REAFFIRMATION AND RATIFICATION AGREEMENT
January
31, 2007
Laurus
Master Fund, Ltd.
c/o
Laurus Capital Management LLC
000
Xxxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Ladies
and Gentlemen:
Reference
is made to (a) the Limited Guaranty dated September 7, 2005 (as amended,
restated, modified and/or supplemented from time to time, the “Luther
Guaranty”)
made
by Xxxxxxx Xxxxxx in favor of Laurus Master Fund, Ltd. (“Laurus”),
(b)
the Limited Guaranty dated September 7, 2005 (as amended, restated, modified
and/or supplemented from time to time, the “Xxxxxxxx
Guaranty”)
made
by Xxxxxxxx X. Xxxxxxxx and Xxxxxxx Xxxxxxxx (collectively, the “Mattesons”)
in
favor of Laurus, (c) the Limited Guaranty dated September 7, 2005 (as amended,
restated, modified and/or supplemented from time to time, the “Xxxxxx
Guaranty”)
made
by Xxxxxx X. Xxxxxx III in favor of Laurus, (d) the Stock Pledge Agreement
dated
as of September 7, 2005 (as amended, restated, modified and/or supplemented
from
time to time, the “Pledge
Agreement”)
by and
among American Technologies Group, Inc., a Nevada corporation (“ATEG”),
Omaha
Holdings Corp., a Delaware corporation (“Omaha”),
and
Laurus, (e) the Intellectual Property Security Agreement dated as of September
7, 2005 (as amended, restated, modified and/or supplemented from time to time,
the “IP
Agreement”)
by and
between ATEG and Laurus, (f) the Deed of Trust dated as of September 7, 2005
(as
amended, restated, modified and/or supplemented from time to time, the
“Deed
of Trust”)
granted by North Texas Steel Company, Inc., a Texas corporation (“NTSCO”
together with ATEG and Omaha, each a “Company”
and
collectively, the “Companies”),
in
favor of Xxxxxxx X. Xxxxx, Xx., Esq., in his capacity as trustee for the benefit
of Laurus and (g) the Open End Mortgage Deed and Security Agreement dated as
of
September 7, 2005 (as amended, restated, modified and/or supplemented from
time
to time, the “Mortgage”)
by and
among the Mattesons and Laurus (the Luther Guaranty, the Xxxxxxxx Guaranty,
the
Xxxxxx Guaranty, the Pledge Agreement, the IP Agreement, the Deed of Trust
and
the Mortgage, each an “Existing
Agreement”
and
collectively, the “Existing
Agreements”).
To
induce
Laurus to enter into the Amended and Restated Security Agreement dated as of
the
date hereof by and among the Companies and Laurus (as amended, restated,
supplemented and/or modified from time to time, the “A&R
Security Agreement”)
and
the Ancillary Agreements (as defined in the A&R Security Agreement) (the
A&R Security Agreement and the Ancillary Agreements, each an “A&R
Agreement”
and
collectively, the “A&R
Agreements”),
each
of the undersigned hereby:
(a) represents
and warrants to Laurus that it has reviewed and approved the terms and
provisions of the A&R Agreements;
(b) acknowledges,
ratifies and confirms that all of the terms, conditions, representations and
covenants contained in the Existing Agreements to which it is a party are in
full force and effect and shall remain in full force and effect after giving
effect to the execution and effectiveness of the A&R
Agreements;
(c) acknowledges,
ratifies and confirms that the defined term “Obligations” under the IP Agreement
and the Deed of Trust and the defined term “Indebtedness” under the Pledge
Agreement include, without limitation, all obligations and liabilities of each
of the Companies to Laurus under the A&R Agreements and all other
obligations and liabilities of each of the Companies to Laurus (including
interest accruing after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, whether
or
not a claim for post-filing or post-petition interest is allowed or allowable
in
such proceeding), whether now existing or hereafter arising, direct or indirect,
liquidated or unliquidated, absolute or contingent (collectively, the
“Obligations”);
(d) acknowledges,
ratifies and confirms that the defined term “Obligations” under the Luther
Guaranty, the Xxxxxxxx Guaranty and the Xxxxxx Guaranty includes, without
limitation, all obligations and liabilities of the Companies to Laurus with
respect to Term Loan B under and as defined in the A&R Security Agreement
(the “Term
Loan B Obligations”);
(e) acknowledges
and confirms that the occurrence of an Event of Default under any of the
Existing Agreements shall constitute an Event of Default under the A&R
Agreements and (ii) the occurrence of an Event of Default under any of the
A&R Agreements shall constitute an Event of Default under the Existing
Agreements;
(f) represents
and warrants that no offsets, counterclaims or defenses exist as of the date
hereof with respect to any of the undersigned’s obligations under any of the
Existing Agreements;
(g) acknowledges,
ratifies and confirms (i) the grant by each Company to Laurus of a security
interest and lien in the assets of such Company as more specifically set forth
in the Pledge Agreement, the IP Agreement and the Deed of Trust, as applicable
(the “Security
Interest Grants”),
and
(ii) that the Security Interest Grants secure all the Obligations;
(h) acknowledges,
ratifies and confirms (i) the grant by the Mattesons of a security interest
and
lien in the Property (as defined in the Mortgage) as more specifically set
forth
in the Mortgage (the “Xxxxxxxx
Mortgage Grant”)
and
(ii) that the Xxxxxxxx Mortgage Grant secures all the Term Loan B Obligations;
and
(i) releases,
remises, acquits and forever discharges Laurus and Laurus’ employees, agents,
representatives, consultants, attorneys, fiduciaries, officers, directors,
partners, predecessors, successors and assigns, subsidiary corporations, parent
corporations, and related corporate divisions (all of the foregoing hereinafter
called the “Released
Parties”),
from
any and all actions and causes of action, judgments, executions, suits, debts,
claims, demands, liabilities, obligations, damages and expenses of any and
every
character, known or unknown, direct and/or indirect, at law or in equity, of
whatsoever kind or nature, for or because of any matter or things done, omitted
or suffered to be done by any of the Released Parties prior to and including
the
date of execution hereof, and in any way directly or indirectly arising out
of
or in any way connected to this Reaffirmation and Ratification Agreement, the
Existing Agreements and the A&R Agreements and any other document,
instrument or agreement made by any of the undersigned in favor of
Laurus.
This
Reaffirmation and Ratification Agreement shall be governed by and construed
in
accordance with the laws of the State of New York.
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Very
truly yours,
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AMERICAN
TECHNOLOGIES GROUP, INC.
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| By: | ||
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Name: |
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| Title: | ||
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OMAHA
HOLDINGS CORP.
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| By: | ||
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Name: |
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| Title: | ||
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NORTH
TEXAS STEEL COMPANY, INC.
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| By: | ||
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Name: |
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| Title: | ||
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Xxxxxxx Xxxxxx, Individually |
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Xxxxxxxx X. Xxxxxxxx, Individually |
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Xxxxxxx
Xxxxxxxx, Individually
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Xxxxxx X. Xxxxxx III, Individually |
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ACCEPTED
AND AGREED TO:
LAURUS
MASTER FUND, LTD.
By:
Name:
Title:
