Document:

ex10-55.htm

    Exhibit
10.55

     

    CHANGE
IN TERMS AGREEMENT

     

    
      
        
          	
                  Principal

                  $1,000,000.00

                	
                  Loan
      Date

                  05-19-2009

                	
                  Maturity

                  07-19-2009

                	
                  Loan
      No.

                  42431

                	
                  Call
      / Call

                  4A1
      / BA

                	
                  Account

                	
                  Officer

                  10033

                	
                  Initials

                
	
                  References
      in the boxes above are for Lender's use only and do not limit the
      applicability of this document to any particular loan or
item.

                  Any
      item above containing ***** has been omitted due to text length
      limitations.

                
	
                  Borrower:            
      AEROGROW INTERNATIONAL, INC.

                     
      JACK J WALKER

                     
      6075 LONGBOW DRIVE SUITE 20

                  BOULDER,
      CO 80301

                	
                  Lender:                 
      First National Bank

                  Canyon
      Branch

                  1155
      Canyon Blvd.

                  Boulder,
      CO 80302-5121

                

        

      

    

     

    
      
        	
                Principal
      Amount: $1,000,000.00

              	
                Date
      of Agreement: May 19, 2009

              

      

       

    

    DESCRIPTION
OF EXISTING INDEBTEDNESS. A Promissory Note dated May 19, 2008 in the original
amount of $1,000,000.00 as modified from time to time by certain Change in Terms
Agreements, if applicable.

     

    DESCRIPTION
OF COLLATERAL. The collateral as described in any security instrument or other
related documents in which a security interest is given to the lender to secure
this indebtedness and any other indebtedness described therein.

     

    DESCRIPTION
OF CHANGE IN TERMS. Extend maturity date from May 19, 2009 to July 19,
2009.

     

    Increase
interest rate from Wall Street Journal Prime Rate plus .50% floating to Wall
Street Journal Prime Rate plus 2.0% floating with a floor interest rate of
5.50%.

     

    PAYMENT.
Borrower will pay this loan in one payment of all outstanding principal plus all
accrued unpaid interest on July 19, 2009. In addition, Borrower will pay regular
monthly payments of all accrued unpaid interest due as of each payment date,
beginning June 19, 2009, with all subsequent interest payments to be due on the
same day of each month after that.

     

    VARIABLE
INTEREST RATE. The interest rate on this loan is subject to change from time to
time based on changes in an independent index which is the base rate on
corporate loans posted by at least 75% of the nation's 30 largest banks known as
the Wall Street Journal Prime Rate (the "Index"). The Index is not necessarily
the lowest rate charged by Lender on its loans. If the Index becomes unavailable
during the term of this loan, Lender may designate a substitute index after
notifying Borrower. Lender will tell Borrower the current index rate upon
Borrower's request. The interest rate change will not occur more often than each
day. Borrower understands that Lender may make loans based on other rates as
well. The Index currently is 3.250% per annum. The interest rate to be applied
to the unpaid principal balance of this loan will be calculated as described in
the "INTEREST CALCULATION METHOD'"paragraph using a rate of 2.000 percentage
points over the Index, adjusted if necessary for any minimum and maximum rate
limitations described below, resulting in an initial rate of 5.500% per annum
based on a year of 360 days. NOTICE: Under no circumstances will the interest
rate an this loan be less than 5.500% per annum or more than the maximum rate
allowed by applicable law.

     

    INTEREST
CALCULATION METHOD. Interest on this loan is computed on a 365/360 basis: that
is, by applying the ratio of the interest rate over a year of 360 days,
multiplied by the outstanding principal balance, multiplied by the actual number
of days the principal balance is outstanding. All interest payable under this
loan is computed using this method.

