EXHIBIT 10.43
XXXXXX X. XXXXXX
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
October 18, 2002
UltraStrip Systems, Inc., as maker of Note
0000 X.X. Xxxxxx Xxxxxxx
Xxxxxx, Xxxxxxx 00000
ATTENTION: Xxxxxx X. Xxxxxxx, M.D.
President and CEO
RE: Extension of Maturity of Note and Modification of Subscription
And Warrant Purchase Agreement
Dear Xx. Xxxxxxx:
UltraStrip Systems, Inc., a Florida corporation ("UltraStrip"),
executed a Promissory Note in the principal amount of $862,069.00 as of October
19, 2001 (the "Note"), together with a Financing Agreement of even date
therewith (the "Financing Agreement") and a Subscription and Warrant Purchase
Agreement of even date therewith (the "Warrant Agreement"). On October 19, 2001,
the Creditor paid an additional $137,931 pursuant to the Warrant Agreement.
The Initial Advances, together with all accrued but unpaid interest,
are due and payable, in full, on October 18, 2002. The Creditor has agreed to
extend the due date for the Initial Advances, together with all accrued but
unpaid interest thereon until January 17, 2003. In exchange for such agreement,
UltraStrip agrees to modify the Warrant Agreement by increasing the number of
Warrants from the existing number of 100,000 to a total of 162,500, an increase
of 62,500 Warrants. The additional 62,500 warrants will have a strike price of
$0.07 and will expire on October 18, 2022.
UltraStrip hereby agrees, represents, warrants and covenants that (a)
there is no current or threatened breach and UltraStrip is in compliance with
all terms and conditions, under the Note, Financing Agreement and Warrant
Agreement other than the failure to pay the Initial Advances, together with
accrued but unpaid interest thereon, as of October 19, 2002, which date has been
extended as provided herein, (b) the Note, Financing Agreement and Warrant
Agreement remain in full force and effect except as otherwise amended as
provided herein, and (c) it has no claims, actions or causes of actions against
the Creditor as of the date hereof.
Any ambiguities between the terms of this letter and the Note,
Financing Agreement, and the Warrant Agreement shall be resolved in favor of the
terms of this letter. This letter may be executed in one or more counterparts
and each such executed counterpart shall be taken together with all other
executed counterparts and constitutue a single instrument binding upon each such
party hereto and their personal and other legal representatives, heirs,
successors and permitted assigns. The terms of this letter shall be construed,
governed and enforced in accordance with Florida law. The terms of this letter
shall only be effective as of October 19, 2002 if and when it is executed by and
delivered to the Creditor and UltraStrip.
/s/ Xxxxxx X. Xxxxxx
Xxxxxx Xxxxxx
/s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
President and CEO
UltraStrip Systems, Inc.
(ORIGINAL AGREEMENT)
SENIOR PROMISSORY NOTE
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Principal Amount $862,069.00 Dated: October _19_, 2001
1. Principal Amount.
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For the mutual consideration received pursuant to the Subscription and
Stock Purchase Agreement and Security Agreement (collectively referred to as
"AGREEMENTS") dated October 19, 2001 between ULTRASTRIP SYSTEMS, INC.
("BORROWER") whose principal place of business is located at 0000 xx Xxxxxx
Xxxxxxx, Xxxxxx, Xxxxxxx 00000 and Xxxxxx X. Xxxxxx ("LENDER") whose address is
000 Xxxxxxxxxxxx Xxxx, Xxxxxxx, Xxx Xxxxxx 00000, which is incorporated by
reference hereto as well as this Promissory Note (the "NOTE"), Borrower may
borrow an amount not to exceed EIGHT HUNDRED SIXTY-TWO THOUSAND SIXTY-NINE
DOLLARS ($862,069.00) on a non-revolving basis in such installments as Borrower
may request, and may be prepaid without penalty by Borrower at any time.
The principal amount hereunder shall bear interest at the effective rate of
sixteen percent (16%) payable in the following fashion:
The principal amount of the loan together with the full
interest payment shall be repaid by way of balloon payment
upon the first anniversary of the advancement of principal
which together total ONE MILLION DOLLARS ($1,000,000.00).
2. Prepayment.
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Borrower has the right to prepay this Note at any time with no
prepayment penalty.
