Exhibit 7.19
AMENDMENT TO LOAN AGREEMENT
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AND NOTES
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THIS AMENDMENT TO LOAN AGREEMENT AND NOTES ("Amendment") entered into
on June 25, 2002 (the "Amendment Date"), by and between Imagine Investments,
Inc., a Delaware corporation ("Lender"), whose address is 0000 Xxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxx 0000, Xxxxxx, Xxxxx 00000 and Xxxxxx Financial Corporation, a
Florida corporation ("Borrower"), whose address is 0000 Xxxxxxx Xxxxxxx, Xxxxx
000, Xxxxxxxxxxxx, Xxxxxxx 00000.
WHEREAS, On February 24, 1999, Borrower and Lender entered into that
certain Loan Agreement (the "Loan Agreement") pursuant to which Borrower
borrowed the aggregate sum of Six Million Dollars ($6,000,000) from Lender as
further evidenced by that certain Term Promissory Note dated February 24, 1999
made by Borrower payable to the order of Lender (the "Term Note");
WHEREAS, pursuant to the terms of the Term Note, on February 28, 2000
Borrower executed and delivered to Lender that certain In Kind Note in the
principal amount of Three Hundred Seventy-Five Thousand Five Hundred Forty-Eight
and 93/100 Dollars ($375,548.93) (the "In Kind Note") in lieu of paying interest
on the interest that accrued under and during the first year of the Term Note
(the Term Note and the In Kind Note are collectively referred to herein as the
"Notes" and each individually as a "Note");
WHEREAS, Borrower has requested and, subject to the terms and
conditions of this Amendment, Lender has agreed, to extend the maturity of the
indebtedness, liabilities and obligations evidenced by the Notes and the other
Loan Documents (the "Indebtedness") to September 30, 2002.
NOW, THEREFORE, notwithstanding anything to the contrary contained in
the Notes or any of the other Loan Documents, Borrower and Lender agree as
follows:
1. Defined Terms. All terms used herein and not otherwise defined
herein shall have the meanings given to them in the Loan Agreement.
2. Reaffirmation of Indebtedness. Borrower and Lender hereby
acknowledge and confirm that: (a) the outstanding principal balance of each Note
as of the Amendment Date is equal to the amount listed beside such Note on
Exhibit A hereto, (b) Borrower's obligation to repay the outstanding principal
balance of each Note and all other Indebtedness is unconditional and not subject
to any offsets, defenses or counterclaims, and (c) by entering into this
Amendment, Lender does not waive or release any term or condition of the Notes
or the other Loan Documents or any of its rights or remedies under such Loan
Documents, or applicable law, except as set forth herein.
3. Interest. (a) with respect to the Indebtedness not relating to the
In Kind Note, effective as of December 31, 2001, notwithstanding anything to the
contrary contained in the Term Note or the other Loan Documents, the interest on
the unpaid principal of the Indebtedness that does note relate to the In Kind
Note is hereby amended to accrue at the rate of ten percent (10%) per annum
until all of such Indebtedness (including, without limitation, principal and
interest) is indefeasibly paid in full and (b) with respect to the Indebtedness
relating to the In Kind Note, effective as of February 28, 2001, notwithstanding
anything to the contrary contained in the In Kind Note or the other Loan
Documents, the interest on the unpaid principal of the Indebtedness that relates
to the In Kind Note is hereby amended to
accrue at the rate of twelve percent (12%) per annum until all of such
Indebtedness (including, without limitation, principal and interest) is
indefeasibly paid in full.
4. Payment of Principal and Interest on the Indebtedness. (a) with
respect to the Indebtedness not relating to the In Kind Note, effective as of
December 31, 2001 and (b) with respect to the Indebtedness relating to the In
Kind Note, effective as of February 28, 2001, each of the Notes and the other
Loan Documents are hereby amended to extend the maturity date of the
Indebtedness (regardless of the stated date of the maturity of the Indebtedness
for such Note or Loan Document) to September 30, 2002, at which time all
Indebtedness (including, without limitation, principal and interest) shall be
due and payable in full.
