EXHIBIT 10(aa)
FIRST AMENDMENT TO DEBENTURE PURCHASE AGREEMENT
This FIRST AMENDMENT TO DEBENTURE PURCHASE AGREEMENT (this
"Amendment") is entered into as of the 30th day of October, 2001, by and between
UNIVERSAL AUTOMOTIVE INDUSTRIES, INC. ("Company"), a Delaware corporation, and
FINOVA MEZZANINE CAPITAL INC. ("Purchaser"), a Tennessee corporation formerly
known as Sirrom Capital Corporation.
RECITALS:
WHEREAS, Purchaser is the holder of that certain Universal Automotive
Industries, Inc. 12.25% Subordinated Debenture Due July 11, 2002 (the
"Debenture") issued by Company and purchased by Purchaser pursuant to that
certain Debenture Purchase Agreement dated July 11, 1997 (the "Purchase
Agreement"); and
WHEREAS, Purchaser and Company wish to amend the Purchase Agreement
pursuant to the terms and conditions hereof;
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency
of which are acknowledged, it is agreed as follows:
1. Amendment of Purchase Agreement. Pursuant to the certain First
Amendment to Universal Automotive Industries, Inc. 12.25% Subordinated Debenture
Due July 11, 2002 dated of even date herewith (the "Debenture Amendment"),
Purchaser and Company amended certain terms of the Debenture. As used in the
Purchase Agreement, the term "Debentures" is hereby amended to mean the
Debenture, as amended by the Debenture Amendment. Additionally, the Purchase
Agreement is hereby amended such that t~e terms and conditions of the Debenture,
as amended by the Debenture Amendment, shall supercede any inconsistent terms in
the Purchase Agreement.
2. Amendment of Purchase Agreement. Pursuant to the Prepayment
Agreement of even date herewith by and between Purchaser and Company, Purchaser
has agreed to surrender the Initial Warrant and all Additional Warrants (each as
defined in the Purchase Agreement) and/or all shares of common stock of the
Company received by Purchaser from the exercise of the Initial Warrant or any
Additional Warrants (the Additional Warrant to be issued to Purchaser in August,
2001, has yet to be delivered by the Company). The Purchase Agreement is hereby
amended to reflect the cancellation of all warrants issued pursuant to Sections
1.2 and 1.3 thereof.
3. Amendment of Purchase Agreement. The following shall be added as an
additional Event of Default to Section 9.1 of the Purchase Agreement:
(1) The failure by the Company on or before Friday, November
2, 2001, to amend its Articles of Incorporation to (i) increase the
Company's authorized common stock, $0.01 par value from 15,000,000 to
30,000,000 shares and (ii) increase the
Company's authorized blank check preferred stock, $0.01 par value from
1,000,000 to 2,000,000 shares.
4. Company's Affirmation. Company acknowledges, warrants and represents
that (i) pursuant to the Debenture, the Purchase Agreement and all other
documents executed or delivered in connection therewith (the Debenture, Purchase
Agreement and such other documents being collectively referred to herein as the
"Purchase Documents"), Company's obligation to repay the Debenture is absolute
and unconditional, and there exists no right of deduction, setoff, recoupment,
counterclaim or defense of any nature whatsoever to payment of the Debenture
that has not been released herein; (ii) the Purchase Documents are valid and
enforceable in accordance with their terms; and (iii) all of the representations
made in Section 2 of the Purchase Agreement are true and correct as of the date
hereof, except as modified or supplemented by Schedule A attached hereto and
incorporated herein by this reference.
5. Valid Consideration; Binding Agreement. Company warrants, represents
and acknowledges that this Amendment has been executed and delivered by Company
for adequate consideration and value under all applicable laws; and that this
Amendment is valid, binding and enforceable in accordance with its terms.
6. Notices. Any communications concerning this Amendment or the credit
described herein shall be addressed as provided in the Purchase Agreement,
except that Purchaser's addresses for notices shall be revised as follows:
The address of Purchaser is:
FINOVA Mezzanine Capital Inc.
000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxxx
Telecopy: 615/242-0842
with a copy to:
Boult, Cummings, Xxxxxxx & Xxxxx, PLC
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxx
Telecopier: 615/252-6323
7. Construction of Amendment. EXCEPT AS EXPRESSLY PROVIDED HEREIN OR IN
THE DEBENTURE AMENDMENT, THE DEBENTURE, PURCHASE AGREEMENT AND OTHER PURCHASE
DOCUMENTS SHALL REMAIN IN FULL FORCE AND EFFECT IN ACCORDANCE WITH THEIR
RESPECTIVE TERMS, AND THIS AMENDMENT SHALL NOT BE CONSTRUED TO (i) WAIVE OR
IMPAIR ANY RIGHTS, POWERS, OR REMEDIES OF PURCHASER THEREUNDER OR (ii) REQUIRE
PURCHASER TO GRANT ADDITIONAL WAIVERS, CONSENTS OR CONCESSIONS WITH RESPECT
THERETO.