     

    CONTINUING
VALIDITY. Except as expressly changed by this Agreement, the terms of the
original obligation or obligations, including all agreements evidenced or
securing the obligation(s), remain unchanged and in full force and effect.
Consent by Lender to this Agreement does not waive Lender's right to strict
performance of the obligation(s) as changed, nor obligate Lender to make any
future change in terms. Nothing in this Agreement will constitute a satisfaction
of the obligation(s). It is the intention of Lender to retain as liable parties
all makers and endorsers of the original obligation(s), including accommodation
parties, unless a party is expressly released by Lender in writing. Any maker or
endorser, including accommodation makers, will not be released by virtue of this
Agreement. If any person who signed the original obligation does not sign this
Agreement below, then all persons signing below acknowledge that this Agreement
is given conditionally, based on the representation to Lender that the
non-signing party consents to the changes and provisions of this Agreement or
otherwise will not be released by it. This waiver applies not only to any
initial extension, modification or release, but also to all such subsequent
actions.

     

    PRIOR TO
SIGNING THIS AGREEMENT, EACH BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS AGREEMENT, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. EACH BORROWER
AGREES TO THE TERMS OF THE AGREEMENT.

     

    BORROWER:

     

    AEROGROW
INTERNATIONAL, INC

     

    By:/s/ Jervis B.
Perkins

         JERVIS
B. PERKINS, President of

         AEROGROW
INTERNATIONAL, INC

     

    /s/ Jack J.
Walker

    JACK J.
WALKER, Individuallyex10-56.htm

    Exhibit
10.56

    

    THIS LOAN
EXTENSION AGREEMENT (“Extension Agreement”) is made effective April 1, 2009
BY AND BETWEEN WLoans LLC (“Lender”) Aerogrow International, Inc (“Borrower”)
and Jack J. Walker (“Walker”).

     

    WHEREAS
the parties hereto executed a Loan Agreement effective 22 May 2008, and a
Promissory Note (“Note”) and Security Instruments of the same date.

     

    AND
WHEREAS the advances made pursuant to the Loan Agreement and other documents
were to be repaid on or before April 1, 2009 and Aerogrow has requested an
extension of the time for repayment and Lender and Walker have agreed thereto
subject to the following terms.

     

    AND
WHEREAS the balance of principal due under the Note is $1,200,000 and interest
on the advances has been paid through March 31, 2009.

     

    NOW,
THEREFORE, in consideration of the premises and mutual covenants set forth
herein, THE PARTIES HEREBY AGREE as follows:

     

    
      	
              1.

            	
              The
      Due Date on the Note is extended for a period of three months and the
      entire balance shall be due and payable in accordance with the Terms of
      the said Note on or before June 30, 2009, unless there is a Default that
      entitles the Lender to be paid
earlier.

            

    

    
      	
              2.

            	
              The
      Borrower agrees to pay a fee of $5,000 for this Extension upon the signing
      hereof.

            

    

    
      	
              3.

            	
              Interest
      shall be paid monthly on the 1st of each month commencing May 1,
      2009.

            

    

    
      	
              4.

            	
              Borrower
      agrees that it is not entitled to any further disbursements under the Loan
      Agreement and that Lender and Walker have in all respects fully complied
      with their respective obligations under the terms of the Loan Agreement
      and Note.

            

    

    
      	
              5.

            	
              In
      the event borrower receives any equity financing, including the issue of
      Preferred Stock in any form, the entire outstanding Principal and interest
      shall become immediately due and
payable.

            

    

    
      	
              6.

            	
              In
      all respects the terms and conditions and other provisions of the Loan
      Agreement and Note are hereby confirmed and shall continue to apply until
      such time as the Principal and interest have been
  repaid.

            

    

     

    IN
WITNESS WHEREOF, the parties have executed this Agreement as of the day and year
first written.

