EXHIBIT 10 (a)(i)
AMENDMENT TO PROMISSORY NOTE,
CORPORATE GUARANTEE AND
SECURITY ARRANGEMENT
US$1,500,000 San Diego, California
FOR VALUE RECEIVED, Berjaya Lottery Management (HK) Ltd. ("Maker") and
International Lottery & Totalizator Systems, Inc. ("Holder") hereby agree to
amend the Promissory Note, dated 14 February 2001 (the "Amendment"). The
provisions of the Promissory Note are amended as follows:
1. Term. The Term of the Promissory Note is extended until 14 February
2002 ("Due Date") and all provisions of the Promissory Note, except as
amended herein by this Amendment, remain in full force and effect until
all principal amounts and interest due under the Promissory Note are
paid by Maker to Holder. However, Holder agrees that if the Promissory
Note is not paid on the Due Date, Maker shall have until 15 April 2002
("Cure Date") to pay the Promissory Note. Interest shall continue to
accrue during the Cure Period.
2. Corporate Guarantee. BLM, as Guarantor, hereby unconditionally
guarantees: (a) all unpaid amounts of the (US)$1,500,000 principal
amount and unpaid interest until all such amounts are paid and (b) the
obligations of Sports Toto as set out in the Promissory Note.
3. Escrow Account. Maker will forward to Mellon Investor Services as
Escrow Agent and as Transfer Agent of Holder certificate(s) for shares
of Common Stock of Holder equal in value to 2X the sum of the principal
amount of the Promissory Note and all interest which will be due and
payable on the Due Date:
(a) The value of a share of Holder's Common Stock for purposes of
determining the number of shares of ILTS Common Stock to be
placed in the Escrow Account is (US)$0.70 per share;
(b) The number of shares of Common Stock of Maker to be placed in
the Escrow Account is 4,579,341 shares (the "Shares");
(c) Maker agrees that if the amount due under the Promissory Note
including interest at nine percent (9%) per annum calculated
on a daily basis from 14 February 2001 up to the date of its
full payment is not paid on the Cure Date, the Escrow
Agreement will provide that the Escrow Agent will transfer the
certificates of Common Stock of Holder to the Holder's
account, in accordance with the provisions of the Escrow
Agreement, for such disposition as Holder determines; and
(d) Maker agrees to execute such stock powers or other documents
requested by Holder and the Escrow Agent to carry out the
purposes of the Promissory Note, this Amendment and the Escrow
Agreement attached as Exhibit A.
4. Security. Maker's obligations under the Promissory Note and this
Amendment are secured by that certain Escrow Agreement of even date
herewith ("Escrow Agreement") encumbering certain shares of ILTS Common
Stock owned by Maker. Notwithstanding the foregoing, Maker and the
Holder or any other holder of this Promissory Note agree that the
holder of this Promissory Note shall have full recourse to all assets
and properties of Maker, including, without limitation, the Shares
pledged to the Holder pursuant to the Escrow Agreement.
This Amendment shall be governed by and construed in accordance with
the laws of the State of California and the parties agree that any
action brought hereunder to enforce the provisions of the Promissory
Note, this Amendment and the Escrow Agreement will be brought in the
U.S. federal or California state courts in San Diego county, California
and each party hereby submits to the jurisdiction of such courts for
notice, service of process and all legal or enforcement proceedings.
Executed this 15th day of October 2001 in San Diego, California.
Berjaya Lottery Management (H.K.) Ltd.
By: /s/ Tan Sri Dato' Seri Xxxxxxx Xxx Chee Yioun
_____________________________________________________
Title: President
_____________________________________________________
International Lottery & Totalizator Systems, Inc.
By: /s/ M. Xxxx Xxxxxxxx
_____________________________________________________
Title: President
_____________________________________________________
