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EXHIBIT 4.23
FORBEARANCE AGREEMENT
THIS AGREEMENT, dated as of the 20th day of October, 1997, by and
among FINOVA CAPITAL CORPORATION, having a place of business located at 000
Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("FINOVA"), STRIKER PAPER
CORPORATION, STRIKER INDUSTRIES, INC. and STRIKER HOLDINGS, INC., having a
principal place of business at Xxx Xxxxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000,
Xxxxx X. Xxxxxxx and Xxxxxxxxx Xxxxxxx, residing at 00000 Xxxxxxxx Xxxxx,
Xxxxxxx, Xxxxx 00000, and Xxxxxxx X. Xxxx and Xxxxx Xxxxxxxx, residing at 0000
Xxxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000.
WHEREAS, STRIKER PAPER CORPORATION, STRIKER INDUSTRIES, INC. and
STRIKER HOLDINGS, INC. (collectively, "Striker") and FINOVA entered into
certain Security Agreements, dated April 25, 1995 (collectively, the "Security
Agreement"); and
WHEREAS, pursuant to the Security Agreement, FINOVA agreed to provide
Striker with certain financing; and
WHEREAS, Striker remains obligated to FINOVA for the monies borrowed
under the Security Agreement and otherwise; and
WHEREAS, Striker executed and delivered to FINOVA certain guarantees,
each of which guaranteed to FINOVA the obligations of Striker, and
WHEREAS, pursuant to written guarantees dated April 25, 1995
(collectively, the "Guaranty"), Striker guaranteed to FINOVA all obligations
owing to FINOVA under the Security Agreement and otherwise; and
WHEREAS, pursuant to written guarantees dated April 25, 1995
(collectively, the "Personal Guaranty"), Xxxxx X. Xxxxxxx, Xxxxxxxxx Xxxxxxx,
Xxxxxxx X. Xxxx and Xxxxx Xxxxxxxx (collectively, the "Guarantors") the
Guarantors guaranteed to FINOVA all obligations owing to FINOVA under the
Security Agreement and otherwise; and
WHEREAS, FINOVA continued to grant advances, loans and extensions of
credit to or for the benefit of Striker; and
WHEREAS, certain defaults exist under the Security Agreement; and
WHEREAS, as of July 31, 1997, Striker was obligated to FINOVA in the
amount of $621,914.83 together with interest thereon from July 1, 1997 at the
interest rate set forth in the Security Agreement plus FINOVA's costs and
expenses, including but not limited to legal fees, costs and disbursements and
any and all additional advances made by FINOVA to protect its collateral
(collectively, "Obligations") which Obligations are guaranteed by Striker and
the Guarantors; and
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WHEREAS, on or about September 5, 1997, FINOVA sent written demand
letter to Striker and the Guarantors via certified mail, return receipt
requested (each a "Demand Letter") which Demand Letters requested that Striker
and the Guarantors pay $621,914.83 plus interest and legal fees from the date
of demand to FINOVA on account of the Guaranty, Personal Guaranty and Security
Agreement; and
WHEREAS, Striker and the Guarantors have requested that FINOVA forbear
in commencing any action against Striker under or pursuant to the Guaranty,
Personal Guaranty and the Security Agreement for the obligations owing to
FINOVA under the Security Agreement and FINOVA is willing to forbear pursuant
to the terms and conditions contained in this Agreement; and
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged the parties agree as follows:
1. All of the above recitals are hereby incorporated by reference
and made a part of this Agreement.
2. Striker shall pay in good funds to FINOVA as follows: (a) on
or before October 22, 1997, the amount of $62,000.00; (b) on or before November
1, 1997, the amount of $15,800.00; and (c) continuing on the first day of each
month thereafter the amount of $15,800.00 until all obligations including
interest and costs are paid in full to FINOVA (each such payment, hereinafter
referred to as a "Installment").
3. Each Installment shall be deposited by FINOVA and credited
against the obligations of Striker under the Security Agreement.