     

    
      	
              BORROWER:
      AEROGROW INTERNATIONAL INC

            	
              LENDER:
      WLOANS LLC

            
	
              /s/
      H. MacGregor Clarke

                   Chief
      Financial Officer

            	
              /s/
      Jack J. Walker

            
	
               

              CO-BORROWER
      (FNB LOAN):

            	 
      
	
              /s/
      JACK J. WALKERex10-57.htm

    Exhibit
10.57

    

    

    SECOND
FORBEARANCE AGREEMENT

    

    THIS
SECOND FORBEARANCE AGREEMENT (this “Second Forbearance Agreement”) effective as
of April 29, 2009 among AEROGROW INTERNATIONAL, INC., a Nevada corporation
(“Borrower”), Jack J. Walker, a Colorado resident (“Guarantor”; Borrower and
Guarantor are sometimes referred to herein individually as an “Obligor” and
collectively as “Obligors”), and FCC, LLC, d/b/a First Capital, a Florida
limited liability company (“Lender”).

     

    WITNESSETH:

     

    WHEREAS,
Borrower and Lender are parties to that certain Loan and Security Agreement
dated as of June 23, 2008 (as amended, restated or otherwise modified from time
to time, the “Loan Agreement”), pursuant to which Lender agreed to extend
certain financial accommodations to Borrower; and

     

    WHEREAS,
Borrower violated certain financial covenants under the Loan Agreement;
and

     

    WHEREAS,
on January 31, 2009, Borrower and Lender entered into a Forbearance Agreement
(the “First Forbearance Agreement”) in which Lender agreed to temporarily
forbear from exercising its rights and remedies under the Loan Agreement,
subject to Borrower’s compliance with certain terms and conditions;
and

     

    WHEREAS,
Borrower failed to comply with Section 6(f) of the First Forbearance Agreement;
and

     

    WHEREAS,
as a result of Borrower’s failure to comply with the First Forbearance
Agreement, Lender has the right, as set forth in the First Forbearance
Agreement, the Loan Agreement and the other Loan Documents, to immediately
exercise all of its rights and remedies with respect to the Collateral, Borrower
and Guarantors, all without notice to Borrower, Guarantors or any other Person;
and

     

    WHEREAS,
Obligors have asked Lender to temporarily forbear from exercising its rights and
remedies with respect to the defaults described above, as more particularly
described herein; and

     

    WHEREAS,
Lender is willing to grant such temporary forbearance, subject to the terms and
conditions set forth herein; and

     

    WHEREAS,
Borrower and Lender desire to temporarily amend the Loan Agreement and the First
Forbearance Agreement as set forth herein.

     

    NOW,
THEREFORE, in consideration of the foregoing premises, and other good and
valuable consideration, the receipt and legal sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:

     

    1.           All
capitalized terms used herein and not otherwise expressly defined herein shall
have the respective meanings given to such terms in the Loan
Agreement.

     

    2.           Borrower
acknowledges and agrees that (i) Borrower has failed to comply with Section
6(f) of the First Forbearance Agreement, and (ii) the foregoing failure
to comply with the First Forbearance Agreement constitutes a Default under the
Loan Agreement and is referred to herein as the “Existing Default.”

     

    3.           In
order to induce Lender to enter into this Second Forbearance Agreement and to
grant the forbearance contemplated hereby, Borrower and Guarantor hereby
acknowledge and agree with Lender as follows:

    

    
      	
               
      

            	
              (a)

            	
              The
      facts set forth in the recitals to this Second Forbearance Agreement are
      true and correct in all material
respects.

            

    

     

    
      	
               
      

            	
              (b)

            	
              The
      Loan Agreement, the Guaranty, as amended (the “Guaranty”) and the other
      Loan Documents constitute the valid, binding and enforceable obligations
      of each Obligor thereto to Lender, Lender has a valid and perfected
      security interest in and to the Collateral, and each Obligor hereby
      reaffirms such Obligor’s obligations to Lender under each of the Loan
      Documents to which such Obligor is a
party.

            

    

     

    
      	
               
      

            	
              (c)

            	
               As
      of the date hereof, the outstanding principal balance of the loans
      outstanding under the Loan Agreement is $5,177,838.58.  Such
      amount, together with all accrued interest thereon, is validly owing by
      Borrower and Guarantor to Lender and is not subject to any right of
      offset, claim or counterclaim in favor of Borrower, Guarantor or any other
      Person.

