Document:

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                                                                   EXHIBIT 10.71

                         CONSENT AND AMENDMENT NO. 2 TO
                    SUBORDINATION AND INTERCREDITOR AGREEMENT

         THIS CONSENT AND AMENDMENT NO. 2 TO SUBORDINATION AND INTERCREDITOR
AGREEMENT (the "Amendment") is dated as of February 13, 2004, but is effective
as of December 31, 2003, and is entered into among Audax Mezzanine Fund, L.P.,
Audax Trust Co-Invest, L.P., Audax Co-Invest, L.P., The Royal Bank of Scotland
plc, New York Branch, Upper Columbia Capital Company, LLC, State Street Bank and
Trust Company, as Trustee for the DuPont Pension Trust and Wilton Private Equity
Fund, LLC (collectively, "Subordinated Creditors"), American Coin Merchandising,
Inc. ("Company"), ACMI Holdings, Inc. ("Holdings") and Madison Capital Funding
LLC, as Agent (the "Agent") for the Senior Lenders.

                                R E C I T A L S:

         A. The Company, the Agent and certain Senior Lenders were parties to a
Credit Agreement dated as of February 11, 2002 (the "Original Senior Credit
Agreement"). In connection therewith, the Subordinated Creditors, the Company,
Holdings and the Agent executed and delivered a certain Subordination and
Intercreditor Agreement dated as of February 11, 2002 (the "Subordination
Agreement").

         B. The Company, the Agent and Senior Lenders are parties to an Amended
and Restated Credit Agreement dated as of April 15, 2003 (the "Amended Senior
Credit Agreement"), which amended and restated the Original Senior Credit
Agreement in its entirety.

         C. On the date hereof, the Company, the Agent and Senior Lenders are
entering into an Amendment No. 1 to Amended and Restated Credit Agreement of
even date herewith (the "Senior Credit Agreement Amendment"), which will amend
certain provisions of the Amended Senior Credit Agreement. In connection
therewith, the parties hereto have agreed to amend the Subordination Agreement
in the manner provided hereinbelow. Unless defined herein, capitalized terms
used herein shall have the meanings provided to such terms in the Amended Senior
Credit Agreement.

         1. Consent of Agent. Agent hereby acknowledges its consent to the
amendments to the Audax A Tranche Subordinated Debt each in the form of Exhibit
A attached hereto.

         2. Consent of Subordinated Creditors. Subordinated Creditors hereby
acknowledge their consent to the Senior Credit Agreement Amendment in the form
of Exhibit B attached hereto.

         3. Amendment. Effective upon the effectiveness of the Senior Credit
Agreement Amendment, the Subordination Agreement is hereby amended as follows:

         (a) The definition of the term "Senior Debt" is hereby amended by
deleting therefrom the amount "$8,200,000" and inserting in its place the amount
of "$8,719,250".

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         4. References. Any references to the Subordination Agreement in any
document, agreement or instrument executed in connection with the Original
Senior Credit Agreement, Amended Senior Credit Agreement or the Subordinated
Purchase Agreement shall be deemed to be a reference to the Subordination
Agreement, as amended by this Amendment.

         5. Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall constitute an original, but all of which taken
together shall be one and the same instrument.

         6. Effect. The terms and provisions set forth in this Amendment shall
modify and supersede all inconsistent terms and provisions of the Subordination
Agreement and shall not be deemed to be a consent to the modification or waiver
of any other term or condition of the Subordination Agreement. Except as
expressly modified and superseded by this Amendment, the terms and provisions of
the Subordination Agreement are ratified and confirmed and shall continue in
full force and effect.

                         [Page left blank intentionally]

                                      -2-
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         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their respective duly authorized officers on the
date first written above.

                                      SUBORDINATED CREDITORS:

                                      AUDAX MEZZANINE FUND, L.P.,
                                       a Delaware limited partnership

                                        By:  Audax Mezzanine Business, L.P.
                                        Its: General Partner

                                         By:  Audax Mezzanine Business, L.L.C.
                                         Its: General Partner

                                         By:
                                            ------------------------------------
                                            Kevin P. Magid
                                         Its: Authorized Member

                                      AUDAX CO-INVEST, L.P.

