FIRST AMENDMENT TO LOAN AGREEMENT AND STOCK PLEDGE AGREEMENT
THIS FIRST AMENDMENT TO LOAN AGREEMENT AND STOCK PLEDGE AGREEMENT (this
"Amendment") is made as of this 16TH day of December, 2002 by and between Galaxy
Nutritional Foods, Inc., f/n/a Galaxy Foods Company, a Delaware corporation
(together with any successor thereto, the "SECURED PARTY") and Morini
Investments Limited Partnership, a Delaware limited partnership (the "PLEDGOR").
Terms not expressly defined in this Amendment shall have the meanings ascribed
to them in the Pledge Agreement (as defined below).
WHEREAS, Xxxxxx X. Xxxxxx ("MORINI") beneficially owns and controls the
Pledgor; and
WHEREAS, the Secured Party and Morini entered into that certain Loan
Agreement dated as of June 15, 1999 (the "LOAN AGREEMENT"), whereby two
promissory notes previously delivered to the Secured Party by Morini were
modified and consolidated into a new promissory note delivered to the Secured
Party by Morini in the principal amount of $12,772,200 (the "NOTE"); and
WHEREAS, pursuant to the terms of the Loan Agreement and as security for
the indebtedness evidenced by the Note (the "INDEBTEDNESS"), the Pledgor and the
Secured Party entered into that certain Stock Pledge Agreement dated as June 15,
1999 (the "PLEDGE AGREEMENT"), whereby the Pledgor pledged certain of its shares
of the Secured Party's common stock to the Secured Party; and
WHEREAS, as a result of a scrivener's error, the Loan Agreement and the
Pledge Agreement stated an incorrect number of shares of the Secured Party's
common stock that secured the Indebtedness; and
WHEREAS, the Secured Party, Morini and the Pledgor desire to amend the Loan
Agreement and the Pledge Agreement to state the correct number of shares of the
Secured Party's common stock pledged to the Secured Party to secure the
Indebtedness.
NOW THEREFORE, in consideration of the foregoing and the mutual covenants
and agreement hereinafter set forth, the parties agree as follows:
1. RECITALS. The above recitals are true and correct and are incorporated herein
by this reference.
2. AMENDMENTS TO LOAN AGREEMENT AND PLEDGE AGREEMENT.
(a) Section 2. of the Loan Agreement entitled "SECURITY FOR THE LOAN" is
hereby amended by deleting "2,571,429" and inserting in lieu thereof "2,914,286"
and by deleting the phrase "the outstanding principal balance of" from such
Section.
(b) Paragraph 3. of the section in the Pledge Agreement entitled
"BACKGROUND", is hereby amended by deleting "2,571,429" and inserting in lieu
thereof "2,914,286".
3. FULL FORCE AND EFFECT. All other provisions of the Pledge Agreement shall
remain in full force and effect, unaltered except as expressly provided above,
and this Amendment shall not be deemed a novation.
4. COUNTERPARTS. This Amendment may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the
day and year written above.
GALAXY NUTRITIONAL FOODS, INC.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
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Title: Chair., Pres. & CEO
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MORINI INVESTMENTS LIMITED
PARTNERSHIP, a Delaware limited
partnership
By: Morini Investments, LLC, a
Delaware limited liability company,
its General Partner
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Xxxxxx X. Xxxxxx
President
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