from time to time by Silicon.  Subject to and upon the terms and conditionsof this Agreement, Second Tranche Term Loans may be made by Silicon during theperiod commencing on the June 2005 Amendment Date and ending on December 31,2005.  The Term Loans shall be repaid asprovided for herein.  Interest shallaccrue from the date of each Term Loan at the rate provided for herein and ispayable monthly as provided for herein.  TermLoans shall be made in disbursements of not less than $100,000.

 

The outstanding principal balance of each Term Loanshall be repaid by Borrower to Silicon in twenty-four (24) equal monthlypayments of principal, commencing on the last day of the calendar month in whichthe applicable Term Loan is made and continuing on the same day of eachsubsequent month until the earlier of

 

3

----

 

the following dates (with respect to each TermLoan, the “Term Loan Maturity Date”): (i) the date such Term Loan has beenindefeasibly paid in full; or (ii) the Revolving Loans Maturity Date; or (iii) thedate this Agreement terminates by its terms or is terminated by either party inaccordance with its terms.  With respectto each Term Loan, on the Term Loan Maturity Date for such Term Loan, theentire unpaid principal balance of such Term Loan, plus all accrued and unpaidinterest thereon, shall be due and payable.  Interest on each Term Loan shall be payablemonthly as provided in Section 1.2 of this Agreement.

 

**(d) ****Modification of Maturity Date (including moving the Term Loanprincipal amortization provisions formerly in Section 4 of the Schedule toSection 1 of the Schedule).  **Section 4 of the Schedule to LoanAgreement, which currently reads as follows:

 

**4.****        ****MATURITY DATE**

(Section 6.1):                         June 5, 2005.

 

Notwithstanding theforegoing, with respect to the Term Loans: The outstanding principal balance ofeach Term Loan shall be repaid by Borrower to Silicon in twenty-four (24) equalmonthly payments of principal, commencing on the last day of the calendar monthin which the applicable Term Loan is made and continuing on the same day ofeach subsequent month until the earlier of the following dates: (i) thedate such Term Loan has been indefeasibly paid in full, or (ii) the datethe Revolving Loans are terminated, or (iii) the date this Agreementterminates by its terms or is terminated by either party in accordance with itsterms.  On the earlier to occur of theforegoing dates, the entire unpaid principal balance of the Term Loans, plusall accrued and unpaid interest thereon, shall be due and payable.  Interest on each Term Loan shall be payablemonthly as provided in Section 1.2of this Agreement.

 

, hereby is amended and restated in its entirety toread as follows:

 

**4.****        ****MATURITY DATE**

(Section 6.1):         With respect to all Obligations other thanthe Term Loan Obligations, June 4, 2006 (the “Revolving Loans MaturityDate”).

 

4

----

 

With respect to each TermLoan and Obligations specifically identified to such Term Loan (collectively, “TermLoan Obligations”), the Term Loan Maturity Date applicable to such Term Loan asset forth in Section 1 of this Schedule.

 

**(e) ****Modification of EarlyTermination Fee.  **The portion of Section 6.2 of the LoanAgreement that currently reads as follows:

 

If this Agreement isterminated by Borrower or by Silicon under this Section 6.2, Borrowershall pay to Silicon a termination fee in an amount equal to one percent (1.0%)of the Maximum Credit Limit, provided that no termination fee shall be chargedif the credit facility hereunder is replaced with a new facility from anotherdivision of Silicon Valley Bank.

 

, hereby is amended and restated in its entirety toread as follows:

 

If this Agreement isterminated by Borrower or by Silicon under this Section 6.2, Borrowershall pay to Silicon a termination fee in an amount equal to one-half of onepercent (0.5%) of the Maximum Credit Limit, provided that no termination feeshall be charged if the credit facility hereunder is replaced with a newfacility from another division of Silicon Valley Bank.

 

**(f) ****Modification of CertainReporting Requirements. **The portion of Section 6 of the Schedule toLoan Agreement that currentlyreads as follows:

 

2.                                       Monthly accounts receivable agings, aged byinvoice date, within fifteen days after the end of each month.

