EXHIBIT 10.36
STANDSTILL AGREEMENT
This Agreement is made as of February 26, 1997, but to be effective as of
November 30, 1996, by Devcon International Corp., a Florida Corporation, the
"Borrower", Masonry Products - Virgin Island Corp. a Florida Corporation, as
Guarantor" and Xxxxxxx Bank N.A., a national banking association, formerly known
as Xxxxxxx Bank of Jacksonville, successor by merger to Xxxxxxx Bank of Broward
County, N. A "the Bank".
RECITALS
This Agreement is made and entered into in reliance on the accuracy of the
following recitals, which are acknowledged by Borrower, Guarantor and Bank to be
true and accurate:
WHEREAS, Borrower executed in favor of Bank and is liable to Bank for a
promissory note, said Note being more particularly described as follows:
Renewal Promissory Note dated June 30, 1993 in the original principal
amount of $l,000,000 which matured on June 30, 1996, on which is owed
as of the Agreement Date, the outstanding principal balance of $1,000
together with accrued and unpaid interest of $21.86
WHEREAS, on June 30, 1993, Guarantor executed and delivered to Bank an
unconditional guaranty of the Note; "Guaranty"; and
WHEREAS, the Note matured on June 30, 1996, and Borrower and Guarantor did not
pay the Note in full on said date; and
WHEREAS, the Borrower, Guarantors and Bank executed a Standstill Agreement dated
July 17, 1996, which extended the maturity until September 30, 1996; and on
October 31, 1996, further extended the standstill maturity date until November
30, 1996; and
WHEREAS, by reason of said maturity, Bank is entitled to have full payment of
the Note and to begin enforcement of Bank's rights under the Note, Mortgage,
Loan Agreement and Security Agreement, which documents, together with the
Guaranty are collectively referred to herein as "Loan Documents"; and
WHEREAS, Borrower and Guarantor are going to or have commenced negotiations with
Bank concerning the Note and plan to continue to evaluate and discuss, as each
party deems necessary, various courses of action that might be in the mutual
interests of all parties including, but not limited to attempting to reach
agreement on payoff, alternative financing, or, modification of the Note; and
WHEREAS, each party requests the other party "standstill" from taking certain
actions for such time and under such conditions as are her hereinafter set
forth; and
WHEREAS, although Bank is under no obligation to do so, Bank is willing to
standstill from enforcement of its rights arising from said maturity against
Borrower and Guarantor and Borrower's and Guarantor's assets, provided that such
standstill is on the terms and conditions as set out herein, and provided that,
except as expressly provided for in this Agreement, such standstill does not
waive or otherwise prejudice the rights of Bank; and
WHEREAS, Borrower and Guarantor are willing to standstill from pursuing any
right, claim, or defense they may have or allege to have against Bank provided
that such standstill is on the terms and conditions as set out herein, and
providing that, except as expressly provided for in this Agreement, such
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standstill does not waive or otherwise prejudice the rights of Borrower and
Guarantor;
NOW, THEREFORE, in consideration of the foregoing and for other valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Borrower, Guarantor and Bank hereby acknowledge, agree and affirm as follows:
1. Each of the above RECITALS is incorporated herein and is relied upon by
Borrower, Guarantor and Bank in agreeing to the terms of this
Agreement.
2. Unless this Agreement is violated by Borrower or Guarantor, Bank will
not initiate or pursue any claim, cause of action, remedy, set-off or
other rights it may have or otherwise enforce against Borrower or
Guarantor under the Loan Documents, or by lien, attachment, execution,
encumbrance, right of set-off or foreclosure against any asset of
Borrower or Guarantor, and shall not join in any petition for
appointment of a receiver for under any section or chapter of the
Bankruptcy Code, or any state or federal law or regulation affecting
creditors' rights prior to the day after June 30, 1997 "Standstill
Maturity Date". The Note is hereby extended, without additional
modification or amendment to the Note, to mature on the Standstill
Maturity Date.
