LOAN RESTRUCTURE AGREEMENT
Exhibit
10.11.1
This Loan
Restructure Agreement (hereafter referred to as the “Agreement”) is entered into
as of December 7, 2009 by and among CoActiv Capital Partners, Inc. (hereinafter
referred to as “CoActive”), and Pure Earth, inc. Pure Earth Materials, Inc.,
(Pennsylvania Corporations) and Juda Construction, Ltd., as co-Borrowers
(“Borrowers”).
BACKGROUND
WHEREAS, on November 19, 2007, CoActiv
and the Borrowers entered into a Security Agreement and Promissory Note
Agreement No. 18056 and thereafter on or about May 30, 2008, the Borrowers
entered into a Security Agreement and Promissory Note No. 29199, collectively
(the “Agreement”), pursuant to which CoActiv loaned to the Borrowers the
aggregate original principal sum of $2,465,000.00, all of which is secured by
certain Equipment. The foregoing loans are also known as System Loan
No(s) 106629-003 and 106629-002, (each, individually, a “Loan” and together,
collectively, the “Loans”), upon the terms and conditions set forth in the
Agreements.
The Agreement, together with all
modifications, amendments and supplements thereto, and all certificates of
delivery and acceptance, UCC financing statements, and other agreements and/or
documents executed in connection therewith are hereinafter referred to,
collectively, as the “Loan Documents”.
WHEREAS, the Borrowers have r4equested
and CoActiv has agreed, subject to the terms and conditions hereof, to modify
the Agreement and restructure the Borrower’s obligations thereunder, as set
forth herein.
WHEREAS, a capitalized terms contained
herein which are not otherwise defined shall have the meanings ascribed to such
terms in the respective Loan Documents.
NOW, THEREFORE, for and in
consideration of the execution of this Agreement and the mutual covenants and
promises contained herein, the parties, each expressly intending to be legally
bound, agree as follows:
1.
Validity
and Enforceability of Loan Documents
1.1 Except as
expressly amended, modified, replaced, nullified or supplemented hereby, all of
the terms and provisions of the Loan Documents shall remain in full force and
effect and, except as expressly modified hereby, are hereby ratified and
confirmed. To the extent of any inconsistency between the Loan
Documents and this Agreement, this Agreement shall control.
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2. Acknowledgment
of Obligations. The Borrowers acknowledge and agree that as of
December 7, 2009, the Borrowers owe to CoActiv the following amounts with
respect to the Loans, plus CoActiv’s fees and costs, including, without
limitation, the fees and costs of the CoActiv’s counsel in the amount of $0.00
and CoActiv’s appraiser in the amount of $0.00 incurred in connection with the
administration and enforcement of the Loans (collectively, the “Existing
Obligations”), all without offset, counterclaims or defenses of any kind and
together with additional fees and costs, which may be incurred by CoActiv and
additional interest accruing at the per diem rates set forth in this Section
2:
|
Loan
No.
|
Outstanding
Loan Payments |
Taxes
|
Late
Charges |
Insurance
|
Total
Obligations |
|||||||||||||||||
| 106629-003 | $ | 1,201,728.84 | $ | $ | $ | $ | 1,201,728.84 | |||||||||||||||
| 106629-002 | $ | 157,749.12 | $ | $ | $ | $ | 157,749.12 | |||||||||||||||
3. Restructure
Obligations. The parties hereto
agree that upon the execution of this Agreement, all of the Existing Obligations
shall be restructure and the Borrowers shall make payments to CoActiv as
follows:
3.1 One
payment, due with the execution of this Agreement, and representing a
restructure fee in the amount of $15,000.00, that must be paid via wire transfer
or certified funds to CoActiv, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇. Payment to be received no later than December 14,
2009.
3.2 Beginning
November 1, 2009, and continuing each month thereafter on the 1st day of
each successive month, Borrowers shall make monthly payments, representing the
new restructured amounts due under each Agreement until such time as the balance
is paid in full as follows:
Loan
106629-003
|
Payment
Start Date
|
Payment
Amount
|
Number
of Payments
|
Tenor
|
Final
Payment
|
||||||||||
| 11-01-2009 | $ | 8,850.00 | 6 |
Monthly
|
4-01-2010 | |||||||||
| 5-01-2010 | $ | 57,855.88 | 20 |
Monthly
|
12-01-2011 | |||||||||
Loan
106629-002
|
Payment
Start Date
|
Payment
Amount
|
Number
of Payments
|
Tenor
|
Final
Payment
|
||||||||||
| 11-01-2009 | $ | 1,179.25 | 6 |
Monthly
|
4-01-2010 | |||||||||
| 5-01-2010 | $ | 6,076.14 | 26 |
Monthly
|
6-01-2012 | |||||||||
Plus applicable taxes
3.3 On the
date of the final payment applicable to each Loan, the Borrowers shall pay in
full any remaining balance on such Loan, together with all accrued but unpaid
principal, interest, late charges, and costs and fees incurred by CoActiv to the
date of that final payment.
