FIRST AMENDMENT TO FORBEARANCE
AGREEMENT
This First Amendment to the Forbearance
Agreement (the “Amended Agreement”) is made as of this
30th day of April, 2009, and effective on May 1, 2009, by and among
NEXT, INC., a Delaware corporation (the “Borrower”),
and DANNY F. COOKE and ROBERT BUDD
(collectively, the “Guarantors”) on the one hand, and
NATIONAL CITY BANK, a banking association organized under the laws
of the United States (the “Bank”), on the other
hand.
RECITALS:
Each party to this Agreement agrees that
the following facts presently exist:
1.
On or about January 30, 2009, the Parties
executed a Forbearance Agreement.
2.
The Parties expressly restate and
reaffirm the recitals from the Forbearance Agreement.
3.
Pursuant to the Forbearance Agreement,
the Borrower’s Indebtedness, as that term was defined in the
Forbearance Agreement, was to be paid in full by April 30, 2009.
The Borrower and Guarantors have requested that the Bank further
forbear from exercising its rights and remedies under the
Forbearance Agreement, Note I and Loan Documents, and further
forbear from taking any affirmative action to collect the
Indebtedness. The Bank has agreed to such further forbearance
subject to the following terms, conditions and
requirements.
NOW, THEREFORE, in consideration of the
premises, the Bank, Borrower and each of the Guarantors, agree as
follows:
1.
Recitals . The Parties do hereby agree that the Recital
Paragraphs set forth above are true, accurate and correct and that
such Recital Paragraphs are incorporated into this Amended
Agreement by reference.
2.
Acknowledgment Regarding
Indebtedness . The Borrower
and Guarantors acknowledge that the Indebtedness is due and owing
without set-off, defense, or counterclaim and that Note I and Loan
Documents are legal, valid and binding obligations enforceable in
accordance with their respective terms.
3.
Amendments to Agreement
. Subject to the modifications contained
in the following paragraphs, the parties acknowledge and restate
all of the covenants, obligations and duties provided for by the
Forbearance Agreement:
(a)
Paragraph 3 shall be modified to provide
that the Termination Date shall be extended to June 30,
2009.
(b)
Paragraph 4(a) and 4(b) shall be modified
accordingly to provide that:
(i)
Borrower and Guarantors agree that the
principal sum available to the Borrower under the terms of the Note
I is reduced to and shall not exceed Three Million Five Hundred
Thousand and 00/100 Dollars ($3,500,000.00), and, if
necessary, Borrower shall immediately make payments to the Bank to
reduce the outstanding Indebtedness to reduce the principal balance
accordingly;
(ii)
Commencing May 1, 2009, the interest rate
on the daily unpaid principal balance of Note I shall accrue at a
fluctuating rate which is 6.00% per annum above the Prime Rate.
After June 30, 2009, the interest rate on the daily unpaid
principal balance of Note I shall accrue at a fluctuating rate
which is 8.00% per annum above the Prime Rate.
(c)
In exchange for and consideration of the
amendments set forth above, Borrower shall pay:
(i)
The $25,000.00 described as “an
additional fee” to the Bank upon the earliest of the
execution of this Amended Agreement or April 30, 2009;
and
(ii)
All of Bank’s out of pocket costs,
including its attorney fees and expenses, incurred in
prepari
