Fourth Amendment To Revolving Credit Agreement

Fourth Amendment and Assignment dated as of June 28, 1996 to Amended and Restated Revolving Credit Agreement (the "Fourth Amendment"), by and among AVID TECHNOLOGY, INC., a Delaware corporation (the "Borrower"), THE FIRST NATIONAL BANK OF BOSTON and the other lending institutions listed on Schedule 1 to the Credit Agreement (as hereinafter defined) (the "Banks") and THE FIRST NATIONAL BANK OF BOSTON, as agent for the Banks (in such capacity, the "Agent"), (a) amending certain provisions of the Amended and Restated Revolving Credit Agreement dated as of June 30, 1995 (as amended and in effect from time to time, the "Credit Agreement") by and among the Borrower, the Banks and the Agent, including, without limitation, reducing the Total Commitment and (b) providing for the assignment by certain of the Banks of all or a portion of its respective interests, rights and obligations under the Credit Agreement to the other Banks. Terms not otherwise defined herein which are defined in the Credit Agreement shall have the same respective meanings herein as therein.


WHEREAS, the Borrower, the Banks and the Agent have agreed to modify certain terms and conditions of the Credit Agreement and waive certain covenants contained in the Credit Agreement as specifically set forth in this Fourth Amendment;


NOW, THEREFORE, in consideration of the premises and the mutual agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:


Section 1. Amendment to Section 1 of the Credit Agreement. Section 1.1 of the Credit Agreement is hereby amended as follows:


(a) The definition of "Consolidated Current Assets" is hereby amended by deleting the definition in its entirety and restating it as follows:


Consolidated Current Assets. All cash and accounts receivable of the
Borrower and its Subsidiaries on a consolidated basis, provided that such
accounts receivable shall be taken at their face value less reserves
determined to be sufficient in accordance with generally accepted accounting
principles.


(b) The definition of "Consolidated Operating Cash Flow" is hereby amended by deleting the definition in its entirety and restating it as follows:


Consolidated Operating Cash Flow. For any fiscal quarter, an amount
equal to (a) the sum of (i) Earnings Before Interest and Taxes for such
period, plus (ii) depreciation and amortization for such period, plus (iii)
if applicable, in-flows resulting from Net Working Capital Changes for such
period, less (b) the sum of (i) cash payments for all taxes paid during such
period, plus (ii) Capital Expenditures made in such period, plus (iii) the
portion of the costs of software development required to be capitalized
pursuant to Financing Accounting Standards Board Statement No. 86, plus (iv)
if applicable, out-flows resulting from Net Working Capital Changes for such
period.


(c) The definition of "Maturity Date" is hereby amended by deleting the date "June 30, 1996" which appears in such definition and substituting in place thereof the date "June 28, 1997".


(d) Section 1.1 of the Credit Agreement is further amended by inserting the following definitions in the appropriate alphabetical order:


Adjustment Date. The first day of the month immediately
following the month in which a Compliance Certificate has been
delivered by the Borrower pursuant to Section 6.4(c).


Applicable Margin. For each period commencing on an Adjustment Date
through the date immediately preceding the next Adjustment Date (each a "Rate
Adjustment Period"), the Applicable Margin shall be the applicable margin set
forth below with respect to the Borrower's Debt Service Ratio, as determined
for the fiscal period of the Borrower and its Subsidiaries ending immediately
prior to the applicable Rate Adjustment Period.


Base Rate LIBOR Rate Commitment Debt Service Loans Loans Fee
RATIO (BASIS POINTS) (BASIS POINTS) (BASIS POINTS) Less than 0 175 40 2.00:1.00


Less than 2.50:100, but greater than 0 150 35 or equal to 2.00:1.00


Greater than or equal to 0 125 25 2.50:1.00


Notwithstanding the foregoing, (a) for Loans outstanding and Commitment
Fees payable during the period commencing on June 28, 1996 through the date
immediately preceding the first Adjustment Date to occur after the fiscal
quarter ending June 30, 1996, the Applicable Margin shall be the highest
Applicable Margin set forth above, and (b) if the Borrower fails to deliver
any Compliance Certificate pursuant to Section 6.4(c) hereof then, for the
period commencing on the next Adjustment Date to occur subsequent to such
failure through the date immediately following the date on which such
Compliance Certificate is delivered, the Applicable Margin shall be the
highest Applicable Margin set forth above.


Commitment Fee Rate. The rate per annum set forth in the
chart contained in the definition of Applicable Margin under the
heading "Commitment Fee".


Compliance Certificate. See Section 6.4(c) hereof.


Debt Service Ratio. As at the date of determination and with respect to
the Borrower and its Subsidiaries, the ratio of (a) Consolidated Operating
Cash Flow of the Borrower and its Subsidiaries for such period to (b) the
Total Debt Service of the Borrower and its Subsidiaries for such period.


Net Working Capital Changes. For any fiscal quarter, the net changes
from the immediately preceding fiscal quarter in (a) both billed and unbilled
accounts receivable, (b) current accounts payable of the Borrower and its
Subsidiaries, (c) current accruals and accretions (exclusive of interest
accruals and accretions) of the Borrower and its Subsidiaries and (d)
inventory of the Borrower and its Subsidiaries.


Rate Adjustment Period. See the definition of Applicable
Margin.


Section 2. Amendment to Section 2 of the Credit Agreement. Section 2 of the Credit Agreement is hereby amended as follows:


(a) Section 2.2 of the Credit Agreement is hereby amended by deleting the words "one quarter of one percent (1/4%)" from the first sentence of Section 2.2 and substituting in place thereof the words "the Commitment Fee Rate".


(b) Section 2.5 of the Credit Agreement is hereby amended by deleting subparagraphs (a) and (b) in their entirety and restating such subparagraphs as follows:


(a) Each Base Rate Loan shall bear interest for the period commencing
with the Drawdown Date thereof and ending on the last day of the Interest
Period with respect th ...