THIRD ADDENDUM TO THE DEBENTURES
This Third Addendum to the Debentures (this "Third Addendum"),
dated as of March 6, 2003 (the "Third Modification Date"), is made
by and among Visual Bible International, Inc., a Florida corporation
(the "Corporation") and each Lender signatory hereto. Capitalized
terms used but not otherwise defined herein shall have the meanings
ascribed to such terms in the Debentures and/or in the First
Addendum (as hereinafter defined) and/or the Second Addendum (as
hereinafter defined).
RECITALS:
A. The Corporation has executed and delivered a Debenture to
each of Augusta Holding, Inc., Xxxxxx Xxxxxxxxxx, Xxxxxxx Maznic,
Xxxxxx Xxxxxxxxxx, Red Brook Developments Limited ("Red Brook"),
Xxxxxxx Xxxxxxx, Xxxx Xxxxxxx Limited and Xxxxxx X. Steels
(collectively, the "Group A Lenders") and AGF Growth Equity Fund,
GWL Growth Equity Fund, London Life Growth Equity Fund, IG AGF
Diversified Growth Fund, IG AGF Diversified Growth Class, Xxxxxxx
XxXxxxxxx and Xxxxxxx Xxxxxx (collectively, the Group B Lenders").
Hereinafter the Group A Lenders and the Group B Lenders are
collectively referred to as Lenders.
B. The Corporation and the Lenders have executed and
delivered an Addendum To The Debentures (the "First Addendum") dated
as of February 17, 2003.
C. The Corporation and the Lenders have executed and
delivered a Second Addendum To The Debentures (the "Second
Addendum") dated as of March 4, 2003.
C. TBJ is continuing to negotiate the RBC Facility with RBC,
but TBJ does not expect the RBC Facility to be concluded prior to
the Third Modification Date.
D. In order to fund certain capital requirements of TBJ
associated with the Production prior to the conclusion by TBJ of the
RBC Facility, Red Brook has agreed, in connection herewith, to
purchase an additional Debenture (the "Third Red Brook Debenture").
The Third Red Brook Debenture is in substantially the same form of
the Initial Funding Debentures, and the Third Red Brook Debenture
shall be deemed to have been modified by the First Addendum and the
Second Addendum in the same manner as the Initial Funding Debentures
were modified thereby. A copy of the Third Red Brook Debenture is
attached hereto as Exhibit ___.
E. The Corporation and Red Brook desire to further amend
certain terms of the Third Red Brook Debenture as set forth in this
Third Addendum.
F. The Corporation and the Lenders have agreed to further
modify all of the Debentures (including the Third Red Brook
Debenture) in accordance with the terms of this Third Addendum.
AGREEMENTS:
In consideration of the premises and the mutual covenants set
forth herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Modifications exclusive to the Third Red Brook Debenture.
The Corporation and Red Brook agree as follows:
(a) Pursuant to the Third Red Brook Debenture, Red Brook is
making a loan of $160,000 (the "Third Red Brook Debenture Maximum
Principal Amount") to the Corporation on the date hereof. $120,000
of the Third Red Brook Debenture Maximum Principal Amount shall be
considered a Production Advance under the Third Red Brook Debenture,
and $40,000 of the Third Red Brook Debenture Maximum Principal
Amount shall be considered an Interim Advance in accordance with the
First Addendum. Red Brook shall have no further obligation to make
Production Advances under the Third Red Brook Debenture.
(b) The Lenders acknowledge the creation of the Third Red
Brook Debenture, as same is modified by the terms of this Third
Addendum, and that Red Brook shall be bound by, and shall be
entitled to the benefits of, the provisions of the First Addendum
and the Second Addendum as if such terms were set forth herein or in
the Third Red Brook Debenture.
2. Representations and Warranties. The representations and
warranties of the Corporation as set forth in: (i) Section 3 of the
Subscription Agreements, dated as of December 24, 2002, between the
Corporation and the Group A Lenders and (ii) Section 6 of the
Debentures, shall be true and correct in all material respects as of
the date hereof.
3. Revisions to the paragraphs 1(g) and 1 (h) of the First
Addendum and to paragraphs 1(b) and 1(c) of the Second Addendum.
