Exhibit 10.50.1
AMENDMENT NO. 1 TO SECURITY AGREEMENT
July 30, 2004
Reference is made to that certain Security Agreement dated August 14, 2003, made
by and between Artemis International Solutions Corporation, a Delaware
corporation (the "Borrower") Artemis International Solutions Ltd. a United
Kingdom corporation ("Guarantor Subsidiary") and LAURUS MASTER FUND, LTD., c/o
Ogier Corporate Services Ltd., P.O. Box 1234 G.T., Queensgate House, South
Church Street, Grand Cayman, Cayman Islands (the "Laurus"") (the "Security
Agreement") pursuant to which, among other things, the Borrower issued a note in
the original principal amount of Five Million Dollars ($5,000,000) (the "Note")
to Laurus.
Capitalized terms used herein without definition shall have the
meanings ascribed to such terms in the Security Agreement.
WHEREAS, the Borrower and Laurus have agreed, as part of the their Restructuring
Agreement executed contemporaneously herewith (the "Restructured Agreement"), to
amend the Security Agreement to reflect the terms of a Secured Revolving Note in
the original principal amount of Three Million Five Hundred Thousand Dollars
($3,500,000) (the Revolving Note") and a Secured Convertible Minimum Borrowing
Note in the original principal amount of One Million Five Hundred Thousand
Dollars ($1,500,000) (the "MB Note"), each issued as of August 14, 2003 in
exchange for and in substitution of the Note and the Borrower desires to make
such changes and to effect such an exchange; and
WHEREAS the Borrower and Laurus agree that on the date hereof that an aggregate
amount of $1,500,000 is outstanding under the Revolving Note and MB Note, with
no monies being attributed and owed relating to the Revolving Note, while all of
the $1,500,000 that is outstanding is owed and relating to the MB Note.
NOW, THEREFORE, in consideration for the execution and delivery by the Borrower
of this amendment, and for other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1.
Section 2 (a)(i) of the Security
Agreement is hereby deleted in its entirety and the following inserted in its
stead:
"2. Loans.
(A) (I)
SUBJECT TO THE TERMS AND CONDITIONS SET FORTH HEREIN AND IN THE
ANCILLARY AGREEMENTS, LAURUS MAY MAKE LOANS (THE "LOANS")
TO THE COMPANY FROM
TIME TO TIME DURING THE TERM WHICH, IN THE AGGREGATE AT ANY TIME OUTSTANDING,
WILL NOT EXCEED THE LESSER OF (X) (I) THE CAPITAL AVAILABILITY AMOUNT MINUS
(II)
SUCH RESERVES AS LAURUS MAY REASONABLY IN ITS GOOD FAITH JUDGMENT DEEM
PROPER AND NECESSARY FROM TIME TO TIME TO PRESERVE AND PROTECT COLLATERAL (THE
"RESERVES") OR (Y) AN AMOUNT EQUAL TO (I) THE ACCOUNTS AVAILABILITY MINUS (II)
THE RESERVES.
THE AMOUNT DERIVED AT ANY TIME FROM SECTION 2(A)(I)(Y)(I) MINUS
2(A)(I)(Y)(II) SHALL BE REFERRED TO AS THE "FORMULA AMOUNT." COMPANY SHALL
EXECUTE AND DELIVER TO LAURUS ON THE CLOSING DATE A MINIMUM BORROWING NOTE
EVIDENCING THE LOANS FUNDED ON THE CLOSING DATE AND A REVOLVING NOTE EVIDENCING
(WITHOUT DUPLICATION OF LOANS EVIDENCED BY ANY MINIMUM BORROWING NOTE) THE
CAPITAL AVAILABILITY AMOUNT.
FROM TIME TO TIME THEREAFTER, COMPANY SHALL
EXECUTE AND