Exhibit 10.1

 

AMENDMENT NUMBER 10 TO LOAN DOCUMENTS

 

This AMENDMENT NUMBER 10 TO LOAN DOCUMENTS (this “Tenth Amendment”) is entered
into as of May 3, 2010, by and among GVEC RESOURCE IV INC. (the “Agent”). as
Agent and as a Lender, PRIVATE EQUITY MANAGEMENT GROUP LLC, a Delaware limited
liability company (“PEMG”). EMRISE CORPORATION, a Delaware corporation
(“Parent”), and Parent’s Subsidiaries that are signatories hereto (collectively
with Parent, the “Borrowers” and each individually, a “Borrower”) with reference
to the following facts:

 

A.                                 Borrowers. Agent and the Lenders named
therein are parties to that certain Credit Agreement dated as of November 30,
2007, as amended by that certain Amendment Number 1 to Loan Documents, dated as
of August 20, 2008, that certain Amendment Number 2 to Loan Documents, dated as
of February 12, 2009, that certain Forbearance Agreement and Amendment Number 3
to Loan Documents, dated as of March 20, 2009 (as amended by that certain
Amendment to Forbearance Agreement and Amendment Number 3 to Loan Documents,
dated as of April 9, 2009), that certain Amendment Number 4 to Loan Documents,
dated as of April 14, 2009, that certain Amendment Number 5 to Loan Documents,
dated as of August 14, 2009, that certain Amendment Number 6 to Loan Documents,
dated as of November 3, 2009, that certain Amendment Number 7 to Loan Documents,
dated as of November 13, 2009, that certain Amendment Number 8 to Loan
Documents, dated as of December 31, 2009 and that certain Amendment Number 9 to
Loan Documents, dated as of April 13, 2010 (as further amended, restated,
supplemented or modified from time to time, the “Credit Agreement”).

 

NOW, THEREFORE, for good and valuable consideration, the parties agree as
follows:

 

1.                                      Defined Terms. Capitalized terms not
otherwise defined herein shall have the same meanings as set forth in the Credit
Agreement

 

2.                                      Representations and Warranties.

 

(a)                                    Each Borrower hereby represents and
warrants that after giving effect to this Tenth Amendment, no Event of Default
or failure of condition has occurred or exists, or would exist with notice or
lapse of time or both under the Credit Agreement.

 

(b)                                   All representations and warranties of
Borrowers in this Tenth Amendment and the Credit Agreement are true and correct
as of the date hereof, and shall survive the execution of this Tenth Amendment.

 

3.                                      Amendments. “Key Milestones” numbered 8,
9 and 10, as set forth in Annex Y to the Credit Agreement, are hereby replaced
in their entireties with the Key Milestones set forth in Annex Y-l attached
hereto.

 

4.                                      Default. In addition to all other Events
of Default under the Credit Agreement, Borrowers’ failure to pay any amount when
due under this Tenth Amendment or to perform any covenant or other agreement
contained in this Tenth Amendment, or any other document entered into pursuant
hereto, shall constitute Events of Default under this Tenth Amendment and the
Credit Agreement.

 

5.                                      Conditions Precedent.  The effectiveness
of this Tenth Amendment is subject to Agent’s receipt of all of the following:

 

(a)                               this Tenth Amendment and such other agreements
and instruments reasonably requested by Agent pursuant hereto (including such
documents as are necessary to create and perfect Agent’s interest in the
Collateral), each duly executed by each Borrower;

 

(b)                              payment by Borrowers of all legal fees and
expenses incurred through the date of this Tenth Amendment (which shall be
remitted via wire transfer according to the instructions set forth on Exhibit A
hereto); and

 

(c)                               such other documents and completion of such
other matters as Agent may reasonably deem necessary or appropriate.

 

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6.                                    Release.

 

(a)                               Each Borrower acknowledges that neither Agent,
any Lender nor PEMG (the “Released Parties”) would enter into this Tenth
Amendment without Borrowers’ assurance hereunder. Except for the obligations
arising hereafter under this Tenth Amendment, each Borrower hereby absolutely
discharges and releases the Released Parties, any person or entity that has
obtained any interest from any of them under the Credit Agreement or otherwise
and each of the Released Parties’ and such entities’ former and present
partners, stockholders, officers, directors, employees, successors, assignees,
agents and attorneys from any known or unknown claims which any Borrower now has
against any of them of any nature, including any claims that any Borrower, its
successors, counsel, and advisors may in the future discover they would have now
had if they had known facts not now known to them, whether founded in contract,
in tort or pursuant to any other theory of liability, including but not limited
to any claims arising out of or related to the Credit Agreement or the
transactions contemplated thereby.

