Exhibit 10
REAFFIRMATION, RATIFICATION AND CONFIRMATION AGREEMENT
January 12, 2006
Laurus Master Fund, Ltd.
c/o Laurus Capital Management LLC
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Reference is made to the Agreement Regarding NCR Transaction and Other
Asset Sales, dated as of November 26, 2004 (as amended, modified or supplemented
from time to time, the "NCR Agreement"), by and between Tidel Technologies,
Inc., a Delaware corporation (the "Company"), and Laurus Master Fund, Ltd., a
Cayman Islands company ("Laurus").
To induce Laurus to enter into (a) the Exercise and Conversion Agreement,
dated as of the date hereof, among Sentinel Technologies, Inc. ("STI"), Sentinel
Operating, L.P., a Texas limited partnership and an affiliate of STI
("Sentinel"), the Company and Laurus, (b) the Voting Agreement, dated as of the
date hereof, among STI, Sentinel, the Company and Laurus, and (c) the Stock
Redemption Agreement, dated as of the date hereof, by and between the Company
and Laurus, the undersigned hereby:
(a) acknowledges, ratifies and confirms that all of the terms, conditions,
representations and covenants contained in the NCR Agreement are in full force
and effect and shall remain in full force and effect prior to and after the
consummation and closing of the transactions contemplated by that certain Asset
Purchase Agreement, dated as of the date hereof (the "Asset Purchase
Agreement"), by and among Sentinel, the Company and Tidel Engineering, L.P.;
(b) acknowledges, ratifies and confirms that the Reorganization Fee (as
defined in the NCR Agreement) and all other obligations due and owing from the
Company to Laurus under the NCR Agreement are secured by the collateral granted
by the Company and its subsidiaries to Laurus under any and all security
agreements and pledge agreements at any time entered into by the Company and/or
any such subsidiaries in favor of Laurus; and
(c) acknowledges, ratifies and confirms that the Company shall be
obligated to pay to Laurus (the "Payment") simultaneously with the consummation
and closing of the transactions contemplated by the Asset Purchase Agreement
(the "Closing"), the amounts payable pursuant to Section 4 of the NCR Agreement
based upon the calculation set forth therein. The calculation, based on
estimates known on the date hereof, is set forth on Exhibit A hereto. For
avoidance of doubt, the amount of the actual payment shall be re-calculated
based upon the actual closing numbers. In no event shall such payment be less
than $5,000,000 or greater than $11,000,000.
This agreement may be executed by facsimile signatures and in any
number of counterparts, each of which shall be an original, but all of which
together shall constitute one agreement.
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This agreement shall be governed by and construed in accordance with the
laws of the State of New York.
Very truly yours,
TIDEL TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
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Title: Director
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Address: 0000 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
ACCEPTED AND AGREED TO:
LAURUS MASTER FUND, LTD.
By: /s/ Xxxxxx Grin
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Name: Xxxxxx Grin
--------------------------
Title: Director
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EXHIBIT A
NCR sales price $ 10,175,000
Add: adjustment for 2 key employees $ 260,000
Plus: net asset adjustment
NET ASSETS 6,400,000
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EXCESS OF 6.825 OR LESS OF 6.175 (6,825,000) $ --
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Total Sale Price $ 10,435,000
Less:
Purchase Price Holdback (500,000)
Xxxxxx bonus (175,000)
Moving allowance for TACC (250,000)
Adjustment for key employees (260,000)
Fairness opinion (150,000)
Legal fees (250,000)
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Total NCR Net Proceeds 8,850,000
TACC sales price $ 17,500,000
Plus: working capital est 12-31 BS
CURRENT ASSETS 3,890,801
LIABILITIES (4,298,113)
(407,312)
Less:
Legal allowance - patent lawsuit (100,000)
Taxes (75,000)
Fairness opinion (75,000)
Legal fees (250,000)
Banking fees
Consulting fees /other (220,000)
Stay bonuses
Employee contract payouts/settlements (750,000)
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Total TACC Net Proceeds 15,622,688
Total Net Proceeds $ 24,472,688
Payment To Laurus due to NCR Purchase Price Holdback $ 283,500
Payment to Laurus $ 9,755,065
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TOTAL $ 10,038,565