Paragraphs 1(g) and 1 (h) of the First Addendum and to paragraphs
1(b) and 1(c) of the Second Addendum are hereby deleted in their
entirety.
4. Repayment of Interim Advances to the Group A Lenders.
(a) The Corporation agrees, to the extent permitted by the RBC
Facility, that it shall repay or it shall cause TBJ to repay
$195,000 (the "Total Repayment Amount") of the outstanding Interim
Advances Advanced pursuant to the First Addendum, the Second
Addendum and this Third Addendum from the proceeds, if any, derived
from the RBC Facility. The Total Repayment Amount shall be repaid to
the Group A Lenders pro rata based upon the aggregate amount of
Interim Advances Advanced by each such Lender on the date of the
repayment. The Corporation further acknowledges and agrees that the
remaining outstanding Interim Advances Advanced to date shall be
repaid from the proceeds, if any, of the Corporation's
sale-leaseback transaction with Grosvenor Park Productions UK
Limited or any substitution for such transaction.
(b) The Group A Lenders shall have no obligation to make the
Initial Marketing Advance or the Subsequent Marketing Advances
unless and until the Total Repayment Amount is repaid in full to the
Group A Lenders by TBJ or the Corporation in accordance with
paragraph (a) above. At such time as the Total Repayment Amount is
repaid in full, then the obligation of the Group A Lenders to make
the Initial Marketing Advance and the Subsequent Marketing Advances
in the manner required under their respective Debentures shall be
reinstated up to an amount equal to the difference between (x) the
aggregate amount of the Initial Marketing Advance and the Subsequent
Marketing Advances and (y) the then outstanding amount of all
Interim Advances Advanced to date (the "Remaining Marketing
Amount"). At such time as the obligation to make the Initial
Marketing Advance and the Subsequent Advances is reinstated, the
obligation upon each Group A Lender to Advance shall be limited to
such Group A Lender's pro rata portion of the Remaining Marketing
Amount.
5. Agreement of the Lenders. The Corporation and the Lenders
agree that the Maturity Date for the Third Red Brook Debenture shall
be December 24, 2004.
6. Payment Obligation. The Corporation and the Lenders
acknowledge and agree that notwithstanding anything contained in the
Debentures, the Corporation shall use the amounts that are the
subject of the Third Red Brook Debenture to pay its obligations to
Toronto Film Studios, Inc. (in the amount of Cdn$237,844.42, as of
the date hereof).
7. Conflict; Ratification. The Corporation and the Lenders
acknowledge and agree that the Debentures as modified by the First
Addendum and the Second Addendum are in full force and effect and
binding upon the Corporation and the Lenders according to the terms
thereof without modification, except as specifically modified by
this Third Addendum. Except as specifically modified hereby, all
covenants, terms, obligations and conditions of the Debentures as
modified by the First Addendum and the Second Addendum are hereby
ratified and confirmed. In the event of a conflict between this
Third Addendum and the Debentures as modified by First Addendum and
the Second Addendum, then this Third Addendum shall control.
8. Execution. This Third Addendum may be executed in two or
more counterparts and shall be deemed to be fully executed when the
Corporation and each of Red Brook and the Lenders has signed at
least one copy hereof. A faxed copy of this Addendum bearing the
signature of a party shall be deemed acceptable for purposes of
execution hereof; provided, however, that each party shall promptly
provide each other party with an originally executed copy.
(Signatures Appear On Next Pages)
IN WITNESS WHEREOF, the parties hereto have executed this Third
Addendum effective on and as of the Third Modification Date.
Visual Bible International, Inc.
By: _______________________________
Xxxxxx Xxxxxx, Executive
Vice President and Chief
Financial Officer
The terms and conditions of this Third Addendum relating to The
Book of Xxxx, Inc. are acknowledged and agreed to effective on and
as of the Third Modification Date.
The Book of Xxxx, Inc.
By: _______________________________
Xxxxxx Xxxxxx, Executive
Vice President
(Lender Counterpart Signature Page Follows)
COUNTERPART LENDER SIGNATURE PAGE
IN WITNESS WHEREOF, the parties hereto have executed this Third
Addendum effective on and as of the Third Modification Date.
Lender:
___________________________________
(Name of Lender)
___________________________________
(Signature)
___________________________________
(Title, if applicable)