                                       By:    101 Huntington Holdings, LLC
                                       Title: General Partner

                                       By:
                                          --------------------------------------
                                       Name: Kevin P. Magid
                                       Its:  Authorized Member

                                      AUDAX TRUST CO-INVEST, L.P.

                                       By:    101 Huntington Holdings, LLC
                                       Title: General Partner

                                       By:
                                          --------------------------------------
                                       Name: Kevin P. Magid
                                       Its:  Authorized Member

                                      THE ROYAL BANK OF SCOTLAND PLC,
                                      NEW YORK BRANCH

                                      By:
                                         ---------------------------------------
                                      Its:
                                          --------------------------------------

Signature Page - Consent and Amendment No. 2 to Subordination and Intercreditor
Agreement
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                                      UPPER COLOMBIA CAPITAL
                                       COMPANY, LLC

                                      By:
                                         ---------------------------------------
                                      Its:
                                          --------------------------------------

                                      STATE STREET BANK AND TRUST
                                       COMPANY, as Trustee for the DuPont
                                       Pension Trust

                                      By:
                                         ---------------------------------------
                                      Name: Thomas C. Poppey
                                      Its:  Vice President

                                      WILTON PRIVATE EQUITY FUND, LLC

                                      By:  Wilton Asset Management, L.L.C.
                                      Its: Manager

                                        By:
                                           -------------------------------------
                                        Its:
                                            ------------------------------------

                                      COMPANY:

                                      AMERICAN COIN MERCHANDISING, INC.,
                                       a Delaware corporation

                                      By:
                                         ---------------------------------------
                                      Its:
                                          --------------------------------------

Signature Page - Consent and Amendment No. 2 to Subordination and Intercreditor
Agreement (continued)
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                                      HOLDINGS:

                                      ACMI HOLDINGS, INC.,
                                       formerly known as CRANE MERGERCO
                                       HOLDINGS, INC., a Delaware corporation

                                      By:
                                         ---------------------------------------
                                      Its:
                                          --------------------------------------

                                      AGENT:

                                      MADISON CAPITAL FUNDING LLC,
                                       a Delaware limited liability company, as
                                       Agent

                                      By:
                                         ---------------------------------------
                                      Its:
                                          --------------------------------------

Signature Page - Consent and Amendment No. 2 to Subordination and Intercreditor
Agreement (continued)exv10w26

 

Exhibit 10.26

CONVERTIBLE PROMISSORY NOTE

	 	 	 
	$1,300,000

	 	December 3, 2003

     FOR VALUE RECEIVED, the undersigned, ENTRX CORPORATION, a Delaware
corporation (the “Maker”), hereby promises to pay to the order of Pandora
Select Partners L.P., a British Virgin Islands limited partnership, or its
assigns (the “Payee”), at such place as the Payee may designate in writing, the
principal sum of One Million Three Hundred Thousand Dollars ($1,300,000), under
the terms set forth herein.

1.      Interest. The unpaid principal balance hereof from time to time outstanding
shall bear interest from the date hereof at the rate of ten percent (10%) per
annum.

2.      Payment. The principal and interest hereof is payable as follows:

     (a) Payments in cash of interest only are payable in arrears on December
15, 2003 and on January 15, February 15, March 15 and April 15, 2004; and

     (b) Commencing on May 15, 2004, and on the 15th day of each of the
following 32 months, Maker shall pay amortized principal and interest on this
Note of $45,221.45 (the “Monthly Scheduled Payment”).