5. Reinstatement of Notes and Loan Documents. Lender, without prejudice
to or waiver of any right or remedy available to it by reason of the occurrence
subsequent to the date hereof of any event or condition constituting a Possible
Default or Event of Default or any other default or event of default that has
occurred and is continuing under any of the Notes or the other Loan Documents
hereby agrees to take no action with respect to any such Possible Default or
Event of Default or any other default or event of default that has occurred and
is continuing under any of the Notes or the other Loan Documents which
heretofore has occurred. Borrower and Lender hereby agree that the Notes and the
Loan Documents are fully reinstated in accordance with their terms and
conditions, as amended, by this Amendment, as if no Possible Default or Event of
Default or any other default or event of default that has occurred and is
continuing under any of the Notes or the other Loan Documents had occurred in
the payment of the Indebtedness prior to the date of this Agreement. It is
expressly understood that Lender will and does hereafter require full
performance of any and all terms, conditions and requirements of all Loan
Documents, as amended by this Amendment. It is further understood and agreed
that the validity and perfection of the liens and security interests granted
under the Loan Documents are not diminished or impaired in any way by this
Amendment. Borrower agrees to perform and/or observe the terms and provisions of
the Loan Documents to which it is a party, as amended by this Amendment.
6. No Commitment to Make Further Advances. Notwithstanding anything to
the contrary contained herein or in any other Loan Document (including, without
limitation, the Loan Agreement) any and all commitments of Lender to advance
funds or issue letters of credit to, or on behalf of, Borrower are hereby
terminated and Lender shall have no further obligation to advance funds or issue
letters of credit to, or on behalf of, Borrower.
7. Expenses. All expenses incurred by Borrower or Lender in connection
with this transaction, including, but not limited to, attorneys' fees, shall be
borne by Borrower and to the extent Lender's expenses are not paid by Borrower
within 10 days of Lender submitting an invoice therefor to Borrower, the amount
of such expenses shall be added to the outstanding principal amount of the
Indebtedness and shall accrue interest in accordance with subclause (a) of
Paragraph 3 hereof.
8. Ratification of Prior Instruments and Priorities. Except as herein
expressly amended, each and every term, condition, warranty and provision of the
Notes and the other Loan Documents shall remain in full force and effect and
such Notes and other Loan Documents are hereby ratified, confirmed and approved
by the parties hereto. Nothing herein shall be construed to alter or affect the
priority of the liens, security interests or title created by the Loan
Documents. Any provision herein that might otherwise be construed to conflict
with the desire of Lender that the liens, security interests and title of the
Loan Documents be maintained and preserved prior to any and all encumbrances
affecting the Collateral arising subsequent to the execution of the Loan
Documents shall, at Lender's option, be void and of no force and effect; it
being the expressly declared intention of the parties hereto that no novation of
the Loan Documents be created hereby. Any promissory note or other indebtedness
described in the
Loan Documents as the obligation secured thereby shall hereafter mean the Notes
as modified by this Agreement and the Indebtedness. The Loan Documents as
modified and amended hereby are hereby ratified and confirmed in all respects.
9. Representations and Warranties. Borrower hereby represents and
warrants that: (a) Borrower is a corporation duly organized, validly existing
and in good standing under the laws of the State of Florida; (b) Borrower has
all requisite power and authority and all necessary consents, approvals,
licenses, permits and other authorizations (i) to own and operate the
Collateral, (ii) to execute and deliver this Amendment and all other documents
and agreements to be executed by Borrower in connection herewith, and (iii) to
carry out and comply with the terms of the Notes and the other Loan Documents,
as amended by this Amendment; (c) the Notes and the other Loan Documents remain
in full force and effect and constitute, and upon the execution and delivery of
this Amendment will continue to constitute, the legal, valid and binding
obligations of Borrower enforceable in accordance with their terms; (f) Borrower
is the sole legal and beneficial owner of the Collateral; and (g) neither the
execution and delivery of this Amendment nor the consummation of the
transactions contemplated herein nor compliance by Borrower with the provisions
of the Loan Documents, as amended by this Amendment, will conflict with or
result in a breach of, or constitute a default under, any of the terms,
conditions or provisions of any law, rule, regulation, order, writ, injunction
or decree of any court or governmental authority to which Borrower is subject,
or of the articles of incorporation, bylaws or any other organizational document
of Borrower, or of any indenture, mortgage, deed of trust, promissory note, loan
agreement or any other agreement or undertaking to which Borrower is a party or
by which Borrower or its properties may be bound or subject.