3. Place of Payment.
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All payments and/or advances to be made hereunder shall be delivered to
the individual party's address as set forth above.
4. Collateral.
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This Note will be secured by the property and machinery of the Borrower
as described in the Security Agreement. To the extent provided by the Uniform
Commercial Code and other applicable law, Lender shall be granted a priority
security interest in the collateral described in the Security Agreement.
Borrower consents to Lender filing any and all appropriate UCC-1 Finanancing
Statements consistent with the Agreements and Note.
5. Charges.
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Lender agrees that there shall be no loan charges, costs, or other
monies due Lender in consideration for making said loan. Lender agrees to pay
all taxes, duties, and other charges specifically levied with regard to this
loan.
6. Miscellaneous.
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A. Severability.
If any one or more of the provisions of this Note are
determined to be unenforceable, in whole or in part, for any reason, the
remaining provisions shall remain fully operative.
B. Payment.
All payments of principal on this Note shall be paid in the
legal currency of the United States.
C. Lender's Rights.
No renewal or extension of this Note, delay in enforcing any
right of Lender under this Note, or assignment by Lender of this Note shall
affect the liability of Borrower. All rights of Lender under this Note are
cumulative and may be exercised concurrently or consecutively at Lender's
option.
D. Default.
If any of the following events occur, the full and complete
unpaid balance of this Note shall become due immediately:
1) The failure to issue stock in accordance with the
terms of the Agreement and this Note.
2) The dissolution or complete liquidation of Borrower.
E. Applicable Law. Venue. Enforcement Costs.
This Note shall be governed by and construed and enforced
according to the laws of the State of Florida except where specifically
preempted by federal law. Venue with respect to any litigation on this Note
shall be Palm Beach County, Florida. To the extent litigation pursuant to the
terms of this Note is necessary, the prevailing party shall be entitled to
reimbursement of its costs including all reasonable attorneys' fees and court
costs.
4. Signatures.
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IN WITNESS WHEREOF, LENDER AND BORROWER has executed this Note on the
date first above written.
LENDER: /S/ XXXXXX X. XXXXXX
--------------------
XXXXXX X. XXXXXX
By:
STATE OF NEW JERSEY, COUNTY OF Xxxxxx XX.:
I CERTIFY that on 10/4, 2001,
Xxxxxx Xxxxxx personally came before me and acknowledged under oath, to
my satisfaction, that this person (or if more than one, each person):
(a) is named in and personally signed this document; and
(b) signed, sealed and delivered this document as his or her act
and deed.
Notary Public of the State of New Jersey
OUTSIDE OF THE STATE OF FLORIDA
The foregoing instrument was sworn to, subscribed and acknowledged
before me this _4_th day of _Oct.__, 2001, by Xxxxxx Xxxxxx, who (_X_) is
personally known to me or (___) who has produced a ________________________
driver's license as identification.
NOTARY PUBLIC/BOAT CAPTAIN (ECR)
By:__/s/ Xxxxxxx Hodge_________________________
Print Name: _Kenneth Hodge_____________________
Notary Public of New Jersey
My Commission Expires Nov. 12, 2001
BORROWER:
ULTRASTRIP SYSTEMS, INC.
By: /s/ Xxxxxx X. Xxxxxxx
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OUTSIDE OF THE STATE OF FLORIDA
The foregoing instrument was sworn to, subscribed and acknowledged
before me this _10_th day of _Oct.__, 2001, by Xxxxxx Xxxxxxx , who (_X_) is
personally known to me or (___) who has produced a ________________________
driver's license as identification.
NOTARY PUBLIC/BOAT CAPTAIN (ECR)
By:__/s/ Xxxxxxx Cristoforo_____________________
Print Name: _Michael Cristoforo_________________
My Commission CC932153
Expires April 30, 2004
(ORIGINAL AGREEMENT)
SECURITY AGREEMENT
------------------
October __19___, 2001
ULTRASTRIP SYSTEMS, INC., a Florida corporation with its principal
place of business located at 0000 XX Xxxxxx Xxxxxxx, Xxxxxx, Xxxxxxx
(hereinafter called the "DEBTOR"), for valuable consideration hereby grants to
XXXXXX XXXXXX, whose address is 000 Xxxxxxxxxxxx Xx, Xxxxxxx, Xxx Xxxxxx 00000
(hereinafter collectively called "SECURED PARTY"), a lien upon and security
interest in the property and any replacements thereof described in Exhibit "A"
attached hereto and by this reference made a part hereof, as well as all
proceeds therefrom and insurance thereon (said property being hereinafter called
the "COLLATERAL").
