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EXHIBIT 10.26.1
AMENDMENT NUMBER FOUR TO
LOAN AND SECURITY AGREEMENT
THIS AMENDMENT NUMBER FOUR TO LOAN AND SECURITY AGREEMENT, dated as of
April 26, 2000 (this "Amendment"), amends that certain Loan and Security
Agreement, dated as of March 26, 1997 (as amended from time to time, the "Loan
Agreement"), by and between ON-POINT TECHNOLOGY SYSTEMS, INC., (dba Lottery
Enterprises, Inc.) ("Borrower"), 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. AMENDMENT TO SECTION 1 OF THE SCHEDULE TO THE LOAN AGREEMENT.
The figure in Section 1 of the Schedule to the Loan Agreement which currently is
"$6,000,000" is changed to read "$10,000,000". The remainder of Section 1 of the
Schedule remains unchanged.
Section 2. AMENDMENT TO SECTION 2 OF THE SCHEDULE TO THE LOAN AGREEMENT.
Section 2 of the Schedule to the Loan Agreement as the same relates to Minimum
Monthly Interest is hereby amended in its entirety to read as follows:
"Minimum Monthly Interest (Section 1.2) An amount equal to the interest
that would have accrued had the daily aggregate outstanding balance of
all Loans been equal to thirty-five percent (35%) of the Maximum Dollar
Amount."
Section 3. AMENDMENT TO SECTION 4 OF THE SCHEDULE TO THE LOAN AGREEMENT.
Section 4 of the Schedule to the Loan Agreement as the same relates to the Early
Termination Fee is hereby amended in its entirety to read as follows:
"An amount equal to 3% of the Maximum Dollar Amount (as defined in the
Schedule), if termination occurs on or before July 31, 2001; 2% of the
Maximum Dollar Amount, if termination occurs after July 31, 2001 and on
or before July 31 2002; and 1% of the Maximum Dollar Amount if
termination occurs after July 31, 2002."
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Section 4. AMENDMENT TO SECTION 4 OF THE SCHEDULE TO THE LOAN AGREEMENT.
Section 4 of the Schedule to the Loan Agreement as the same relates to the
Maturity Date is hereby amended in its entirety to read as follows:
"July 31, 2003, subject to automatic renewal as provided in Section 6.1
above and subject to early termination as provided in Section 6.2 above."
Section 5. AMENDMENT TO SECTION 7 OF THE SCHEDULE TO THE LOAN AGREEMENT.
Section 7 of the Schedule to the Loan Agreement is hereby amended in its
entirety to read as follows:
"On and after April 7, 2000, Borrower shall maintain book net worth of at
least Eight Million Dollars ($8,000,000); provided that such minimum
amount shall be decreased by the amount, if any, of the write-down of
Borrower's assets incurred in connection with the resolution of the
issues respecting the Solutioneering assets (currently carried on
Borrower's books at approximately $2,100,000."
Section 6. AMENDMENT FEE. In connection with this Amendment Borrower
shall pay to Coast a fee in the amount of Two Hundred Fifty Thousand Dollars
($250,000) (the "Fee"). The Fee shall be fully earned on the date hereof and
payable in monthly installments on the last day of each month commencing with
the last day of April, 2000 and continuing on the last day of each of the next
succeeding thirty five (35) months,: provided, however, the unpaid balance shall
be due and payable upon termination, if termination occurs at anytime prior to
the payment in full of the Amendment Fee.
Section 7. CONDITION PRECEDENT. The effectiveness of this Amendment is
expressly conditioned upon the receipt by Coast of an executed copy of this
Amendment executed by Borrower.
Section 8. 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 9. CONFLICTING TERMS. In the event of a conflict between the
terms and provisions of this Amendment and the terms 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 force
and effect.
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Section 10. 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 HEREOF, 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.
BORROWER:
ON-POINT TECHNOLOGY SYSTEMS, INC.
(dba Lottery Enterprises, Inc.)
By /s/ Frederick Sandvick
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President or Vice President
By /s/ Sam Stearman
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Secretary or Ass't Secretary
COAST:
COAST BUSINESS CREDIT,
a division of Southern Pacific Bank
By /s/ R. Britton Terrell
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Title V. P.
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