Document:

Exhibit
10.20

 

AMENDMENT TO LOAN DOCUMENTS

 

THIS AMENDMENT TO LOAN
DOCUMENTS (the “Amendment”) is made as of the 31st day of July, 2003, by
and between KEY TECHNOLOGY, INC., an Oregon corporation (the “Borrower”),
and BANNER BANK, a Washington banking corporation (the “Lender”).

 

RECITALS

 

A.               Borrower and Lender are parties to that
certain Loan Agreement dated as of August 9, 2002 as amended by that
certain Amendment to Loan Documents dated as of December 11, 2002, by that
certain Letter Agreement dated March 24, 2003 and by that certain Change
In Terms Agreement dated May 1, 2003 (as the same may be amended, modified
or extended from time to time the “Loan Agreement”) and the related Loan
Documents described therein.

 

B.                 The revolving credit facility under the Loan
Agreement is currently scheduled to expire on July 31, 2003, and Borrower
has requested Lender to extend the expiration date of such revolving credit
facility until July 31, 2004, and to make certain other modifications to
the Loan Agreement which Lender has agreed to do, subject to, among other
things, the execution and delivery of this Amendment.

 

NOW, THEREFORE, in
consideration of the foregoing, and for other good and valuable consideration
receipt of which is hereby acknowledged, Borrower and Lender hereby agree as
follows:

 

AGREEMENT

 

1.                                      Definitions; Interpretation. 
Capitalized terms used herein and not otherwise defined shall have the
meaning given in the Loan Agreement. 
The rules of construction and interpretation specified in Section 1.2
and Section 1.4 of the Loan Agreement also apply to this
Amendment and are incorporated herein by this reference.

 

2.                                      Amendments to Loan Agreement.  The
Loan Agreement is amended as follows:

 

(a)
Amendment to Definitions.  In Section 1.1,
amendments are made to the definitions as follows:

 

(i)               Eligible Accounts
Receivable.  Clauses (c) and (l) of
the definition of “Eligible Accounts Receivable” are amended and restated to
read as follows:

 

(c)             such Accounts with payment terms less than
thirty (30) days after the date of the original invoice do not remain unpaid
for more than sixty (60) days after the date of the original invoice; provided,
however, that such of those Accounts that satisfy each of the
eligibility criteria set forth in this definition other than this clause shall
be deemed eligible notwithstanding this clause until such Accounts remain
unpaid for more than ninety (90) days after the date of the original invoice; provided,
further, that the aggregate of all such Accounts deemed eligible
notwithstanding this clause shall not exceed Five Hundred Thousand Dollars
($500,000) at any time;

 

(l)                such Accounts of a single account debtor or
its Affiliates do not constitute more than twenty-five percent (25%) of all
otherwise Eligible Accounts (but the portion of the Accounts not in excess of
such percentage may be deemed Eligible Accounts), unless, with respect to any
single account debtor and its Affiliates, Lender shall otherwise consent in
writing;

 

(ii)           Net
Amount of Eligible Accounts.  The definition of “Net Amount of Eligible
Accounts” is amended and restated to read as follows:

 

 

“Net
Amount of Eligible Accounts” means the gross amount of Eligible Accounts less
(i) the amount by which sales, excise or similar taxes included in the
amount thereof exceeds One Hundred Thousand Dollars ($100,000) and
(ii) returns, discounts, claims, credits and allowances of any nature at
any time issued, owing, granted, outstanding, available or claimed with respect
thereto.

 

(iii)       Revolving
Maturity Date.  The definition of
“Revolving Maturity Date” is amended and restated to read as follows:

 

“Revolving
Maturity Date” means July 31, 2004.

 

(b)
Amendment to Section 2.4.  In clause (i) of the first
sentence of Section 2.4(a), the phrase “one percent (1%)
above” is deleted.

 

(c)
Amendment to Section 5.15.  Section 5.15 is
amended and restated to read as follows:

 

Section 5.15                Financial Covenants.

 

(a)  Debt to Tangible Net Worth
Ratio.  Borrower shall maintain as of the end of
each month, a ratio of Indebtedness to Tangible Net Worth equal to or less than
3.0 to 1.

 

(b) NCAO to
Debt Service Ratio. 
Borrower shall maintain as of the end of each month, for the period of
twelve (12) consecutive months then ended, a ratio of NCAO to Debt Service of
not less than 2.0 to 1.  As used herein,
“Debt Service” shall mean, for any Person, for any period, all regularly
scheduled principal payments required to be made by such Person during such
period on Long-Term Debt.