8. Voluntary Agreement. Company represents and warrants that Company is
represented by legal counsel of its choice; has investigated fully its
alternatives to the execution and performance of this Amendment; has had ample
time to review this Amendment and consult with Company's counsel; is fully aware
of the terms contained in this Amendment; and has knowingly, voluntarily and
without coercion or duress of any kind entered into this Amendment and the
documents executed in connection with this Amendment.
9. No Reliance on Purchaser's Analysis. Company acknowledges, warrants
and represents that, in connection with its business activities and its
execution of this Amendment, Company has not relied upon any financial
projection, budget, assessment or other analysis by Purchaser or upon any
representation by Purchaser as to the risks, benefits or prospects of Company's
business activities or present or future capital needs incidental thereto. all
such considerations having been examined fully and independently by Company.
10. Consent to Jurisdiction; Venue. COMPANY HEREBY IRREVOCABLY CONSENTS
TO THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT
OF TENNESSEE AND OF ALL TENNESSEE STATE COURTS SITTING IN DAVIDSON COUNTY,
TENNESSEE, FOR THE PURPOSE OF ANY LITIGATION TO WHICH PURCHASER MAY BE A PARTY
AND WHICH ARISES FROM OR RELATES TO THIS AMENDMENT OR THE PURCHASE DOCUMENTS. IT
IS FURTHER AGREED THAT VENUE FOR ANY SUCH ACTION SHALL LIE EXCLUSIVELY WITH
COURTS SITTING IN DAVIDSON COUNTY, TENNESSEE, UNLESS PURCHASER AGREES TO THE
CONTRARY IN WRITING.
11. Not Partners; No Third Party Beneficiaries. Nothing contained
herein or in any related document shall be deemed to render Purchaser a partner
of Company for any purpose. This Amendment has been executed for the sole
benefit of Purchaser and Company and there are no third party beneficiaries
hereof.
12. Indulgence Not Waiver. Purchaser's indulgence in any other
departure from the terms of this Amendment shall not prejudice Purchaser's right
to demand strict compliance with this Amendment.
13. Amendment and Waiver in Writing. No provision of this Amendment can
be amended or waived, except by a statement in writing signed by the party
against which enforcement of the amendment or waiver is sought.
14. Expenses. Company agrees to pay any and all costs and expenses
(including, without limitation, reasonable attorneys' fees and litigation
expenses) incurred by Purchaser and arising out of or relating to any breach of
any covenant or agreement or the material incorrectness or inaccuracy of any
representation and warranty of Company contained in this Amendment or any
document delivered to Purchaser by Company pursuant to the terms of this
Amendment.
15. Assignment. This Amendment shall be binding upon and inure to the
benefit of the respective heirs, successors and assigns of Company and
Purchaser, except that Company may not assign any rights or delegate any
obligations arising hereunder without the prior written consent of Purchaser.
Any attempted assignment or delegation without the required prior consent shall
be void.
16. Entire Agreement. This Amendment and the other written agreements
between Company and Purchaser represent the entire agreement between the parties
concerning the subject matter hereof, and all oral discussions and prior
agreements are merged therein.
17. Severability. Should any provision of this Amendment be invalid or
unenforceable for any reason, the remaining provisions hereof shall remain in
full effect.
18. Counterpart Execution. This Amendment may be executed in
counterparts via facsimile, each of which will be deemed an original document,
but all of which will constitute a single document. This document will not be
binding on or constitute evidence of a contract between the parties until such
time as a counterpart of this document has been executed by each party to this
Amendment.
19. Applicable Law. The validity, construction and enforcement of this
Amendment shall be determined according to the substantive laws of Illinois
without regard to conflicts principles.
20. Gender and Number. Words used herein indicating gender or number
shall be read as context may require.
21. Captions Not Controlling. Captions and headings have been included
in this Amendment for the convenience of the parties, and shall not be construed
as affecting the content of the respective sections.
22. Waiver of Jury Trial. COMPANY AND PURCHASER HEREBY KNOWINGLY AND
VOLUNTARILY WAIVE ANY RIGHT TO A TRIAL BY JURY WITH REGARD TO ANY ACTION,
PROCEEDINGS, CLAIMS OR COUNTERCLAIMS, WHETHER IN CONTRACT OR IN TORT, AT LAW OR
IN EQUITY, OF ANY TYPE OR NATURE WHATSOEVER ARISING UNDER OR CONCERNING TI-HS
AMENDMENT OR THE PURCHASE DOCUMENTS.
Executed as of the date first written above
FINOVA MEZZANINE CAPITAL, INC., a
Tennessee corporation
By: /s/ Xxxxx X. XxxXxxxxx
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Title: Vice President
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UNIVERSAL AUTOMOTIVE INDUSTRIES,
INC., a Delaware corporation
By: /s/ Xxxxxx Xxxx
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Title: Chairman
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