 

(b)                              Each Borrower waives die provisions of
California Civil Code Section 1542, which states:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

 

(c)                               The provisions, waivers and releases set forth
in this section are binding upon each Borrower and each Borrower’s shareholders,
agents, employees, assigns and successors in interest. The provisions, waivers
and releases of this section shall inure to the benefit of the Released Parties
and their respective agents, employees, officers, directors, assigns and
successors in interest.

 

(d)                              Each Borrower warrants and represents that such
Borrower is the sole and lawful owner of all right, title and interest in and to
all of the claims released hereby and no Borrower has heretofore assigned or
transferred or purported to assign or transfer to any person any such claim or
any portion thereof. Each Borrower shall indemnify and hold harmless Agent, each
Lender and PEMG from and against any claim, demand, damage, debt, liability
(including payment of attorneys’ fees and costs actually incurred whether or not
litigation is commenced) based on or arising out of any such assignment or
transfer.

 

(e)                               The provisions of this section shall survive
payment in full of the Obligations, full performance of all the terms of this
Tenth Amendment and the Credit Agreement, and/or Agent’s, any Lender’s or PEMG’s
actions to exercise any remedy available under the Credit Agreement or
otherwise.

 

7.                                    Consultation of Counsel. Each Borrower
acknowledges that such Borrower has had the opportunity to be represented by
legal counsel of its own choice throughout all of the negotiations that preceded
the execution of this Tenth Amendment. Each Borrower has executed this Tenth
Amendment after reviewing and understanding each provision of this Tenth
Amendment and without reliance upon any promise or representation of any person
or persons acting for or on behalf of Agent, Each Borrower further acknowledges
that such Borrower and its counsel have had adequate opportunity to make
whatever investigation or inquiry they may deem necessary or desirable in
connection with the subject matter of this Tenth Amendment prior to the
execution hereof and the delivery and acceptance of the consideration described
herein.

 

8.                                    Miscellaneous.

 

(a)                                Successors and Assigns. This Tenth Amendment
shall be binding upon and shall inure to the benefit of Borrower and Agent and
their respective successors and assigns: provided, however, that the foregoing
shall not authorize any assignment by Borrower of its rights or duties
hereunder.

 

(b)                               Integration. This Tenth Amendment and any
documents executed in connection herewith or pursuant hereto contain the entire
Tenth Amendment between the parties with respect to the subject matter hereof
and supersede all prior agreements, understandings, offers and negotiations,
oral or written, with respect thereto and no extrinsic evidence whatsoever may
be introduced in any judicial or arbitration proceeding, if any, involving this
Tenth Amendment; except that any financing statements or other agreements or
instruments filed by Agent with respect to Borrower shall remain in full force
and effect.

 

(c)                                Course of Dealing; Waivers. No course of
dealing on the part of Agent or its officers, nor any failure or delay in the
exercise of any right by Agent, shall operate as a waiver, thereof, and any
single or partial exercise of any such right shall not preclude any later
exercise of any such right, Agents failure at any time to require shirt
performance by Borrower of any

 

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provision shall not affect any right of Agent thereafter to demand strict
compliance and performance. Any suspension or waiver of a right must be in
writing signed by an officer of Agent.

 

(d)                               Time is of the Essence. Time is of the essence
as to each and every term and provision of this Tenth Amendment and the other
Credit Agreement.

 

(e)                                Legal Effect. The Credit Agreement remains in
full force and effect. If any provision of this Tenth Amendment conflicts with
applicable law, such provision shall be deemed severed from this Tenth
Amendment, and the balance of this Tenth Amendment shall remain in full force
and effect.

 

(f)                                  Choice of Law and Venue; Jury Trial Waiver;
Judicial Reference; Service of Process. Section 12 of the Credit Agreement
hereby is incorporated herein by this reference as though fully set forth.