3. Unless this Agreement is violated by Bank, Borrower and Guarantor will
not initiate or pursue any claim, cause of action defense or other
rights they may have or allege to have against Bank prior to the day
after the Standstill Maturity Date.
4. The Loan Documents are authentic and valid, remain in full force and
effect and are legally binding and enforceable against the signatories
thereto.
5. Any and all prepayment penalties and late charges set forth in the Loan
Documents applicable to the payment of the Note prior to the Agreement
Date only are hereby waived by Bank provided that payment in full of
the Note is made on or before the Standstill Maturity Date.
6. Borrower will continue to conduct its business in a prudent manner,
make normal and necessary payments to entities/individuals as Borrower
deems necessary for operation of its business.
7. If any additional event of default under the Loan Documents occurs
after the Agreement Date but prior to the Standstill Maturity Date, or
if any additional event of default previously unknown or undisclosed to
Bank occurring prior to the Agreement Date is found, same will be a
violation of this Agreement. Upon the occurrence of any such event of
default, Bank may without demand, presentment or other notice of any
kind, all of which are hereby expressly waived by Borrower and
Guarantor, immediately exercise all rights and remedies available to
Bank herein and in the Loan Documents without any notice, demand, or
grace period or cure provision as may otherwise be allowed for or
required in the Loan Documents.
8. In addition to any financial information that Borrower and Guarantor
are required to provide to Bank under the Loan Documents, Borrower and
Guarantor will provide to Bank such financial information as Bank may
reasonably require.
9. Until the Standstill Maturity Date, interest shall continue to accrue
on the Note from the Agreement Date at the rate of .5% per annum in
excess of the rate of interest as is publicly announced by Xxxxxxx
Xxxxx, Inc. from time to time as its prime rate. Borrower has paid
accrued and unpaid interest through February 28, 1997 upon execution of
this Agreement. Bank will continue to fund advances under the
provisions of the Loan Documents.
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10. On the Standstill Maturity Date the Note is due and payable in full.
Borrower's, Guarantor's and Bank's standstill of their rights and
remedies will cease the day after the Standstill Maturity Date and
Borrower, Guarantor and Bank are entitled to take whatever actions they
may have without regard to any payments being tendered or accepted
hereinafter or immediately prior hereto.
11. In the event that during the term of this Agreement any petition in
bankruptcy shall be filed by Borrower or Guarantor, or against Borrower
or Guarantor, by any third party, or if Borrower or Guarantor shall
execute any assignments for the benefit of creditors or shall in any
manner take or accept the benefit of any proceeding under the statue or
otherwise for the relief of debtors, then and in that event, this
Agreement, with the exception of the consent to lift stay in paragraph
17 hereof, shall become null and void and Bank shall have the right to
demand, receive and collect the Note in full, less any payments made
under this Agreement, with the same force and effect as if this
Agreement had not been made.
12. Borrower and Guarantor may have liabilities to Bank under other loans
or credit facilities other than those reflected in the Loan Documents.
Borrower, Guarantor and Bank intend that such other loans ad facilities
shall not be affected by this Agreement and shall remain in full force
and effect in all respects.
13. The standstill of performance by Borrower and Guarantor under any of
the terms of this Agreement shall not operate as a waiver or release of
performance under other terms of this Agreement or the Loan Documents.
Except as specifically provided in this Agreement, Borrower and
Guarantor will comply with all requirements of the Loan Documents to
the extent not inconsistent with this Agreement. This Agreement does
not represent (i) a commitment by Bank to make any new loans or grant
or extend any financial accommodations to Borrower or Guarantor, (ii) a
commitment by Bank to restructure the Loan Documents or grant or extend
any financial accommodations with respect to the Loan Documents, or
(iii) except as expressly provided for herein, an intention by Bank to
waive, modify or forbear from exercising any of its rights, powers and
privileges under the Loan Documents. Borrower and Guarantor
acknowledge, agree and affirm that no such commitment, waiver,
modification or forbearance has been offered, granted, extended or
agreed to by Bank.
14. Any waiver of jury trial or consent to jurisdiction previously executed
by, or between Borrower, Guarantor and Bank shall unconditionally be
fully effective and extend fully to this Agreement and any document
executed in conjunction herewith.
