AGREEMENT
This Agreement made this 10th day of December, 2006, by and
between New Valu, Inc. ("Lender") and HSK Funding, Inc. ("HSK") and Adsouth,
Inc. and Adsouth Partners, Inc., (collectively "Adsouth")
W I T N E S S E T H
WHEREAS, Lender has loaned to Genco Power Solutions, Inc.
("Borrower"), the sum of Two Million One Hundred Thousand and 00/100 Dollars
($2,100,000.00) pursuant to the terms of a Loan Agreement dated May 8, 2006, a
Promissory Note dated May 8, 2006 and other loan documents associated therewith
which loan was modified by Modification to Loan Agreement dated September 5,
2006. (The loan dated May 8, 2006, together with the Modification to Loan
Agreement shall collectively be referred to as the "Loan"); and
WHEREAS, the principal balance of the Loan as of the date
hereof is One Million Eight Hundred Sixty Six Thousand Six Hundred Sixty-six and
00/100 Dollars ($1,866,666.00) together with accrued interest; and
WHEREAS, Adsouth guaranteed the repayment of the Loan pursuant
to Commercial Guarantees executed by Adsouth (the "Commercial Guaranty(s)"); and
WHEREAS, Adsouth Partners, Inc. pledged 80% of the issued and
outstanding common stock of Borrower to Lender as collateral for the Loan. The
common stock pledged by Adsouth Partners, Inc. is represented by the following
certificates (the "Genco Shares"):
Certificate No. Number of Shares
2 660
10 135
11 5 ;and
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WHEREAS, Adsouth has requested that it be released from all
obligations from under its Guaranty to Lender and Lender has agreed upon the
following terms and conditions; and
WHEREAS, HSK Funding loaned to Borrower, the sum of One
Hundred Fifty Six Thousand Two Hundred Fifty and 00/100 Dollars ($156,250.00)
pursuant to a Promissory Note dated October 18, 2006 (the "HSK Loan"); and
WHEREAS, Adsouth Partners, Inc. pledged 625,000 shares of the
common stock of MFC Development Corp. as security for the HSK Loan.
NOW THEREFORE, in consideration of one and 00/100 dollars
($1.00) and other good and valuable consideration, a receipt of which is hereby
acknowledged, the parties hereto agree as follows:
1. Lender hereby terminates the Commercial Guaranty executed by
Adsouth, Inc. and Adsouth Partners, Inc. and releases Adsouth
from any liability under the Guaranty subject to the terms of
this Agreement.
2. In consideration of its release of the Commercial Guaranty by
Lender as set forth above, Adsouth hereby transfers and
conveys to Lender, all of the Genco Shares described above and
represents that it does not own or have knowledge of any other
shares of common stock, preferred stock, or warrants issued by
Genco, to it or any other person or entity.
3. Adsouth acknowledges that any financial commitments, loans or
indebtedness owed by Genco to Adsouth or to any of the
officers, directors or shareholders of Adsouth by Genco are
hereby forgiven, released and terminated and that Genco has no
other further financial obligations to Adsouth, including but
not limited to, any payments previously made pursuant to an
unwritten lease by Adsouth to Genco with respect to Premises
located at 0000 Xxxxx Xxxxxx Xxxxxx, Xxxx Xxxxx, Xxxxxxx
00000. Such lease is deemed to be terminated as of the date
hereof and Adsouth acknowledges that there are no further
amounts due and owing from Genco in connection with such
lease. Genco agrees to vacate the Premises on or before
December 17, 2006.
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4. Lender agrees to release to Adsouth, 625,000 shares of the
common stock of MFC Development Corp., which it holds as
collateral for the Loan.
5. If Adsouth files a petition in bankruptcy or if a petition is
involuntarily filed against Adsouth and if any of the terms of
this Agreement are deemed void or if any transfers are deemed
preferences or if the transfer of stock to the Lender is
deemed void, then the release and termination of the
Commercial Guaranty of Adsouth shall be null and void and the
Guaranty shall be reinstated and shall be in full force and
effect.
6. Adsouth does hereby sell and transfer the 625,000 shares of
MFC Development Corp. stock to HSK for the sum of .25 cents
per share or a total of One Hundred Fifty Six Thousand Two
Hundred Fifty and 00/100 Dollars ($156,250.00) and Adsouth
agrees that the proceeds of such sale shall be applied by HSK
to the HSK Loan to pay the same in full and that the 625,000
shares shall be transferred free and clear of any liens and
encumbrances to HSK.
7. Adsouth agrees to deliver to Lender, all of the corporate
books and financial records of Genco simultaneously with the
execution of this Agreement.
8. This Agreement shall bind the successors and assigns of the
parties hereto.
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IN WITNESS WHEREOF the parties have executed this Agreement
the day and year first written above.
ADSOUTH, INC.
By: /S/ Xxxxxx Press_______________
Name: Xxxxxx Press
Title: Chairman of the Board of Directors
ADSOUTH PARTNERS, INC.
By: /S/ Xxxxx Haynes_______________
Name: Xxxxx Xxxxxx
Title: Secretary and Director
NEW VALU, INC.
By: /S/ Xxxxxx Kaufman________________
Name: Xxxxxx Xxxxxxx
Title: Vice-President
HSK FUNDING, INC.
By: /S/ Xxxxxx X. Nolt_____________
Name: Xxxxxx X. Xxxx
Title: Chief Financial Officer
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STATE OF FLORIDA )
) ss:
COUNTY OF BROWARD )
On the 10 day of December in the year 2006, before me, the
undersigned, personally appeared Xxxxxx Press as Chairman of the Board of
Directors for ADSOUTH, INC., personally known to me or proved to me on the basis
of satisfactory evidence to be the individual(s) whose name(s) is (are)
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their capacity(ies), and that by his/her/their
signature(s) on the instrument, the individual(s), or the person upon behalf of
which the individual(s) acted, executed the instrument.
Notary Public
STATE OF FLORIDA )
) ss:
COUNTY OF BROWARD )
On the 10 day of December in the year 2006, before me, the
undersigned, personally appeared Xxxxx Xxxxxx as Secretary and Director for
ADSOUTH PARTNERS, INC., personally known to me or proved to me on the basis of
satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed
to the within instrument and acknowledged to me that he/she/they executed the
same in his/her/their capacity(ies), and that by his/her/their signature(s) on
the instrument, the individual(s), or the person upon behalf of which the
individual(s) acted, executed the instrument.
Notary Public
STATE OF NEW YORK )
) ss:
COUNTY OF )
On the 11 day of December in the year 2006, before me, the
undersigned, personally appeared Xxxxxx Xxxxxxx as Vice President for
NEW VALU, INC., personally known to me or proved to me on the basis of
satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed
to the within instrument and acknowledged to me that he/she/they executed the
same in his/her/their capacity(ies), and that by his/her/their signature(s) on
the instrument, the individual(s), or the person upon behalf of which the
individual(s) acted, executed the instrument.
Notary Public
STATE OF NEW YORK )
) ss:
COUNTY OF )
On the 11 day of December in the year 2006, before me, the
undersigned, personally appeared Xxxxxx X. Xxxx as Chief Financial Officer for
HSK FUNDING, INC., personally known to me or proved to me on the basis of
satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed
to the within instrument and acknowledged to me that he/she/they executed the
same in his/her/their capacity(ies), and that by his/her/their signature(s) on
the instrument, the individual(s), or the person upon behalf of which the
individual(s) acted, executed the instrument.
Notary Public
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