Document:

exv10w81

 

Exhibit 10.81

SECOND AMENDMENT TO INDUSTRIAL LEASE AGREEMENT

     THIS SECOND AMENDMENT TO INDUSTRIAL LEASE AGREEMENT (this “Second Amendment”) is dated as of
December 28, 2007 by and between INDUSTRIAL PROPERTY FUND VI, LLC, a Delaware limited liability
company (“Landlord”), as successor-in-interest to Industrial Developments International, Inc., a
Delaware corporation (“IDI”), and PRIORITY FULFILLMENT SERVICES, INC., a Delaware corporation
(“Tenant”).

RECITALS

     IDI and Tenant previously entered into that certain Industrial Lease Agreement dated August
19, 2004, as amended by that certain First Amendment to Industrial Lease Agreement, dated December
22, 2004 (as amended, the “Lease”) for the lease of approximately 434,900 square feet of space,
more commonly known as 8474 Market Place, Southaven Mississippi 38671 (the “Demised Premises”),
located within Airways Distribution Center, DeSoto County, Mississippi. Landlord has succeeded to
the interest of IDI under the Lease.

     Landlord and Tenant now desire to amend the Lease to, among other things, extend the Term.

     NOW, THEREFORE, for and in consideration of Ten and No/100 Dollars ($10.00) and other good and
valuable consideration in hand paid by each party hereto to the other, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto do hereby agree as follows:

     1. All capitalized terms used herein but undefined shall have the meaning as defined in the
Lease.

     2. The Expiration Date, as defined in Section 1(h) of the Lease, is hereby extended to
December 31, 2010. As used herein, “Term” is hereby defined as the period commencing on the Lease
Commencement Date and terminating on the Expiration Date, as extended hereby.

     3. Beginning on January 1, 2008, the Annual Base Rent, as defined in Section 1(d) of the
Lease, for the remainder of the Term as extended hereby shall be $1,278,606.00 per year payable in
Monthly Base Rent Installments of $106,550.50 per month.

     4. Special Stipulation 3 of Exhibit C of the Lease is hereby deleted in its entirety. The
first sentence of Special Stipulation 4 of Exhibit C of the Lease is hereby amended and modified to
replace the number “two (2)” with “one (1)” so that from and after the date hereof, Tenant shall
only have one (1) option to extend the Term pursuant to Special Stipulation 4.

 

 

     5. Allowance for Tenant’s Changes.

          (a) Assuming Tenant either delivers to Landlord a Termination Waiver in accordance with the
terms of Section 7 below or does not timely exercise the Termination Option (as defined below) such
that it expires by its terms, Landlord shall reimburse Tenant for Tenant’s costs up to an amount
equal to One Hundred Eight Thousand Seven Hundred Twenty Five and No/100 Dollars ($108,725.00) (the
“Tenant Allowance”) which are incurred by Tenant in constructing any Tenant’s Changes which are
completed on or before June 30, 2008 (the “Construction Completion Date”) in accordance with the
terms of Section 18 of the Lease so long as, on or before the Construction Completion Date Tenant
has met the following requirements (“Reimbursement Requirements”):

          (i) substantially completed the applicable Tenant’s Changes and received a certificate
of occupancy (if required) from the applicable governing authority and delivered a copy of
the same to Landlord;

          (ii) delivered to Landlord lien waivers and affidavits from Tenant’s contractor, all
subcontractors, and all laborers or materials suppliers having performed any work at the
Demised Premises relating to the applicable Tenant’s Changes, together with any other
evidence reasonably required by Landlord to satisfy Landlord’s title insurer that there are
no parties entitled to file a lien against the real property underlying the Project in
connection with such work; and

          (iii) delivered to Landlord all invoices, receipts and other evidence reasonably
required by Landlord to evidence the cost of the applicable Tenant’s Changes.

          (b) Any qualifying reimbursement amounts described above shall be paid by Landlord to Tenant
within thirty (30) days after the later of (i) the Termination Option Expiration Date (as defined
below) (including, without limitation, if the Termination Option Expiration Date is accelerated due
to delivery by Tenant of a Termination Waiver in accordance with the terms of Section 7 below) or
(ii) thirty (30) days after satisfaction of the Reimbursement Requirements.

     6. Tenant utilizes the Demised Premises to provide logistical services (“Logistical Services”)
for its client, Philip Morris USA Inc. (“PM USA”). Landlord hereby agrees to simultaneously
deliver to PM USA, at the address below and otherwise in accordance with the terms of the Lease (a
“PM USA Notice”), a copy of any notice to Tenant regarding any failure by Tenant to fulfill its
obligations under the Lease which, with the giving of notice or the passage of time, or both, would
constitute an Event of Default (a “Potential Event of Default”).

 

 

PM USA Notice address:

Philip Morris USA, Inc.

