Document:

exhibit10_1.htm

Exhibit 10.1

EIGHTH AMENDMENT TO LOAN AND SECURITY AGREEMENT

 

1. THIS EIGHTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Agreement”) is entered into on February 27, 2014, but is effective as of January 15, 2014, by and between SILICON VALLEY BANK, a California corporation (“Bank”), and POKERTEK, INC., a North Carolina corporation (“Borrower”), with its principal place of business at 1150 Crews Road, Suite F, Matthews, North Carolina 28105.

 

Recitals

 

2. A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of July 25, 2008 (as the same has and may continue to be from time to time further amended, modified, supplemented or restated, the “Loan Agreement”).

 

3. B. Bank has extended credit to Borrower for the purposes permitted in the Loan Agreement.

 

4. C. Borrower has requested that Bank (i) extend the Maturity Date and (ii) amend certain other provisions of the Loan Agreement.

 

5. D. Although Bank is under no obligation to do so, Bank is willing to amend certain provisions of the Loan Agreement, all on the terms and conditions set forth in this Agreement, so long as Borrower complies with the terms, covenants and conditions set forth in this Agreement in a timely manner.

 

Agreement

 

6. Now, Therefore, in consideration of the foregoing recitals and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, and intending to be legally bound, the parties hereto agree as follows:

 

Definitions.  Capitalized terms used but not defined in this Agreement, including its preamble and recitals, shall have the meanings given to them in the Loan Agreement.

 

Amendment to Loan Agreement.

 

Section 13 (Definitions).  The following term and its definition set forth in Section 13.1 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

 

“Maturity Date” is January 14, 2015.

Limitation of Amendment.

 

The amendment set forth in Section 2, above, is effective for the purposes set forth herein and shall be limited precisely as written and shall not be deemed to (a) be a consent to any amendment, waiver or modification of any other term or condition of any Loan Document, or (b) otherwise prejudice any right or remedy which Bank may now have or may have in the future under or in connection with any Loan Document.

 

  

  

  

 

This Agreement shall be construed in connection with and as part of the Loan Documents and all terms, conditions, representations, warranties, covenants and agreements set forth in the Loan Documents, except as herein amended, are hereby ratified and confirmed and shall remain in full force and effect.

 

Representations and Warranties.  To induce Bank to enter into this Agreement, Borrower hereby represents and warrants to Bank as follows:

 

Immediately after giving effect to this Agreement (a) the representations and warranties contained in the Loan Documents are true, accurate and complete in all material respects as of the date hereof (except to the extent such representations and warranties relate to an earlier date, in which case they are true and correct as of such date), and (b) no Event of Default has occurred and is continuing;

 

Borrower has the power and authority to execute and deliver this Agreement and to perform its obligations under the Loan Agreement, as amended by this Agreement;

 

The organizational documents of Borrower delivered to Bank on the Effective Date and February 22, 2012 remain true, accurate and complete and have not been amended, supplemented or restated and are and continue to be in full force and effect;

 

The execution and delivery by Borrower of this Agreement and the performance by Borrower of its obligations under the Loan Agreement, as amended by this Agreement, have been duly authorized;

 

The execution and delivery by Borrower of this Agreement and the performance by Borrower of its obligations under the Loan Agreement, as amended by this Agreement, do not and will not contravene (a) any law or regulation binding on or affecting Borrower, (b) any contractual restriction with a Person binding on Borrower, (c) any order, judgment or decree of any court or other governmental or public body or authority, or subdivision thereof, binding on Borrower, or (d) the organizational documents of Borrower;

 

The execution and delivery by Borrower of this Agreement and the performance by Borrower of its obligations under the Loan Agreement, as amended by this Agreement, do not require any order, consent, approval, license, authorization or validation of, or filing, recording or registration with, or exemption by any governmental or public body or authority, or subdivision thereof, binding on Borrower, except as already has been obtained or made; and

 

This Agreement has been duly executed and delivered by Borrower and is the binding obligation of Borrower, enforceable against Borrower in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, liquidation, moratorium or other similar laws of general application and equitable principles relating to or affecting creditors’ rights.