15. Borrower and Guarantor agree that through Standstill Maturity Date,
Bank will provide the following response to any inquiry concerning
Borrower:
"Since 1978, Xxxxxxx Bank has made various extensions of credit to
Devcon International Corp. on both a secured and unsecured basis. High
credit to mid-seven figure range. Payment history has been as agreed."
Borrower, Guarantor and Bank each agree that if during the standstill
period any party discovers information that might make the above
statement misleading to a third party, such party will immediately
communicate such information to all other parties, and each party
agrees to make all reasonable efforts to cooperate in preparing a
substitute statement, which statement shall not be provided to any
third party until approved in writing by all parties to this Agreement.
During the standstill period, when communicating with third parties,
Borrower and Guarantor agree that Borrower and Guarantor will disclose
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fully and accurately the terms of this Agreement. Bank agrees that
Borrower and Guarantor may give copies of this Agreement to third
parties; however, only with prior notice to and consent by Bank.
16. The parties may commence discussions or negotiations concerning the
Loan Documents. Without liability for filing to do so, the parties
plan, but are not obligated or committed to doing so, to discuss
various courses of action that might be in the parties mutual
interests. Any party, in its sole and absolute discretion, may
terminate these discussions and negotiations at any time and for any
reason. Upon such termination of discussions, any change in the
parties' respective obligations to one another subsequent to the
Agreement Date shall be only as set forth in a formal, executed written
agreement.
17. The fact that the parties may commence or have commenced discussions or
negotiations shal1 be without prejudice to any party and shall not be
used against any party during the negotiations undertaken between the
parties are intended as and shall be construed to constitute settlement
negotiations designed to resolve a pending dispute between the parties.
Accordingly, statements made and documents generated and exchanged by
and between the parties from and after the Agreement Date through the
Standstill Maturity Date are privileged and shall not be susceptible to
production in discovery or introduction in evidence. This Agreement
shall not be used during the course of litigation for any purpose,
unless there is a dispute over the application of this Agreement.
18. Neither the execution of this Agreement nor any discussions shall
operate to toll any time period which otherwise might be applicable,
including without limitation, any time periods which may be provided
for in the Loan Documents or by statute upon the commencement of
judicial or non-judicial foreclosure preceedings.
19. As a material inducement to the agreements of Bank in this Agreement,
Borrower and Guarantor agree that in the event that Borrower or
Guarantor is the subject of any insolvency, bankruptcy, receivership,
dissolution, reorganization or similar proceeding, federal or state,
voluntary or involuntary, under any present or future law or act, Bank
is entitled to the automatic and absolute lifting of any automatic stay
as to the enforcement of its remedies under the Loan Documents against
any collateral or security interest granted to Bank or against any
account of Borrower or Guarantor, including specifically, but not
limited to the stay imposed by Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx
Bankruptcy Code, as amended, or any similar state law and, to
accomplish such purposes, Borrower and Guarantor agree to the full
extent permitted by law not to seek to take advantage of any
appraisement, valuation, stay or extension law now or hereafter in
force, in order to prevent or hinder the enforcement of the Loan
Documents or the provisions of this Agreement. Borrower and Guarantor
hereby consent to the immediate lifting of any such automatic stay, and
will not contest any motion by Bank to lift such stay. Borrower and
Guarantor agree to execute all documentation necessary to waive or
provide for relief from any stay provisions under any federal or state
law.
20. Separate counterparts of this Agreement may be signed by the parties
hereto with the same effect as if all the parties had subscribed and
signed their names to the original Agreement. Notwithstanding anything
to the contrary herein, no party is bound hereby until this Agreement
has been executed by all of the parties hereto.
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21. This Agreement shall bind and inure to the benefit of the respective
transferees, heirs, personal representative, successors and assigns of
each of the parties; provided, however, that Borrower and Guarantor may
not assign this Agreement or any rights hereunder without Bank's prior
written consent and any prohibited assignment shall be absolutely void.