6601 West Broad Street

Richmond, Virginia 23230

Attention: Manager of Marketing Services

If a Potential Event of Default occurs, so long as PM USA has the assets, capitalization, tangible
net worth (as defined in the Lease) and creditworthiness (collectively, the “Creditworthiness”) at
least equal to the Creditworthiness of the Guarantor as of the Lease Date as determined by GAAP, PM
USA shall have the right to cure any Potential Event of Default in the same manner and within the
same time frames in which Tenant would be so entitled under the terms of the Lease, provided that,
simultaneously with its causing such cure, PM USA delivers to Landlord a copy of the Lease
Assignment Agreement attached hereto as Exhibit A (the “Assignment Document”) duly executed by all
parties other than Landlord for whom signature blocks have been added, at which time, so long as
all the terms and conditions required in Section 29 of the Lease for a Pre-Approved Assignment are
met (other than the requirement of giving forty-five days prior written notice to Landlord), and no
Event of Default then exists and is continuing, Tenant shall be deemed to have assigned its
interest in the Lease to PM USA and PM USA shall be deemed to have assumed the obligations of
Tenant under the Lease (excluding any obligations and liabilities of Tenant which have accrued
prior to the PM USA Assignment) (the “PM USA Assignment”). Upon the Effective Date of a PM USA
Assignment (as defined in the Assignment Document), Tenant’s right, title and interest in the
Security Deposit shall be deemed assigned to PM USA. If the Security Deposit is then in the form
of a Letter of Credit, PM USA shall, simultaneously with its delivery of the Assignment Document,
cause a new Letter of Credit to be issued to Landlord in the same form as Tenant’s (after which,
if, and to the extent not previously drawn upon pursuant to the terms of the Lease, Landlord shall
return to Tenant its Letter of Credit). The PM USA Assignment shall be deemed effective on the
Effective Date, provided that the Potential Event of Default has been cured, no Event of Default
then exists and is continuing, and the Security Deposit has been fully replenished at the time of
delivery of the Assignment Document; otherwise, the PM USA Assignment shall not be deemed
effective. Tenant hereby irrevocably agrees to the terms of PM USA Assignment, and shall be deemed
to have approved and consented to the PM USA Assignment as if it had executed the Assignment
Document. From and after the Effective Date of a PM USA Assignment, PM USA shall become liable
directly to Landlord for all obligations of Tenant under the Lease arising after the Effective
Date, without, however, relieving Tenant or Guarantor of any liability thereunder. In the event
Landlord declares Tenant in default under section 22(a)(vii) of the Lease, notwithstanding the lack
of a cure period with respect to such default in the Lease, PM USA shall be entitled to a period of
10 days from receipt of a PM USA Notice with respect to such default to deliver a duly executed
Assignment Document in order to effect a PM USA Assignment of the Lease. Upon the Effective Date
of a PM USA Assignment, the default shall be deemed cured with respect to the Lease as assigned to
PM USA; provided, however, that the 10-day period in favor of PM USA is not intended as and shall
not be construed as a cure period in favor of Tenant with respect to such default should a PM USA
Assignment not occur within such period.

 

 

     In addition to the foregoing, PM USA shall have the right to effect a PM USA Assignment at any
time no Potential Event of Default or Event of Default exists and is continuing and so long as all
the terms and conditions required in the Lease for a Pre-Approved Assignment are met (other than
the requirement of giving forty-five days prior written notice to Landlord), by executing and
delivering to Landlord, with a copy to Tenant, the Assignment Document, whereupon all of the
provisions of the preceding paragraph shall apply. Tenant hereby waives any claims it may have
against Landlord in connection with a PM USA Assignment, including without limitation any
recognition by Landlord of PM USA as the Tenant under the Lease following delivery of the
Assignment Document (even in the event Tenant notifies Landlord that it disputes the right of PM
USA to cause the PM USA Assignment).

     Notwithstanding the foregoing, Tenant agrees that it will not amend or modify the Lease
without the prior written consent of PM USA and Landlord agrees that it will not amend or modify
the Lease unless Tenant provides Landlord with a copy of PM USA’s written consent thereto. Other
than as specifically set forth herein PM USA shall not be deemed to have any interest whatsoever in
the Lease, whether as a third party beneficiary or otherwise. In no event shall Landlord suffer
any liability whatsoever for any failure to provide a PM USA Notice; provided however, the time
periods related to the notice and cure provisions of the Lease shall not be deemed to commence
unless and until a PM USA Notice has been given with respect to any particular Potential Event of
Default.

     7. Early Termination and Termination Payment. Provided that no Event of Default has
occurred and is then continuing and no facts or circumstances exist, either at the time of Tenant’s
notice to Landlord or on the date such termination would otherwise be effective, which, with the
giving of notice or the passage of time, or both, would constitute an Event of Default, Tenant
shall have the right to terminate this Lease effective on December 31, 2008 (the “Termination
Option”). In order to exercise the Termination Option, Tenant must notify Landlord of such
exercise on or before February 28, 2008 (such date, or any earlier date on which Tenant delivers to
Landlord a Termination Waiver (as defined below), is referred to as the “Termination Option
Expiration Date”), and together with such notice, provide written consent by PM USA of such
exercise by Tenant of the Termination Option, and further, together with such notice Tenant shall
deliver to Landlord an amount equal to One Hundred Thirteen Thousand Seventy Four and No/100
Dollars ($113,074.00) as an agreed-upon payment as liquidated damages. Tenant may at any time
waive the Termination Option by written notice to Landlord (a “Termination Waiver”), and any such
Termination Waiver shall be irrevocable, and, upon delivery of the Termination Waiver, the
Termination Option shall expire and terminate and have no further effect. Nothing contained herein
shall be deemed to relieve Tenant of its obligation to pay Rent through the effective date of such
termination (in addition to the termination payment). In the event Tenant fails to exercise the
Termination Option by February 28, 2008 (or Tenant fails to deliver the above-described written
consent by PM USA or the termination payment by such date), Tenant shall be deemed to have waived
the Termination Option. This Termination Option is personal to Priority Fulfillment Services, Inc.
(or to PM USA in the event the Lease is

 

 

assigned to PM USA pursuant to a PM USA Assignment) and shall become null and void upon the
occurrence of an assignment of the Lease (other than a PM USA Assignment) or a sublet of all or a
part of the Demised Premises.