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|
4.
|
Breach
of Agreement; CoActiv’s
Remedies
|
4.1 Any
one or more of the following shall constitute a breach under this
Agreement: (a) the occurrence of a default or an Event of Default
under the Loan Documents (as modified hereby): (b) failure of the
Borrowers to make any payment pursuant to the terms described above within five
(5) business days of the payment due date; (c) any representation or
warranty made by the Borrowers in this Agreement proves to be false or
misleading in any material respect when made; (d) the Borrowers
institute or commence any action or any legal or equitable proceeding seeking to
rescind, amend, alter, revoke, terminate, or otherwise modify the provisions of
this Agreement or the Loan Documents; (d) the validity, binding
nature of, or enforceability of any term or provision of this Agreement is
disputed or any material term or provision of this Agreement is found or
declared to be invalid, avoidable, or unenforceable by any court of competent
jurisdiction; (e) a bankruptcy petition is filed by or against the
Borrowers or a receiver, liquidator, custodian, trustee or similar official or
fiduciary is appointed for the Borrowers or any of its/his property, or the
Borrowers make or propose in writing, an assignment for the benefit of creditors
generally and any such proceeding or any such appointment is not terminated
within sixty (60) days thereafter; and/or (f) a material adverse
change occurs with respect to the Borrowers, and/or the Equipment.
4.2 Upon
the occurrence of any one or more breaches of the Agreement, CoActiv is entitled
to exercise any and all rights and remedies available to it hereunder, under the
Loan Documents and applicable law and at equity, which include, without
limitation: (a) the entire principal balance of each Loan plus all
accrued interest, late charges, restructure fees, and all of CoActiv’s costs and
counsel fees shall, immediately and without any notice, accelerate and become
due and payable; (b) confess judgment against the Borrowers, at
CoActiv’s option in the Court of Common Pleas of ▇▇▇▇▇▇▇▇▇▇ County, Pennsylvania
and thereafter domesticate or transfer that judgment to any State in which
Borrowers may be found or in which real property belonging to Borrowers may be
situated; and, without limiting the generality of the foregoing; (c)
CoActiv shall be entitled to all accrued interest calculated at the rate of ten
(10%) percent per annum on the unpaid balance with interest calculated from the
date of the occurrence of such default or breach of this Agreement plus actual
counsel fees incurred to collect this debt.
5. Independent
Decision. Each party enters into this Agreement freely and
voluntarily and on the advice of independent counsel, and each party
acknowledges the terms and conditions hereof to be a fair and reasonable
settlement of its respective legal and equitable rights.
6. General
Release. In consideration for CoActiv’s agreement to enter
into this Agreement and for other valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Borrowers, each, on behalf of
itself/himself/herself and all of its/his/her present, past and future parents,
subsidiaries, affiliates, predecessors, successors, assigns, trustees, agents,
attorneys, shareholders, directors, officers, members, partners, and employees
all persons or entities claiming by, through, or under such any of them (the
“Releasors”), does hereby unconditionally remise, release and forever discharge
CoActiv, its present, past and future parents, subsidiaries, affiliates,
shareholders, partners, officers, directors, employees, agents, attorneys,
divisions, predecessors, successors and assigns (the “Releasees”) from any and
all manner of actions, causes of action, suits, claims, counterclaims,
crossclaims, defenses and demands whatsoever, arising from any and all debts,
demands, proceedings, agreements, contracts, judgments, damages, accounts,
reckonings, executions, controversies, claims, liabilities, and facts whatsoever
whether known or unknown, whether contingent or fixed, liquidated or
unliquidated, at law or at equity, if any, which the Borrowers and/or any other
Releasors ever had, now has, and/or hereafter may have against the Releasees,
for or by reason of any cause, matter or thing whatsoever arising from the
beginning of the world through the date hereof, including, but not limited to,
all claims relating to the loan transactions between the Borrowers and
CoActiv.