22. This Agreement has been negotiated, executed and delivered in Xx.
Xxxxx, Xxxxxxx and shall be deemed to have been made in the State of
Florida, and the validity of this Agreement, its construction,
interpretation and enforcement, and the rights of the parties hereunder
and concerning the Loan Documents, shall be determined under, governed
by and construed in accordance with the internal laws of the State of
Florida. The Loan Documents are hereby supplemented and modified to the
extent set forth herein, which modifications shall supersede and
prevail over any conflicting provision of the Loan Documents.
23. Each provision of this Agreement shall be severable from every other
provision of this Agreement for the purpose of determining the legal
enforceability of any specific provision.
24. This Agreement embodies the entire terms and agreements of the parties.
There are no representations, promises, terms, conditions or
obligations other than those contained herein and this Agreement shall
supersede and previous communications, understandings, discussions,
representations or agreements, either oral or written, between the
parties hereto relative to the terms of this Agreement. All
representations and warranties set forth herein shall survive the
execution of this Agreement. Without limiting the foregoing, no letter,
telegram or other communications passing between the parties hereto
concerning any matters during the negotiation of this Agreement shall
be deemed a part of this Agreement, nor shall it have the effect of
modifying or adding to this Agreement.
The undersigned have executed this Agreement as of the Agreement Date.
XXXXXXX BANK N.A., a national banking Devcon International Corp.
association, formerly known as Xxxxxxx
Bank of Jacksonville, successor by merger
to Xxxxxxx Bank of Broward County, N.A. /S/ XXXXXX X. XXXXXXX
By: Xxxxxxx Xxxxx, Inc., a Florida -------------------------
corporation, as Attorney-In fact By: Xxxxxx X. Xxxxxxx
for Xxxxxxx Bank, N.A. pursuant to Vice President
a Power of Attorney dated as of
March 1, 1992
By: /S/ X. X. XXXX
-------------------------------
Print Name: X. X. Xxxx
Title: Senior Workout Officer
GUARANTOR:
WITNESS Masonry Products-Virgin Island Corp.
/S/ V. XXXXXX XXXXXXXX
----------------------------
/S/ V. XXXXXX XXXXXXXX /S/ XXXXXX X. XXXXXXX
---------------------------- ------------------------------------
Vice President
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STATE OF GEORGIA)ss
COUNTY OF CAMDEN)
The foregoing Standstill Agreement was acknowledged before me this 26th day of
February, 1997 by Water X. Xxxxxxx, as Vice President of Devcon International
Corp., a Florida corporation, for and on behalf of the corporation, who is
personally known to me or produced drivers license as identification and did not
take an oath.
My Commission Expires: NOTARY PUBLIC
January 16,2000 /S/ V. Xxxxxx Xxxxxxxx
Camden County, Georgia
STATE OF GEORGIA)ss
COUNTY OF CAMDEN)
The foregoing Standstill Agreement was acknowledged before me this 26th day of
February, 1997 by Water X. Xxxxxxx, as Vice President of Masonry Products Virgin
Island Corp., a Florida corporation, for and on behalf of the corporation, who
is personally known to me or produced DRIVERS LICENSE as identification and did
not take an oath.
My Commission Expires: NOTARY PUBLIC
January 16, 2000 /S/ V. Xxxxxx Xxxxxxxx
Camden County, Georgia
STATE OF GEORGIA)ss
COUNTY OF CAMDEN)
The foregoing Standstill Agreement was acknowledged before me this 26th day of
February, 1997 by X. X. Xxxx, as Senior Workout Officer of XXXXXXX BANK INC. a
Florida Corporation, as attorney in fact for XXXXXXX BANK N.A, a Florida banking
corporation, on behalf of the corporation, pursuant to that Power of Attorney
dated as of March 1, 1992 and Third Amended and Restated Florida Certificate of
Designation dated January 18, 1994. He is personally known to me or produced
DRIVERS LICENSE as identification and did not take an oath.
My Commission Expires: NOTARY PUBLIC
January 16, 2000 /S/ V. Xxxxxx Xxxxxxxx
Camden County, Georgia
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