     8. Tenant is in possession of, and has accepted, the Demised Premises, and acknowledges that
all the work to be performed by the Landlord in the Demised Premises as required by the terms of
this Lease, if any, have been satisfactorily completed. Tenant further certifies that all
conditions of the Lease required of Landlord as of this date have been fulfilled and there are no
defenses or setoffs against the enforcement of the Lease by Landlord.

     9. Tenant represents to Landlord that, to the best of its knowledge, as of the date hereof,
Landlord is not in default of the Lease.

     10. Except as amended hereby, the Lease shall be and remain in full force and effect and
unchanged. As amended hereby, the Lease is hereby ratified and confirmed by Landlord and Tenant.
To the extent the terms hereof are inconsistent with the terms of the Lease, the terms hereof shall
control.

     11. The submission of this Second Amendment to Tenant for examination or consideration does
not constitute an offer to amend the Lease, and this Second Amendment shall become effective only
upon the execution and delivery thereof by Landlord and Tenant. Execution and delivery of this
Second Amendment by Tenant to Landlord constitutes an offer to amend the Lease on the terms
contained herein. The offer by Tenant will be irrevocable until 6:00 p.m. Eastern time for fifteen
(15) days after the date of execution of this Second Amendment by Tenant and delivery to Landlord.

 

 

     IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to be executed and
sealed as of the date first written above.

	 	 	 	 	 	 	 	 	 	 	 
	 	 	LANDLORD:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	INDUSTRIAL PROPERTY FUND VI, LLC, a	 	 
	 	 	Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By: Strategic
Industrial Properties, I, LLC, a 
Delaware limited liability
company, its sole 

member	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By: IDI Holdings III, LLC, a Delaware	 	 
	 	 	 	 	limited liability company, its managing

member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	 

	 	 
	 

	 	 	 	 	 	Title:	 	 	 	 

	 	 	 	 	 	 	 	 	 
	 	 	TENANT:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	PRIORITY FULFILLMENT SERVICES, INC.,	 	 
	 	 	a Delaware corporation	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Attest:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 
	 

	 	 	 	 	 	[CORPORATE SEAL]	 	 

 

 

	 	 	 	 	 	 	 
	Acknowledged and agreed:	 	 
	 
	 	 	 	 	 	 
	PHILIP MORRIS USA, INC.	 	 
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:
	 	 

	 	 
	 

	 	 	 	 

	 	 
	Attest:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:
	 	 

	 	 
	 

	 	 	 	 

	 	 

[CORPORATE SEAL]

 

 

GUARANTOR

The capitalized terms of this Consent shall have the meaning as defined in the Second Amendment to
which this Consent is attached, unless otherwise defined. The undersigned, being the Guarantor of
the Lease under that certain Guaranty dated August 19, 2004, from Guarantor to Landlord, hereby
consents to the Second Amendment, and acknowledges and reaffirms that the Guaranty is in full force
and effect as it relates to the Lease, as amended by the Second Amendment.

	 	 	 	 	 	 	 	 	 	 	 
	Date:	 	 	 	GUARANTOR:	 	 	 	 
	 

	 	 

	 	 	 	 	 	 	 	 
	 	 	 	 	PFSWEB, INC., a Delaware corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Attest:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 	 	 

	 	 
	 

	 	 	 	 	 	 	 	[CORPORATE SEAL]exv10w21

 

Exhibit 10.21

COLLATERAL PLEDGE AGREEMENT

     This Collateral Pledge Agreement (this “Agreement”) dated December 31, 2007, is made by
RUTGERS INVESTMENT GROUP, INC. a Texas corporation (“Pledgor”) in favor of FIRSTPLUS
FINANCIAL GROUP, INC. (“Secured Party”).

Background

     A. To induce Secured Party to extend credit to Pledgor pursuant to that certain Subordinated
Debenture dated of even herewith from Pledgor to Secured Party (as amended, restated, supplemented,
or replaced from time to time, the “Note”), Pledgor executes and delivers this Agreement to Secured
Party. All capitalized terms used herein and not otherwise defined shall have the same meanings
assigned to such terms in the Note.

     B. This Agreement is given and is intended to provide additional security for the Note.

     NOW THEREFORE, for other good and sufficient consideration, the receipt of which is hereby
acknowledged, Pledgor, intending to be legally bound, hereby covenants and agrees as follows:

     1. Pledgor, for the purpose of granting a continuing lien and security interest, does hereby
assign, pledge, hypothecate, deliver and set over to Secured Party, its successors and assigns, for
the benefit of Secured Party, the stock described on Schedule I attached hereto and made
part hereof, together with any additions, exchanges, replacements, and substitutions therefore, and
distributions with respect thereto, and the proceeds thereof (collectively, the “Pledged
Collateral”).

     2. The pledge and security interest described herein shall continue in effect to secure the
Note until the Note has been indefeasibly paid and satisfied in full.