This Security Agreement ("AGREEMENT") is entered into to secure the
performance by the DEBTOR of its obligations TO SECURED PARTY as set forth in
the Promissory Note dated _10/19/01___ (hereinafter referred to herein as the
"NOTE"). Incident thereto, the DEBTOR agrees with the SECURED PARTY as follows:
1. DEBTOR warrants and represents that:
(a) The Security Interest granted to the SECURED PARTY in the
Collateral shall constitute a first lien thereon and no superior lien will be
granted to any other parties as long as a balance remains on this Note, without
the consent of SECURED PARTY, and that DEBTOR is the lawful owner of such
Collateral and has good right to pledge, assign, transfer, and create a Security
Interest in the same;
2. Upon request and as instructed by SECURED PARTY, the DEBTOR agrees
to comply with the requirements of all valid and applicable state and federal
laws in order to grant to the SECURED PARTY a valid lien upon, and a security
interest in, the Collateral under the Uniform Commercial Code of Florida, or
which may be described in any amendment supplementary hereto.
3. The DEBTOR will pay, when due, all taxes, assessments, trademark
fees, and other charges lawfully and validly levied or assessed upon the
Collateral or any part thereof, and the DEBTOR will pay any and all fees, costs,
and expenses, of whatever kind and nature, which the SECURED PARTY may incur in
filing public notices.
4. The DEBTOR agrees to notify the SECURED PARTY promptly of any change
in its mailing address or principal place of business, in order that a prompt
refiling of any outstanding notices may be made, if necessary.
5. At its option, the SECURED PARTY may discharge taxes, liens, or
security interests or other encumbrances at any time levied or placed on the
Collateral. All such sums, as well as costs, advanced by SECURED PARTY pursuant
to this Security Agreement shall be due immediately from DEBTOR to SECURED
PARTY.
6. The DEBTOR shall be in default under this Security Agreement upon
the happening of any of the following events or conditions:
(a) Failure of DEBTOR to make any payment or perform any
obligation or covenant provided for in this Agreement or the Note;
(b) The falsity in any material respect of any warranty,
representation or statement made or furnished to SECURED PARTY by DEBTOR,
expressed in this Agreement or the Definitive Agreement, or necessarily implied
by the provisions hereof;
(c) The occurrence of any event which causes the acceleration
of the indebtedness of DEBTOR to others under any indenture, agreement or
undertaking;
(d) The making of any levy on, or seizure or allotment of the
Collateral, or any portion thereof;
(e) The dissolution of DEBTOR;
(f) Commencement of any voluntary or involuntary proceeding
under the bankruptcy or any state insolvency law against DEBTOR; the
dissolution, insolvency or business failure of DEBTOR; the appointment of a
receiver for any part of the property of Debtor; or the assignment for the
benefit of creditors of DEBTOR; and
7. Upon such default, and at any time thereafter, the SECURED PARTY may
declare all Obligations secured hereby immediately due and payable, including,
without limitation, all amounts owned under the Promissory Note and shall have
the remedies of a secured party under the Uniform Commercial Code as adopted in
Florida.
In case of the exercise of any of the rights of the SECURED PARTY
hereunder, all Collateral, and other property or security given to secure the
indebtedness secured hereby, may be offered for sale for one total price, and
the proceeds of such sale accounted for in one account without distinction
between items of security or without assigning to them any proportion of the
proceeds of such sale, the DEBTOR, insofar as it legally may so do, hereby
waiving the application of any doctrine of marshaling, or the Collateral, or
such other property or security, may be offered for sale separately, and sales
may be held from time to time, and all powers of the SECURED PARTY shall not be
fully executed until all Collateral, and such other property or security, shall
have been sold.
8. No waiver by the SECURED PARTY of any default shall operate as a
waiver of any other default or of the same default on a future occasion. All
rights of the SECURED PARTY hereunder shall inure to the benefit of its
successors and assigns; and all obligations of the DEBTOR shall bind its
successors and assigns.
