Exhibit 2.2
July 31, 2001
Xxxx Xxxxxxx Xxxxxx
Xxxxx Xxxxxx
c/o Faith Walk Designs, Inc.
00000 Xxxxxx Xxxx, Xxxxx X
Xxxxxxx, XX 00000
Re: Side Letter to that certain Merger Agreement by and between
Decorize, Inc., ("Decorize"), Step of Faith, Inc., ("Step of
Faith") and Faith Walk Designs, Inc., ("Faith Walk"), dated as
of July 31, 2001, (the "Merger Agreement")
Dear Xx. Xxxxxx:
Referenceis made to that certain demand Promissory Note, dated June 19,
2001, executed by Xxxx Xxxxxxx Xxxxxx in favor of Decorate, Inc., in the amount
of Thirty Thousand Dollars ($30,000.00), that certain demand Promissory Note,
dated July 6, 2001, executed by Xxxx Xxxxxxx Xxxxxx in favor of Decorate, Inc.,
in the amount of Fifty Thousand Dollars ($50,000.00), and that certain demand
Promissory Note, July 16, 2001, executed by Xxxx Xxxxxxx Xxxxxx in favor of
Decorate, Inc., in the amount of Fifty Thousand Dollars
($50,000.00),(collectively, the "Notes").
This Side Letter is being executed in conjunction with the Merger
Agreement and any defined terms used herein shall have the meaning given them in
the Merger Agreement unless otherwise defined herein.
Notwithstanding anything in the Merger Agreement to the contrary, the
parties agree to the following:
1. Before or at Closing, Xxxx Xxxxxxx Xxxxxx and Xxxxx Xxxxxx shall pay to
Decorate, Inc., all amounts due under the Notes, including accrued
interest thereon. The payoff of the Notes and accrued interest shall be
a condition precedent to the obligations of Decorize and Step of Faith
under the Merger Agreement.
2. In the event Sterling Bank does not release Faith Walk of Faith Walk's
obligations under any Security Agreement or Guaranty executed by the
corporation in favor of Sterling Bank by reason of that certain
Promissory Note, dated September 2, 1998 executed by Xxxx Xxxxxxx
Xxxxxx and Xxxxx Xxxxxx in favor of Sterling Bank in the amount of
Three Hundred Fifteen Thousand Dollars ($315,000.00), Xxxx Xxxxxxx
Xxxxxx and Xxxxx Xxxxxx, husband and wife, jointly and severally,
hereby agree to indemnify Decorize and Step of Faith for any costs,
fees or expenses, including reasonably attorneys fees, arising directly
or indirectly from any Security Agreement or Guaranty. This indemnity
shall survive the Closing of the Merger Agreement.
3. Notwithstanding anything in the Merger Agreement to the contrary, Xxxx
Xxxxxxx Xxxxxx agrees to pay to Decorize an amount equal to Six
Thousand Five Hundred Seventy-Eight Dollars and Sixty-Two Cents
($6,578.62) and interest thereon at a rate of 6.75% per annum until all
principal and accrued interest are paid in full. Xxxx Xxxxxxx Xxxxxx
agrees that all principal and interest shall be paid in full to
Decorize by January 1, 2002. Xxxx Xxxxxxx Xxxxxx agrees that Decorize
shall have the right to set off on any amounts due from Decorize to
Xxxxxx.
4. This Side Letter incorporates by reference Sections 12.2, 12.3, 12.5,
12.6, 12.8 and 12.10 of the Merger Agreement as though repeated in
their entirety herein.
In the event that it should become necessary to enforce the terms of
this Side Letter by legal action, the losing party shall pay the costs fees and
expenses of the prevailing party.
If this letter accurately reflects your understanding relating to the
various issues addressed herein, please execute one original copy of this letter
and return it to Decorize at the above address.
Sincerely,
DECORATE, INC.
By: /s/ Xxx Xxxxx
-----------------------
Xxx Xxxxx, President
AGREED TO THIS 31st DAY OF JULY, 2001:
/s/ Xxxx Xxxxxxx Xxxxxx
-------------------------
Xxxx Xxxxxxx Xxxxxx
/s/ Xxxxx Xxxxxx
-------------------------
Xxxxx Xxxxxx
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