     3. Pledgor hereby represents and warrants that:

               (a) Except as pledged herein, Pledgor has not sold, assigned, transferred, pledged or granted
any option or security interest in or otherwise hypothecated the Pledged Collateral in any manner
whatsoever and the Pledged Collateral is pledged herewith free and clear of any and all liens,
security interests, encumbrances, claims, pledges, restrictions, legends, and options;

               (b) Pledgor has the full power and authority to execute, deliver, and perform under this
Agreement and to pledge the Pledged Collateral hereunder;

               (c) This Agreement constitutes the valid and binding obligation of Pledgor, enforceable in
accordance with its terms, and the pledge of the Pledged Collateral referred to herein is not in
violation of and shall not create any default under any agreement, undertaking or obligation of
Pledgor;

               (d) The Pledged Collateral has been duly and validly authorized and issued by
the issuer thereof;

 

 

               (e) Contemporaneously with the execution hereof, Pledgor is delivering to Secured Party all
stock certificates, representing or evidencing the Pledged Collateral, accompanied by duly
executed instruments of transfer or assignments in blank, to be held by Secured Party in
accordance with the terms hereof;

               (f) Pledgor hereby confirms that Secured Party is authorized to file all UCC-1 financing
statements that are required under the UCC (as defined below) to perfect any security interest
granted hereunder;

     4. If an Event of Default occurs under the Note then Secured Party may, at its sole option,
exercise from time to time with respect to the Pledged Collateral any and/or all rights and
remedies available to it hereunder, under the Note and/or under the Uniform Commercial Code as
adopted from time to time in the State of Texas (“UCC”), or otherwise available to it, at law or
in equity, including, without limitation, the right to dispose of the Pledged Collateral at public
or private sale(s) or other proceedings, and Pledgor agrees that, if permitted by law, Secured
Party or its nominee may become the purchaser at any such sale(s). Any such sale shall be conducted
on not less than ten (10) days prior written notice to Pledgor.

     5. (a) In addition to all other rights granted to Secured Party herein or otherwise available
at law or in equity, Secured Party shall have the following rights, each of which may be exercised
at Secured Party’s sole discretion (but without any obligation to do so), at any time following the
occurrence of an Event of Default under the Note, without further consent of Pledgor: (i) transfer
the whole or any part of the Pledged Collateral into the name of itself or its nominee or to
conduct a sale of the Pledged Collateral in accordance with Section 4 hereof, pursuant to the UCC
or pursuant to any other applicable law; (ii) vote the Pledged Collateral; (iii) notify the persons
obligated on any of the Pledged Collateral to make payment to Secured Party of any amounts due or
to become due thereon; and (iv) release, surrender or exchange any of the Pledged Collateral at any
time, or to compromise any dispute with respect to the same. Secured Party may proceed against the
Pledged Collateral, or any other collateral securing the Note, in any order, and against Pledgor
and any other obligor, jointly and/or severally, in any order to satisfy the Note. Pledgor waives
and releases any right to require Secured Party to first collect any of the obligations secured
hereby from any other collateral or any other party under any theory of marshalling of assets, or
otherwise. All rights and remedies of Secured Party are cumulative, not alternative.

     (b) Pledgor hereby irrevocably appoints Secured Party its attorney-in-fact, subject to the
terms hereof, following the occurrence of an Event of Default under the Note at Secured Party’s
option: (i) to effectuate the transfer of the Pledged Collateral on the books of the issuer thereof
to the name of Secured Party for the purpose set forth in Section 5(a)(i) above or to the name of
Secured Party’s nominee, designee or assignee for the purpose of a sale conducted in accordance
with Section 4 hereof; (ii) to endorse and collect checks payable to Pledgor representing
distributions or other payments on the Pledged Collateral; and (iii) to exercise any other rights
of Secured Party hereunder or as permitted by law.

2

 

     6. The proceeds of any Pledged Collateral received by Secured Party at any time,
whether from the sale of Pledged Collateral or otherwise, may be applied to or on account of
the obligations under the Note and in such order as Secured Party may elect. In addition, Secured
Party may, in its discretion, apply any such proceeds to or on account of the payment of all costs,
fees and expenses (including, without limitation, attorneys’ fees) which may be incurred by Secured
Party.

     7. Pledgor recognizes that Secured Party may be unable to effect, or may effect only after
such delay which would adversely affect the value that might be realized from the Pledged
Collateral, a public sale of all or part of the Pledged Collateral by reason of certain
prohibitions contained in the Securities Act of 1933, as amended, and applicable state securities
laws (collectively, the “Securities Act”) and may be compelled to resort to one or more private
sales to a restricted group of purchasers, all of whom qualify as accredited investors (as defined
in the Securities Act) who will be obliged to agree, among other things, to acquire such
securities for their own account, for investment and not with a view to the distribution or resale
thereof. Pledgor agrees that any such private sale may be at prices and on terms less favorable
to Secured Party or the seller than if sold at public sales, and therefore recognizes and confirms
that such private sales shall not be deemed to have been made in a commercially unreasonable manner
solely because they were made privately. Pledgor agrees that Secured Party has no obligation to
delay the sale of any such securities for the period of time necessary to permit the issuer of such
securities to register such securities for public sale under the Securities Act. Secured Party
shall not sell or cause the sale of any of the Pledged Collateral in violation of the Securities
Act or other law.

