Document:

exv10w1

 

Exhibit 10.1

FIRST AMENDMENT TO BUSINESS LOAN AND SECURITY AGREEMENT

     This First Amendment (“First Amendment”) dated as of April 19, 2007, for reference purposes,
is made to the BUSINESS LOAN AND SECURITY AGREEMENT (the “Domestic Agreement”) entered into as of
January 16, 2007, by and between Mid-Peninsula Bank, part of Greater Bay Bank N.A. (“Bank”) and
Iridex Corporation (“Borrower”), combining two credit facilities provided by Bank to Borrower, with
one facility being a $6,000,000 principal amount asset-based revolving line of credit (“Line of
Credit”) and the other facility being a $6,000,000 principal amount term loan (“Term Loan”).

Recitals

     A.     The Line of Credit under the Domestic Agreement includes a $3,000,000 principal amount
export-import revolving line of credit (“Exim Sub-Limit Line”) guaranteed by the Export-Import Bank
of the United States (“Exim Bank”).

     B.     Based upon the financial performance of Borrower during the quarter ended March 31, 2007,
Borrower has requested a waiver of certain covenants contained in the Domestic Agreement.

     C.     Borrower also has requested an adjustment to the Exim Sub-Limit Line to increase the limit
of the principal amount under the Exim Sub-Limit Line to $5,000,000.

     D.     Bank is willing to provided a one-time waiver of certain covenants of the Domestic
Agreement as expressly provided in the waiver letter (“Waiver Letter”) dated the same date as this
First Amendment on the conditions and subject to the terms of this First Amendment and an amendment
to that certain Export-Import Bank Loan and Security Agreement entered into as of January 16, 2007,
by and between Bank and Borrower, similar to this First Amendment and dated the same date as this
First Amendment, and also is willing to increase the Exim Sub-Limit Line to the principal amount of
$5,000,000.

     NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable
consideration the receipt of which is hereby acknowledged and confirmed, the parties agree as
follows:

     1.     This First Amendment shall amend, modify and supersede as expressly described below, or to
the extent of any inconsistencies, the provisions of the Domestic Agreement. Except as expressly
amended hereby, all provisions of the Domestic Agreement shall remain in full force and effect and
the parties hereby ratify the terms and conditions of the Domestic Agreement as amended herein.
All defined terms used in this First Amendment shall have the same meanings ascribed to them in the
Domestic Agreement unless otherwise expressly defined herein.

     2.     The third sentence of Section 1, RECITALS, of the Domestic Agreement is deleted and
replaced in its entirety with the following sentence: This Agreement combines two credit
facilities, namely (i) a $6,000,000 principal amount, asset-based revolving line of credit
(“Line of Credit”), including, if

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approved by the Export-Import Bank of the United States
(“Exim Bank”), the $5,000,000
principal amount export-import revolving line of credit to be
guaranteed by the Exim Bank (“Exim
Sub-Limit Line”) to be provided by Lender to Borrower under the terms and conditions of the
Export-Import Bank Loan and Security Agreement (“Exim Agreement”) between Lender and
Borrower dated the same date as this Agreement, and the Borrower Agreement (as amended,
supplemented or modified, “Borrower Agreement”), entered into by Borrower in favor of the
Exim Bank and the Lender dated the same date as this Agreement, and (ii) a $6,000,000 principal
amount term loan (“Term Loan”); collectively the Line of Credit, including the Exim
Sub-Limit Line thereunder) and Term Loan are collectively referred to as the “Credit
Facilities.”

     3.     The third sentence of under Section 6.1, Grant of Security Interest, of the
Domestic Agreement is delete and replaced in its entirety with the following sentence: Without
limiting Bank’s security interest in all of Borrower’s Deposit Accounts with Bank, Borrower shall
deposit and maintain cash in one segregated Deposit Account with Bank as identified in Section
8.5(c)(1) below, and Bank will retain the rights of possession of such segregated Deposit Account,
together with any evidence of such segregated Deposit Account such as certificates or passbooks, so
long as any Indebtedness (except for inchoate indemnity obligations) are outstanding, and Borrower
further acknowledges that during the continuance of any Event of Default Bank will place
a “hold” on any and all Deposit Accounts pledged by Borrower under the terms of this Domestic
Agreement as Collateral to secure the Indebtedness.

     4.     Clause (3) of paragraph (a), Additional Requirements, under Section 8.3,
Financial Statements and Reports, of the Domestic Agreement is deleted in its entirety
eliminating the requirement of Borrower to provide to Bank a monthly affidavit of liquidity.

     5.     Clause (1) only of paragraph (c), Other Requirements, of Section 8.5, Financial
Covenants and Ratios, of the Domestic Agreement is deleted in its entirety eliminating the
requirement of Borrower to maintain a minimum aggregate amount of Domestic Unrestricted
Cash/Marketable Securities of $3,000,000.00, and replaced in its entirety with the following clause
(1) under Section 8.5: (1) to deposit and maintain cash of not less than $3,800,000 in one
segregated Deposit Account with Bank (account number 1101120495), which minimum amount Borrower
acknowledges will be preserved in full and Borrower will not draw upon or reduce in any manner
below such minimum amount so long as any Indebtedness (except for inchoate indemnity obligations)
are outstanding.

