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EXHIBIT 10.34
Loan No.: 1910106
H HELLER FINANCIAL
FIRST AMENDMENT
TO
SECURITY AGREEMENT
1. Parties and Date. This First Amendment to Security Agreement (the
"Amendment") is entered into effective as of December 18, 1999, by and between
AG Associates, Inc., a California corporation ("Debtor"), and Heller Financial,
Inc., a Delaware corporation ("Secured Party"). Capitalized terms used herein
and not defined shall have the meanings assigned to them in the Security
Agreement described below.
2. Defaults. Events of Default described in clause (j) of Section 4 of the
Security Agreement have occurred and cannot be cured.
Intention of the Parties . Debtor has requested that the Security
Agreement be amended and that Secured Party waive from exercising any rights or
remedies it may have as a result of the Events of Default described in Section 2
above. Secured Party is willing to amend the Security Agreement as debtor has
requested and to waive from exercising those rights and remedies on the terms
and conditions set forth in this Agreement.
4. Amendment to Security Agreement. Debtor and Secured Party hereby agree to
amend the Security Agreement as follows:
4.1 The Exhibit A referenced in clause (j) of Section 4 of the Security
Agreement is hereby deleted therefrom and shall no longer have any force or
effect and in place thereof the attached Exhibit A-2 shall be and hereby is
added.
4.2 Section 2 of the Security Agreement shall be and hereby is amended such
that the following clause is included.
(w) Year 2000 Compliance. Debtor has made an assessment of the microchip
and computer-based systems and the software used in its business and based upon
such assessment believes that it will be "Year 2000 Compliant" by January 1,
2000. For purposes of this paragraph, "Year 2000 Compliant" means that all
software, embedded microchips and other processing capabilities utilized by, and
material to the business operations or financial condition of, Debtor we able to
interpret, store, transmit, receive and manipulate data on and involving all
calendar dates correctly and without causing any abnormal ending scenarios in
relation to dates in and after the Year 2000. From time to time, at the request
of Secured Party, Debtor shall provide to Secured Party such updated information
as is requested regarding the status of its efforts to become Year 2000
Compliant.
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5. Waiver of Default. Secured Party agrees to forbear from exercising and hereby
waives any rights and ren dies it may have arising solely as a direct result of
the occurrence of the Event of Default described in Section 2 above.
6. Acknowledgments. Ratifications and Reaffirmations; by Debtor. Debtor hereby
acknowledges, ratifies and reaffirms that (i) no Event of Default or other event
or circumstance which, with the passage of time or the giving of notice, or
both, would constitute an Event of Default, has occurred or exists, (ii) Debtor
has no defense, offset, objection, or counterclaim to any of Debtor's
obligations under the Note, Security Agreement or other Loan Documents (as
defined in the Security Agreement), and (iii) the Note. Security Agreement (as
amended by this Amendment) and other Loan Documents are in full force and effect
as of the date hereof and are legal, valid, binding, and fully enforceable
obligations against Debtor in accordance with their respective terms.
7. Fee. In consideration for Secured Party entering into this Amendment, Debtor
shall promptly pay to Secured Party the amount of Two Thousand One Hundred
Eighty-Six and 25/100 Dollars ($2,186.25). Secured Party's receipt of the
foregoing payment shall be a condition precedent that must be satisfied before
this Amendment shall become binding in any way on Secured Party.
8. Effectiveness of Loan Judgements. Except as expressly amended by this
Amendment, all terms of the Security Agreement, as well as the Note and all of
the other Loan Documents, shall remain in full force and effect. To the extent
any terms and conditions in any of the Loan Documents shall contradict or be in
conflict with any terms or conditions of the amended Loan Documents, after
giving effect to this Amendment, such terms and conditions are hereby deemed
modified and amended hereby. In connection herewith, Debtor shall execute such
amendments to the other Loan Documents or re-execute such of the other Loan
Documents as Secured Party shall request.
