Exhibit 99.2
STATE OF TEXAS (S)
(S)
COUNTY OF XXXXXX (S)
NOTE MODIFICATION AGREEMENT
THIS NOTE MODIFICATION AGREEMENT (this "Modification Agreement") is entered
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into as of the 21/st/ day of June, 2002, by and between KATIE PETROLEUM, INC., a
Texas corporation ("Lender"), and RETRACTABLE TECHNOLOGIES, INC., a Texas
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corporation, ("Borrower").
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RECITALS:
A. Borrower and Lender have entered into that certain First Amendment to
Loan Agreement dated as of the date hereof (the "Amendment"), for purposes of
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amending that certain Loan Agreement dated November 12, 2001 (the "Loan
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Agreement").
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B. Pursuant to the Loan Agreement, the Lender, among other things,
purchased that certain Commercial Variable Rate First Deed of Trust Promissory
Note dated February 18, 2000 (the "Note"), made and executed by Borrower,
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originally payable to the order of First International Bank in the original
principal amount of $1,500,000.00.
C. The Note is secured, among other security, by (i) that certain
Commercial Deed of Trust dated February 18, 2000, executed by Borrower and filed
for record in the Office of the County Clerk of Xxxxxx County, Texas on February
24, 2000, under Instrument File Number 00-R0016390 (the "Deed of Trust"), and
(ii) that certain Assignment of Rents dated February 18, 2000, executed by
Borrower and filed for record in the Office of the County Clerk of Xxxxxx
County, Texas on February 24, 2000, under Instrument File Number 00-R0016391
(the "Assignment of Rents"), which Deed of Trust and Assignment of Rents have
been assigned to Lender.
D. The Loan Agreement, the Note, the Deed of Trust, the Assignment of Rents
and all other documents and instruments now or hereafter governing, evidencing,
guaranteeing, securing or otherwise relating to payment of all or any part of
the indebtedness evidenced by the Note are herein collectively called the "Loan
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Documents." The liens and security interests created by the Loan Documents are
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herein collectively called the "Liens."
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E. Concurrently herewith, Lender and Borrower are entering into a
Securities Purchase Agreement (herein so called) pursuant to which, among other
things, Borrower agrees to issue shares of its Series V Class B Convertible
Preferred Stock ("Series V Stock") to Lender in exchange for the cancellation
and settlement of a portion of the indebtedness of Borrower under the Note, as
hereinafter provided.
F. Borrower and the Lender now desire to modify the Note as hereinafter
provided and desire to enter into this Modification Agreement to provide for the
foregoing and to ratify and confirm the Loan Documents and to ratify the Liens
and confirm that they continue to secure the Note.
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AGREEMENTS:
Article 1.
Modification of Note
The Note and the indebtedness evidenced thereby shall be, and are hereby,
renewed and modified as follows:
Section 1.01 The parties hereto acknowledge and agree that (i) immediately
prior to the issuance of the Series V Stock pursuant to the Securities Purchase
Agreement, the outstanding principal balance of the Note is $1,429,286.77, (ii)
effective as of the date hereof, $1,179,284.00 of the indebtedness evidenced by
the Note is hereby cancelled and discharged, and (iii) the outstanding principal
balance of the Note after such cancellation and discharge is $250,002.77 as of
the date hereof.
Section 1.02 The payment schedule set forth in the Note is amended to read
as follows:
Borrower shall pay the principal and interest according to the following
schedule:
(a) Accrued interest shall be payable monthly on the 18/th/ day
of each calendar month; and (b) all outstanding principal shall
be due and payable on February 18, 2005.
Section 1.03 This Agreement is subject to the terms and conditions of the
Loan Agreement dated November 12, 2001 and the First Amendment to that Loan
Agreement dated as of the date hereof.
Article 2.
Defined Terms
Section 2.01 Defined Terms. Each capitalized term not otherwise defined
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herein shall have the meaning assigned to such term in the Loan Agreement.
Article 3.
Ratification; Indemnification
Section 3.01 Ratification. The terms and provisions set forth in this
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Modification Agreement shall modify and supersede all inconsistent terms and
provisions set forth in the Loan Agreement and any other Loan Document, and
except as expressly modified and superseded by this Modification Agreement and
the Amendment, the terms and provisions of the Loan Agreement and the other Loan
Documents are ratified and confirmed and shall continue in full force and
effect. Borrower and Lender agree that the Note, as amended and modified hereby,
and the other Loan Documents shall continue to be legal, valid, binding and
enforceable in accordance with their respective terms. The Liens are hereby
ratified and confirmed as continuing to secure payment of the Note, as modified
hereby. Nothing herein shall in any manner diminish, impair or extinguish the
Note, any of the indebtedness evidenced thereby, any of the other Loan Documents
or the Liens, except as provided in Section 1.01 hereof.