9. The covenants and agreements herein contained shall extend to, inure
to the benefit of, and be binding upon, the respective successors, heirs,
executors, administrators, and assigns of the Parties hereto, the same as if
they were in every case named and expressed.
10. This Agreement may be executed in one or more counterparts having
the signatures of the parties, and each such counterpart shall, for all
purposes, be deemed an original, but all such counterparts shall together
constitute but one and the same instrument.
11. Paragraph and Section titles or captions contained in this
Agreement are inserted only as a matter of convenience for reference and in no
way define, limit, extend or describe the scope of this Agreement or the intent
of any provision hereof.
12. This Agreement represents the entire understanding and agreement
between the Parties with respect to the subject matter hereof, and supersedes
all other negotiations, understandings and representations (if any) made by and
between such Parties.
13. Any notice required to be given hereunder may be hand delivered,
sent by overnight courier which provides receipts, or by certified mail, return
receipt requested, to the addresses contained in this Agreement or at any other
address as designated in writing by that party. The notice shall be deemed
delivered when received (if hand delivered), on the day following deposit with
the express courier (if forwarded by overnight courier), or on the date of
actual delivery as evidenced by the return receipt, the date delivery is refused
or the date the notice is designated as not deliverable by the postal
authorities, (if sent by certified mail).
14. This Agreement and all transactions contemplated in this Agreement
shall be governed by, construed and enforced in accordance with, the internal
laws of the State of Florida without regard to principles of conflicts of law.
15. If any provision of this Agreement or any other agreement entered
into pursuant hereto is contrary to, prohibited by or deemed invalid under
applicable law or regulation, such provision shall be inapplicable and deemed
omitted to the extent so contrary, prohibited or invalid, but the remainder
hereof shall not be invalidated thereby and shall be given full force and effect
so far as possible. If any provisions of this Agreement may be construed in two
or more ways, one of which would render the provision invalid or otherwise
voidable or unenforceable and another of which would render the provision valid
and enforceable, such provision shall have the meaning which renders it valid
and enforceable.
16. Wherever the construction so requires in this Agreement, the
masculine shall include the feminine and the neuter, and the singular shall
include the plural, and conversely.
17. The Parties hereby agree from time to time to execute and deliver
such further and other transfers, assignments and documents and do all matters
and things which may be convenient or necessary to more effectively and
completely carry out the intentions of this Agreement.
18. All covenants, agreements, representations and warranties made
herein or otherwise made in writing by any party pursuant hereto shall survive
the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby.
19. The provisions of this Agreement may be amended, supplemented,
waiver or changed orally, only by a writing signed by the party as to whom
enforcement of any such amendment, supplement, waiver or modification is sought
and making specific reference to this Agreement.
20. Except as otherwise expressly provided herein, no remedy herein
conferred upon any party is intended to be exclusive of any other remedy, and
each and every such remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing at law or in equity or
by statute or otherwise. No single or partial exercise by any party of any
right, power or remedy hereunder shall preclude any other or further exercise
thereof.
IN WITNESS WHEREOF, the DEBTOR has caused this Security Agreement to be
duly executed on its behalf, under seal, as of the day and year first above
written.
WITNESSES: "DEBTOR"
ULTRASTRIP SYSTEMS, INC.
/s/ Xxxxx X. Xxxx BY: /s/ Xxxxxx X. Xxxxxxx
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/s/ Xxxxx X. Xxxxxxx
--------------------
(Corporate Seal)
OUTSIDE OF THE STATE OF FLORIDA
The foregoing instrument was sworn to, subscribed and acknowledged
before me this _10_th day of _Oct.__, 2001, by , who (_X_) is personally known
to me or (___) who has produced a ________________________ driver's license as
identification.
NOTARY PUBLIC/BOAT CAPTAIN
/s/ Xxxxxxx Xxxxxxxxxx
----------------------
Xxxxxxx Xxxxxxxxxx
My Commission CC932153
Expires April 30, 2004
By:__/s/ Xxxxxx X. Baratta__________
Print Name: ___Robert O. Baratta____
EXHIBIT "A"
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TO
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SECURITY AGREEMENT
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The Collateral is defined to include:
1. All existing equipment and machinery utilized to manufacture
debtor's product.
ULTRASTRIP SYSTEMS, INC.
Dated: September , 2001
By: /s/ Xxxxxx X. Xxxxxxx, M.D.
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President