3.      Optional Payment in Stock.

     (a) In lieu of making a cash payment under subsection 2(b) above, Maker
may pay the Monthly Scheduled Payment, or any portion thereof, but only to the
extent permitted by this subsection (a), by the issuance of shares of its $0.10
par value common stock (the “Common Stock”), the per share value of which is
computed as provided in Subsection (b) below. Despite the foregoing, the
number of shares of Common Stock which may be issued to pay all or any portion
of a particular Monthly Scheduled Payment may not exceed the lesser of (i) 8%
of the aggregate number of traded shares of Common Stock reported on the NASDAQ
System (or if not then traded on the NASDAQ System, on the OTC Bulletin Board
as reported by bigcharts.com, or if this service is discontinued, such other
reporting service acceptable to Payee) for the 20 trading days immediately
preceding such Monthly Scheduled Payment due or (ii) a number of shares of
Common Stock which, when added to the number of shares of Common Stock owned of
record together by Payee and its affiliates, would not cause Payee and its
affiliates together to own of record more than 4.99% of the Maker’s outstanding
Common Stock. In computing under this subsection (a) the aggregate number of
traded shares during any time period, the Maker shall exclude (i) shares sold
by or for the account or at the direction of the Maker, officers or directors
of Maker or any members of their immediate families or any affiliates of Maker
and (ii) shares determined solely by Payee (for which Payee shall so inform the
Maker in writing) to represent unlawful or potentially unlawful sales. Maker
may pay the Monthly Scheduled Payment, or any portion thereof, by the issuance
of Common Stock only if, at the time of such payment, Maker has in effect a
registration statement on Form S-2 with the SEC and applicable state securities
laws covering the original issuance of such shares by the Maker or the resale
of such shares by the Payee. Further, Maker may not pay a Monthly Scheduled
Payment, or any portion thereof, by the issuance of Common Stock if, at the
time of such payment, the per share value of the Maker’s Common Stock (as
computed in accordance with subsection (b) below) is less than $0.72 per share.

     (b) The per share value of the Common Stock as of a specified Scheduled
Monthly Payment date for the purposes of this Section 3 is 90% (rounded to the
nearest $.01) of the average (rounded to the nearest $.01) of the high closing
bid prices of Maker’s Common Stock on the NASDAQ System (or if not then traded
on the NASDAQ System, then on the OTC Bulletin Board as reported by
bigcharts.com, or if this service is discontinued, such other reporting service
acceptable to Payee) for the 20 trading days immediately preceding the
particular Scheduled Monthly Payment date.

 

 

     (c) Payment by Common Stock shall be deemed to be made by Maker by giving
written notice to the Payee of the number of shares being issued in such
payment, and the Maker’s calculation of the per share market value under
subsection (b) above; provided that certificates representing those shares are
delivered to Payee within 20 days of the due date of the Scheduled Monthly
Payment.

4.      Conversion.

     (a) At any time while any portion of the principal or interest of this
Note is outstanding (including during the notice period prior to any optional
cash prepayment by the Maker), the Payee may give the Maker written notice of
its intention to convert all or any portion of the outstanding principal and/or
accrued, but unpaid interest on this Note into shares of the Maker’s Common
Stock based on $1.35 per share (the “Conversion Rate”). Upon receipt of the
Payee’s notice, the Maker shall immediately cause certificates representing
these shares to be delivered to Payee within 20 days of, and Payment shall be
deemed to have been made on, the date of such notice.

     (b) The Conversion Rate shall be adjusted proportionally for any
subsequent stock dividend or split, stock combination or other similar
recapitalization, reclassification or reorganization of or affecting Maker’s
Common Stock. In case of any consolidation or merger to which the Maker is a
party other than a merger or consolidation in which the Maker is the continuing
corporation, or in case of any sale or conveyance to another corporation of the
property of the Maker as an entirety or substantially as an entirety, or in the
case of any statutory exchange of securities with another corporation
(including any exchange effected in connection with a merger of a third
corporation into the Maker), then instead of receiving shares of Maker’s Common
Stock, Payee shall have the right thereafter to receive the kind and amount of
shares of stock and other securities and property which the Payee would have
owned or have been entitled to receive immediately after such consolidation,
merger, statutory exchange, sale or conveyance had the same portion of this
Note been paid or converted immediately prior to the effective date of such
consolidation, merger, statutory exchange, sale or conveyance and, in any such
case, if necessary, appropriate adjustment shall be made in the application of
the provisions set forth in this Section with respect to the rights and
interests thereafter of the Payee, to the end that the provisions set forth in
this Section shall thereafter correspondingly be made applicable, as nearly as
may reasonably be, in relation to any shares of stock and other securities and
property thereafter deliverable in connection with this Note. The provisions
of this subsection shall similarly apply to successive consolidations, mergers,
statutory exchanges, sales or conveyances.