     8. In the event that any reclassification, readjustment or other change is made or declared in
the Pledged Collateral or Pledgor acquires or in any other manner receives additional shares, or
any option included within the Pledged Collateral is exercised, any and all new, substituted or
additional interest, or other securities, issued by reason of any such change or exercise, shall be
delivered to and held by Secured Party under the terms hereof in the same manner as the Pledged
Collateral originally pledged hereunder. No distribution may be paid to or retained by Pledgor
unless expressly permitted in the Loan Agreement.

     9. So long as no Default or Event of Default has occurred under the Note, and, until Secured
Party notifies Pledgor in writing of the exercise of its rights hereunder, Pledgor shall retain the
sole right to vote the Pledged Collateral and exercise all rights of ownership with respect to all
corporate or company questions for all purposes not inconsistent with the terms hereof. Pledgor
shall execute in favor of Secured Party voting proxies for the Pledged Collateral upon Secured
Party’s request from time to time.

     10. Secured Party shall have no obligation to take any steps to preserve, protect or defend
the rights of Pledgor or Secured Party in the Pledged Collateral against other parties. Secured
Party shall have no obligation to sell or otherwise deal with the Pledged Collateral at any time
for any reason, whether or not upon request of Pledgor, and whether or not the value of the Pledged
Collateral, in the opinion of Secured Party or Pledgor, is more or less than the aggregate amount
of the obligations secured hereby, and any such refusal or inaction by Secured Party shall not be
deemed a breach of any duty which Secured Party may have under law to preserve the Pledged
Collateral. Except as provided by applicable law, no duty, obligation or responsibility of any
kind is intended to be delegated to or assumed by Secured Party at any time
with respect to the Pledged Collateral.

3

 

     11. To the extent Secured Party is required by law to give Pledgor prior notice of any public
or private sale, or other disposition of the Pledged Collateral, Pledgor agrees that ten (10) days
prior written notice to Pledgor shall be a commercially reasonable and sufficient notice of such
sale or other intended disposition.

     12. Pledgor shall indemnify, defend and hold harmless Secured Party from and against any and
all claims, losses and liabilities resulting from any breach by Pledgor of Pledgor’s
representations and covenants under this Agreement.

     13. For purposes hereof, Pledgor hereby waives notice of (a) acceptance of this Agreement, (b)
the existence and incurrence from time to time of any obligations under the Note, (c) the existence
of any Event of Default, the making of demand, or the taking of any action by Secured Party under
the Note and (d) demand and default hereunder.

     14. Pledgor hereby consents and agrees that Secured Party may at any time or from time to time
pursuant to the Note (a) extend or change the time of payment and/or the manner, place or terms of
payment of any and all obligations under the Note, (b) supplement, amend, restate, supersede, or
replace the Note, (c) renew, extend, modify, increase or decrease loans and extensions of credit
under the Note, (d) modify the terms and conditions under which loans and extensions of credit may
be made under the Note, (e) settle, compromise or grant releases for any obligations under the Note
and/or any person or persons liable for payment of any obligations under the Note, (f) exchange,
release, surrender, sell, subordinate or compromise any collateral of any party now or hereafter
securing any of the obligations under the Note and (g) apply any and all payments received from any
source by Secured Party at any time against the obligations under the Note in any order as Secured
Party may determine; all of the foregoing in such manner and upon such terms as Secured Party may
determine and without notice to or further consent from Pledgor and without impairing or modifying
the terms and conditions of this Agreement which shall remain in full force and effect.

     15. This Agreement shall remain in full force and effect and shall not be limited, impaired or
otherwise affected in any way by reason of (a) any delay in making demand on Pledgor for, or delay
in enforcing or failure to enforce, performance or payment of Pledgor’s obligations under the Note,
(b) any failure, neglect or omission on Secured Party’s part to perfect any lien upon, protect,
exercise rights against, or realize on, any property of Pledgor or any other party securing the
obligations under the Note, (c) any failure to obtain, retain or preserve, or the lack of prior
enforcement of, any rights against any person or persons or in any property, (d) the invalidity or
unenforceability of any obligations under the Note, (e) the existence or nonexistence of any
defenses which may be available to Pledgor with respect to the obligations under the Note, or (f)
the commencement of any bankruptcy, reorganization, liquidation, dissolution or receivership
proceeding or case filed by or against any Pledgor.

     16. Pledgor covenants and agrees that Pledgor shall not, without the prior written consent of
Secured Party, sell, encumber or grant any lien, security interest or option on or with respect to
any of the Pledged Collateral.

4

 

     17. Any failure of or delay by Secured Party to exercise any right or remedy hereunder shall
not be construed as a waiver of the right to exercise the same or any other right or remedy at any
other time.

     18. This Agreement constitutes the entire agreement between the parties hereto regarding the
subject matter hereof and may be modified only by a written instrument signed by Pledgor and
Secured Party.