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7. Unenforceable
Provisions. If any provision of this Agreement is found to be
unenforceable, this Agreement shall be modified to the extent necessary so that
the remainder of the Agreement is held to be valid and enforceable, however the
release language in paragraph 6 shall never be effective unless and until all
sums due CoActiv are remitted in full. Time is of the essence
herein. Borrowers may not assign its liabilities under this Agreement
without the prior written consent of CoActiv.
8. Representations
and Warranties. To induce CoActiv to enter into this Agreement
the Borrowers make the following representations and warranties to CoActiv, each
and all of which shall survive the execution and delivery of this
Agreement:
3.4 Any
person signing this Agreement for a party represents and warrants that he/she
has express authority to sign this Agreement for that party and agrees to
indemnify and hold the opposing party harmless for costs or consequences of the
absence of actual authority to sign;
3.5 Each and
every item of Equipment is located at one of the following
addresses: ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇;
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇; ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇.
9. Governing
Law, Jurisdiction and Venue. This Agreement
shall be governed and enforced in accordance with the internal laws of the
Commonwealth of Pennsylvania without application of its principles of conflicts
of law rules. Any suit to enforce this Agreement may only be brought
in the United States District Court for the eastern District of Pennsylvania, or
if subject matter jurisdiction is lacking, only in the Court of common Pleas of
▇▇▇▇▇▇▇▇▇▇ County, Pennsylvania.
10. Binding
Effect. This Agreement shall be binding upon the parties, and
their respective heirs, assigns, officers, directors, agents, shareholders,
principals, employees, successors and predecessors in interest, and all persons,
firm, and legal entities legally responsible for the actions of the parties
hereto.
11. Entire
Agreement. Except as specifically stated herein, this
Agreement constitutes the entire agreement between the parties and supersedes
all agreements, represetn6ations, warranties, statements, promises, and
understandings not delivered in connection herewith. Neither party
has in any way relied, nor shall in any way rely, upon any oral or written
agreements, representations, warranties, statements, promises, or understandings
not specifically set forth in this Agreement.
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12. Multiple
Copies or Counterparts. The original and one or more copies of
this Agreement may be executed in counterparts by one or more of the parties
hereto. In such event, all of such executed copies shall have the
same force and effect as the executed original and all of such counterparts
taken together shall have the effect of a fully executed original. A
facsimile signature shall be as valid and binding as an originally executed
document.
13. Warrant
of Attorney. THE FOLLOWING PARAGRAPH SETS FORTH A WARRANT OF
AUTHORITY FOR ANY ATTORNEY TO CONFESS JUDGMENT AGAINST BORROWERS. IN
GRANTING THIS WARRANT OF ATTORNEY TO CONFESS JUDGMENT AGAINST BORROWERS, THE
BORROWERS FOLLOWING CONSULTATION WITH SEPARATE COUNSEL AND WITH KNOWLEDGE OF THE
LEGAL EFFECT HEREOF, HEREBY KNOWINGLY, INTENTIONALLY, VOLUNTARILY AND
UNCONDITIONALLY WAIVE ANY AND ALL RIGHTS BORROWERS HAVE OR MAY HAVE TO PRIOR
NOTICE AND AN OPPORTUNITY FOR HEARING UNDER THE RESPECTIVE CONSTITUTIONS AND
LAWS OF THE UNITED STATES OF AMERICA, THE COMMONWEALTH OF PENNSYLVANIA, OR
ELSEWHERE. IT IS SPECIFICALLY ACKNOWLEDGED BY THE UNDERSIGNED THAT
COACTIV HAS RELIED ON THIS WARRANT OF ATTORNEY IN ENTERING INTO THIS AGREEMENT
AND AS AN INDUCEMENT TO GRANT CERTAIN FINANCIAL ACCOMMODATIONS TO
BORROWERS.