 

  

  

  

 

Integration.  This Agreement and the Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements.  All prior agreements, understandings, representations, warranties, and negotiations between the parties about the subject matter of this Agreement and the Loan Documents merge into this Agreement and the Loan Documents.

 

Counterparts.  This Agreement may be executed in any number of counterparts and all of such counterparts taken together shall be deemed to constitute one and the same instrument.

 

Effectiveness.  This Agreement shall be deemed effective as of January 15, 2014 upon (a) the due execution and delivery to Bank of this Agreement by each party hereto, (b) Bank’s receipt of the Reaffirmation of Amended and Restated Subordination Agreement dated of even date herewith, duly executed and delivered by each party thereto, (c) evidence satisfactory to Bank that the insurance policies required by Section 6.4 of the Loan Agreement are in full force and effect, together with appropriate evidence showing lender loss payable and additional insured clauses or endorsements in favor of Bank, (d) Borrower’s payment of a non-refundable amendment and extension fee in an amount equal to Seven Thousand Five Hundred Dollars ($7,500), and (e) payment of Bank’s legal fees and expenses in connection with the negotiation and preparation of this Agreement.

 

[Signature Page Follows]

 

  

  

  

 

7. In Witness Whereof, the parties hereto have caused this Agreement to be duly executed and delivered as of the date first written above.

 

	
BANK

	  
	
SILICON VALLEY BANK

	  
	
By: /s/ Lauren Cole

Name: Lauren Cole

Title: Vice President

	  
	  	  
	
BORROWER

	  
	
POKERTEK, INC.

By: /s/ Mark Roberson

Name: Mark Roberson

Title: Chief Executive Officer & Chief Financial Officerexhibit10_2.htm

Exhibit 10.2

PokerTek, Inc.

1150 Crews Rd Ste F

Matthews, NC 28105

March 4, 2014

Mark Roberson

c/o PokerTek

Dear Mark:

On behalf of PokerTek, Inc. (“PokerTek” or the “Company”), this will confirm the terms of your continued employment as Chief Executive Officer (“CEO”) of the Company. In your capacity as CEO, you will continue to report directly to the Company’s Board of Directors (the “Board”), and will continue to work at the Company’s headquarters at 1150 Crews Road, Suite F, Matthews, NC 28105. Your compensation package as outlined herein is subject to approval of the Board of Directors. Upon approval by the Board of Directors, the terms set forth herein will be retroactively effective as of January 1, 2014.

Base Salary. Your annual base salary will be $15,416.67 per month ($185,000.00 annually), less applicable taxes, deductions and withholdings, paid monthly and subject to annual review. PokerTek’s regularly scheduled pay day is currently on the 30th of every month.

Incentive Compensation. You will be eligible to participate in an annual incentive bonus plan with a target incentive of up to 60% of your annual base salary (the “Target Award”) if you achieve your targets, less applicable taxes, deductions, and withholdings. Target incentives do not constitute a promise of payment. To qualify for the incentive bonus, you must remain employed with the Company through the date that the incentive bonus is paid. Your actual incentive bonus payout will depend on PokerTek’s financial performance and, to the extent applicable, the Compensation Committee’s assessment of your individual performance. Incentive bonuses are usually paid in February or March of the year after the fiscal year for which they are earned.

Retention Incentive. You will be eligible to receive a retention incentive of $185,000.00, less applicable taxes, deductions, and withholdings, to be paid (a) $15,417 per month for 12-months beginning January 1, 2015 as a retention bonus for remaining with PokerTek through December 31, 2014; or (b) in the event of the closing of a merger, sale, or purchase transaction, paid for a period of 12 months beginning at closing of the transaction if your employment is continued at a salary not less than your current base salary; or (c) in the event of the closing of a merger, sale, or purchase transaction if your employment is terminated, paid immediately.

Stock Incentive Plan Awards. You will be awarded 300,000 Restricted Stock Units on the date of approval by the Board of Directors. These RSU will fully vest in 24 months from the grant date. RSU are governed by PokerTek’s 2009 Stock Incentive Plan (“SIP”). Any other SIP awards made prior to this employment letter shall remain unchanged.

