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EXHIBIT 4.19
FIRST AMENDMENT TO CREDIT AGREEMENT
This First Amendment to Credit Agreement (this "Amendment") is made and
entered into as of September 30, 1999, by and among CHASE BANK OF TEXAS, N.A., a
national banking association ("Lender"), TIDEL ENGINEERING, L.P. ("Borrower"), a
Delaware limited partnership, and TIDEL TECHNOLOGIES, INC., a Delaware
corporation ("Ultimate Parent").
R E C I T A L S:
A. On April 1, 1999, Lender, Borrower, and Ultimate Parent entered into
that certain Credit Agreement (the "Credit Agreement") pursuant to which Lender
agreed to make loans and advances (collectively the "Loans") to Borrower and
Ultimate Parent in accordance with the terms thereof. The Loans are evidenced by
that certain Revolving Credit Note of even date with the Credit Agreement, in
the stated principal amount of $7,000,000.00, and that certain Term Note of even
date with the Credit Agreement, in the stated principal amount of $544,000.00,
each bearing interest and being payable to the order of Lender as therein
provided (collectively, the "Notes"). The Credit Agreement, the Notes and the
documents, instruments and agreements executed in connection therewith are
collectively referred to herein as the "Loan Documents".
B. Borrower has requested Lender to extend the term of the Credit
Agreement and to modify the minimum Tangible Net Worth requirement of Section
8.12 of the Credit Agreement.
C. Lender, at the request of Borrower, for good and valuable
consideration, is willing to enter into this Amendment upon the terms and
conditions set forth below:
A G R E E M E N T:
NOW, THEREFORE, for and in consideration of Ten and No/100 Dollars
($10.00) and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Borrower and Lender hereby covenant and agree
as follows:
1. Defined Terms. Capitalized terms used but not otherwise defined
herein shall have the meanings given to them in the Credit Agreement.
2. Eligible Receivables. Clause (d) of the definition of "Eligible
Receivables" in Section 1.1 of the Credit Agreement is hereby amended to read in
its entirety as follows:
(d) the total Receivables owing to the Borrower by the applicable
account debtor constitute 10% or less of the aggregate Receivables
owing to the Borrower by all account debtors, or if the total
Receivables of the applicable account debtor (other than Credit Card
Center, in which case 20%, and CardPro, Inc./CardTronics, in which case
15%) exceed 10% of the aggregate of all Receivables owing to the
Borrower and its Subsidiaries by all account debtors, the Receivables
of the applicable account debtor up
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to such respective percentage limit shall be deemed to constitute
Eligible Receivables (subject to compliance with all other applicable
standards of eligibility) and the Receivables of the applicable account
debtor exceeding such respective percentage limit shall be included
within Eligible Receivables (subject to compliance with all other
applicable standards of eligibility) only if the Receivables exceeding
such respective percentage limit are backed or secured by credit
insurance reasonably satisfactory to the Lender in all respects and
such credit insurance has been assigned to the Lender upon terms
reasonably acceptable to the Lender in its discretion;
3. Revolving Loan Maturity Date. The definition of "Revolving Loan
Maturity Date" in Section 1.1 of the Credit Agreement is hereby amended to read
in its entirety as follows:
Revolving Loan Maturity Date shall mean the earlier of (a)
September 30, 2001, (b) any date that the Revolving Commitment is
terminated in full by the Borrower pursuant to Section 2.4 hereof, and
(c) any date the Revolving Loan Maturity Date is accelerated by the
Lender pursuant to Section 9.1 hereof.
4. Tangible Net Worth. Section 8.12 of the Credit Agreement is hereby
amended to read in its entirety as follows:
8.12 Tangible Net Worth. Permit the Tangible Net Worth of the
Borrower (expressly excluding Ultimate Parent, its Subsidiaries and
Borrower's Subsidiaries), as determined at any time and from time to
time, to be less than the sum of the following:
(i) $11,000,000.00; plus
(ii) the amount, which shall be added to clause (i) above as
of the end of each calendar month, on a cumulative basis, beginning
with the calendar month beginning October 1, 1998 and continuing each
calendar month thereafter through the term of this Agreement, that is
equal to the sequential monthly calculations of fifty percent (50%) of
the positive (but not the negative) net income of the Borrower for each
calendar month, beginning on and after October 1, 1998 (it being
acknowledged that such calculations for calendar months prior to April
1, 1999 shall be made with respect to Tidel Engineering, Inc., the
predecessor-in-interest to the Borrower); plus
(iii) the amount of all capital contributions to Borrower on
or after October 1, 1998 (it being acknowledged that such calculations
for calendar months prior to April 1, 1999 shall be made with respect
to Tidel Engineering, Inc., the predecessor-in-interest to the
Borrower, and shall be made with respect to the amount of consideration
received in exchange for equity interests issued by Tidel Engineering,
Inc. during the applicable period of time).
5. Exhibit D. Exhibit D to the Credit Agreement is hereby deleted in
its entirety and replaced with Exhibit D attached hereto.
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6. Exhibit H. Exhibit H to the Credit Agreement is hereby deleted in
its entirety and replaced with Exhibit H attached hereto.