 

(c) Minimum
Net Income.  Borrower shall maintain as of the end of each
fiscal quarter of Borrower, net income of not less than Zero Dollars ($0) for
the for the period of four (4) consecutive fiscal quarters then ended, in each
case determined in accordance with GAAP for such period, excluding, to the
extent deducted in determining such net income, any write-offs of goodwill
during such period.

 

(d) Minimum
Working Capital.  Borrower shall maintain as of the end of
each month (i) an excess of current assets over current liabilities equal
to or greater than Four Million Five Hundred Thousand Dollars ($4,500,000) and
(ii) a ratio of current assets to current liabilities equal to or greater
1.25 to 1, in each case determined in accordance with GAAP as of such date of
determination.

 

3.                                      Amendment to Revolving Note.  In
the first paragraph of the Revolving Note, the phrase “one percent (1%)
above” is deleted.

 

4.                                      Conditions to Effectiveness. 
Notwithstanding anything contained herein to the contrary, this
Amendment shall not become effective until each of the following conditions is
fully and simultaneously satisfied:

 

(a)
Delivery of Amendment.  Borrower and Lender shall have executed and
delivered counterparts of this Amendment to each other;

 

(b) Payment
of Fees.  Borrower shall have paid to Lender an
amendment fee in the amount of Fifty Thousand Dollars ($50,000) in respect of
Lender’s agreement to enter into this Amendment;

 

(c)
Corporate Authority.  Lender shall have received in form and
substance reasonably satisfactory to it such evidence of corporate authority as
Lender shall reasonably request;

 

 

(d)
Representations True; No Default.  The representations of
Borrower as set forth in Article 4 of the Loan Agreement shall be
true on and as of the date of this Amendment with the same force and effect as
if made on and as of this date or, if any such representation or warranty is
stated to have been made as of or with respect to a specific date, as of or
with respect to such specific date.  No
Event of Default and no event which, with notice or lapse of time or both,
would constitute an Event of Default, shall have occurred and be continuing or
will occur as a result of the execution, delivery or performance of the
Amendment Documents; and

 

(e) Other
Documents.  Lender shall have received such other
documents, instruments, and undertakings as Lender may reasonably request.

 

5.                                      Representations and Warranties. 
Borrower hereby represents and warrants to Lender that each of the
representations and warranties set forth in Article 4 of the Loan
Agreement is true and correct in each case as if made on and as of the date of
this Amendment or, if any such representation or warranty is stated to have
been made as of or with respect to a specific date, as of or with respect to
such specific date.  Borrower expressly
agrees that it shall be an additional Event of Default under the Loan Agreement
if any representation or warranty made hereunder shall prove to have been
incorrect in any material respect when made.

 

6.                                      No Further Amendment.  Except as expressly modified
by this Amendment, the Loan Agreement and the other Loan Documents shall remain
unmodified and in full force and effect and the parties hereby ratify their
respective obligations thereunder.

 

7.                                      Reservation of Rights.  Borrower acknowledges and
agrees that the execution and delivery by Lender of this Amendment shall not be
deemed to create a course of dealing or otherwise obligate Lender to forbear or
execute similar amendments under the same or similar circumstances in the
future.  Borrower further acknowledges
and agrees that the execution and delivery by Lender of this Amendment shall
not be deemed to obligate Lender to issue any standby or commercial letter of
credit for Borrower’s account.

 

8.                                      Miscellaneous.

 

(a) Entire
Agreement.  This Amendment and the other Amendment Documents
comprise the entire agreement of the parties with respect to the subject matter
hereof and supersedes all prior oral or written agreements, representations or
commitments.

 

(b)
Counterparts.  This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original, and all of which
taken together shall constitute one and the same Amendment.  Delivery of an originally executed signature
page or pages hereto, a counterpart signature page, or a photocopy thereof
transmitted by telephone facsimile transmission, shall be as effective as
delivery of a manually signed counterpart of this Amendment.

 

(c)
Governing Law.  This Amendment and the other agreements
provided for herein and the rights and obligations of the parties hereto and
thereto shall be construed and interpreted in accordance with the laws of the
State of Washington, excluding its conflicts of law rules.

 

(d) Oral
Agreements Not Enforceable.

 

ORAL AGREEMENTS OR ORAL COMMITMENTS
TO LOAN MONEY, EXTEND CREDIT, OR TO FOREBEAR FROM ENFORCING REPAYMENT OF A DEBT
ARE NOT ENFORCEABLE UNDER WASHINGTON LAW.