Benefits. Subject to meeting the various eligibility requirements, you may continue to participate in the Company’s health insurance benefits (medical, dental and vision), life insurance, short term and long term disability, 401(k) Plan, and Flexible Spending Plan (Healthcare Reimbursement Account and/or Dependent Care Reimbursement Account). Please refer to benefit plan documents for eligibility. Of course, PokerTek may change its benefits at any time.

 

  

  

  

 

Paid Time Off. You are eligible for 20 vacation days per year in addition to designated Company paid holidays each year.

Proprietary Agreement and No Conflict with Prior Agreements. As an employee of PokerTek, it is likely that you will become knowledgeable about confidential and/or proprietary information related to the operations, products and services of PokerTek and its clients. Similarly, you may have confidential or proprietary information from prior employers that should not be used or disclosed to anyone at PokerTek. Therefore, you will be required to read, complete and sign PokerTek’s standard Employee Confidentiality and Assignment of Inventions Agreement (“Proprietary Agreement”) and the Proprietary Information Obligations Checklist and return it to PokerTek on or prior to your Employment Start Date. In addition, PokerTek requests that you comply with any existing and/or continuing contractual obligations that you may have with your former employers. By signing this offer letter, you represent that your employment with PokerTek shall not breach any agreement you have with any third party.

Obligations. During your employment, you shall devote your full business efforts and time to PokerTek. This obligation, however, shall not preclude you from engaging in appropriate civic, charitable or religious activities or, with the consent of the Board, from serving on the boards of directors of companies that are not competitors to PokerTek, as long as the activities do not materially interfere or conflict with your responsibilities to or your ability to perform your duties of employment at PokerTek. Any outside activities must be in compliance with and approved if required by PokerTek’s Code of Ethics.

Non-competition. You agree and acknowledge that undertakings and covenant not to compete with the Company set forth in Section 5 of the Employee Proprietary Information and Inventions Agreement which you entered into with the Company is hereby incorporated herein and made a part hereof and constitutes a material inducement to the Company to enter into this Agreement.

Employment At-Will. Please understand that this letter does not constitute a contract of employment for any specific period of time, but will create an employment at-will relationship that may be terminated at any time by you or PokerTek, with or without cause and with or without advance notice. The at-will nature of the employment relationship may not be modified or amended except by written agreement signed by PokerTek’s Chairman of the Board and you.

Code of Ethics and PokerTek Policies. PokerTek is committed to creating a positive work environment and conducting business ethically. As an employee of PokerTek, you will be expected to abide by the Company’s policies and procedures including, but not limited to, PokerTek’s Code of Business Conduct and Ethics.

Non-Disparagement. You agree, other than with regard to employees in the good faith performance of your duties with the Company while employed by the Company, both during and for five (5) years after your employment with the Company terminates, not to knowingly disparage the Company or its officers, directors, employees or agents in any manner likely to be harmful to it or them or its or their business, business reputation or personal reputation. The Company will instruct its Chairman and the named executive officers of the Company, other than in the good faith performance of their duties to the Company or in connection with their fiduciary duties to the Company and applicable law, both during and for five (5) years after your employment with the Company terminates, not to knowingly disparage you in any manner likely to be harmful to you or your business reputation or personal reputation. This paragraph shall not be violated by statements from either party which are truthful, complete and made in good faith in required response to legal process or governmental inquiry. You also agree that any breach of this non-disparagement provision by you shall be deemed a material breach of this offer letter.

 

  

  

  

 

Entire Agreement. This offer letter and the referenced documents and agreements constitute the entire agreement between you and PokerTek with respect to the subject matter hereof and supersede any and all prior or contemporaneous oral or written representations, understandings, agreements or communications between you and PokerTek concerning those subject matters.

Background Check. You represent that all information provided to PokerTek or its agents with regard to your background is true and correct.

Please indicate your acceptance of this offer by signing where indicated below and returning an executed copy of this offer to me at your earliest convenience.

 

	  
	
Sincerely,

	
/s/ Joseph Lahti

	
Chairman of the Board

I accept this offer of employment with PokerTek, Inc. and agree to the terms and conditions outlined in this letter.

 

	  	  	  	  	  	  	  
	
/s/ Mark Roberson

	  	  	  	
March 4, 2014

	  	  
	
Mark Roberson

	  	  	  	
Date

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