     6.     At the end of paragraph (6) of Section 14.1, Rights and Remedies, the following
provision is hereby added: , and without limiting the foregoing, Bank may take directly
all funds in the Deposit Accounts and apply them to the Indebtedness. If any of the Deposit
Accounts are subject to an early withdrawal penalty, that penalty shall be deducted from the
Deposit Account before its application to the Indebtedness, whether the Deposit Account is with
Bank or some other institution. Any excess funds remaining after application of the Deposit
Account proceeds to the Indebtednesswill be paid to Borrower as the interests of Borrower may
appear. Borrower agrees, to the extent permitted by law, to pay any deficiency after application
of the proceeds of the Deposit Accounts to the Indebtedness. Bank also shall have all the rights
of a secured party under the California Uniform Commercial Code, even if any of the Deposit
Accounts are not otherwise subject to such Code concerning security interests, and the parties to
this Agreement agree that the provisions of the Code giving rights to a secured party shall
nonetheless be a part of this Agreement.

     7.     The
 definition of “Borrowing Base” under Section 17.6 of the Domestic Agreement, is deleted
and replaced in its entirety with the following definition: The words “Borrowing Base” mean, as

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determined by Lender from time to time, the lesser of (1) $6,000,000.00 or (2) 80.000% of the
aggregate amount of Eligible Accounts minus a Borrowing Base restriction amount determined by the Bank from
time to time, up to a maximum of $2,200,000 of the aggregate dollar amount of the amounts otherwise
determined to be Eligible Accounts (and for the avoidance of doubt, the parties acknowledge and
agree that, to determine the dollar amount of the Borrowing Base, first 80.000% of the aggregate
amount of Eligible Accounts will be determined without subtracting the Borrowing Base restriction
amount, and then up to $2,200,000 will be subtracted from such aggregate amount of Eligible
Accounts to complete the calculation of the actual Eligible Accounts for the purpose of this clause
(2)).

     8.     Counterparts; Facsimile Signature Copies. This First Amendment may be executed in
one or more counterparts, each of which when so executed and delivered will be deemed to be an
original and all of which taken together will constitute but one and the same instrument.
Facsimile copies of the signatures set forth below will be deemed to be original signatures for all
purposes.

     IN WITNESS WHEREOF, the parties have caused their respective duly authorized representatives
to execute this First Amendment as of the date first written above.

	 	 	 	 	 	 	 	 
	 	IRIDEX CORPORATION

 	 	 	MID-PENINSULA BANK — PART OF GREATER BAY BANK N.A 

 	 
	 	By:  	/s/ Barry G. Caldwell
 	 	 	By:  	/s/ Stephen G. Heitel
 	 
	 	 	Barry G. Caldwell, President & CEO 	 	 	 	Stephen G. Heitel, President & CEO                     	 
	 	 	 	 	 	 	 	 
	 

3exv10w2

 

Exhibit 10.2

FIRST AMENDMENT TO EXPORT-IMPORT BANK

LOAN AND SECURITY AGREEMENT

     This First Amendment (“First Amendment”) dated as of April 19, 2007, for reference purposes,
is made to the EXPORT-IMPORT BANK LOAN AND SECURITY AGREEMENT (the “Exim Agreement”) entered into
as of January 16, 2007, by and between Mid-Peninsula Bank, part of Greater Bay Bank N.A. (“Bank”)
and Iridex Corporation (“Borrower”), relating to a working capital facility provided to Borrower by
Bank and guaranteed by Export-Import Bank of the United States in the principal amount of up to
$3,000,000.

Recitals

     A.     Based upon the financial performance of Borrower during the quarter ended March 31, 2007,
Borrower has requested a waiver of certain covenants contained in the Exim Agreement.

     B.     Borrower also has requested an adjustment to the Exim Committed Line to increase the limit
of the principal amount under the Exim Committed Line to $5,000,000.

     C.     Bank is willing to provided a one-time waiver of certain covenants of the Exim Agreement as
expressly provided in the waiver letter (“Waiver Letter”) dated the same date as this First
Amendment on the conditions and subject to the terms of this First Amendment and an amendment to
that certain Business Loan and Security Agreement entered into as of January 16, 2007, by and
between Bank and Borrower, similar to this First Amendment and dated the same date as this First
Amendment, and also is willing to increase the limit of the principal amount under the Exim
Committed Line to $5,000,000.

     NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable
consideration the receipt of which is hereby acknowledged and confirmed, the parties agree as
follows:

     1.     This First Amendment shall amend, modify and supersede as expressly described below, or to
the extent of any inconsistencies, the provisions of the Exim Agreement. Except as expressly
amended hereby, all provisions of the Exim Agreement shall remain in full force and effect and the
parties hereby ratify the terms and conditions of the Exim Agreement as amended herein. All
defined terms used in this First Amendment shall have the same meanings ascribed to them in the
Exim Agreement unless otherwise expressly defined herein.