 

 

IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be executed by their respective officers or agents thereunto
duly authorized as of the date first above written.

 

	
  BORROWER:

  	
  KEY TECHNOLOGY, INC., an Oregon corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Phyllis C. Best

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its 

  	
  CFO

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  LENDER:

  	
  BANNER BANK, a Washington banking corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By /s/

  	
  Matt Tucker

  	
   

  
	
   

  	
  Its 

  	
  Senior Vice PresidentExhibit
10.1

 

EXECUTION
COPY

 

GUARANTY

 

THIS GUARANTY (“Guaranty”)
is made December 10, 2003, by Quixote Corporation, a Delaware corporation
(“Guarantor”),
to and for the benefit of Peek Traffic Inc., a Delaware corporation, and Peek
Traffic Systems, Inc., a Florida corporation (together, “Seller”).

 

RECITALS

 

A.            Seller and Vision Acquisition Corporation, a
Delaware corporation (“Buyer”),
have entered into that certain Asset Purchase Agreement of even date herewith
(the “Asset Purchase
Agreement”).

 

B.            Pursuant to the Asset Purchase Agreement,
Buyer is purchasing the Business (as that term is defined in the Asset Purchase
Agreement).

 

C.            Pursuant to the Asset Purchase Agreement,
Buyer agrees to certain payment, indemnification and reimbursement obligations
in favor of Seller and Buyer provides to Seller a series of representations and
warranties and made various other agreements and covenants to induce the Seller
to complete the transactions contemplated by the Asset Purchase Agreement.

 

D.            Pursuant to the Asset Purchase Agreement,
Buyer covenants to secure its payment, indemnification and reimbursement
obligations to Seller and third parties pursuant to the Asset Purchase
Agreement by providing this Guaranty of Guarantor, which is the parent
corporation of the affiliated group of which Buyer is a member, with respect to
such obligations.

 

E.             Guarantor
will derive substantial benefit from the transactions contemplated by the Asset
Purchase Agreement and Guarantor is willing to guarantee the obligations of
Buyer pursuant to the Asset Purchase Agreement and those other agreements,
including the Sub-Lease Agreement dated the date hereof (the “Palmetto Lease”),
delivered by Buyer to Seller in accordance with the Asset Purchase
Agreement  (all such agreements, including
the Asset Purchase Agreement, being referred to hereinafter as the “Transaction Agreements”).

 

F.             The
execution and delivery of this Guaranty by Guarantor is a condition to Closing
(as that term is defined in the Asset Purchase Agreement).

 

 

AGREEMENTS

 

NOW, THEREFORE, Guarantor, in consideration of the matters described in
the foregoing Recitals, which Recitals are incorporated herein and made a part
hereof, and for other good and valuable consideration, the receipt and
sufficiency of which are acknowledged, hereby covenants and agrees for the
benefit of Seller and its affiliates, successors and assigns as follows:

 

1.             Guarantor absolutely, unconditionally, and
irrevocably guarantees to Seller:

 

(a)           the prompt payment when due and payable of
each rent installment under the Palmetto Lease;

 

(b)           the prompt and timely performance by Buyer
of each and all of its covenants to Seller arising under or created by the
terms of the Asset Purchase Agreement, including, without limitation, Buyer’s
timely payment and/or discharge of the Assumed Liabilities (as defined in the
Asset Purchase Agreement) and Buyer’s timely performance of its covenants to
Seller under each of the other Transaction Agreements; and

 

(c)           the timely satisfaction of Buyer’s
obligations under the indemnification provisions of the Asset Purchase
Agreement;

 

in all cases subject to the
terms of the Asset Purchase Agreement and the other Transaction Documents  (collectively, the “Obligations”).  This Guaranty, and the covenants and waivers
contained herein, will remain in effect until all Obligations have been
satisfied.

 

2.             In the event of any default by Buyer in
performance of the Obligations, as aforesaid, Guarantor agrees, on demand by
Seller in the manner provided below in Section 3, to perform all the
Obligations as are then or thereafter to be performed under the terms of the
Transaction Agreements.  The parties
agree that (a) Guarantor’s obligations under this Guaranty shall be
subject to the limitations, exclusions and exculpations of liability set forth
in the Transaction Agreements including with respect to the Palmetto Lease, (b)
except as provided Section 6, below, Guarantor may assert any and all
defenses, set-offs, or counterclaims of any kind available to Buyer so as to
deny payment related to this Guaranty including, without limitation, any such
rights acquired by Guarantor through subrogation, assignment, or otherwise and
(c) the obligations of Guarantor hereunder are dependent upon Seller’s
performance of its obligations under the Transaction Agreements.

