FOURTH AMENDMENT TO LOAN AND SECURITY AGREEMENT
Exhibit 10.1
FOURTH AMENDMENT
THIS
FOURTH AMENDMENT (this “Amendment”) is made as of the _____ day
of August, 2005 to the Loan and Security Agreement dated as of June 30, 2003 (as amended or
otherwise modified from time to time, the “Loan Agreement”; unless otherwise defined herein,
capitalized terms used herein shall have the meanings ascribed to them in the Loan Agreement) by
and among Xxxxx-Xxxxxxx Electronics Corporation, an Illinois corporation (“WGE”), American Gaming &
Electronics, Inc., a Nevada corporation (“AGE”) and LaSalle Bank National Association, a national
banking association (“Lender”).
WHEREAS, Borrowers have requested that Lender amend the Loan Agreement in certain
respects as provided herein;
WHEREAS, Lender has agreed to amend the Loan Agreement on the terms, and subject to the
conditions set forth below;
NOW, THEREFORE, in consideration of the foregoing, and the mutual covenants herein
contained, and such other consideration as the parties mutually agree, the parties hereto agree as
follows:
1. Amendment. Borrower and Lender agree to amend the Loan Agreement as follows:
(a) The date contained in the second line of Section 10 of the Loan
agreement which currently reads “June 30, 2006” is hereby amended to read “June 30, 2007”.
(b) Subsection 14(c) of the Loan Agreement is hereby amended and
restated in its entirety to read as follows:
(c) Interest Coverage
Borrowers shall not permit the ratio of (i) EBITDA to (ii) schedule
payments of interest and fees, to the extent carried as interest expense on
Borrowers’ financial statements, with respect to indebtedness for borrowed
money (including the interest component payments with respect to capitalized
leases) to be less than (w) 0.50:1.00 as of March 31, 2006, (x) 1.25:1:00 as
of June 30, 2006, (y) 2,00:1.00 as of September 30,
2006 and (z) 2.50:1.00
as of the last day of each quarter thereafter, in each case for the twelve
(12) month period ending on such date.
(c) Section 14 of the Loan Agreement is hereby amended to add a new subsection 14(e) as follows:
(e) EBITDA
Borrower shall not permit EBITDA to be less than the amounts set
forth below for the 3 month periods ending on the corresponding dates:
| Date | Amount | |||
September 30, 2005 |
($ | 490,000 | ) | |
December 31,2005 |
$ | 275,000 | ||
March 31,2006 |
$ | 375,000 | ||
June 30, 2006 |
$ | 425,000 | ||
September 30, 2006 |
$ | 490,000 | ||
December 31, 2006 |
$ | 580,000 | ||
March 31, 2007 |
$ | 820,000 | ||
June 30, 2007 |
$ | 780,000 | ||
2. Representations and Warranties of Borrowers. Each
Borrower represents and warrants that, as of the date hereof:
(a) Borrowers have the right and power and is duly authorized to enter into
this Amendment and all other agreements executed in connection herewith;
(b) The execution, delivery and performance by Borrowers of this
Amendment and the other agreements to which each Borrower is a party (i) have been duly
authorized by all necessary action on its part; (ii) do not and will not, by the lapse of
time, giving of notice or otherwise, violate the provisions of the terms of its Certificate of
Incorporation or By-Laws, or of any mortgage, indenture, security agreement, contract,
undertaking or other agreement to which a Borrower is a party, or which purports to be
binding on a Borrower or any of its properties; (iii) do not and will not, by lapse of time,
the giving of notice or otherwise, contravene any governmental restriction to which a Borrower
or any of its properties may be subject; and (iv) do not and will not, except as contemplated
in the Loan Agreement, result in the imposition of any lien, charge, security interest or
encumbrance upon any of a Borrower’s properties under any indenture, mortgage, deed of
trust, loan or credit agreement or other agreement or instrument to which a Borrower is a
party or which purports to be binding on a Borrower or any of its properties;
(c) No consent, license, registration or approval of any governmental
authority bureau or agency is required in connection with the execution, delivery,
performance, validity or enforceability of this Amendment and the other agreements executed
by Borrowers in connection herewith; and
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(d) This Amendment and the other agreements executed by each Borrower in connection
herewith have been duly executed and delivered by Borrowers and are enforceable against Borrowers
in accordance with their terms.
3. Conditions to Effectiveness of this Amendment. The effectiveness of
the terms and provisions of this Amendment shall be subject to (i) the execution and delivery
by Borrowers and Lender of this Amendment and (ii) payment by Borrowers of $25,000
waiver and amendment fee to be automatically deducted by Lender.
4. Costs and Expenses. Borrower agrees to pay all reasonable legal fees
and other expenses, whether for in-house or outside counsel, incurred by Lender in
connection with this Amendment and the transactions contemplated hereby.
5. Loan Agreement Remains in Force. Except as specifically waived and
amended hereby, all of die terms and conditions of the Loan Agreement shall remain in full
force and effect and this Amendment shall not be a waiver of any rights or remedies which
Lender has provided for in the Loan Agreement and all such terms and conditions are
herewith ratified, adopted, approved and accepted.
6. No Novation. This Amendment and all other agreements executed by
Borrower on the date hereof are not intended to nor shall be construed to create a novation or
accord and satisfaction, and shall only be a modification and extension of the existing
Liabilities of Borrower to Lender.
7. Entire Agreement. This Amendment comprises the entire agreement
relating to the subject matter it covers and supersedes any and all prior written or oral
agreements between Lender and Borrower relating thereto.
8. Severability. Any provision of this Amendment that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other jurisdiction.
9. Amendment. No amendment hereto shall be valid unless contained in a writing
duly executed by the party or parties to be bound by it.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their
proper and duly authorized officers as of the day and year first set forth above.
| XXXXX-XXXXXXX ELECTRONICS CORPORATION | ||||
| as a Borrower | ||||
| By | ||||
| Its | ||||
| AMERICAN GAMING & ELECTRONICS, INC., | ||||
| as a Borrower | ||||
| By | ||||
| Its | ||||
| LASALLE BANK NATIONAL ASSOCIATION, | ||||
| as Lender | ||||
| By | ||||
| Its | ||||
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