 

3.                                       Monthly accounts payable agings,aged by invoice date, and outstanding or held check registers, if any, withinfifteen days after the end of each month.

 

4.                                       Monthly reconciliations of accountsreceivable agings (aged by invoice date), transaction reports, and generalledger, within fifteen days after the end of each month.

 

, hereby is amended and restated in its entirety toread as follows:

 

2.                                       Monthly accounts receivable agings, aged byinvoice date, within thirty days after the end of each month.

 

3.                                       Monthly accounts payable agings,aged by invoice date, and outstanding or held check registers, if any, withinthirty days after the end of each month.

 

5

----

 

4.                                       Monthly reconciliations of accountsreceivable agings (aged by invoice date), transaction reports, and generalledger, within thirty days after the end of each month.

 

**(g) Modificationof Certain Streamline Provision.**  Subsection (2) of Section 8(c) ofthe Schedule to Loan Agreement, which currently reads as follows:

 

(2)          In order for a Streamline Period to go into effect, and at all timesduring the Streamline Period, no Revolving Loans may be outstanding or made, noLetters of Credit may be outstanding, the combined amount of the required FXReserves and Cash Management Reserves may not exceed $250,000 and the amount ofObligations outstanding with respect to the Term Loans may not exceed $500,000.

 

, hereby are amended and restated in theirrespective entirety to read as follows:

 

(2)          In order for a Streamline Period to go into effect, and at all timesduring the Streamline Period, no Revolving Loans may be outstanding or made,and no Letters of Credit may be outstanding.

 

**(h) Modificationof Financial Covenant (including deletion of existing Tangible Net Worthfinancial covenant and addition of new Liquidity Covenant). **Section 5 of the Schedule to Loan Agreement, which currentlyreads as follows:

 

**5.****        ****FINANCIAL COVENANTS**

(Section 5.1):                         Borrower shall comply with each of thefollowing covenants:

 

**Minimum Tangible**

**Net Worth:**                               Borrower shall maintain a Tangible Net Worthof not less than the following amounts as of the end of each of the followingmonths:

 
| **As of end of:** | ** ** | **Minimum Tangible  Net Worth** |
|-------------------|------------|---------------------------------|
| May, 2004         |       | $                               | 2,250,000 |
| June, 2004        |       | $                               | 2,250,000 |
| July, 2004        |       | $                               | 3,000,000 |
| August, 2004 |       | $                               | 2,250,000 |

 

6

----

 
| September, 2004    |   | $                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 2,250,000 |
|--------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------|
| October, 2004      |   | $                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 3,000,000 |
| November, 2004     |   | $                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 2,250,000 |
| December, 2004     |   | $                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 2,250,000 |
| January 2005  |   | $                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 2,750,000 |
| February 2005 |   | $                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 2,250,000 |
| March 2005    |   | $                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 2,250,000 |
| April 2005    |   | $3,000,000; unless on or before March 31, 2005, the  Minimum Tangible Net Worth Covenant shall be reset, by mutual written  agreement of Silicon and Borrower in their respective discretion, for April 2005  and each month thereafter based on Borrower’s projected financial statements  for such period, such projected financial statements to have been approved by  the Borrower’s Board of Directors and accepted jointly by Borrower and by  Silicon in their respective discretion, which projected financial statements  Borrower hereby covenants and agrees to deliver to Silicon no later than March 15,  2005. |
| May 2005      |   | $                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 2,250,000 |
|                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |           |  |

 

Definitions.                                  For purposes of the foregoing financialcovenants, the following term shall have the following meaning:

 

“Tangible Net Worth” shallmean the excess of total assets over total liabilities, determined inaccordance with GAAP, with the following adjustments:

 

7

----

 

(A)      there shall be excluded from assets: (i) notes, accounts receivable and other obligations owing toBorrower from its officers or other Affiliates, and (ii) all assets whichwould be classified as intangible assets under GAAP, including withoutlimitation goodwill, licenses, patents, trademarks, trade names, copyrights,capitalized software and organizational costs, licenses and franchises

 

(B)        there shall be excluded from liabilities: all indebtedness which is subordinated to the Obligations under asubordination agreement in form specified by Silicon or by language in theinstrument evidencing the indebtedness which Silicon agrees in writing isacceptable to Silicon in its good faith business judgment.

