Exhibit 10.1


 


LOAN MODIFICATION AGREEMENT


 


This
Loan Modification Agreement is entered into as of February 28, 2005, by and
between Intraware, Inc. (the “Borrower”) and Silicon Valley Bank (“Bank”).


 


1.             DESCRIPTION OF
EXISTING OBLIGATIONS:  Among other
Obligations which may be owing by Borrower to Bank, Borrower is indebted to
Bank pursuant to, among other documents, a Loan and Security Agreement, dated
August 1, 2003, as amended or modified from time to time, (the “Loan Agreement”).
The Loan Agreement provides for, among other things, a Committed Equipment Line
in the original amount of Five Hundred Thousand Dollars ($500,000), a Term Loan
in the original principal amount of One Million Nine Hundred Eighty-Two
Thousand Nine Hundred Forty-Five Dollars ($1,982,945) and Committed Equipment 2
Line in the original amount of Five Hundred Thousand Dollars ($500,000).  Defined terms used but not otherwise defined
herein shall have the same meanings as set forth in the Loan Agreement.


 


Hereinafter, all indebtedness owing by Borrower to Bank shall be
referred to as the “Obligations.”


 


2.             DESCRIPTION OF
COLLATERAL. Repayment of the Obligations is secured by the Collateral as
described in the Loan Agreement.


 


Hereinafter,
the above-described security documents and guaranties, together with all other
documents securing repayment of the Obligations shall be referred to as the “Security
Documents”.  Hereinafter, the Security
Documents, together with all other documents evidencing or securing the
Obligations shall be referred to as the “Existing Loan Documents”.


 


3.             DESCRIPTION OF CHANGE IN TERMS.


 


A.                                Modification(s)
to Loan Agreement.


 


 


1.                                       Sub-section
(b) under Section 6.7 entitled “Financial Covenants” is hereby amended to read
as follows:


 


(b)
Borrower will maintain, as of the last day of each fiscal quarter, maximum Loss
from Operations through the end of such period in an amount not greater than
the following:


 


	
  Period
  (fiscal quarter ending)

  	
   

  	
  Maximum
  Loss from Operations

  
	
   

  	
   

  	
   

  
	
  February
  28, 2005

  	
   

  	
  ($750,000)

  
	
  May
  31, 2005

  	
   

  	
  ($1,000,000)

  
	
  August
  31, 2005

  	
   

  	
  ($650,000)

  
	
  November
  30, 2005

  	
   

  	
  ($650,000)

  
	
  February
  28, 2006

  	
   

  	
  ($200,000)

  



 


For each period
therafter, Bank shall reset the levels of maximum Loss from Operations, using
the same or similar methodology as was utilized by Bank to set the levels for
maximum Loss from Operations set forth above, based upon the new projections
for Borrower’s fiscal year 2007 as approved by Borrower’s board of directors;
provided, that if such new projections are not reasonably acceptable to Bank,
Bank may reset the levels of maximum Loss from Operations based upon such other
criteria as Bank may reasonably select.


 


4.             CONSISTENT
CHANGES.  The Existing Loan Documents
are hereby amended wherever necessary to reflect the changes described above.


 





















 


5.             NO DEFENSES OF BORROWER.  Borrower (and each guarantor and pledgor
signing below) agrees that, as of the date hereof, it has no defenses against
paying any of the Obligations.


 


6.             CONTINUING
VALIDITY.  Borrower (and each
guarantor and pledgor signing below) understands and agrees that in modifying
the existing Indebtedness, Bank is relying upon Borrower’s representations,
warranties, and agreements, as set forth in the Existing Loan Documents.  Except as expressly modified pursuant to this
Loan Modification Agreement, the terms of the Existing Loan Documents remain
unchanged and in full force and effect. 
Bank’s agreement to modifications to the existing Obligations pursuant
to this Loan Modification Agreement in no way shall obligate Bank to make any
future modifications to the Obligations. 
Nothing in this Loan Modification Agreement shall constitute a
satisfaction of the Obligations.  It is
the intention of Bank and Borrower to retain as liable parties all makers and
endorsers of Existing Loan Documents, unless the party is expressly released by
Bank in writing.  Unless expressly
released herein, no maker, endorser, or guarantor will be released by virtue of
this Loan Modification Agreement.  The
terms of this paragraph apply not only to this Loan Modification Agreement, but
also to all subsequent loan modification agreements.


 


                This Loan
Modification Agreement is executed as of the date first written above.


 


	
  BORROWER:

  	
   

  	
  BANK:

  
	
   

  	
   

  	
   

  
	
  INTRAWARE,
  INC.

  	
   

  	
  SILICON
  VALLEY BANK

  	 

	
   

  	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	
   

  	 

	
  By:

  	
  /s/
  WENDY NIETO

  	
   

  	
  By:

  	
  /s/
  HEATHER HAMILTON

  	 

	
  Name:

  	
  Wendy
  Nieto

  	
   

  	
  Name:

  	
  Heather
  Hamilton

  	 

	
  Title:

  	
  CFO

  	
   

  	
  Title:

  	
  VP