4. Striker and the Guarantors hereby acknowledge that they are
indebted to FINOVA under the Security Agreement, the Personal Guaranty and the
Guaranty.
5. The Forbearance Period shall mean the period from the date of
this Agreement until the "Termination Date", which Termination Date shall be
the earlier of: (a) receipt of payment in full by FINOVA; or (b) immediately
upon an Event of Default under this Agreement (as such term is hereafter
defined).
6. FINOVA agrees during the Forbearance Period to forbear in
commencing any action upon the Guaranty, the Personal Guaranty and the Security
Agreement for the obligations owing to FINOVA under the Security Agreement
provided an Event of Default under this Agreement has not occurred (as such
term is hereafter defined).
7. An Event of Default under this Agreement shall mean the
following: (a) the failure of Striker or any of the Guarantors to observe, or
timely comply with, or perform
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any covenant or term contained in this Agreement; (b) the failure of Striker or
any of the Guarantors to pay FINOVA any sum when due under this Agreement; (c)
the occurrence of a material adverse change subsequent to the date of this
Agreement with respect to Striker's or any Guarantors' finances or property,
it being specifically understood and agreed that FINOVA may make such
determination in its sole and absolute discretion; (d) any financial
statements, affidavits of financial condition or other financial information
delivered or provided by Striker or any of the Guarantors in connection with
this Agreement is or shall be false or misleading in any material respect; (e)
any warranty or representation made or deemed made by Striker or the Guarantors
in this Agreement is or shall be untrue in any material respect; (f) if at any
time FINOVA shall, in FINOVA's sole and absolute discretion, consider the
obligations insecure or any part of the collateral unsafe, insecure or
insufficient and Striker or the Guarantors (or other person or entity acting on
Striker's behalf) shall not on FINOVA's demand furnish other collateral or
make payment on account, satisfactory to FINOVA in its sole and absolute
discretion; and (g) Striker or any of the Guarantors: (I) files a petition with
any bankruptcy court of competent jurisdiction; or (ii) admits in writing its
inability to pay its debts as they mature.
8. This Agreement shall be construed under and in accordance with
the laws of the State of New York.
9. This Agreement represents the entire Agreement between FINOVA,
Striker and Guarantors, all such other agreements (except the Guaranty, the
Personal Guaranty, the Security Agreement and any other guaranty or security
agreement) being merged with this Agreement and the Guaranty, the Personal
Guaranty, the Security Agreement and any other guaranty or security agreement
remaining in full force and effect notwithstanding FINOVA's willingness to
forbear in commencing any action for obligations owing to FINOVA under the
Security Agreement pursuant to the terms and conditions contained in this
Agreement.
10. No executory agreement and no course of dealing between
Striker, the Guarantors and FINOVA shall be effective to change or modify this
Agreement in whole or in part; nor shall any change, modification or waiver of
any rights or powers of FINOVA be valid or effective unless in writing or
signed by an authorized officer of FINOVA. Notwithstanding anything to the
contrary contained herein, FINOVA does not agree to change, modify, waive, or
forbear in exercising any of its rights or powers with respect to any
corporation, shareholder or individual not a party to this Agreement.
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IN WITNESS WHEREOF, the undersigned hereby agree to the terms and
conditions set forth hereinabove.
FINOVA CAPITAL CORPORATION
By: /s/ XXXXXX XXXXXXXXXX
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Xxxxxx Xxxxxxxxxx,
Vice President
STRIKER PAPER CORPORATION
By: /s/ XXXXXXX X. XXXX
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Xxxxxxx X. Xxxx
Title: Chief Financial Officer
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By: /s/ XXXXX X. XXXXXXX
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Xxxxx X. Xxxxxxx
Title: Chief Executive Officer
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STRIKER INDUSTRIES, INC.