     (c) Despite anything above to the contrary, the Payee may not convert this
Note into Common Stock under this Section 4 during the time period and to the
extent that the shares of Maker’s Common Stock that the Payee could acquire
upon the conversion would cause Payee’s Beneficial Ownership of Maker’s Common
Stock to exceed 4.99% of Maker’s outstanding Common Stock; provided, however,
that the limitations on the right to exercise a Warrant for 400,000 shares of
Common Stock being issued to Payee in connection with this Note, as provided by
such Warrant, shall first reduce Payee’s Beneficial Ownership of Maker’s Common
Stock before limitation of Payee’s conversion rights hereunder; and provided
further, that the limitation of Payee’s conversion rights hereunder shall first
reduce Payee’s Beneficial Ownership before limiting the number of shares that
Maker may issue to Payee as payment hereunder pursuant to Section 3(a) above.
The Payee will, at the request of Maker, from time to time, notify Maker of
Payee’s computation of Payee’s Beneficial Ownership. The parties shall compute
Payee’s “Beneficial Ownership” of Maker’s Common Stock in accordance with U.S.
Securities and Exchange Commission (“SEC”) Rule 13d-3.

5.      Security. The full and timely payment of this Note (together with the
Maker’s obligations under a Purchase Agreement of this date among Maker, Payee
and Whitebox Advisors, LLC) shall be secured by a Pledge Agreement of this date
(the “Pledge Agreement”).

6.      Optional Prepayments. The Maker may prepay this Note, in whole or in part,
and in cash, without penalty by Maker upon fifteen days written notice to
Payee. Prepayments shall be applied first to accrued but unpaid interest and
then to principal.

 

 

7.      Default. The occurrence of any one or more of the following events shall
constitute an event of default, upon which Payee may declare the entire
principal amount of this Note, together with all accrued but unpaid interest,
to be immediately due and payable in cash (despite provisions otherwise for
payment with Common Stock):

     (a) The Maker shall fail to make any required payment of principal or
interest when due, and in its proper form (i.e., in cash, in stock or by a
combination thereof), and such failure shall continue for 10 days after the due
date thereof.

     (b) The Maker shall be in default of any term or provision of the Pledge
Agreement, the Registration Rights Agreement of this date between Maker and
Payee or the Warrant being issued on the date hereof by Maker to Payee.

     (c) Wayne W. Mills shall be in default of any term or provision of the
Guaranty Agreement being entered into by him on the date hereof for the benefit
of the Payee.

     (d) The Maker shall become insolvent or any bankruptcy, reorganization,
debt arrangement or other proceeding under any bankruptcy or insolvency law
shall be instituted by or against the Maker.

     Without limiting the above, the Maker acknowledges that payments on the
various scheduled due dates in Sections 2 and 3(c) are of essence and that any
failure to timely pay any installment of principal or interest (whether as
permitted by cash, with stock or by a combination thereof and within any
permitted grace period above) permits Payee to declare this Note immediately
due in cash in its entirety without any prior notice of any kind to Maker.

8.      Applicable Law. THE VALIDITY, CONSTRUCTION AND ENFORCEABILITY OF THE NOTE
SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF MINNESOTA, WITHOUT
GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF.

9.      Waivers. The Maker hereby waives presentment for payment, notice of
dishonor, protest and notice of payment and all other notices of any kind in
connection with the enforcement of this Note.

10.      No Setoffs. The Maker shall pay principal and interest under the Note
without any deduction for any setoff or counterclaim.

11.      Costs of Collection. If this Note is not paid when due, the Maker shall
pay Payee’s reasonable costs of collection, including reasonable attorney’s
fees.

	 	 	 	 	 	 	 
	

	 	 	 	ENTRX CORPORATION
	 
	 	 	 	 	 	 
	

	 	 	 	By
	

	

	 	 	Wayne W. Mills, Chief Executive Officer

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