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Exhibit 10.25
AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT
As of January 2, 1999
Congress Financial Corporation
(Central)
000 Xxxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Congress Financial Corporation (Central) ("Lender") and Stuart
Entertainment, Inc. ("Borrower") have entered into certain financing
arrangements pursuant to the Loan and Security Agreement, dated November 20,
1997, by and between Lender and Borrower (the "Loan Agreement"), as amended by
Amendment No. 1 to Loan and Security Agreement, dated December 1, 1998
("Amendment No. 1") and all other Financing Agreements at any time executed
and/or delivered in connection therewith or related thereto. All capitalized
terms used herein shall have the meanings ascribed to them in the Loan
Agreement, unless otherwise defined herein.
Borrower has requested that Lender agree to amend certain
provisions of the Loan Agreement relating to funds received in or deposited to
the Blocked Accounts, and Lender is willing to agree to the foregoing, on and
subject to the terms and conditions contained in this Amendment No. 2 to Loan
and Security Agreement (this "Amendment").
In consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the parties hereto, the parties hereto hereby agree as follows:
1. Temporary Amendment of Section 6.3(a)(v). Notwithstanding the
existing provisions of Section 6.3(a)(v) of the Loan Agreement, solely during
the period from and after the date on which this Amendment becomes effective
through and including February 28, 1999, Lender shall only have the right under
Section 6.3(a)(v) of the Loan Agreement to instruct the depository banks at
which the Blocked Accounts are maintained to transfer all funds received or
deposited into the Blocked Accounts to the Payment Account if the aggregate
principal amount of Loans and Letter of Credit Accommodations, plus the U.S.
Dollar Equivalent of the aggregate outstanding principal amount of Loans and
Letter of Credit Accommodations under, and as such terms are defined in, the
Canadian Loan Agreement, shall equal or exceed $20,000,000. After February 28,
1999, the provisions of Section 6.3(a)(v) shall be deemed automatically
reinstated as they existed prior to the effectiveness of Amendment No. 1 and the
$15,000,000 threshold contained in Section 6.3(a)(v) as temporarily increased to
$20,000,000 in this Section 1, shall automatically revert to $15,000,000.
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2. Representations, Warranties and Covenants. In addition to the
continuing representations, warranties and covenants heretofore or hereafter
made by Borrower to Lender pursuant to the Loan Agreement and the other
Financing Agreements, Borrower hereby represents, warrants and covenants with
and to Lender as follows, which representations, warranties and covenants are
continuing and shall survive the execution and delivery hereof and shall be
incorporated into and made a part of the Financing Agreements:
(a) No event of default exists on the date of this Amendment
after giving effect to the amendments to the Loan Agreement made by this
Amendment; and
(b) This Amendment has been duly executed and delivered by
Borrower and the undersigned consenting Guarantors, and is in full force and
effect as of the date hereof, and the agreements and obligations of Borrower
contained herein constitute its legal, valid and binding obligations enforceable
against Borrower in accordance with their respective terms.
3. Conditions Precedent. This Amendment shall not become effective
unless all of the following conditions precedent have been satisfied in full, as
determined by Lender:
(a) the receipt by Lender of an original of this Amendment,
duly authorized, executed and delivered by Borrower and the undersigned
Guarantors;
(b) Lender shall have received, in form and substance
satisfactory to Lender, a copy of a fully executed copy of an amendment to the
Canadian Loan Agreement entered into between Canadian Borrower and Congress
(Canada), pursuant to which, among other things, Section 6.3(a)(v) of the
Canadian Loan Agreement shall be amended temporarily in the same manner and to
the same extent as Section 6.3(a)(v) of the Loan Agreement has been amended
pursuant to Section 1 of this Amendment; and
(c) as of the date of this Amendment, no Event of Default
shall have occurred and be continuing and no event shall have occurred and be
continuing or condition be existing which, with notice or passage of time, or
both, would constitute an Event of Default.
4. Effect of this Amendment. Except as modified pursuant hereto, no
other changes or modifications to the Loan Agreement and the other Financing
Agreements are intended or implied and in all other respects the Loan Agreement
and the other Financing Agreements are hereby specifically ratified, restated
and confirmed by all parties hereto as of the effective date hereof. To the
extent of any conflict between the terms of this Amendment and any of the
Financing Agreements, the terms of this Amendment shall control. The Loan
Agreement and this Amendment shall be read and be construed as one agreement.
5. Further Assurances. At Lender's request, Borrower shall execute and
deliver such additional documents and take such additional actions as Lender
reasonably requests to effectuate the provisions and purposes of this Amendment.
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6. Governing Law. The validity, interpretation and enforcement of this
Amendment and any dispute arising out of the relationship between the parties
hereto, whether in contract, tort, equity or otherwise, shall be governed by the
internal laws of the State of Illinois (without giving effect to principles of
conflicts of law).
7. Binding Effect. This Amendment shall be binding upon and inure to
the benefit of each of the parties hereto and their respective successors and
assigns.
8. Counterparts. This Amendment may be executed in any number of
counterparts, but all of such counterparts when executed shall together
constitute but one and the same agreement. In making proof of this Amendment, it
shall not be necessary to produce or account for more than one counterpart
thereof signed by each of the parties hereto.
Very truly yours,
STUART ENTERTAINMENT, INC.
By: /s/ XXXXXXXX X. XXXXXX III
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Title: EXEC VP & CFO
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AGREED:
CONGRESS FINANCIAL CORPORATION (CENTRAL)
By: /s/ XXXXX XXXXX
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Title: AVP
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CONSENTED TO:
VIDEO KING GAMING SYSTEMS, INC.
By /s/ XXXXXXXX X. XXXXXX III
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Title: VICE PRES
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[SIGNATURES CONTINUED FROM PREVIOUS PAGE]
BINGO SYSTEMS & SUPPLY, INC.
By: /s/ Xxxxxxx X. Xxxxxx
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Title: VICE PRES
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