 

, hereby is amended and restated in its entirety toread as follows:

 

**5.****         FINANCIAL COVENANTS**

(Section 5.1):                         Borrower shall comply with each of thefollowing covenants:

 

**Minimum**

**Liquidity:****                                        **During each month, Borrower shall maintainLiquidity of at least $2,000,000.

 

Definitions.                                                     For purposes of the foregoing financialcovenants, the following term shall have the following meaning:

 

“Liquidity” shall mean, asof any date of determination, the sum of (a) Borrower’s unrestricted cashmaintained on deposit at Silicon, plus (b) the net amount of all EligibleAccounts of Borrower.

 

**2.****                                     ****Limited Waiver.** Silicon and Borrower hereby agree that the failure of Borrower to complywith the Tangible Net Worth financial covenant required under Section 5 ofthe Schedule to Loan Agreement (as in effect immediately prior to theeffectiveness of this Amendment) solely for the month ending April 30,2005 (the “Designated TNW Default”) hereby is waived. It is understood,however, that the foregoing waiver of the Designated TNW Default does notconstitute a waiver of the aforementioned covenant with respect to any otherdate or time period, or of any other provision or term of the Loan Agreement orany other Loan Document, nor an agreement to waive in the future such covenantwith respect to any other date

 

8

----

 

or time period or any other provision or termof the Loan Agreement or any other Loan Document.

 

**3.****                                     ****Fee.**  Inconsideration for Silicon entering into this Amendment, Borrower shallconcurrently pay Silicon a fee in the amount of $15,000.00, which shall befully-earned and non-refundable and in addition to all interest and other feespayable to Silicon under the Loan Documents. Silicon is authorized to charge such fee to Borrower’s loan account.

 

**4.****                                     ****Representations True.**  Borrowerrepresents and warrants to Silicon that all representations and warranties setforth in the Loan Agreement, as amended hereby, aretrue and correct.

 

**5.****                                     ****General Provisions.**  ThisAmendment, the Loan Agreement, any prior written amendments to the LoanAgreement signed by Silicon and Borrower, and the other written documents andagreements between Silicon and Borrower set forth in full all of therepresentations and agreements of the parties with respect to the subjectmatter hereof and supersede all prior discussions, representations, agreementsand understandings between the parties with respect to the subject hereof.  Except as herein expressly amended, all ofthe terms and provisions of the Loan Agreement, and all other documents andagreements between Silicon and Borrower shall continue in full force and effectand the same are hereby ratified and confirmed.

 

[remainder of page intentionallyleft blank; signature page follows]

 

9

----

 

**6.****                                     ****Counterparts.**  ThisAmendment may be executed in any number of counterparts and by differentparties on separate counterparts, each of which, when executed and delivered,shall be deemed to be an original, and all of which, when taken together, shallconstitute but one and the same document.  Delivery of an executed counterpart of thisAmendment by telefacsimile shall be equally as effective as delivery of anoriginal executed counterpart of this Amendment.

 
| ** **                                | **Borrower:**         | **Silicon:**            |
|-------------------------------------------|-----------------------|-------------------------|
|                                      |                  |
| ** **                                | **UNIFY CORPORATION** | **SILICON VALLEY BANK** |
|                                      |                  |
|                                      |                  |
| ** **                                | **By**                | /s/ Todd E. Wille       | ** ** | **By** | /s/ Mark Harris |   |
| **President  or Vice President**          | **Title**             | Relationship Manager    | ** ** |
|                                      |                  |
|                                      | **By**                | /s/ Todd E. Wille       |   |   |
| **Secretary  or Ass’t****Secretary** | ** **            |
|                                           |                       |                         |  |  |  |  |  |

 

10

----