     2.     The definition of “Exim Committed Line” under Section 1.1 of the Exim Agreement, is deleted
and replaced in its entirety with the following definition: “Exim Committed Line” means a credit
extension of up to five million and no/100 Dollars ($5,000,000).

     3.     The first sentence of under Section 2.1.1(a), Revolving Advances, of the Exim
Agreement is deleted and replaced in its entirety with the following sentence: Subject to the
terms and conditions of this Exim Agreement and the Domestic Agreement, Bank agrees to make
Advances to Borrower in an aggregate amount outstanding at any time not to exceed (i) the Exim
Committed Line or

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the Borrowing Base, whichever is less, minus (ii) the face amount of all outstanding Letters of
Credit (including drawn but unreimbursed Letters of Credit), and (iii) minus the amount by which
the then outstanding aggregate advances to Borrower under the Line of Credit facility under the
Domestic Agreement exceed $1,000,000.

     4.     The third sentence of under Section 4.1, Grant of Security Interest, of the Exim
Agreement is deleted and replaced in its entirety with the following sentence: Without limiting
Bank’s security interest in all of Borrower’s Deposit Accounts with Bank, Borrower shall deposit
and maintain cash in one segregated Deposit Account with Bank as identified in Section 6.8(c)(i)
below, and Bank will retain the rights of possession of such segregated Deposit Account, together
with any evidence of such segregated Deposit Account such as certificates or passbooks, so long as
any Obligations (except for inchoate indemnity obligations) are outstanding, and Borrower further
acknowledges that during the continuance of any Event of Default Bank will place a “hold”
on any and all Deposit Accounts pledged by Borrower under the terms of this Exim Agreement as
Collateral to secure the Obligations.

     5.     Clause (c) under Section 6.3, Financial Statements, Reports, Certificates, of the
Exim Agreement is deleted in its entirety eliminating the requirement of Borrower to provide to
Bank a monthly affidavit of liquidity.

     6.     Clause (i) only of paragraph (c), Other Requirements, of Section 6.8, Financial
Covenants and Ratios, of the Exim Agreement is deleted in its entirety eliminating the
requirement of Borrower to maintain a minimum aggregate amount of Domestic Unrestricted
Cash/Marketable Securities of $3,000,000.00 and replaced in its entirety with the following clause
(i) under Section 6.8: (i) to deposit and maintain cash of not less than $3,800,000 in one
segregated Deposit Account with Bank (account number 1101120495), which minimum amount Borrower
acknowledges will be preserved in full and Borrower will not draw upon or reduce in any manner
below such minimum amount so long as any Obligations (except for inchoate indemnity obligations)
are outstanding;

     7.     At the end of paragraph (f) of Section 9.1, Rights and Remedies, the following
provision is hereby added: , and without limiting the foregoing, Bank may take directly all funds
in the Deposit Accounts and apply them to the Obligations. If any of the Deposit Accounts are
subject to an early withdrawal penalty, that penalty shall be deducted from the Deposit Account
before its application to the Obligations, whether the Deposit Account is with Bank or some other
institution. Any excess funds remaining after application of the Deposit Account proceeds to the
Obligations will be paid to Borrower as the interests of Borrower may appear. Borrower agrees, to
the extent permitted by law, to pay any deficiency after application of the proceeds of the Deposit
Accounts to the Obligations. Bank also shall have all the rights of a secured party under the
California Uniform Commercial Code, even if any of the Deposit Accounts are not otherwise subject
to such Code concerning security interests, and the parties to this Agreement agree that the
provisions of the Code giving rights to a secured party shall nonetheless be a part of this
Agreement.

     8.     To properly reflect the increase in the Exim Committed Line as set forth above, all
references to “Commitment Amount: $3,000,000.00,” or any similar description, including reference
to same in Exhibit D, Borrowing Base Certificate, of the Exim Agreement shall be changed to
refer to the increase in such amount to $5,000,000.00.

     9.     To
 properly reflect the elimination of the monthly affidavit of liquidity as set forth
above, all references to such prior requirement, including the reference in Exhibit E,
Compliance

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Certificate, of the Exim Agreement shall be deemed deleted.

     10.     Counterparts; Facsimile Signature Copies. This First Amendment may be executed in
one or more counterparts, each of which when so executed and delivered will be deemed to be an
original and all of which taken together will constitute but one and the same instrument.
Facsimile copies of the signatures set forth below will be deemed to be original signatures for all
purposes.

     IN WITNESS WHEREOF, the parties have caused their respective duly authorized representatives
to execute this First Amendment as of the date first written above.

	 	 	 	 	 	 	 	 
	 	IRIDEX CORPORATION 

 	 	 	MID-PENINSULA BANK — PART OF GREATER BAY BANK N.A

 	 
	 	By:  	/s/ Barry G. Caldwell
 	 	 	By:  	/s/ Stephen G. Heitel
 	 
	 	 	Barry G. Caldwell, President & CEO                                           	 	 	 	Stephen G. Heitel, President & CEO 	 
	 	 	 	 	 	 	 	 
	 

	 

	 

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