EXHIBIT 10.1
FIRST AMENDMENT TO FORBEARANCE
AGREEMENT
THIS FIRST AMENDMENT TO FORBEARANCE
AGREEMENT (the "Amendment") is made and entered into as of August
7, 2009, by and among PREMIX-MARBLETITE MANUFACTURING CO. ("
Premix "), DFH, INC. , formerly known as Acrocrete,
Inc. and Acro Holdings, Inc. (" DFH "), and JUST-RITE
SUPPLY, INC. (" Just-Rite "), each a Florida corporation
(each a " Borrower " and collectively, " Borrowers
"); IMPERIAL INDUSTRIES, INC. , a Delaware corporation ("
Guarantor "); MICHAEL PHELAN, as assignee for the
benefit of the creditors of Just-Rite, and not individually ("
Assignee "); and WACHOVIA BANK, NATIONAL ASSOCIATION
, a national banking association and successor to Congress
Financial Corporation (Florida) under the Loan Agreement (defined
below) (" Lender ").
Recitals :
Lender and Borrowers entered into a
certain Consolidating, Amended and Restated Financing Agreement and
Security Agreement dated January 28, 2000 (as amended, restated,
modified and supplemented from time to time, the " Loan
Agreement "), pursuant to which Lender has made loans and other
extensions of credit to Borrowers, which loans and extensions of
credit are secured by security interest in and liens upon all of
the assets of Borrowers and guaranteed unconditionally by
Guarantor.
Just-Rite has made an assignment for the
benefit of its creditors under Florida law, styled In re
Just-Rite Supply, Inc., Assignor, to Michael Phelan, Assignee ,
Case No. CACE 2009 09032744XXXX (04), In the Circuit Court of the
17th Judicial Circuit, In and For Broward County, Florida (the "
ABC "). Assignee is the assignee in the
ABC.
Lender, Borrowers and Guarantor entered
into a Forbearance and Amendment Agreement dated June 9, 2009 (as
at any time amended, the " Forbearance Agreement "). By
separate written agreement, Assignee has agreed to be bound by the
Loan Agreement and the Forbearance Agreement. Borrowers, Guarantor
and Assignee have requested that the Forbearance Agreement be
amended, and Lender is willing to amend the Forbearance Agreement
as hereinafter set forth.
NOW, THEREFORE, for TEN DOLLARS ($10.00)
in hand paid and in consideration of the premises and the
mutual covenants herein contained, the parties hereto, intending to
be legally bound hereby, agree as follows:
1.
Definitions
. All capitalized terms used in
this Amendment, unless otherwise defined, shall have the meanings
ascribed to such terms in the Forbearance Agreement;
provided that as used herein, the term "Obligor" shall mean
and include Borrowers, Guarantor and the Assignee (solely in his
capacity as assignee in the ABC, and not individually).
2.
Acknowledgments and Stipulations of
Obligors .
(a)
Each Obligor acknowledges, stipulates and
agrees that (1) as of the opening of business on August 7,
2009, the aggregate net principal balance of Revolving Loans
outstanding under the Loan Agreement, exclusive of accrued
interest, costs, bank fees and attorneys' fees chargeable to
Obligors under the Financing Agreements, totaled approximately
$800,463; (2) all
of the Obligations are absolutely due and
owing to Lender without any defense, deduction, offset or
counterclaim (and, to the extent any Obligor had any defense,
deduction, offset or counterclaim on the date hereof, the same
is hereby waived); (3) Events of Default have occurred and
exist under the Financing Agreements, (4) the Financing
Agreements executed by each Borrower are legal, valid and binding
obligations of such Borrower enforceable against such Borrower in
accordance with their terms; (5) the security interests
granted by each Borrower to Lender in the Accounts, Inventory,
general intangibles and other Collateral are duly perfected
security interests in such Collateral; (6) each of the
Guaranty and Waiver Agreements executed by Guarantor (collectively,
the " Guaranties ") is a legal, valid and binding obligation
of Guarantor and is enforceable against Guarantor in accordance
with its terms; (7) each of the recitals contained at the
beginning of this Agreement is true and correct; and
(8) prior to executing this Agreement, each Obligor consulted
with and had the benefit of advice of legal counsel of its own
selection and each has relied upon the advice of such counsel, and
in no part upon any representation of Lender concerning the legal
effects of this Amendment or any provision hereof.
(b)
In addition, each Obligor acknowledges,
stipulates and agrees that certain Forbearance Conditions have not
been satisfied as a result of the following (collectively, but
solely as the same exist on the date hereof, the " Existing
Forbearance Condition Violations "):
(1)
The outstanding unpaid Revolving Loans
made to Premix and the Assignee exceeded the amount available to be
borrowed under the Credit Agreement, as amended by Section 10(C) of
the Forbearance Agreement, by an amount that exceeded $230,000 as
of July 30, 2009;
(2)
For each and every measurement period
during the Forbearance Period, Borrowers and Assignee have failed
to deliver to Lender actual cash proceeds of Collateral owned by
Just-Rite in an amount not less than 75% of such proceeds as
projected in the Budget, in violation of Section 5 of the
Forbearance Agreement;
(3)
Neither Borrowers nor Assignee have
provided copies of bank statements of Just-Rite and the Assignee or
forecasts of cash needs, sales and collections, in each case as and
to the extent required by Section 13 of the Forbearance
Agreement;
(4)
Neither Borrowers nor Assignee have
provided to Lender the month-end physical count of Inventory as of
June 30, 2009, which was due to be provided to Lender no later than
July 10, 2009, pursuant to Section 13 of the Forbearance Agreement;
and
(5)
Assignee has failed to deliver to Lender
all proceeds of Collateral as and when received by Assignee as
required by the Loan Agreement and Secti
