Exhibit 10.1

 

January 31, 2006

BY FACSIMILE MACHINE

(416) 467-7173

 

Mr. William Smith

Teckn-O-Laser Company

Teckn-O-Laser Global Company

Adsero Corp

Tecknolaser USA inc.

2101-N Nobel Street

Sainte-Julie (Québec) J3E 1Z8

 

Re: Standstill Agreement

 

Dear Mr. Smith:

 

WHEREAS according to the terms and conditions set out in the letter of offer
dated and signed on December 23, 2004, National Bank of Canada (“NBC”) agreed to
grant to Teckn-O-Laser Company (“Teckn-O-Laser”) credit facilities in the total
amount of $ 3,800,000 (said letter of offer if and as subsequently modified is
hereinafter designated as the “Letter of offer”);

 

WHEREAS as of January 26, 2006, Teckn-O-Laser’s debt towards NBC is in the
amount of $ 3,676,215.63, in principal and interest (the amounts owed to NBC as
of January 26, 2006 are hereinafter collectively designated as the “Debt”);

 

WHEREAS the maturity date for the operating credits made available to
Teckn-O-Laser has expired and has not been extended, and WHEREAS Teckn-O-Laser
is in default to respect some of the terms and conditions set out in the Letter
of offer ( collectively, the “Defaults”);

 

WHEREAS in order to guarantee the repayment of the Debt, NBC holds charges,
liens, encumbrances and guarantees, and some of them are more precisely
described in the Letter of offer (these charges, liens, encumbrances and
guarantees are hereinafter collectively designated as the “Securities”);

 

WHEREAS pursuant to the Defaults, NBC would be entitled to exercise its rights
and recourses against Teckn-O-Laser, as well as its rights and recourses arising
from the Securities;

 

WHEREAS as per Teckn-O-Laser request, NBC and Teckn-O-Laser agreed on the terms
and conditions pursuant to which NBC is willing to temporarily suspend the
exercise of its rights and recourses against Teckn-O-Laser, as well as those
arising from the Securities, without renouncing to its rights and recourses
arising from the Defaults;

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THE PARTIES HEREBY AGREE AS FOLLOWS:

 

1.

PREAMBLE

1.1

The preamble is an integral part of this agreement and contains factual
declarations which the parties acknowledge to be accurate.

2.

ACKNOWLEDGEMENT OF THE DEBT

2.1

Teckn-O-Laser, Adsero Corp. (“Adsero”), Teckn-O-Laser Global Company
(“Teckn-O-Laser Global”) and Tecknolaser USA inc. acknowledge and agree that
Teckn-O-Laser is presently indebted towards NBC, in the amount of the Debt,
calculated in principal and interest as of January 26, 2006, to which amount is
added the interest at the rate agreed to, since that date, as well as the fees
and accessories provided in the Letter of offer;

2.2

Teckn-O-Laser, Adsero, Teckn-O-Laser Global and Tecknolaser USA inc. acknowledge
and agree that:

 

2.2.1

All obligations contained in the Letter of offer as well as the obligations
arising from the Securities, including the total repayment of the Debt, are
valid and enforceable (collectively, the “Obligations”);

 

2.2.2

The Defaults have occurred and continue to exist;

 

2.2.3

Considering the Defaults, NBC is in a position to immediately realize its
Securities and to undertake all appropriate judicial proceedings in recovery of
the Debt; and

 

2.2.4

NBC’s tolerance of the Defaults and the additional time period granted prior to
the realization of NBC’s securities substantially benefit Teckn-O-Laser;

2.3

Teckn-O-Laser acknowledges and agrees that:

 

2.3.1

It has no claim against NBC, nor against its directors, officers, employees,
agents or representatives; and

 

2.3.2

It has no claim, counter-claim, defence or rights to any compensation whatsoever
which may be raised against NBC in respect of the Debt;

3.

TEMPORARY SUSPENSION OF THE REALIZATION OF THE SECURITIES

3.1

Subject to the terms and conditions hereinafter contained, NBC agrees to suspend
the realization of its Securities and to tolerate the Defaults with respect to
Teckn-O-Laser’s Obligations until the earlier of the following dates:

 

a)

April 30, 2006; or

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b)

The date on which Teckn-O-Laser fails to respect the “Suspension Conditions”
(the earlier date between a) and b) being hereinafter designated as the
“Termination date of the suspension”).

3.2

For the purposes hereof, the Suspension Conditions are as follows:

 

3.2.1

No hypothecary or other recourse, no prior notice of the exercise of hypothecary
right shall be instituted against Teckn-O-Laser or its assets which, in the
opinion of NBC, would have material unfavourable consequences with respect to
the assets, the business or the financial situation of Teckn-O-Laser or with
respect to the rights and recourses of NBC;

 

3.2.2

No material change of Teckn-O-Laser’s situation shall occur which, in the
opinion of NBC, has or may have a material negative impact in a material way on
the assets, the business or the financial situation of Teckn-O-Laser or on the
rights and recourses of NBC;

 

3.2.3

Teckn-O-Laser shall not declare bankruptcy or be the object of receivership
proceedings;

 

3.2.4

Teckn-O-Laser shall not file a proposal to the benefit of its creditors or
prevail itself of the C.C.A.A. without the prior written consent of NBC in
regards thereto;

 

3.2.5

Teckn-O-Laser agrees to fully cooperate with NBC or any representative that NBC
may designate with respect to any information request, evaluation, examination,
visit or other procedure that NBC may undertake with respect to the assets,
business or financial situation of Teckn-O-Laser;

 

3.2.6

The interest rate of Credit A (as defined in the Letter of offer) shall be
increased to Canadian prime rate + 2.5 %;

 

3.2.7

The monthly fees, earned upon acceptance of this Standstill Agreement, shall be
in the amount of $ 20,000 and shall be paid in accordance with subsection 3.2.9.
These monthly fees shall replace the fees (“Frais de déficit d’équité”) reffered
to in the Letter of offer and in section 2.4 of a letter of renewal dated August
14, 2005, accepted on August 8, 2005.