10. Conditions to Effectiveness of this Amendment. This Amendment shall
not become effective until, and shall become effective when, each and every one
of the following conditions shall have been satisfied:
a. executed counterparts of this Amendment, duly executed by
Borrower and Lender, shall have been delivered to Lender;
b. Lender shall have received a copy of the resolutions of the
Board of Directors of Borrower authorizing the execution, delivery and
performance by Borrower of this Amendment and any and all documents
relating thereto, certified by Borrowers' Secretary or an Assistant
Secretary;
c. the representations and warranties of Borrower set forth
herein are true and correct on and with respect to the date hereof; and
d. J. Xxxxxx Xxxxxx shall have executed the Ratification of
Guaranty attached hereto.
11. Defenses. Borrower covenants and warrants that there are no
defenses, counterclaims or offsets to any of the Notes, the other Loan Documents
or the Indebtedness, and Borrower hereby waives any defense, claim or
counterclaim against Lender.
12. Further Assurances. Borrower, upon request from Lender, agrees to
execute such other and further documents as may be reasonably necessary or
appropriate to consummate the transactions contemplated herein or to perfect the
liens and security interests intended to secure the payment of the Indebtedness.
13. Business and Financial Information. Borrower will promptly furnish
to Lender from time to time such information regarding the Collateral and/or the
business and affairs and financial condition of Borrower as Lender may
reasonably request, and will furnish such items Lender.
14. Descriptive Headings. Descriptive headings are inserted for
convenience and reference only and do not in any way limit or amplify the terms
and provisions hereof.
15. Default. If Borrower shall fail to perform or observe any of the
covenants or agreements contained herein or if any statement, representation or
warranty contained herein is false, misleading or erroneous in any material
respect, an Event of Default shall be deemed to have occurred and Lender shall
be entitled at its option to exercise any and all of the rights and remedies
granted pursuant to any of the Loan Document or which Lender may otherwise be
entitled, whether at law or in equity.
16. FINAL AGREEMENT. THE NOTES AND THE OTHER LOAN DOCUMENTS, AS AMENDED
HEREBY REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES HERETO RELATED TO THE
SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES HERETO.
IN WITNESS WHEREOF, the parties hereto have each executed this
Amendment as of June __, 2002.
LENDER:
IMAGINE INVESTMENTS, INC.,
a Delaware corporation
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
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Title: V.P.
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BORROWER:
XXXXXX FINANCIAL CORPORATION,
a Florida corporation
By: /s/ J. Xxxxxx Xxxxxx
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Name: J. Xxxxxx Xxxxxx
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Title: President
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EXHIBIT A
Amount of Notes
Note Face Amount 6/__/02 6/__/02 6/__/02
Principal Interest Total
Term Note $6,000,000.00 $___________ $__________ $___________
In Kind Note 375,548.93 $___________ $__________ $___________
Ratification of Guaranty
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The undersigned Guarantor hereby joins in this Amendment to (i)
evidence his consent to execution by Borrower of this Amendment and acknowledges
that without such consent and confirmation Lender would not execute this
Amendment, (ii) confirms that each Loan Document (including, without limitation
the Unconditional Guaranty Agreement and the Stock Pledge Agreement) now or
previously executed by the undersigned continues to be valid and enforceable and
remains in full force and effect, and (iii) confirms that the amendments
contained herein shall fully amend any Loan Documents (including, without
limitation the Unconditional Guaranty Agreement and the Stock Pledge Agreement)
to which the undersigned is a party.
GUARANTOR:
/s/ J. Xxxxxx Xxxxxx
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J. Xxxxxx Xxxxxx