9. No Waiver of Remedies. Except as specifically provided herein, Secured Party
expressly reserves any and all rights and remedies at any time available to it
in connection with the Loan, whether arising under the Note, Security Agreement
and/or any of the other Loan Documents, at law, in equity or otherwise. No
failure to exercise, or delay by Secured Party in exercising, any right, remedy,
power or privilege under or in connection with the Note, Security Agreement
and/or any of the other Loan Documents shall preclude any other or further
exercise thereof, or the exercise of any other right, remedy, power or privilege
at any time, and all such rights, remedies, powers and privileges shall be
cumulative and not exclusive of one another.
10. Enforcement. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS AND DECISIONS OF THE STATE OF ILLINOIS. AT SECURED PARTIES
ELECTION AND WITHOUT LIMITING SECURED PARTY'S RIGHT TO COMMENCE AN ACTION IN ANY
OTHER JURISDICTION, DEBTOR HEREBY SUBMITS TO THE EXCLUSIVE JURISDICTION AND
VENUE OF ANY COURT (FEDERAL, STATE OR LOCAL)
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HAVING STATUS WITHIN THE STATE OF ILLINOIS, EXPRESSLY WAIVES PERSONAL SERVICE OF
PROCESS AND CONSENTS TO SERVICE BY CERTIFIED MAIL, POSTAGE PREPAID, DIRECTED TO
THE LAST KNOWN ADDRESS OF DEBTOR, WHICH SERVICE SHALL BE DEEMED COMPLETED WITHIN
TEN (10) DAYS AFTER THE DATE OF MAILING TBEREOF.
11. Entire Agreement. The parties acknowledge and agree that there are no other
agreements or representations, either oral or written, "press or implied, in
connection with the Loan that are not embodied in this Amendment, the Note, the
Security Agreement and the other Loan Documents, which together represent a
complete integration of all prior and contemporaneous agreements and
understandings of Debtor and Secured Party in any way related to the Loan. The
Security Agreement (as amended by this Amendment) may not be altered, modified
or terminated in any manner except by a writing duly executed by Debtor and
Secured Party. If any provision of the Security Agreement (as amended by this
Amendment) is held to be invalid or unenforceable, the remaining provisions
shall remain in effect without impairment.
12. Binding on Successors. Debtor shall not assign any of its rights, duties or
obligations under the Note, the Security Agreement (as amended by this
Amendment) or any of the other Loan Documents and any purported such assignment
shall be void. Secured Party may transfer or assign the Note or the Indebtedness
(as defined in the Security Agreement) and the other Loan Documents, either
together or separately, in accordance with the Security Agreement. Without in
any way limiting the foregoing, the Note, Security Agreement (as amended by this
Amendment) and other Loan Documents shall be binding upon the successors and
legal representatives of Debtor.
IN WITNESS WHEREOF, Debtor and Secured Party have each executed this Amendment
to be effective as of the day and year first above written.
"DEBTOR"
AG Associates, Inc., a
California corporation
By:
Name:
Title:
"SECURED PARTY"
Heller Financial, Inc., a Delaware corporation
By:
Name:
Title:
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EXHIBIT A-2
TO
SECURITY AGREEMENT
(ADDITIONAL EVENTS OF DEFAULT)
The following shall each constitute an Event of Default under the
Security Agreement between Secured Party and Debtor, and upon its occurrence,
Secured Party shall have the right to exercise any one or more of the remedies
provided the Security Agreement:
(i) If, as of the end of any fiscal quarter, Borrower has Earnings Before
Interest, Taxes, Depreciation and Amortization ("EBITDA" as determined in
accordance with GAAP) of less than Nine Hundred Thousand Dollars ($900,000) per
quarter, commencing with the quarter ending on March 31, 1999; and
(ii) If, as of the end of any fiscal quarter, Borrower has a consolidated net
worth of less than Fifteen Million Dollars ($15,000,000), where consolidated net
worth means the stockholders equity of Borrower determined in accordance with
GAAP.
AG ASSOCIATES, INC.
By:
Name:
Date:
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