EXHIBIT 99
FORBEARANCE AGREEMENT
This Forbearance Agreement ("Agreement") is entered into as of the __ day of
October 1997, by and between XXXXXXXX ACQUISITION CORP., a Delaware corporation
(the "Maker"), XXXXXXXX TECHNOLOGIES OF MINNESOTA, INC., a Minnesota corporation
formerly known as BFI Tire Recyclers of Minnesota, Inc. ("GTM"), XXXXXXXX
TECHNOLOGIES OF GEORGIA, INC., a Georgia corporation formerly known as BFI Tire
Recyclers of Georgia, Inc. (together with GTM "Pledgors"), XXXXXXXX
TECHNOLOGIES, INC., a Delaware corporation ("Guarantor"), XXXXXXXX-XXXXXX
INDUSTRIES OF MINNESOTA, INC., a Minnesota corporation ("BFIM") and
XXXXXXXX-XXXXXX INDUSTRIES OF GEORGIA, INC., a Georgia corporation (together
with BFIM "Holders").
RECITALS
A. Maker executed and delivered to Holders that certain Promissory Note
dated June 30, 1997 ("Note") in the principal amount of Four Million
Seven Hundred Fifty Eight Thousand Eight Hundred Thirty Dollars
($4,758,830).
B. The Note is secured by Security Agreements, each dated June 30, 1997 by
Pledgors in favor of Holders, a Pledge Agreement dated June 30, 1997 by
Maker in favor of Holders, and a Guaranty Agreement dated June 30, 1997
by Guarantor in favor of Holders.
C. Such Note, Security Agreement, Pledge Agreement and Guaranty Agreement
were delivered pursuant to a Purchase and Sale Agreement dated June 30,
1997 (the "Purchase Agreement") by and among Maker, Guarantor, Holders
and Xxxxxxxx-Xxxxxx Industries, Inc., a Delaware corporation.
D. The Note, Security Agreement, Pledge Agreement, Guaranty Agreement, and
Purchase Agreement are hereinafter referred to collectively as the
"Documents".
E. The Note is in default and Maker desires that Holders forbear until
December 6, 1997 in the exercise of their rights, powers, benefits and
remedies under the Documents in respect of such default by Maker.
F. Holders have agreed to such forbearance subject to the representations
and covenants contained in this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereto agree as follows:
1. Forbearance. Maker agrees to make an installment payment of principal
under the Note to Holders in the amount of Two Million Dollars
($2,000,000) in immediately available funds ("Installment") on or
before November 6, 1997. Thereafter, all outstanding principal and
accrued interest under the Note shall be due and payable on or before
December 6, 1997. Holders agree that Holders will not exercise any of
their rights, powers, benefits and remedies arising under the Documents
prior to November 6, 1997 in respect of the default by Maker under the
Note. If Maker pays Holders the Installment on or before November 6,
1997, Holder also agrees that it will not exercise any of its rights,
powers, benefits and remedies arising under the Documents prior to
December 6, 1997 in respect of the default by Maker under the Note. If
such Installment due and payable on or prior to November 6, 1997, is
not paid in full by such date, Holder will be entitled to exercise any
and all of its rights, powers, benefits and remedies arising under the
Documents in respect of the default by Maker under the Note.
2. Post-Closing Adjustment. In the event the Final Working Capital is less
than the Estimated Working Capital (as such terms are defined in the
Purchase Agreement), the outstanding principal balance under the Note
due and payable on December 6, 1997 shall be reduced by such Working
Capital deficiency. No immediately available funds shall accordingly be
due and owing to Maker or Guarantor.
3. Confirmation. The terms, covenants, conditions and warranties contained
in the Documents which are not changed, modified or amended by this
Agreement are unchanged and are hereby ratified, affirmed and held to
be in full force and effect. Makers, Pledgors and the Guarantor jointly
and severally represent and agree that as of the date hereof no fact or
condition exists which would result in any defense, counterclaim or
claim of offset on behalf of Makers, Pledgors or the Guarantor arising
under the Documents. Notwithstanding the foregoing, no provision of
this Agreement shall in any manner affect (a) Makers' rights, if any,
to deliver a substitute promissory note pursuant to Section 1.05 of the
Purchase Agreement, (b) the rights of the parties hereto with the
respect to the litigation entitled Dodger Enterprise Co. and Xxx X.
Xxxxx v. Xxxx Xxxxx, et al and (c) Holders' obligations to correct
defects in title, if any, to real or personal property.
4. Miscellaneous.
(i) Counterparts. This Agreement may be executed in several
counterparts, each of which shall be an original but all of
which together shall constitute one and the same instrument.
(ii) Amendment and Waiver. this Agreement shall not be modified or
amended except by a writing executed by the party against whom
the modified or amended term or provision is sought to be
enforced. Neither a failure by Holders to exercise any of
their options hereunder, nor failure to enforce their rights
or seek any remedies upon any default shall effect or
constitute a waiver of Holders' right to enforce such right,
or to seek remedy with respect to that default or to any prior
or subsequent default. The remedies provided in this Agreement
shall be cumulative and shall not in any way abridge, modify,
or preclude any other rights or remedies to which Holders may
be entitled either at law or in equity.
(iii) Governing Law. This Agreement shall be construed in accordance
with, and governed by, the laws of the State of Massachusetts.
(iv) Savings Clause. If any one or more of the provisions contained
in this Agreement shall, for any reason, be held to be
invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect
any other provisions of this Agreement but this Agreement
shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.
(v) Captions. The Captions of the Sections and Paragraphs of this
Agreement are for convenience of reference only and shall not
be utilized in construing the terms of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first written above.
XXXXXXXX ACQUISITION CORP. XXXXXXXX TECHNOLOGIES, INC.
By: ______________________________ By: __________________________________
Title: ___________________________ Title: ______________________________
XXXXXXXX TECHNOLOGIES OF XXXXXXXX-XXXXXX INDUSTRIES
MINNESOTA, INC. OF MINNESOTA, INC.
By: ______________________________ By: __________________________________
Title: ___________________________ Title: ______________________________
XXXXXXXX TECHNOLOGIES OF XXXXXXXX-XXXXXX INDUSTRIES
GEORGIA, INC. OF GEORGIA, INC.
By: ______________________________ By: __________________________________
Title: ___________________________ Title: ______________________________
2
