Exhibit 10.5
AGREEMENT
This Agreement dated as of
June 30, 2008 (this “Agreement”), is made by and
between Oxford Finance Corporation (“Lender”) and
Favrille, Inc. a Delaware corporation
(“Borrower”).
WITNESSETH
:
A.
Lender and Borrower are parties to
that certain Master Security Agreement dated as of July 26,
2004, as amended by an Amendment dated as of December 29,
2004, an Amendment dated June 16, 2005, an Amendment dated
December 30, 2005 and a Loan Amendment Agreement dated as of
May 16, 2008, pursuant to which Lender made a series of loans
(the “Loans”) to Borrower arising under and evidenced
by a series of promissory notes delivered by Borrower to Lender
(the foregoing Master Security Agreement, the promissory notes,
this Agreement, and any other documents evidencing or relating to
the obligations arising thereunder, as any such documents may have
been amended, restated, modified or supplemented from time to time,
are hereafter referred to as the “Loan Documents”),
which Loans are secured by a security interest in certain property
owned by Borrower (the “Collateral”).
B.
A default occurred under the Loan
Documents on or about June 4, 2008, thus entitling Lender to
exercise its legal rights and remedies. On or about
June 5 and 6, 2008, Lender and General Electric Capital
Corporation (“GE Capital”), another secured creditor of
Borrower, delivered notices of exclusive control (the
“Control Notices”) to certain financial institutions at
which Borrower maintained funds. On or about June 11,
2008, Lender and GE Capital notified those financial institutions
to deliver funds to Lender and to GE Capital.
C.
Pursuant to the Control Notices,
Lender received $3,795,101.99 on or about June 11, 2008.
On or about June 17, 2008, Lender notified Borrower of such
receipt and of how such funds were applied. Lender also
demanded repayment of the balance that Lender contended was still
owing.
D.
A portion of the funds that Lender
received was applied by Lender on account of a prepayment charge
that Lender contends was owed to it. Borrower has disputed
Lender’s entitlement to receive the prepayment
charge.
E.
Borrower and Lender desire to
resolve that dispute, to settle any remaining issues under the Loan
Documents, and to provide each other with mutual releases of
claims.
F.
Borrower has informed Lender that it
is concurrently entering into an Agreement with GE Capital (the
“Borrower/GE Capital Agreement”) that resolves
Borrower’s similar dispute with GE Capital.
NOW, THEREFORE
, in consideration of the premises,
the covenants and agreements contained herein, and for other good
and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties do hereby agree as
follows:
STATEMENT OF TERMS
.24
Acknowledgment
of Recitals . Borrower and Lender
acknowledge the accuracy of the recitals set forth
above.
.25
GE Capital
Wire Transfer . No later than two
business days after Borrower’s execution and delivery of this
Agreement (“Execution Date”) and GE Capital’s
receipt of an executed copy of the Borrower/GE Capital Agreement
and this Agreement, GE Capital shall send a wire transfer for the
benefit of