     19. This Agreement, and all matters arising out of or relating to this Agreement, shall be
governed by and construed in accordance with the laws of the State of Texas applied to contracts to
be performed wholly within the State. Any judicial proceeding brought by or against Pledgor with
respect to any of the obligations secured by the Note, this Agreement, or any related agreement
may be brought in any court of competent jurisdiction in the State of Texas, County of Cameron,
United States of America, and, by execution and delivery of this Agreement, Pledgor accepts for
itself and in connection with its properties, generally and unconditionally, the non-exclusive
jurisdiction of the aforesaid courts, and irrevocably agrees to be bound by any judgment rendered
thereby in connection with this Agreement. Pledgor hereby waives personal service of any and all
process upon it and consents that all such service of process may be made by registered mail.
Nothing herein shall affect the right to serve process in any manner permitted by law or shall
limit the right of Secured Party to bring proceedings against Pledgor in the courts of any other
jurisdiction. Pledgor waives any objection to jurisdiction and venue of any action instituted
hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon
forum non conveniens. Pledgor waives the right to remove any judicial proceeding brought against
Pledgor in any state court to any federal court. Any judicial proceeding by Pledgor against
Secured Party involving, directly or indirectly, any matter or claim in any way arising out of,
related to or connected with this Agreement or any related agreement, shall be brought only in a
federal or state court located in the County of Cameron, State of Texas.

     20. All communications which Secured Party may provide to Pledgor herein shall be sent to
Pledgor at the address set forth in the Note.

     21. This Agreement shall be binding upon and inure to the benefit of the parties hereto, and
their respective successors and assigns.

     22. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING UNDER THIS AGREEMENT OR ANY OTHER INSTRUMENT,
DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR (B) IN ANY WAY CONNECTED
WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION
HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE AND EACH PARTY HEREBY
CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL

5

 

WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A
COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENTS OF THE PARTIES HERETO TO
THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

6

 

     IN WITNESS WHEREOF, this Collateral Pledge Agreement has been executed and delivered as of the
date first set forth above.

	 	 	 	 	 	 	 
	 	 	RUTGERS INVESTMENT GROUP, INC
	 

	 	Pledgor	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Jack Roubinek	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Jack Roubinek	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	CEO	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	FIRSTPLUS FINANCIAL GROUP, INC.,
	 	 	Secured Party
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ John Maxwell	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	John Maxwell	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	CEO & Chairman	 	 
	 

	 	 	 	 	 	 

(Signature Page to Collateral Pledge Agreement)

S-1

 

SCHEDULE I

Pledged Collateral

     The following Pledged Collateral is hereby pledged by Pledgor to Secured Party pursuant to the
Collateral Pledge Agreement to which this Schedule is attached:

	 	 	 	 	 
	 	 	State	 	 
	 	 	of	 	Number of Shares
	Name of Entity	 	Formation	 	Pledged
	FirstPlus Financial Group, Inc.
	 	 
	 	10,000,000

 

 

SUBORDINATED DEBENTURE

December 31, 2007

     In consideration of the issuance of Ten Million (10,000,000) common shares of the capital
stock of FIRSTPLUS FINANCIAL GROUP, INC. (“Lender”) being made concurrently herewith by Lender to
RUTGERS INVESTMENT GROUP, INC (“Borrower”), Borrower promises to pay Lender, at 5100 North O’Connor
Boulevard, Suite 400, Irving, Texas 75039, (or such other place as Lender may from time to time
designate in writing to Borrower), the principal sum of ONE MILLION DOLLARS ($1,000,000), together
with interest on the principal from time to time remaining unpaid prior to the Payment Date
(hereinafter defined) at the interest rates stated in this Subordinated Debenture (this “Note”), at
the times and on the terms and conditions hereinafter set forth. All principal and accrued
interest not earlier due and payable pursuant to other provisions of this Note shall be finally due
and payable on demand, which demand may be made any time after the first anniversary date of this
Note (the “Payment Date”), provided, Lender provides to Borrower 10 days’ advance written
notice of the Payment Date.

     1. Rate and Calculation of Interest.

               (a) Interest Rate. The unpaid principal balance of this Note from time to time
outstanding bears interest until this Note has been paid in full, at an annual rate (the “Interest
Rate”) equal to the lesser of (i) 10.0% (the “Contract Rate”), or (ii) the Maximum Legal Rate
(hereinafter defined).

               (b) Computation. All interest on this Note shall be calculated on the basis of actual
days elapsed but computed as if each year consisted of 360 days. All changes in the Interest Rate
resulting from a change in the Contract Rate or Maximum Legal Rate, as the case may be, shall be
effective on the day the Contract Rate or Maximum Legal Rate changes without notice to Borrower.

               2. Payment of Principal and Interest. Payments of principal and interest are due and
payable as follows:

               (a) Scheduled Payments. Accrued interest under this Note will only be done on the
Payment Date, when the payment of all unpaid principal under this Note plus all accrued and unpaid
interest thereon is due and payable. Borrower’s obligation to pay interest under this Note is
subject to the non-recourse provisions of Section 5 hereof.

               (b) Prepayment. Borrower may from time to time prepay all or any portion of the
principal of this Note without premium or penalty without notice to Lender.

               (c) Manner of Payment and Application of Funds. All sums payable under this Note are
payable by Borrower to Lender on the day when due, in United States Dollars, in immediately
available collected funds, and in a form that is legal tender for the payment of all debts, public
and private, at the time of payment. Except as otherwise specifically provided in this Note, all
payments on this Note shall be applied first to any accrued but unpaid interest then due and
payable under Note and then to the principal amount due and payable. All

-1-

 

non-regularly scheduled payments will be applied in the order and manner determined from time
to time by Lender in its sole discretion, subject to the provisions of this Note regarding legal
interest limitations.