BORROWERS
EACH HEREBY IRREVOCABLY AUTHORIZE AND EMPOWER COACTIV, BY AND THROUGH ANY
ATTORNEY OR ANY CLERK OF ANY COURT OF RECORD, TO APPEAR FOR AND CONFESS JUDGMENT
AGAINST BORROWERS (A) FOR SUCH SUMS AS ARE DUE AND/OR MAY BECOME DUE
ON THE OBLIGATIONS EVIDENCED BY THIS AGREEMENT TOGETHER WITH INTEREST AND COSTS
OF SUIT, INCLUDING ACTUAL REASONABLE ATTORNEY’S FEES INCURRED BY REASON OF SUCH
DEFAULT AND IN COLLECTION OF THE AFORESAID OBLIGATIONS, AND/OR (B) IN ANY ACTION
OF REPLEVIN INSTITUTED BY COACTIV TO OBTAIN POSSESSION OF ANY COLLATERAL
SECURING THE LOAN, THE NOTE OR SECURING ANY OF THE OBLIGATIONS, IN EITHER CASE
WITH OR WITHOUT DECLARATION, WITH COSTS OF SUIT, WITHOUT STAY OF EXECUTION AND
WITH AN AMOUNT, FOR LIEN PRIORITY PURPOSES, EQUAL TO THE AMOUNT OF SUCH
JUDGMENT, PLUS ACTUAL ATTORNEY’S COLLECTION FEES. TO THE EXTENT
PERMITTED BY LAW, BORROWERS: (1) WAIVE THE RIGHT OF INQUISITION ON
ANY REAL ESTATE LEVIED ON, VOLUNTARILY CONDEMN THE SAME, AUTHORIZE THE
PROTHONOTARY OR CLERK TO ENTER UPON THE WRIT OF EXECUTION; (2) WAIVE
AND RELEASE ALL RELIEF FROM ALL REDEMPTION, APPRAISEMENT, STAY, EXEMPTION, OR
APPEAL LAWS OF ANY STATE NOW IN FORCE OR HEREAFTER ENACTED; AND (3) RELEASE ALL
ERRORS IN SUCH PROCEEDINGS. IF A COPY OF THIS AGREEMENT, VERIFIED BY
AFFIDAVIT, BY OR ON BEHALF OF COACTIV SHALL HAVE BEEN FILED IN SUCH ACTION, IT
SHALL NOT BE NECESSARY TO FILE THE ORIGINAL OF THIS AGREEMENT AS A WARRANT OF
ATTORNEY. THE AUTHORITY AND POWER TO APPEAR FOR AND ENTER JUDGMENT
AGAINST BORROWERS SHALL NOT BE EXHAUSTED BY THE INITIAL EXERCISE THEREOF, AND
THE SAME MAY BE EXERCISED, FROM TIME TO TIME, AS OFTEN AS COACTIV MAY DEEM
NECESSARY AND DESIRABLE, AND THIS AGREEMENT SHALL BE A SUFFICIENT WARRANT
THEREFOR. COACTIV MAY ENTER ONE OR MORE JUDGMENTS IN THE SAME OR
DIFFERENT JURISDICTIONS FOR ALL OR PART OF BORROWERS’ RESPECTIVE OBLIGATIONS,
WITHOUT REGARD TO WHETHER JUDGMENT HAS THERETOFOR BEEN ENTERED ON MORE THAN ONE
OCCASION FOR THE SAME OBLIGATIONS. IN THE EVENT ANY JUDGMENT ENTERED
AGAINST BORROWERS HEREUNDER IS STRICKEN OR OPENED UPON APPLICATION BY OR ON
BORROWERS BEHALF FOR ANY REASON WHATSOEVER, COACTIV IS HEREBY AUTHORIZED AND
EMPOWERED TO AGAIN APPEAR FOR AND CONFESS JUDGMENT AGAINST BORROWERS FOR ANY
PART OR ALL OF THE OBLIGATIONS; INCLUDING, WITHOUT LIMITATION, A SUBSEQUENT
ENTRY OR ENTRIES OF JUDGMENT BY COACTIV TO CURE ANY ERROR OR DEFECTS IN SUCH
PRIOR PROCEEDINGS.
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A FAXED COPY OF THIS DOCUMENT SHALL BE
ACCEPTED AS A LEGAL AND BINDING AGREEMENT PENDING RECEIPT OF THE EXECUTED
ORIGINAL HEREOF WHICH IS REQUIRED TO BE IMMEDIATELY FORWARDED TO COACTIV VIA
OVERNIGHT DELIVERY UPON ITS FULL EXECUTION.
IN WITNESS WHEREOF, the parties hereto,
expressly intending to be legally bound, have caused their duly authorized
representatives to sign this Agreement as of the above day and
date.
| WITNESS/ATTEST: | Borrowers: | ||||
| Pure Earth, Inc., Juda Construction, Ltd., | |||||
| and Pure Earth Materials, Inc. | |||||
| By: | /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ | |||
| Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ | ||||
| Title: Office Manager | Title: CFO | ||||
| CoActiv Capital Partners, Inc. | |||||
|
|
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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|
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
|
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Title: Vice
President
|
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