 

3.             Seller shall make its demand for payment
hereunder by delivering to Guarantor a written notice which: (i) states that it
is a demand required under this Guaranty for payment of one or more of the
Obligations, (ii) sets forth the amount and the basis for such demand, and
(iii) is signed by an authorized officer of Seller.  Subject to the assertion of any rights it has as referenced in
Section 2 or under applicable law,

 

2

 

Guarantor shall make payment to Seller of the
amount specified in the written demand referenced in the preceding sentence in
immediately available funds not later than thirty (30) days after the delivery
of that written demand.

 

4.             Subject in all cases to Section 2 of
this Agreement, Guarantor does hereby (a) waive notice of acceptance of
this Guaranty by Seller; (b) waive any notices or demands that are not
required by this Guaranty or the Transaction Agreements; (c) agree not to
assert any defense, right of set off or other claim which Guarantor may have
against Buyer, to the extent such assertion will affect or delay the payment in
full of all amounts due Seller under this Guaranty; and (d) waive
presentment for payment, demand for payment, notice of nonpayment or dishonor,
protest and notice of protest, diligence in collection and any and all
formalities which otherwise might be legally required to charge Guarantor with
liability.  Seller shall have no
obligation to disclose or discuss with Guarantor its assessment of the
financial condition of Buyer.  Guarantor
authorizes Seller, without notice to, demand of, or consent from Guarantor (but
subject in all cases to the consent of Buyer), and without affecting its
liability to Seller hereunder (except to the extent that the underlying
Obligation has changed), from time to time to renew, extend, accelerate or
otherwise change the time or place for payment of, or otherwise change the
terms of all, or any part of, the Obligations. 
No modification or waiver of any of the provisions of this Guaranty
shall be binding upon Seller, except as expressly set forth in a writing duly
signed and delivered by Seller.  No
modification or waiver of any of the provisions of this Guaranty shall be
binding upon Buyer, except as expressly set forth in a writing duly signed and
delivered by Buyer.

 

5.             This Guaranty is a present and continuing
guaranty of performance and payment and not of collection.  This Guaranty is, except as expressly set
forth in Section 2, absolute and unconditional.  Guarantor agrees that this Guaranty may be enforced by Seller
without the necessity at any time of resorting to or exhausting any other
security or collateral given in connection herewith or with the Transaction
Agreements.  Subject to Section 2,
Guarantor hereby waives any right to require Seller to join Buyer in any action
brought hereunder or to commence any action against or obtain any judgment
against Buyer.  Guarantor further agrees
that, subject to Section 2, nothing contained herein or otherwise shall
prevent Seller from pursuing concurrently or successively all rights and
remedies available to it at law and/or in equity or under the Transaction
Agreements, and the exercise of any of its rights or the completion of any of
its remedies shall not constitute a discharge of Guarantor’s obligations as
required pursuant to this Guaranty, except to the extent such remedies
constitute a discharge of Buyer’s obligations under the Transaction Agreements.

 

6.             None of Guarantor’s obligations under this
Guaranty or any remedy for the enforcement thereof shall be impaired, modified,
changed or released in any manner whatsoever by any impairment, modification,
change, release or limitation of the liability of Buyer by reason of the
bankruptcy of Buyer or by reason of any creditor or bankruptcy proceeding instituted
by or against Buyer.

 

7.             In the event Seller shall assign its rights
under the Transaction Agreements (if permitted pursuant to the terms thereof)
or this Guaranty to any third

 

3

 

party, Guarantor will accord full recognition
thereto and agree that all rights and remedies of Seller or such assignee shall
be enforceable against Guarantor by such assignee with the same force and
effect and to the same extent as would have been enforceable by Seller but for
such assignment.

 

8.             If any provision of this Guaranty is
determined to be invalid or not fully enforceable, such invalidity or
unenforceability shall not affect the other provisions of this Guaranty which
shall be enforceable to the maximum extent permitted at law.