               (d) Payment on Business Days. If any payment on this Note becomes due on a day other
than a Business Day (as hereinafter defined); the payment must be made on the next succeeding
Business Day. The extension of time will be included in computing interest in connection with the
payment. The term “Business Day”, as used herein, means any day other than a Saturday, Sunday, or
any other day on which national banking associations are authorized to be closed.

     3. Default. The occurrence of any of the following events is an “Event of Default”
under this Note:

               (a) Failure to Pay. If Borrower fails to pay any installment of principal or interest
due on this Note when due and such failure remains uncured for a period of 10 days following
written notice of such failure from Lender to Borrower.

               (b) Dissolution. If Borrower terminates its existence, liquidates, or dissolves.

               (c) Insolvency. If Borrower files a petition for bankruptcy, has a petition for
bankruptcy filed against them or it, becomes insolvent, makes an assignment. for the benefit of
creditors, or seeks or consents to the appointment of a receiver for any of its property.

     4. Stock Pledge. This Note is secured by Borrower’s pledge of Ten Million (10,000,000)
shares of Lender’s capital stock (the “Collateral”) pursuant to that certain Collateral Pledge
Agreement of even date herewith between Lender and Borrower (the “Pledge Agreement”).

     5. Acceleration; Non-Recourse. If any Event of Default occurs under this Note,
Lender, at its option, may declare the entire unpaid principal balance and all unpaid accrued
interest owing on this Note, together with any other accrued but unpaid amounts due and payable
under this Note, due and payable immediately, without further presentment, demand, protest, notice,
grace, or action of any nature whatsoever, all of which are specifically waived by Borrower.
Lender’s acceptance of any late or insufficient payment does not (A) constitute a waiver of the
right to exercise any of the foregoing options at that time or at any subsequent time or nullify
any prior exercise of such options; (B) constitute a waiver of the right to receive timely payments
in the future; (C) constitute a waiver of the right to receive payment in full of all amounts due
and payable at the time of such payment; or (D) impair, reduce, release, or extinguish the
obligations of Borrower as originally provided in this Note. Notwithstanding anything to the
contrary contained in this Note or the Pledge Agreement or any other document between Lender and
Borrower, upon the occurrence of an Event of Default or a demand for payment by Lender, or any
prepayment by Borrower, Lender shall not hold Borrower personally liable for repayment of the
indebtedness evidenced by this Note or for any other sums due as a result of an Event of Default
hereunder or under the Pledge Agreement, or for the payment of any deficiency established after
foreclosure of the Collateral. Lender’s sole and exclusive

-2-

 

remedy and Borrower’s sole and exclusive method to satisfy its obligations under this Note and
the Pledge Agreement shall be to transfer the full amount (i.e., each and every share, regardless
of any appreciation in the value thereof) of the Collateral to Lender. Upon such transfer, the
obligations of Borrower under this Note and the Pledge Agreement shall be deemed satisfied in full.
In the event that Borrower fails to effectuate such transfer, nothing contained in this Section 5
shall limit, impair or otherwise affect in any way Lender’s rights to cause the full amount of the
Collateral to be transferred to Lender.

     6. Waiver. Borrower and any endorsers or guarantors of this Note severally waive
notice, grace, presentment, and demand for payment, notice of dishonor, notice of intent to
accelerate maturity, notice of acceleration of maturity, protest and notice of protest and
non-payment, bringing of suit, and diligence in taking any action to collect any sums owing under
this Note or in proceeding against any of the rights and properties securing payment of this Note,
and indulgences of every kind. Borrower and any endorsers or guarantors of this Note agree that,
from time to time both before and after the Payment Date and without notice, Lender may renew the
indebtedness evidenced by this Note, extend the time for any payments on this Note, consent to the
substitution of security, acceptance of additional security, or release of any existing security
for this Note, and accept partial payments of this Note without in any manner affecting the
liability of Borrower or any endorser of guarantor under or with respect to this Note, even though
Borrower or such endorser or guarantor is not a party to agreement.

     7. Governing Law. This Note is governed by, and must be construed and enforced in
accordance with, the laws of the State of Texas and the federal laws of the United States
applicable to the transaction evidenced by this Note, as in effect from time to time. Any judicial
proceeding brought by or against Borrower with respect to any of the obligations under this Note
or any related agreement may be brought in any court of competent jurisdiction in the State of
Texas, County of Cameron, United States of America, and, by execution and delivery of this Note,
Borrower accepts for itself and in connection with its properties, generally and unconditionally,
the non-exclusive jurisdiction of the aforesaid courts, and irrevocably agrees to be bound by any
judgment rendered thereby in connection with this Note. Borrower hereby waives personal service of
any and all process upon it and consents that all such service of process may be made by registered
mail. Nothing herein shall affect the right to serve process in any manner permitted by law or
shall limit the right of Lender to bring proceedings against Borrower in the courts of any other
jurisdiction. Borrower waives any objection to jurisdiction and venue of any action instituted
hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon
forum non conveniens. Borrower waives the right to remove any judicial proceeding brought against
Borrower in any state court to any federal court. Any judicial proceeding by Borrower against
Lender involving, directly or indirectly, any matter or claim in any way arising out of, related to
or connected with this Note or any related agreement, shall be brought only in a federal or state
court located in the County of Cameron, State of Texas.