 

(g)                               Upon the effectiveness of this Tenth
Amendment, each reference in the Credit Agreement to “this Tenth Amendment,”
“hereunder,” “herein,” “hereof” or words of like import referring to the Credit
Agreement shall mean and refer to the Credit Agreement as amended by this Tenth
Amendment.

 

(h)                               Upon the effectiveness of this Tenth
Amendment, each reference in the Loan Documents to the “Credit Agreement”
“thereunder,” “therein,” “thereof or words of like import referring to the
Credit Agreement shall mean and refer to the Credit Agreement as amended by this
Tenth Amendment.

 

(i)                                   Assignment and Indemnity. Borrower
consents to Agent’s assignment, in accordance with Section 13 of the Credit
Agreement, of all or any part of Agent’s rights under this Tenth Amendment and
the Credit Agreement.

 

9.                                    Entire Amendment; Effect of Tenth
Amendment. This Tenth Amendment, and the terms and provisions hereof,
constitutes the entire Tenth Amendment among the parties pertaining to the
subject matter hereof and supersedes any and all prior or contemporaneous
amendments relating to the subject matter hereof. Except as expressly set forth
in this Tenth Amendment, the Credit Agreement and other Loan Documents shall
remain unchanged and in full force and effect. To the extent any terms or
provisions of this Tenth Amendment conflict with those of the Credit Agreement
or other Loan Documents., the terms and provisions of this Tenth Amendment shall
control. This Tenth Amendment is a Loan Document.

 

10.                              Counterparts; Electronic Transmission. This
Tenth Amendment may be executed in any number of counterparts, all of which
taken together shall constitute one and the same instrument and any of the
parties hereto may execute this Tenth Amendment by signing any such counterpart.
Delivery of an executed counterpart of this Tenth Amendment by electronic mail
shall be equally as effective as delivery of an original executed counterpart of
this Tenth Amendment. Any party delivering an executed counterpart of this Tenth
Amendment by electronic mail also shall deliver an original executed counterpart
of this Tenth Amendment, but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Tenth Amendment.

 

[Balance of Page Intentionally Left Blank]

 

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IN WITNESS WHEREOF, the parties have caused this Amendment Number 10 to Loan
Documents to be executed and delivered on the date first written above.

 

EMRISE CORPORATION

 

EMRISE ELECTRONICS CORPORATION

 

 

 

 

 

 

By:

/s/ Carmine Oliva

 

By:

/s/ Carmine Oliva

Name:

Carmine Oliva

 

Name:

Carmine Oliva

Title:

Chief Executive Officer

 

Title:

President

 

 

 

 

 

 

CXR LARUS CORPORATION

 

ADVANCED CONTROL COMPONENTS, INC.

 

 

 

 

 

 

By:

/s/ Carmine Oliva

 

By:

/s/ Carmine Oliva

Name:

Carmine Oliva

 

Name:

Carmine Oliva

Title:

President

 

Title:

President

 

 

 

 

 

 

CUSTOM COMPONENTS, INC.

 

GVEC RESOURCE IV INC.,

 

 

as Agent and a Lender

 

 

 

By:

/s/ Carmine Oliva

 

By: PRIVATE EQUITY MANAGEMENT GROUP LLC, its Court-Appointed Receiver

 

Name:

Carmine Oliva

 

 

Title:

President

 

By:

/s/ Jim LeSieur

 

 

Name:

Jim LeSieur

 

 

Title:

Chief Operating Officer

PRIVATE EQUITY MANAGEMENT GROUP LLC

 

 

 

 

 

 

 

 

By:

/s/ Jim LeSieur

 

 

Name:

Jim LeSieur

 

 

Title:

Chief Operating Officer

 

 

 

[Signature Page to Amendment Number 10 to Loan Documents]

 

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ANNEX Y-1

(Amended “Key Milestones” re Sale of ACC)

 

Key
Milestone

 

 

 

 

 

 

#

 

Date

 

PEM Deliverable

 

Description

8

 

5/17

 

Binding SPA

 

·                  Sign binding SPA

9

 

5/19

 

Preliminary proxy

 

·                  File preliminary proxy for shareholder approval

10

 

6/29

 

Closing documentation

 

·                  Complete vote and close transaction

 

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