AMENDMENT NO. 2 to UNSECURED SUBORDINATED LOAN AGREEMENT
EXHIBIT
10.4
[*] denotes confidential information omitted and filed separately with the Securities and Exchange
Commission pursuant to a request for confidential treatment under Rule 24b-2 under the Securities Exchange Act of 1934, as amended.
EXECUTION COPY
AMENDMENT NO. 2 to UNSECURED SUBORDINATED LOAN AGREEMENT
THIS AMENDMENT NO. 2 to UNSECURED SUBORDINATED LOAN AGREEMENT (this “Amendment”) is
being executed and delivered as of September 15, 2008, by and among MIDWAY GAMES INC., a Delaware
corporation (the “Borrower”), as Borrower, and NATIONAL AMUSEMENTS, INC., a Maryland
corporation, as Lender (the “Lender”). All capitalized terms used herein without
definition shall have the same meanings as set forth in the hereinafter identified and defined
Credit Agreement.
W I T N E S S E T H:
WHEREAS, the Lender and the Borrower have entered into that certain Unsecured Subordinated
Loan Agreement, dated as of February 29, 2008 (as amended, restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”); and
WHEREAS, the Borrower has requested that the Lender agree to amend the Credit Agreement, as
set forth herein, and the Lender has agreed to so amend the Credit Agreement on the terms and
conditions of this Amendment;
NOW, THEREFORE, in consideration of the foregoing premises, the terms and conditions stated
herein, the representations and warranties of the Borrower in Section 2 hereof, and other valuable
consideration, the receipt and sufficiency of which are hereby acknowledged by the Borrower and the
Lender, such parties hereby agree as follows:
1. Amendments. As of the date hereof, the Credit Agreement is hereby amended as
follows:
“Factoring Agreement” shall mean that certain Factoring Agreement, dated as of
September 15, 2008, by and among Midway, as seller, the Lender, as purchaser, and MAG, as
servicer, as amended, restated, supplemented or otherwise modified and in effect.
“Segregated Accounts” shall mean any of (i) Midway’s deposit account number [*]
maintained with Bank of America, N.A., (ii) Midway’s deposit accounts number [*] or [*]
maintained with Xxxxx Fargo Bank, National Association, or (iii) any other deposit account
designated by Midway as a “Permanent Segregated Account” with the consent of the Lender.
(b) The definition of “Permitted Disposition” appearing in Section 1.1 of the Credit
Agreement is hereby amended (i) to insert the additional clause, “(l) sales of Accounts and
related assets pursuant to the Factoring Agreement” immediately after clause (k) therein and
(ii) to redesignate the final clause in such definition from “(l)” to “(m)”.
(c) Section 2.1(b)(ii) of the Credit Agreement is hereby amended to insert the words
“(but excluding any amounts on deposit in any Segregated Account)” immediately after the
words “in the aggregate” appearing therein.
(d) Section 6.19 of the Credit Agreement is hereby amended and restated in its entirety
as follows:
6.19 Excess Cash. Unless otherwise agreed by the Lender, in the event
that the aggregate outstanding principal amount of all “Term Loans” and “Advances”
under and as defined in the Secured Loan Facility plus the aggregate outstanding
principal amount of all “Advances” under and as defined in the Unsecured Loan
Facility shall equal or exceed $40,000,000 as of the close of business on the
Business Day immediately preceding the last Business Day of any calendar week (each
such day, a “Testing Date”), on or before the close of business on the
Business Day following such Testing Date the Borrower shall issue instructions to
each depository bank or other financial institution at which the Borrower or any of
its Subsidiaries maintains deposit accounts (other than any Segregated Account or
any deposit accounts maintained in Japan or Australia and excluding any amounts on
deposit to cash collateralize any letter of credit reimbursement obligations) to
cause an amount equal to any excess in increments of $1,000,000 of:
| i. | the then available cash balances in such accounts as of such Testing Date after giving effect to all receipts and other payments due or owing to or from such accounts, over | ||
| ii. | (a) Prior to the date Midway has designated with the consent of the Lender a “Permanent Segregated Account” (as such term is defined in the definition of “Segregated Account” hereunder), $14,000,000; or | ||
| (b) At any time thereafter, $10,000,000 |
to be transferred to the Lender’s Account on or before the Business Day
after such Testing Date (or, in the case of funds transferred from an
account located outside of the United States, the second Business Day after
such Testing Date) for application to the outstanding Obligations hereunder
in accordance with the terms hereof; provided that after giving
effect to such application the aggregate outstanding principal amount of the
Advances hereunder shall not be less than $10,000,000.
(e) Section 7.13 of the Credit Agreement is hereby amended to insert the words “for the
Factoring Agreement, or” immediately after the word “Except” appearing therein.
(f) Article 8 of the Credit Agreement is hereby amended to delete the word “or”
appearing at the end of Section 8.15, to insert the word “; or” in place of the period at
the end of Section 8.16, and to insert the following new section at the end of such Article:
| * | Information has been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
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8.17 The occurrence of an “Event of Termination” under and as defined in the Factoring
Agreement.
2. Representations and Warranties. The Borrower hereby represents and warrants that
after giving effect to the terms of this Amendment (i) no Default or Event of Default has occurred
and is continuing and (ii) the representations and warranties contained in the Credit Agreement
shall be true and correct in all material respects on and as of the date hereof, as though made on
and as of such date (except to the extent that such representations and warranties relate solely to
an earlier date).
3. Counterparts. This Amendment may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so executed and delivered
shall be deemed to constitute one and the same instrument. A signature page sent to the Lender or
its counsel by facsimile or other electronic means (including in portable document format (.pdf))
shall be effective as an original counterpart signature.
4. Section Titles. The section titles contained in this Amendment are and shall be
without substance, meaning or content of any kind whatsoever and are not a part of the agreement
between the parties hereto.
5. Governing Law. The validity of this Amendment, the construction, interpretation,
and enforcement hereof, and the rights of the parties hereto with respect to all matters arising
hereunder or related hereto shall be determined under, governed by, and construed in accordance
with the laws of the State of Illinois.
[Signature Pages Follow]
| * | Information has been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
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IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first above
written.
| MIDWAY GAMES INC., | ||||||
| as Borrower | ||||||
| By | /s/ Xxxxxxx X. Booty
|
|||||
| Title Interim President and Chief Executive Officer | ||||||
| * | Information has been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
| NATIONAL AMUSEMENTS, INC., | ||||||
| a Maryland corporation, as Lender | ||||||
| By: | /s/ Xxxxxxx X. Xxxxxxx
|
|||||
| Title: Vice President | ||||||
| * | Information has been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 24b-2 under the Securities Exchange Act of 1934, as amended. |
