THOUSAND DOLLARS ($285,000.00).
3.
SUBORDINATED DEBT.
(A)
IN ADDITION TO ALL OF THE OTHER CONDITIONS SET FORTH IN THAT
CERTAIN SUBORDINATION AGREEMENT AMONG BORROWERS, LANA, LLC AND LENDER DATED JULY
30, 2003 (AS AMENDED, THE "SUBORDINATION AGREEMENT"), AT ANY TIME DURING WHICH
THE PERMITTED OUT-OF-FORMULA AMOUNT IS AVAILABLE TO BORROWERS, BORROWERS SHALL
NOT MAKE ANY PAYMENTS OF PRINCIPAL, INTEREST OR OF ANY OTHER NATURE ON
INDEBTEDNESS TO LANA, LLC.
(B)
CONTEMPORANEOUSLY WITH THE EXECUTION OF THIS AMENDMENT, BORROWERS
SHALL CAUSE LANA, LLC TO EXECUTE AND DELIVER TO LENDER AN AMENDMENT TO THE
SUBORDINATION AGREEMENT IN FORM AND CONTENT SATISFACTORY TO THE LENDER, PURSUANT
TO WHICH LANA, LLC SHALL ACKNOWLEDGE AND AGREE (I) THAT ALL INDEBTEDNESS OF
BORROWERS TO LANA, LLC SHALL BE FULLY SUBORDINATED TO ALL OBLIGATIONS,
REGARDLESS OF WHETHER OR NOT SUCH INDEBTEDNESS TO LANA, LLC IS EVIDENCED BY A
NOTE OR ANY OTHER INSTRUMENT, (II) THAT THE OUTSTANDING PRINCIPAL BALANCE OF THE
INDEBTEDNESS OF BORROWERS TO LANA, LLC IS AT LEAST THREE MILLION FIVE HUNDRED
THOUSAND DOLLARS ($3,500,000.00) AND (III) TO THE ADDITIONAL CONDITION ON
PAYMENT OF THE INDEBTEDNESS TO LANA, LLC SET FORTH ABOVE.
4.
OUTSIDE ACCOUNTS.
(A)
BORROWERS AND GUARANTOR REPRESENT AND WARRANT TO LENDER THAT
ATTACHED HERETO AS SCHEDULE 3 IS A COMPLETE LISTING OF ALL ACCOUNTS OF BORROWERS
AND GUARANTOR MAINTAINED WITH ANY BANK OR OTHER FINANCIAL INSTITUTION OTHER THAN
LENDER (COLLECTIVELY, THE "OUTSIDE ACCOUNTS").
(B)
ON OR BEFORE MAY 30, 2004, BORROWERS AND GUARANTOR SHALL CAUSE TO
BE DELIVERED TO LENDER CONTROL AGREEMENTS WITH RESPECT TO LENDER'S SECURITY
INTEREST IN EACH OF THE OUTSIDE ACCOUNTS, WHICH CONTROL AGREEMENTS MUST BE IN
FORM AND CONTENT SATISFACTORY TO LENDER.
5.
APPRAISALS.
LENDER INTENDS TO OBTAIN A CURRENT APPRAISAL OF ALL
EQUIPMENT OF BORROWERS AND A DESK-TOP REVIEW OF PREVIOUSLY PERFORMED APPRAISALS
OF BORROWERS' REAL ESTATE.
BORROWERS SHALL BE FULLY LIABLE FOR ALL COSTS AND
EXPENSES INCURRED BY LENDER IN CONNECTION WITH SUCH APPRAISAL AND REVIEW, WHICH
SUMS MAY BE DEDUCTED BY LENDER FROM ANY DEPOSIT ACCOUNT OF BORROWERS MAINTAINED
WITH LENDER OR CHARGED AS A REVOLVING LOAN.
BORROWERS SHALL FULLY COOPERATE
WITH RESPECT TO SUCH EQUIPMENT APPRAISAL SUCH THAT THE EQUIPMENT APPRAISAL IS
COMPLETED ON OR BEFORE MAY 30, 2004.
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6.
FURTHER AGREEMENTS AND REPRESENTATIONS. EACH BORROWER AND
GUARANTOR DOES HEREBY:
(A)
RATIFY, CONFIRM AND ACKNOWLEDGE THAT, AS AMENDED HEREBY, THE LOAN
AGREEMENT AND THE OTHER LOAN DOCUMENTS ARE VALID, BINDING AND IN FULL FORCE AND
EFFECT;
(B)
COVENANT AND AGREE TO PERFORM ALL OF SUCH BORROWER'S AND
GUARANTOR'S OBLIGATIONS UNDER THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS,
AS AMENDED;
(C)
ACKNOWLEDGE AND AGREE THAT AS OF THE DATE HEREOF, NEITHER ANY
BORROWER NOR GUARANTOR HAS ANY DEFENSE, SET-OFF, COUNTERCLAIM OR CHALLENGE
AGAINST THE PAYMENT OF ANY SUMS OWING UNDER ANY OF THE OBLIGATIONS, AS AMENDED,
OR THE ENFORCEMENT OF ANY OF THE TERMS OF THE LOAN AGREEMENT OR OF THE OTHER
LOAN DOCUMENTS, AS AMENDED;
(D)
ACKNOWLEDGE AND AGREE THAT EXCEPT AS HERETOFORE DISCLOSED TO
LENDER BY BORROWERS IN WRITING, ALL