 

9.             All notices, requests, payments,
instructions, or other documents to be given hereunder shall be in writing, and
shall be deemed to have been duly given if (i) delivered personally (effective
upon delivery), (ii) mailed by registered or certified mail, return receipt
requested, postage prepaid (effective five business days after dispatch), (iii)
sent by a reputable, established courier service that guarantees next business
day delivery (effective the next business day), or (iv) sent by facsimile,
followed within 24 hours by confirmation by one of the foregoing methods
(effective upon the first business day after receipt of the facsimile in
complete, readable form).  Notices to
each party shall be addressed as set forth below (or to such other address as
the recipient party may have furnished to the sending party for the purpose
pursuant to this Paragraph 10).

 

If to
Guarantor:

 

Quixote
Corporation

One East
Wacker Drive

Chicago,
Illinois  60601

Facsimile
No.: (312) 467-0197

Attention:  Leslie J. Jezuit

 

With a copy
to:

 

Holland
& Knight LLC

131 S.
Dearborn Street, 30th Floor

Chicago,
Illinois 60603

Facsimile
No.: (312) 578-6666

Attention:  Anne Hamblin Schiave

 

If to
Seller:

 

Peek
Corporation

2511
Corporate Way

Palmetto,
FL  34221

Attn: Andy
Roake, CEO

Facsimile:
941-365-0837

 

4

 

	
  With a copy (which shall not
  constitute notice) to:

  	
   

  	
  Allen & Overy

  1221 Avenue of the Americas

  New York, NY 10020

  Attn:  Hugh McDonald

  Facsimile:  212-610-6399

  

 

or at such other address as the party to be served with notice may have
furnished in writing to the party seeking or desiring to serve notice as a
place for the service of notice.

 

10.           In order to induce Seller to execute and
deliver the Transaction Agreements, Guarantor makes the following
representations and warranties:

 

(a)           Guarantor is a corporation duly organized
and validly existing under the laws of the State of Delaware, and has full
power and authority to execute, deliver and perform its covenants, agreements,
and obligations under this Guaranty, and such execution, delivery and
performance has been duly authorized by all requisite action on the part of
Guarantor.

 

(b)           The execution, delivery, and performance by
Guarantor of this Guaranty does not and will not contravene or conflict with
(i) the organizational documents of Guarantor, (ii) any law, order,
rule, regulation, writ, injunction, or decree now in effect of any government,
governmental instrumentality or court having jurisdiction over Guarantor, or
(iii) any material contractual restriction binding on or affecting
Guarantor or Guarantor’s property or assets which may adversely affect
Guarantor’s ability to fulfill its obligations under this Guaranty.

 

(c)           This Guaranty creates a legal, valid, and
binding obligation of Guarantor enforceable in accordance with its terms.

 

11.           This Guaranty shall be binding upon the
successors and assigns of Guarantor and shall not be discharged or affected, in
whole or in part, by the dissolution of Guarantor, provided however, that this
Guaranty imposes no obligation on any person other than the signatory hereto.

 

12.           This Guaranty shall be governed by,
construed and enforced under the internal laws (without regard to principles of
conflicts of laws) of the State of Illinois. 
Any legal action, suit or proceeding arising out of or relating to this
Guaranty or the transactions contemplated hereby shall be instituted
exclusively in the courts of the State of Illinois, located in the City of
Chicago or, provided subject matter jurisdiction exists, in the United States
Federal Court for the Northern District of Illinois, located in Chicago,
Illinois, and each party hereto agrees not to assert as a defense in any such
action, suit or proceeding, any claim that it is not subject personally to the
jurisdiction of

 

5

 

such courts, that its property is exempt or
immune from attachment or execution, that the action, suit or proceeding is
brought in an inconvenient forum, that the venue of the action, suit or
proceeding is improper or that this Agreement or the subject matter hereof may
not be enforced in or by such court. 
Each party further irrevocably submits to the exclusive jurisdiction of
such courts in any such action, suit or proceeding.

 

13.           If Guarantor is determined by a court of
competent jurisdiction to have breached the terms of this Guaranty, then
Guarantor shall pay to Seller upon demand all reasonable attorneys’ fees, costs
and expenses including, without limitation, court costs, filing fees, recording
costs, expenses of collection, and all other costs and expenses reasonably
incurred by Seller in connection with its enforcement of this Guaranty.

 

IN WITNESS WHEREOF, Guarantor has delivered this Guaranty in the State
of Illinois as of the date first written above.

 

	
   

  	
  GUARANTOR:

  
	
   

  	
   

  
	
   

  	
  QUIXOTE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ LESLIE JEZUIT

  	
   

  
	
   

  	
  Name:

  	
   LESLIE JEZUIT

  	
   

  
	
   

  	
  Title:

  	
   President

  	
   

  
								

 

6

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