 

3.2.8

Adsero undertakes to pay NBC, within a delay of two (2) business days following
the acceptance of the present Standstill Agreement, an amount of $ 500,000 U.S.

 

3.2.9

The amount of $ 500,000 U.S. shall be applied by NBC as follows:

 

(i)

To the complete payment of the principal and the interest owing and due
according to Credit B (as defined in the Letter of offer). As of January 26,
2006, the amount owing and due according to Credit B is $ 276,784.50. It is
clearly understood that this credit facility shall be terminated and shall no
longer be available;

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(ii)

To the complete payment of the tolerance and postponement fees of $ 35,000
referred to in subsection 4.1;

 

(iii)

To the complete payment of the monthly fees referred to in subsection 3.2.7,
representing a total amount of $ 80,000;

 

(iv)

To the partial payment and reduction of Credit A (as defined in the Letter of
offer).

 

3.2.10

Teckn-O-Laser shall obtain, at the latest on April 15, 2006, a letter of offer
from another financial institution, which Teckn-O-Laser shall have agreed to and
which shall enable it to repay the Debt, at the latest, by April 30, 2006;

3.3

At any time after Termination date of the suspension, NBC shall have the right
to exercise its rights and recourses pursuant to the Letter of offer, the
Securities or the relevant legislation, without any other notice, delay or
contestation, of any nature whatsoever, on the part of Teckn-O-Laser, the later
agreeing to irrevocably and voluntarily surrender the property charged in favour
of NBC by virtue of the Securities, upon NBC’s request;

3.4

Teckn-O-Laser agrees and acknowledges that NBC does not undertake to grant an
additional time period or tolerate the Defaults beyond the Termination date of
the suspension and undertakes to manage its affairs accordingly.

4.

FEES

4.1

Tolerance and postponement fees of $ 35,000.00 shall be payable according to the
terms and conditions set out in subsection 3.2.9;

4.2

All fees and disbursements incurred by NBC further to the services rendered by
its legal advisers related to the review and to the preparation of any document,
letter, contract, letter of offer or security, shall continue to be paid by
Teckn-O-Laser by debit from the account upon receipt of the invoice and shall be
in addition to all other expenses, including those referred to in subsections
3.2.7 and 4.1;

5.

MISCELLANEOUS

5.1

This agreement shall be governed by and construed and enforced in accordance
with the laws of the Province of Quebec and the federal laws of Canada
applicable therein;

5.2

If any provision of this agreement is declared illegal, invalid or unenforceable
for any reason, such provision shall be severed from the remainder of this
agreement and shall be ineffective to the extend of such illegality, invalidity
or unenforceability and shall not affect or impair the remaining provisions of
this agreement;

5.3

This agreement contains the entire understanding of the parties hereto
concerning the subject matter hereof and supersedes all prior and
contemporaneous agreements between the parties to that effect. This agreement
may only be amended by an instrument in writing signed by both parties;

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5.4

This agreement operates without novation of any term and condition of the Letter
of offer, Securities and any right, surety and recourse pursuant thereto, which
remain valid and fully in force, pursuant to the terms and conditions expressed
therein;

5.5

This agreement shall not be interpreted as changing, modifying or amending the
terms and conditions of the Letter of offer, except as provided herein in
subsections 3.2.6, 3.2.7, 3.2.8 and 3.2.9;

5.6

This agreement shall not be interpreted as an agreement or a renunciation by NBC
to its rights and recourses arising from the Defaults;

5.7

The parties hereto acknowledge that they have required that this agreement be
drawn in English. Les parties reconnaissent avoir exigé la rédaction en anglais
de cette entente.

This Standstill Agreement must be acceptable by Teckn-O-Laser, Teckn-O-Laser
Global, Adsero and Tecknolaser USA inc. no later than February 2, 2006 by
signing and returning the attached copy to us, failing which NBC reserves the
right to take all necessary measures in such circumstances without further delay
or notice.

Yours truly,

NATIONAL BANK OF CANADA

 

/s/ Pierre-Paul Dufault

Pierre-Paul Dufault

 

We declare that we have taken cognizance of this Standstill Agreement dated
January 31, 2006 and we accept the terms, conditions and obligations hereof.

 

Executed this

2nd

day of

February

2006.

 

 

TECKN-O-LASER COMPANY

TECKN-O-LASER GLOBAL COMPANY

 

 

Per: /s/ William Smith

Per: /s/ William Smith

 

William Smith

William Smith

 

 

ADSERO CORP.

TECKNOLASER USA INC.

 

 

Per: /s/ William Smith  

Per: /s/ William Smith

 

William Smith

William Smith

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