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Section 3.02 Indemnification. Lender hereby agrees to indemnify Borrower
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from, and hold Borrower harmless against, any and all losses, liabilities,
claims, damages, penalties, judgments, disbursements, costs, interest, expenses
(including reasonable attorneys' fees) and amounts paid in settlement to which
Borrower may become subject which directly or indirectly arise from or relate to
any claim by any party that Borrower has any indebtedness, obligation or
liability under the Note in excess of the reduced amount of indebtedness of
Borrower existing after the cancellation and discharge of indebtedness pursuant
to Section 1.01 hereof.
Article 4.
Consent of Guarantor
Section 4.01 Guarantor Consent. The Guarantor hereby joins in this
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Modification Agreement to evidence his consent to execution by Borrower of this
Modification Agreement, to confirm that his guaranty applies and shall continue
to apply to the Note, as modified by this Modification Agreement, and to
acknowledge that without such consent and confirmation, Lender would not execute
this Modification Agreement.
Article 5.
Miscellaneous
Section 5.01 Reference to Agreement. Each of the Loan Documents is hereby
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amended so that any reference in such Loan Documents to the Note shall mean a
reference to the Note, as amended hereby.
Section 5.02 Severability. Any provision of this Modification Agreement
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held by a court of competent jurisdiction to be invalid or unenforceable shall
not impair or invalidate the remainder of this Modification Agreement and the
effect thereof shall be confined to the provision so held to be invalid or
unenforceable.
Section 5.03 APPLICABLE LAW. THIS MODIFICATION AGREEMENT AND ALL OTHER LOAN
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DOCUMENTS EXECUTED PURSUANT HERETO SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
Section 5.04 Successors and Assigns. This Modification Agreement is binding
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upon and shall inure to the benefit of Lender and Borrower and their respective
successors and assigns.
Section 5.05 Counterparts. This Modification Agreement may be executed in
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one or more counterparts, each of which when so executed shall be deemed to be
an original, but all of which when taken together shall constitute one and the
same instrument.
Section 5.06 Headings. The headings, captions, and arrangements used in
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this Modification Agreement are for convenience only and shall not affect the
interpretation of this Modification Agreement.
NOTICE PURSUANT TO TEX. BUS. & COMM. CODE (S)26.02
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THIS MODIFICATION AGREEMENT AND ALL OTHER LOAN DOCUMENTS EXECUTED BY ANY OF THE
PARTIES BEFORE OR SUBSTANTIALLY CONTEMPORANEOUSLY WITH THE EXECUTION HEREOF
TOGETHER CONSTITUTE A WRITTEN LOAN AGREEMENT WHICH REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES 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.
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EXECUTED effective as of the date first set forth above.
BORROWER:
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RETRACTABLE TECHNOLOGIES, INC.
By: /s/ Xxxxxx X. Xxxx
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Name: Xxxxxx X. Xxxx
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Title: CEO President
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LENDER:
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KATIE PETROLEUM, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
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Title: President / CEO
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STATE OF TEXAS (S)
(S)
COUNTY OF Xxxxxx (S)
The foregoing instrument was ACKNOWLEDGED before me this 2 day of July,
2002, by Xxxxxx Xxxx, the President CEO of RETRACTABLE TECHNOLOGIES, INC., a
Texas corporation, on behalf of said corporation.
/s/ Xxxxxxx Xxxxxx
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[STAMP] Notary Public for State of Texas
Printed Name: XXXXXXX XXXXXX
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My Commission Expires: 02-07-04
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STATE OF TEXAS (S)
(S)
COUNTY OF Dallas (S)
The foregoing instrument was ACKNOWLEDGED before me this 2 day of July,
2002, by Xxxx Xxxxxxx, the CEO of KATIE PETROLEUM, INC., a Texas corporation, on
behalf of said corporation.
/s/ Xxxxx X. Xxxxxxxx
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[STAMP] Notary Public for State of Texas
Printed Name: XXXXX X. XXXXXXXX
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My Commission Expires: 6-29-2003
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JOINED BY GUARANTOR:
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/s/ Xxxxxx X. Xxxx
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XXXXXX X. XXXX, Individually
STATE OF TEXAS (S)
(S)
COUNTY OF Xxxxxx (S)
The foregoing instrument was ACKNOWLEDGED before me this 2 day of July,
2002, by XXXXXX X. XXXX, an Individual.
/s/ Xxxxxxx Xxxxxx
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[STAMP] Notary Public for State of Texas
Printed Name: XXXXXXX XXXXXX
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My Commission Expires: 02-07-04
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WHEN RECORDED, RETURN TO:
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X X Xxxxxxx Xx
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Xx Xxx 000000
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Xxxxxx, XX 00000 - 2063
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