By: /s/ XXXXX X. XXXXXXX
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Xxxxx X. Xxxxxxx
Title: Chief Executive Officer
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By: /s/ XXXXXXX X. XXXX
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Xxxxxxx X. Xxxx
Title: Chief Financial Officer
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STRIKER HOLDINGS, INC.
By: /s/ XXXXXXX X. XXXX
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Xxxxxxx X. Xxxx
Title: Chief Financial Officer
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By: /s/ XXXXX X. XXXXXXX
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Xxxxx X. Xxxxxxx
Title: Chief Executive Officer
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/s/ XXXXX X. XXXXXXX
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Xxxxx X. Xxxxxxx, Guarantor
/s/ XXXXXXXXX XXXXXXX
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Xxxxxxxxx Xxxxxxx, Guarantor
/s/ XXXXXXX X. XXXX
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Xxxxxxx X. Xxxx, Guarantor
/s/ XXXXX XXXXXXXX
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Xxxxx Xxxxxxxx, Guarantor
STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
On the ___ day of October, 1997 before me personally came Xxxxxx
Xxxxxxxxxx, to me known, who, being by me duly sworn, did depose and say that
he is the Vice President of FINOVA CAPITAL CORPORATION, the corporation
described in and which executed the foregoing instruments and that he signed
his name hereto by order of the board of directors of said corporation.
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Notary Public
STATE OF TEXAS )
)ss.:
COUNTY OF XXXXXX )
On the 2Oth day of October, 1997, before me personally came Xxxxxxx X.
Xxxx, to me known, who being by me duly sworn, did depose and say that he
resides at 3926 Purdue, that he is the CFO of Striker Paper Corporation,
Striker Industries, Inc. And Striker Holdings, Inc., the corporation described
in and which executed the foregoing instruments and that he signed his name
thereto by order of the board of directors of said corporation.
/s/ XXXXX XXXXX
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Notary Public
[SEAL]
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STATE OF TEXAS )
)ss.:
COUNTY OF XXXXXX )
On the 21th day of October, 1997, before me personally came Xxxxx X.
Xxxxxxx, to me known, who being by me duly sworn, did depose and say that he
resides at Houston Tx, that he is the C.E.O of Striker Paper Corporation,
Striker Industries, Inc. And Striker Holdings, Inc., the corporation described
in and which executed the foregoing instruments and that he signed his name
thereto by order of the board of directors of said corporation.
/s/ XXXXXXXX XXXXXXXXXX
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Notary Public
[SEAL]
STATE OF TEXAS )
)ss.:
COUNTY OF XXXXXX )
On the 21th day of October, 1997, before me personally appeared Xxxxx
X. Xxxxxxx, to me known, and known to me to be the individual described in and
who executed the foregoing instrument and he duly acknowledged to me that he
executed the same.
/s/ XXXXXXXX XXXXXXXXXX
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Notary Public
[SEAL]
STATE OF TEXAS )
)ss.:
COUNTY OF XXXXXX )
On the 21th day of October, 1997, before me personally appeared
Xxxxxxxxx Xxxxxxx, to me known, and known to me to be the individual described
in and who executed the foregoing instrument and he duly acknowledged to me
that he executed the same.
/s/ XXXXXXXX XXXXXXXXXX
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Notary Public
[SEAL]
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STATE OF TEXAS )
)ss.:
COUNTY OF XXXXXX )
On the 20th day of October, 1997, before me personally appeared
Xxxxxxx X. Xxxx, to me known, and known to me to be the individual described in
and who executed the foregoing instrument and he duly acknowledged to me that
he executed the same.
/s/ XXXXX XXXXX
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Notary Public
[SEAL]
STATE OF TEXAS )
)ss.:
COUNTY OF XXXXXX )
On the 20th day of October, 1997, before me personally appeared Xxxxx
Xxxxxxxx, to me known, and known to me to be the individual described in and
who executed the foregoing instrument and he duly acknowledged to me that he
executed the same.
/s/ XXXXX XXXXX
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Notary Public
[SEAL]
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