INTEREST DEFERRAL AGREEMENT AND LIMITED WAIVER
AND
LIMITED WAIVER
This
Interest Deferral Agreement and Limited Waiver (the “Agreement”) is made
effective as of January 1, 2011 (the “Effective Date”), by and between DAL
Group, LLC, a Delaware limited liability company (“DAL”), Chardan
Capital, LLC, a Delaware limited liability company (“Chardan”), and Xxxxx X.
Xxxxxxx (“Propper”). DAL, Chardan, and Propper are referred to from
time to time in this Agreement individually as a “Party” and together as the
“Parties.”
Background
A. DAL
and Chardan are parties to that certain Amended and Restated Senior Term Note,
dated as of June 1, 2010, in the principal amount of $1,000,000 (the “Chardan
Note”).
B. DAL
and Propper are parties to that certain Amended and Restated Senior Term Note,
dated as of June 1, 2010, in the principal amount of $1,500,000 (the “Propper
Note”). The Chardan Note and the Propper Note are referred to,
collectively, as the “Senior Notes”.
C. Pursuant
to Section 1(a) of each of the Senior Notes, DAL agreed to pay to each of
Chardan and Propper interest equal to three percent (3.0%) per annum, payable
monthly, in arrears, on the first day of each month (the “Monthly Interest
Payments”).
D. Pursuant
to Section 1(b) of each of the Senior Notes, DAL agreed to pay the principal
amount outstanding under each Senior Note on January 15, 2011 (the “Principal
Payments”).
E. The
Parties desire to defer the payment of certain Monthly Interest Payments and the
Principal Payments otherwise due under the Senior Notes, as set forth
below.
F. The
Parties desire to waive events of defaults under the Loan Documents (as defined
in a certain Senior Loan, Security and Pledge Agreement dated January 15, 2010
between the Parties (the “Loan Agreement”)).
Now,
therefore, the Parties hereby agree as follows.
Agreement
1. The
Parties hereby agree that all Monthly Interest Payments and the Principal
Payments due from DAL to Chardan or Propper between January 1, 2011 and April 1,
2011 pursuant to the Senior Notes, including the interest payments deferred by
the Interest Deferral Agreement and Limited Waiver between the Parties dated as
of November 1, 2010, shall not be due and payable until April 1, 2011 or, if
earlier, the payment in full of all amounts due by DAL to BA Note Acquisition
LLC and Banc of America Leasing & Capital, LLC. Chardan and
Propper hereby grant a limited waiver of any default or Event of Default under
the Senior Notes that has arisen or may arise solely as a result of DAL’s
deferral of Monthly Interest Payments and Principal Payments in accordance with
this Agreement. This limited waiver shall not be deemed to waive any
additional or subsequent failures to deliver payments pursuant to the Senior
Notes.
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2. Chardan
and Propper hereby grant a limited waiver through March 31, 2011 of any default
or Event of Default under the Loan Documents arising from DAL’s default on
indebtedness due by DAL to BA Note Acquisition LLC and Banc of America Leasing
& Capital, LLC, receipt of notice of such a default from such lenders,
including, but not limited to a letter dated November 5, 2010, a letter dated
December 8, 2010, and acceleration of such indebtedness.
3. Chardan
and Propper hereby consent to the acquisition of Americal Title Company by
Timios, Inc., and hereby grant a limited waiver of Section 6.3 of the Loan
Agreement with respect to such transaction.
4. In
addition to the other waivers granted pursuant to this Agreement, Chardan and
Propper hereby grant a limited waiver through March 31, 2011 of any default or
Event of Default based on breach or violation of the following provisions of the
Loan Agreement: Section 5.2 (Compliance with Laws) for periods prior
to January 1, 2011, Section 5.9 (Notice of Proceedings) for failure to give
notice during periods prior to January 1, 2011, and Section 5.14 (Reporting
Requirements) through April 1, 2011.
5. This
Agreement is limited to the specific matters described above and shall not be
deemed to be a waiver of or a consent to any other matter, including without
limitation, any failure to comply with any other provision of the Senior Notes
or the Loan Documents, or a default or any event of default, whether now in
existence or subsequently arising.
[Signatures
on following page]
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IN
WITNESS WHEREOF, the Parties have executed this Agreement as of January 14,
2011.
| DAL GROUP, LLC | |||
|
|
By:
|
/s/ Xxxxxxx X. Xxxxxxxxx | |
| Xxxxxxx X. Xxxxxxxxx | |||
| President | |||
| CHARDAN CAPITAL MARKETS, LLC | |||
|
|
By:
|
/s/ Xxxxxxx X. Xxxxxxx | |
| Xxxxxxx X. Xxxxxxx | |||
| Chief Executive Officer | |||
|
|
By:
|
/s/ Xxxxx X. Xxxxxxx | |
| XXXXX X. XXXXXXX |
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JOINDER BY AND AGREEMENT OF
GUARANTOR
Each of the undersigned, DJS
Processing, LLC, Professional Title and Abstract Company of Florida, LLC, and
Default Servicing, LLC (each a “Guarantor,” and collectively the “Guarantors”),
being guarantors of the obligations under the Senior Notes (as such term is
defined in that certain Interest Deferral Agreement and Limited Waiver of even
date herewith, by and between DAL Group, LLC (“DAL”), Chardan Capital, LLC
(“Chardan”), and Xxxxx X. Xxxxxxx (“Propper”) (the “Waiver”)) pursuant to each
certain Guaranty dated as of January 15, 2010 executed by each Guarantor in
favor of certain Lenders (as defined in the Loan Documents) (collectively, the
“Guaranty”), hereby represents and warrants and acknowledges and agrees to the
following:
1. Reaffirmation of
Guaranty. The Guaranty constitutes the valid, legally binding
obligation of Guarantor in favor of Chardan and Propper, enforceable against
Guarantor, in accordance with its terms. By its execution hereof,
Guarantor waives and releases any and all defenses, affirmative defenses,
setoffs, claims, counterclaims and causes of action of any kind or nature which
any Guarantor has asserted, or might assert, against Chardan or Propper which in
any way relate to or arise out of the Guaranty or any of the other Loan
Documents. Each Guarantor consents to
the execution and delivery of the Waiver by DAL and agree and acknowledges that
the liability of such Guarantor under the Guaranty shall not be diminished in
any way by the execution and delivery of the Waiver or by the consummation of
any of the transactions contemplated thereby.
2. Agreements of
Guarantor. By its execution hereof, Guarantor agrees to the
execution of the Waiver by DAL.
3. Defined
Terms. All terms that are used herein that are not defined
herein shall have the meaning ascribed to them in the Waiver.
[Signatures
on following page]
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Each Guarantor has executed
and delivered this Joinder and Agreement to be effective as of the Effective
Date of the Waiver.
| GUARANTOR: | |||
| DJS PROCESSING, LLC | |||
|
|
By:
|
/s/ Xxxxxxx X. Xxxxxxxxx | |
| Xxxxxxx X. Xxxxxxxxx | |||
| President | |||
| PROFESSIONAL TITLE AND ABSTRACT COMPANY OF FLORIDA, LLC | |||
|
|
By:
|
/s/ Xxxxxxx X. Xxxxxxxxx | |
| Xxxxxxx X. Xxxxxxxxx | |||
| President | |||
| DEFAULT SERVICING, LLC | |||
|
|
By:
|
/s/ Xxxxxxx X. Xxxxxxxxx | |
| Xxxxxxx X. Xxxxxxxxx | |||
| Vice President | |||
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