FIRST AMENDMENT TO CREDIT AGREEMENT
Exhibit 10.35
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is entered into as of April 3, 2006, by and
between GAMETECH INTERNATIONAL, INC., a Delaware corporation (“Borrower”), and XXXXX FARGO BANK,
NATIONAL ASSOCIATION (“Bank”).
RECITALS
WHEREAS, Borrower is currently indebted to Bank pursuant to the terms and conditions of that
certain Credit Agreement between Borrower and Bank dated as of
April 2, 2005, as amended from time
to time (“Credit Agreement”).
WHEREAS, Bank and Borrower have agreed to certain changes in the terms and conditions set forth in
the Credit Agreement and have agreed to amend the Credit Agreement to reflect said changes.
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree that the Credit Agreement shall be amended as follows:
1. Section 1.1
(a) is hereby amended by deleting “April 2, 2006” as the last day on which
Bank will make advances under the Line of Credit, and by substituting for said date “April
2, 2007,” with such changes to be effective upon the execution and delivery to Bank of a
promissory note dated as of April 3, 2006 (which promissory note shall replace and be
deemed the Line of Credit Note defined in and made pursuant to the Credit Agreement) and
all other contracts, instruments and documents required by Bank to evidence such change.
2. Section 1.1 (b) is hereby renumbered as Section 1.1 (c) and the following is hereby
added to the Credit Agreement as the new Section 1.1 (b):
“(b) Letter
of Credit Subfeature. As a subfeature under the Line of Credit, Bank agrees from
time to time during the term thereof to issue or cause an affiliate to issue commercial and/or
standby letters of credit for the account of Borrower to finance the
purchase of inventory from overseas (each, a “Letter of
Credit” and collectively,“Letters of Credit”);
provided however, that the aggregate undrawn amount of all outstanding Letters of Credit shall
not at any time exceed Two Million Five Hundred Thousand Dollars
($2,500,000.00). The form and
substance of each Letter of Credit shall be subject to approval by Bank, in its sole
discretion. Each Letter of Credit shall be issued for a term not to exceed three hundred
sixty-five (365) days, as designated by Borrower; provided however, that no Letter of Credit
shall have an expiration date more than ninety (90) days beyond the maturity date of the Line
of Credit. The undrawn amount of all Letters of Credit shall be
reserved under the Line of
Credit and shall not be available for borrowings thereunder. Each Letter of Credit shall be
subject to the additional terms and conditions of the Letter of
Credit agreements, applications and any related documents required by
Bank in connection with the
issuance thereof. Each drawing paid under a Letter of Credit shall be deemed an advance under
the Line of Credit and shall be repaid by Borrower in accordance with the terms
-1-
and conditions
of this Agreement applicable to such advances; provided however, that if advances under the
Line of Credit are not available, for any reason, at the time any drawing is paid, then
Borrower shall immediately pay to Bank the full amount drawn, together with interest thereon
from the date such drawing is paid to the date such amount is fully repaid by Borrower, at the
rate of interest applicable to advances under the Line of Credit. In such event Borrower
agrees that Bank, in its sole discretion, may debit any account maintained by Borrower with
Bank for the amount of any such drawing.”
3. Section 1.2 (a) is hereby deleted in its entirety, and the following substituted
therefor:
“(a) Foreign
Exchange Facility. Subject to the terms and conditions of this Agreement, Bank hereby
agrees to make available to Borrower a facility (the “Foreign Exchange Facility”) under which
Bank, from time to time up to and including April 2, 2007, will enter into foreign exchange
contracts for the account of Borrower for the purchase and/or sale by Borrower in United States
dollars of foreign currencies designated by Borrower; provided however, that the maximum amount of
all outstanding foreign exchange contracts shall not at any time exceed an aggregate of One Million
United States Dollars (US$1,000,000.00). No
foreign exchange contract shall be for a term which extends beyond April 2, 2007. Borrower shall
have a “Delivery Limit” under the Foreign Exchange Facility not to exceed at any time
the aggregate principal amount of Two Hundred Thousand United States Dollars (US$200,000.00),
which Delivery Limit reflects the maximum principal amount of Borrower’s foreign exchange contracts
which may mature during any two (2) day period. All foreign exchange transactions shall be subject
to the additional terms of a Foreign Exchange Agreement dated as of April 3, 2006 (“Foreign
Exchange Agreement”), all terms of which are incorporated herein by this reference.”
4. Section 4.3
(d) is hereby deleted in its entirety, without substitution.
5. Section 4.9
(d) is hereby deleted in its entirety, without substitution.
6. Section 5.3
is hereby deleted in its entirety, and the following substituted
therefor:
“SECTION 5.3 MERGER, CONSOLIDATION, TRANSFER OF ASSETS. Merge into or consolidate with any other
entity; make any substantial change in the nature of Borrower’s business as conducted as of the
date hereof; acquire all or substantially all of the assets of any other entity which shall require
cash consideration in excess of $2,500,000.00; nor sell, lease, transfer or otherwise dispose of
all or a substantial or material portion of Borrower’s assets except in the ordinary course of its
business.”
-2-
7. Section 5.6 is hereby deleted in its entirety, and the following substituted therefor:
“SECTION 5.6 DIVIDENDS, DISTRIBUTIONS. Declare or pay any dividend or distribution either in cash,
stock or any other property on Borrower’s stock now or hereafter outstanding, nor redeem, retire,
repurchase or otherwise acquire any shares of any class of Borrower’s stock now or hereafter
outstanding, except stock repurchase pursuant to Borrower’s stock repurchase plan announced on or
about May 28, 1998 and August of 2000, up to a maximum amount of $12,500,000.00”
8. The following is hereby added to the Credit Agreement as Section 5.8:
“SECTION 5.8 CAPITAL EXPENDITURES. Make any additional investment in fixed assets in any fiscal
year in excess of an aggregate of $15,000,0000.00.”
9. Except as specifically provided herein, all terms and conditions of the Credit Agreement remain
in full force and effect, without waiver or modification. All terms defined in the Credit Agreement
shall have the same meaning when used in this Amendment. This Amendment and the Credit Agreement
shall be read together, as one document.
10. Borrower hereby remakes all representations and warranties contained in the Credit Agreement
and reaffirms all covenants set forth therein. Borrower further certifies that as of the date of
this Amendment there exists no Event of Default as defined in the Credit Agreement, nor any
condition, act or event which with the giving of notice or the passage of time or both would
constitute any such Event of Default.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the day and
year first written above.
| GAMETECH INTERNATIONAL, INC. | XXXXX FARGO BANK, NATIONAL ASSOCIATION |
|||||||
By:
|
/s/ Xxx Xxxxxxxxx | By: | /s/ Xxxx Xxxxx | |||||
| Chief Executed Officer | Relationship Manager | |||||||
By:
|
/s/ Xxxxx Xxxxxx | |||||||
| Chief Financial Officer | ||||||||
-3-
