MODIFICATION AGREEMENT
THIS
MODIFICATION AGREEMENT (the
“Agreement”), dated effective as of the 30th
day of
April, 2008, by and among DECORIZE, INC., a Delaware corporation (“Borrower”)
and SRC Holdings Corporation, a Missouri corporation (“Lender”)
WHEREAS,
on June
15, 2005, Borrower executed and delivered to Lender a Third Amended and Restated
Promissory Note in the principal sum of Seven Hundred Fifty Thousand Dollars
($750,000.00) (the “Note”), which was issued in replacement of and substitution
for that certain Second Amended and Restated Promissory Note in the original
principal amount of $750,000, which was issued on April 11, 2005, which in
turn
was issued in replacement of and substitution for that certain First Amended
and
Restated Secured Promissory Note in the original principal amount of $750,000,
which was issued on September 30, 2004, which in turn was issued in replacement
of and substitution for that certain Secured Line of Credit Promissory Note
in
the original principal amount of up to $500,000, which was issued on April
29,
2004 (the “Original Note”);
WHEREAS,
the
Note was deemed issued and delivered in conjunction with that certain Security
Agreement dated April 29, 2004, entered into by and between Borrower and
Lender
in connection with the issuance of the Original Note (as from time to time
supplemented, amended or restated, the “Security Agreement”);
WHEREAS,
the
parties desire to amend the Note so that the interest payable on the Note
shall
accrue at the prime rate per annum as from time to time published by the
Wall
Street Journal; and
WHEREAS,
the
parties desire to amend the Note so that the Borrower is no longer obligated
to
make interest payments in monthly installments over the term of the Note;
and
WHERAS,
the
parties desire to amend the Note so that all accrued interest on the unpaid
principal balance shall be due and payable in full upon demand by
Lender.
NOW,
THEREFORE,
in
consideration of the premises and mutual covenants herein contained and agreed
to be kept, the parties hereto do agree as follows:
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1.
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Modification
of Interest Rate.
Effective April 30, 2008, the Note shall accrue interest at the
prime rate
per annum as from time to time published by the Wall Street
Journal.
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2.
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Modification
of Payment Terms.
All accrued interest on the unpaid principal balance of the Note
shall be
due and payable in full upon demand by
Lender.
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3.
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No
Other Modification.
The modification and amendments to the Note set forth in this Agreement
shall only modify and amend the Note to the extent necessary to
give
effect to such modification and amendments, and, except as otherwise
provided in this Agreement, the Note and Security Agreement shall
continue
to bind the parties to such documents and be in full force and
effect in
accordance with their original terms as of their effective
dates.
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4.
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Representations
and Warranties.
When Borrower signs this Agreement, Borrower represents and warrants
to
Lender that: (a) there is no event which is, or with notice or
lapse of
time or both would be, a default under the Note or Security Agreement
(collectively, the “Loan Documents”) except those events, if any, that
have been disclosed in writing to Lender or waived in writing by
Lender,
(b) the representations and warranties in the Loan Documents are
true as
of the date of this Agreement as if made on the date of this Agreement,
(c) this Agreement does not conflict with any law, agreement, or
obligation by which Borrower is bound, and (d) this Agreement is
within
Borrower’s powers, has been duly authorized, and does not conflict with
any of Borrower’s organizational
papers.
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5.
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Counterparts.
This Agreement may be executed in counterparts, each of which when
so
executed shall be deemed an original, but all such counterparts
together
shall constitute but one and the same
instrument.
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6.
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General
Provisions.
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a.
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Headings.
The headings, captions and arrangements used in this Agreement
are, unless
specified otherwise, for convenience only and shall not be deemed
to
limit, amplify or modify the terms of the Agreement, nor effect
the
meaning hereof.
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b.
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Survival.
All agreements, covenants, undertakings, representations and warranties
made in this Agreement shall survive the execution
hereof.
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c.
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Governing
Law. This Agreement and the rights and duties of the parties hereto
shall
be governed by the laws of the State of Delaware (without regard
to
principles of conflicts of law), except to the extent the same
are
governed by applicable federal law, and the substantive laws of
such state
shall govern the validity, construction, enforcement and interpretation
of
the Agreement and any related documents, unless otherwise specified
therein.
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d.
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Attorney’s
Fees and Costs. In the event that any dispute arises between the
parties
hereto relating to the interpretation, enforcement or performance
of this
Agreement, and such matter is referred to an attorney for resolution,
the
prevailing party shall be entitled to collect from the losing party
any
attorney’s fees together with any costs and expenses in the event of
litigation.
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e.
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Assignment.
This Agreement shall be binding upon and inure to the benefit of
each
party hereto, and its respective successors and
assigns.
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7.
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Final
Agreement.
By signing this document each party represents and agrees that:
(a) this
document represents the final agreement between the parties with
respect
to the subject matter hereof, (b) this document supersedes any
term sheet
or other written outline of the terms and conditions relating to
the
subject matter hereof, unless such term sheet or other written
outline of
terms and conditions expressly provides to the contrary, (c) there
are no
unwritten oral agreements between the parties, and (d) this document
may
not be contradicted by evidence of any prior, contemporaneous,
or
subsequent oral agreements or understandings of the
parties.
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ORAL
AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM
ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND OR RENEW SUCH
DEBT
ARE NOT ENFORCEABLE. TO PROTECT YOU (BORROWER) AND US (CREDITOR) FROM
MISUNDERSTANIDNG OR DISAPPOINTMENT, ANY AGREEMENTS WE REACH COVERING SUCH
MATTERS ARE CONTAINED IN THIS WRITING, WHICH IS THE COMPLETE AND EXCLUSIVE
STATEMENT OF THE AGREEMENT BETWEEN US, EXCEPT AS WE MAY LATER AGREE IN WRITING
TO MODIFY IT.
This
Agreement is executed as of the date stated at the beginning of this
Agreement.
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SRC
HOLDINGS CORPORATION
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a
Delaware corporation
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a
Missouri corporation
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By:
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/s/
Xxxxx Xxxxxxx
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By:
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/s/
Xxxx X. Xxxxx
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| Name: Xxxxx Xxxxxxx | Name: Xxxx X. Xxxxx | ||||
| Title: President and Chief Executive Officer | Title: Chief Executive Officer | ||||