7. Conditions Precedent. The effectiveness of this Amendment is subject
to the satisfaction of the following conditions precedent, unless specifically
waived in writing by Lender:
(a) Lender shall have received a Revolving Credit Note, in
form and substance satisfactory to Lender, duly executed by the
Borrower;
(b) The representations and warranties contained herein and in
all Loan Documents, as amended hereby, shall be true and correct in all
material respects as of the date hereof as if made on the date hereof;
and
(c) No Event of Default by Borrower or Ultimate Parent under
the Loan Documents, as amended hereby, as of the date hereof, shall
have occurred and be continuing and no event or conditions shall have
occurred that with the giving of notice or lapse of time or both would
be an Event of Default by Borrower or Ultimate Parent under the Loan
Documents, as amended hereby, as of the date hereof, unless such Event
of Default has been specifically waived in writing by Lender.
8. Costs and Expenses. Borrower agrees to reimburse Lender for Lender's
costs and expenses, including, but not limited to, reasonable attorneys' fees
and legal expenses, incurred by Lender in connection with the preparation of
this Amendment and in connection with the negotiation and consummation of the
transaction contemplated hereby.
9. The Credit Agreement. All references to the Credit Agreement in the
Loan Documents shall be deemed to be the Credit Agreement, as modified hereby.
Borrower expressly promises to perform all of its obligations under the Credit
Agreement and other Loan Documents, as modified by this Amendment.
10. Acknowledgments of Borrower and Ultimate Parent. Borrower and
Ultimate Parent each hereby acknowledge and agree that (a) Lender is not in
default in the performance of its obligations under the Loan Documents; (b)
Borrower and Ultimate Parent have no claims, counterclaims, offsets, credits or
defenses to the Loan Documents and the performance of their respective
obligations thereunder, or if Borrower or Ultimate Parent have any such claims,
counterclaims, offsets, credits or defenses to the Loan Documents or any
transaction related to the Loans and/or the Loan Documents, same are hereby
waived, relinquished and released in consideration of Lender's execution and
delivery of this Amendment; (c) all of the provisions of the Loan Documents,
except as amended hereby, are in full force and effect; and (d) upon the
execution hereof, the Credit Agreement, the Notes, and the other Loan Documents,
as amended herein, are not in default by Borrower or Ultimate Parent.
11. Full Force and Effect. Except as expressly modified and amended in
this Amendment, all of the terms, provisions and conditions of the Credit
Agreement, the Notes, and
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all other Loan Documents are and shall remain in full force and effect and are
incorporated herein by reference.
12. Counterparts. This Amendment may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed and delivered shall be deemed to be an original, and all of
which taken together shall constitute but one and the same instrument.
13. No Oral Agreements. THIS AMENDMENT AND THE OTHER LOAN DOCUMENTS
EMBODY THE ENTIRE AGREEMENT AMONG THE PARTIES AND SUPERSEDES ALL PRIOR
AGREEMENTS AND UNDERSTANDINGS, IF ANY, RELATING TO THE SUBJECT MATTER HEREOF.
THIS WRITTEN AMENDMENT REPRESENTS THE FINAL AGREEMENT AMONG THE PARTIES AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES.
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IN WITNESS WHEREOF, the parties have executed this First Amendment to
Credit Agreement as of the day and year first above written.
LENDER:
CHASE BANK OF TEXAS, N.A.,
a national banking association
By:
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Xxxxxx Xxxxxxxx, Vice President
BORROWER:
TIDEL ENGINEERING, L.P.,
a Delaware limited partnership
By: Tidel Cash Systems, Inc., its sole
general partner
By:
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Xxxx X. Xxxxxxxx,
President and Chief Executive
Officer
ULTIMATE PARENT:
TIDEL TECHNOLOGIES, INC.,
a Delaware corporation
By:
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Xxxx X. Xxxxxxxx,
Chief Operating Officer
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By its execution below, each of Tidel Technologies, Inc., a Delaware
corporation, Tidel Services Inc., a Delaware corporation, and Tidel Cash
Systems, Inc., a Delaware corporation (each individually, a "Guarantor"),
acknowledges and consents to all of the terms and conditions of this Amendment,
and ratifies and confirms its respective Guaranty to and for the benefit of
Lender. Each Guarantor acknowledges that such Guarantor has no claims,
counterclaims, offsets, credits or defenses to the Loan Documents and the
performance of its obligations thereunder, or if such Guarantor does have any
such claims, counterclaims, offsets, credits or defenses to the Loan Documents
or any transaction related to the Loans and/or the Loan Documents, same are
hereby waived, relinquished and released in consideration of Lender's execution
and delivery of this Amendment. Further, each Guarantor agrees that nothing
contained in this Amendment shall adversely affect any right or remedy of Lender
under its respective Guaranty and that with respect to such Guaranty, all
references in such Guaranty to the "Obligations" shall mean the "Obligations",
as amended by this Amendment; that the execution and delivery of this Amendment
shall in no way change or modify such Guarantor's obligations as Guarantor
pursuant to its Guaranty; and that the execution and delivery of any agreements
by Borrower and Lender in connection with this Amendment shall not constitute a
waiver by Lender of any of Lender's rights against any Guarantor.
TIDEL TECHNOLOGIES, INC.,
a Delaware corporation
By:
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Xxxx X. Xxxxxxxx,
Chief Operating Officer
TIDEL SERVICES, INC.,
a Delaware corporation
By:
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Xxxxxx Xxxxxxxxxx, Vice President
TIDEL CASH SYSTEMS, INC.,
a Delaware corporation
By:
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Xxxx X. Xxxxxxxx, President and Chief
Executive Officer
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