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EXHIBIT 10.2
AMENDMENT NUMBER ONE TO
LOAN AND SECURITY AGREEMENT
THIS AMENDMENT NUMBER ONE TO LOAN AND SECURITY AGREEMENT, dated as of
September 30, 1998 (this "Amendment"), amends that certain Loan and Security
Agreement, dated as of April 23, 1998 (as amended from time to time, the "Loan
Agreement"), by and between MAI SYSTEMS CORPORATION, a Delaware corporation
GAMING SYSTEMS INTERNATIONAL, a Nevada corporation, and HOTEL INFORMATION
SYSTEMS, INC, a Delaware corporation ( each a "Borrower" and collectively
"Borrowers"), on the one hand, and COAST BUSINESS CREDIT, a division of Southern
Pacific Bank, a California corporation ("Coast"), on the other hand. All
initially capitalized terms used in this Amendment shall have the meanings
ascribed thereto in the Loan Agreement unless specifically defined herein.
RECITALS
WHEREAS, Borrower and Coast wish to amend the Loan Agreement pursuant
to the terms and provisions set forth in this Amendment; and
NOW, THEREFORE, the parties hereto agree as follows:
AMENDMENT
Section 1. WAIVER OF SECTION 8.1 TO THE SCHEDULE. Section 8.1 of the
Schedule to the Loan Agreement, as the same relates to Borrowers Consolidated
Tangible Net Worth, is hereby waived until December 31, 1998.
Section 2. APPLICATION OF SECTION 10.2 OF THE LOAN AGREEMENT. Section
10.2 of the Loan Agreement, is hereby invoked to increase the rate of interest
that accrues on the Loans from 2.25% to 5.25%. This rate of interest shall be
applied to the Loans until such time as Borrowers are in compliance with the
Consolidated Net Worth covenant as detailed in Section 8.1 of the Schedule to
the Loan Agreement.
Section 3. AMENDMENT TO SECTION 8.1 OF THE SCHEDULE TO THE LOAN
AGREEMENT. Section 8.1 of the Schedule to the Loan Agreement, is hereby amended
by adding the following language after the second paragraph:
"Beginning September 1, 1998, Borrowers shall show a monthly pre-tax
profit of no less than Two Hundred Thousand Dollars ($200,000)
(excluding severance payments to discharged employees), and from the
period beginning September 1, 1998, and ending December 31, 1998,
Borrowers shall show a pre-tax profit of no less than One Million
Dollars ($1,000,000) (excluding severance payments to discharged
employees)."
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Section 4. WAIVER FEE. In connection with the waiver detailed above,
Borrowers shall pay Coast a waiver fee (the "Waiver Fee") in the amount of
Twenty-Five Thousand Dollars ($25,000) on or before September 30, 1998.
Section 5. CONDITION PRECEDENT. The effectiveness of this Amendment is
expressly conditioned upon the receipt by Coast of an executed copy hereof by
Borrowers and the Waiver Fee.
Section 6. ENTIRE AGREEMENT. The Loan Agreement, as amended hereby,
embodies the entire agreement and understanding between the parties hereto and
supersedes all prior agreements and understandings relating to the subject
matter hereof. Borrower represents, warrants and agrees that in entering into
the Loan Agreement and consenting to this Amendment, it has not relied on any
representation, promise, understanding or agreement, oral or written, of, by or
with, Coast or any of its agents, employees, or counsel, except the
representations, promises, understandings and agreements specifically contained
in or referred to in the Loan Agreement, as amended hereby.
Section 7. CONFLICTING TERMS. In the event of a conflict between the
terms and provisions of this Amendment and the farms and provisions of the Loan
Agreement, the terms of this Amendment shall govern. In all other respects, the
Loan Agreement, as amended and supplemented hereby, shall remain in full fore
and effect.
Section 8. MISCELLANEOUS. This Amendment shall be governed by and
construed in accordance with the laws of the State of California. This Amendment
may be executed in any number of counterparts, all of which taken together shall
constitute one agreement, and any party hereto may execute this Amendment by
signing such counterpart.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective officers thereunto duly authorized as of the
date first above written.
BORROWERS:
MAI SYSTEMS CORPORATION,
a Delaware corporation
By /s/ [SIGNATURE ILLEGIBLE]
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Title EVP & COO/CFO
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By
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Title
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HOTEL INFORMATION SYSTEMS, INC.,
a Delaware corporation
By /s/ [SIGNATURE ILLEGIBLE]
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Title EVP & COO/CFO
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By
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Title
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GAMING SYSTEMS INTERNATIONAL,
a Nevada corporation
By /s/ [SIGNATURE ILLEGIBLE]
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Title SECRETARY
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By
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Title
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COAST:
COAST BUSINESS CREDIT,
a division of Southern Pacific Bank
By /s/ [SIGNATURE ILLEGIBLE]
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Title VP
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