     8. Legal Interest Limitations.

               (a) Maximum Legal Rate. The term “Maximum Legal Rate”, as used in this Note, means,
at the particular time in question, the maximum rate of interest that may then be contracted for,
charged, taken, received, or reserved by Lender under this Note under

-3-

 

applicable state or federal law. If applicable state or federal law (i) imposes no limit,
(ii) provides that the amount of interest which may be contracted for, charged, or received on the
indebtedness evidenced by this Note is unlimited, or (iii) ceases to provide for such a maximum
rate of interest, then the Maximum Legal Rate will be equal to ten percent (10%) per annum.

               (b) Applicable Law. Lender intends at all times to comply with the applicable laws
governing the maximum rate or amount of interest payable on or in connection with this Note and the
loan evidenced by this Note. Except as otherwise set forth in this Section, Lender will rely on
California law for the purpose of determining the Maximum Legal Rate. To the extent federal law
permits Lender to contract for, charge, or receive a greater amount of interest, Lender will rely
on federal law.

               (c) Usury Savings Clause. If (i) the applicable law is ever revised, repealed, or
judicially interpreted so as to render usurious any amount called for under this Note, or
contracted for, charged, taken, reserved, or received with respect to the indebtedness evidenced by
this Note; (ii) Lender exercises the option to accelerate the maturity of this Note; or (iii) any
prepayment by Borrower results in Borrower’s having paid any interest in excess of that permitted
by law, Lender and Borrower expressly intend that the following will occur without the necessity of
the execution of any new document: (A) Lender shall credit all excess amounts already collected to
the principal balance of this Note, or, if this Note has been paid in full, shall refund the excess
amounts to Borrower; (B) the provisions of this Note automatically shall be reformed to comply with
the then applicable law in the manner that permits recovery by Lender of the fullest amount
otherwise called for under this Note; and (C) the amounts thereafter collectable under this Note
shall be reduced. The right to accelerate maturity of this Note does not include the right to
accelerate any interest that has not accrued on the date of the acceleration, and Lender does not
intend to collect any unearned interest in the event of acceleration. All sums paid, or agreed to
be paid, by Borrower for the use, forbearance, detention, taking, charging, receiving, or reserving
of the indebtedness of Borrower to Lender under this Note shall, to the maximum extent permitted by
applicable law, be amortized, prorated, allocated, and spread throughout the full term of the
indebtedness until payment in full so that the rate or amount of interest on account of such
indebtedness does not exceed the usury ceiling from time to time in effect and applicable to such
indebtedness for so long as such indebtedness is outstanding.

               (d) Controlling Provision. The terms and provisions of this Section control and
supersede every other provision of all agreements between Borrower and Lender.

     9. Notices. Any notice or demand permitted or required under this Note must be made
in writing and is effective on the earlier of: (i) the day of actual receipt of the written notice
or demand by the party to whom the notice or demand is given or (b) the day when the written notice
or demand is deposited in the United States mail post paid, first class, certified or registered
mail with return receipt requested and addressed to the party to whom the notice or demand is being
given at the address provided for notices (whether or not the notice or demand is actually
received). The address for notices are stated below, provided that either party may change its
address for notices to any other location within the continental United States by notifying the
other party of the new address in the manner provided herein for the giving of

-4-

 

notices, with such change to become effective ten (10) days after notice of the change of
address is given.

     10. Subordination. The indebtedness represented by this Note is hereby expressly
subordinated in right of payment to the prior payment in full of all of Borrower’s indebtedness
then due to banks, insurance companies, lease financing institutions or other lending institutions
regularly engaged in the business of lending money (each, a “Senior Lender”). It is intended by
this provision that this Note may be paid in accordance with its terms so long as Borrower is not
in default in payment of indebtedness to which this Note has been subordinated (the “Senior Debt”)
and has, in fact, made all payments due under the Senior Debt at the time of the payment in
question on this Note. Interest shall continue to accrue during any suspension in payment on this
Note. Upon request of Borrower, Lender hereby agrees to enter into (i) a subordination agreement
with each Senior Lender to the effect specified in this Section 9 but containing such additional
terms and conditions requested by Senior Lender and (ii) such other documents to effectuate any
transaction with Senior Lender.

ADDRESS FOR NOTICES:

			
	Lender:	 	FIRSTPLUS FINANCIAL GROUP, INC.

Attn: John Maxwell

122 West John Carpenter Freeway, Suite 450

Irving, Texas 75039

			
	Borrower:	 	RUTGERS INVESTMENT GROUP, INC

Attn: Jack Roubinek, CEO

5100 North O’Connor Blvd, Suite 400

Irving, Texas 75039

[Remainder of Page Intentionally Left Blank]

-5-

 

     IN WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly
authorized officer.

	 	 	 	 	 
	 	BORROWER:

RUTGERS INVESTMENT GROUP, INC,

 	 
	 	By:  	/s/ Jack Roubinek	 
	 
	 	 	 
	 	 	Jack Roubinek [Chief Executive Officer] 	 
	 

ACKNOWLEDGED AND ACCEPTED

LENDER:

FIRSTPLUS FINANCIAL GROUP, INC.

	 	 	 	 	 
	 	 
	By:  	 	
/s/ John Maxwell	 
	 	 	John Maxwell (Chief Executive Officer and Chairman) 	 
	 

-1-

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