            

    

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    4.           In
consideration of Borrower’s timely and strict compliance with Borrower’s
agreements set forth in the Loan Agreement and in this Second Forbearance
Agreement, and in reliance upon the representations, warranties, agreements and
covenants of Obligors, other than by Guarantor, set forth herein, Lender agrees
to forbear until the Forbearance Termination Date (as defined below) from
exercising its rights and remedies under the Loan Agreement and the other Loan
Documents as a result of the Existing Defaults.  Lender reserves its
rights and remedies at all times with respect to any Default under the Loan
Agreement, the Guaranty, the First Forbearance Agreement, this Second
Forbearance Agreement or any other Loan Document other than the Existing
Defaults, whether presently existing or occurring hereafter.  At any
time on or after the Forbearance Termination Date, Lender may exercise any and
all of its rights and remedies under or with respect to the Loan Agreement, the
Guaranty, the First Forbearance Agreement, this Second Forbearance Agreement and
the other Loan Documents, whether relating to the Existing Default or
otherwise.  As used herein, “Forbearance Termination Date” means the
earlier of (x) June 30, 2009, (y) the date of the occurrence of a Default other
than an Existing Default (whether any such Default first occurred or arose on,
prior or after the date hereof), and (z) the default or breach by any Obligor of
any of the covenants, agreements, representations and warranties set forth in
this Second Forbearance Agreement.

     

    5.           In
conjunction with the forbearance contemplated in this Second Forbearance
Agreement, from the date of this Second Forbearance Agreement through and
including the Forbearance Termination Date, the Loan Agreement is amended as
follows:

     

    (a)           Item
1(a)(ii) of the Schedule to the Loan Agreement is amended by deleting the
item in its entirety (including the proviso at the end of Item 1(a)(ii)(B) of
the Schedule) and replacing it with the following in    
lieu thereof:

     

    “(ii)         the
sum of :

     

    
      	
              (A)  

            	
               85%
      of the dollar amount of Eligible Accounts;
plus

            

    

     

    
      	
              (B)  

            	
              the
      lessor of

            

    

     

    (i)                 $6,000,000,
or

     

    (ii)                80%
of the dollar value (determined at the lower of cost or market value) of
Eligible Inventory.

     

    On July
1, 2009, the amendment to Item
1(a)(ii) of the Schedule set forth above shall cease to be effective, and
the terms of Item
1(a)(ii) of the Schedule shall revert back to those terms otherwise in
effect under the Loan Agreement.

     

    6.           Borrower
and Lender agree to the make the following amendments and modifications to the
First Forbearance Agreement, and except as amended and modified below, the First
Forbearance Agreement will remain in full force and effect:

     

    
      	
               
      

            	
              (a)          
      Effective as of the date hereof, Section 6(a) of the First Forbearance
      Agreement is deleted.

            

    

    

    
      	
               
      

            	
              (b)          
      Effective as of the date hereof, Section 6(b) of the First Forbearance
      Agreement is deleted.  

            

    

    

    
      	
               
      

            	
              (c)

            	
              Effective
      as of the date hereof, Section 6(f) of the First Forbearance Agreement is
      deleted.

            

    

    

                  
 7.           In
consideration of the accommodations made by Lender hereunder, Borrower agrees as
follows:

    
    

     

    
      	 	(a) 	Borrower
      will pay to Lender on demand all reasonable costs and expenses of Lender
      in connection with the preparation, execution, delivery and enforcement of
      this Second Forbearance Agreement and
      any other transactions contemplated hereby and thereby, including, without
      limitation, the reasonable fees and out-of-pocket expenses of legal
      counsel to Lender.

    

     

    
      	
               
      

            	
              (b)           On
      or before June 30, 2009, Borrower shall raise additional equity capital in
      an amount of at least $4,000,000.

            

    

    

    
      	
               
      

            	
              (c)

            	
              On
      or before May 29, 2009, Borrower will cause Jack J. Walker to execute and
      deliver to Lender (i) a Second Amendment to Limited Guaranty of Individual
      in form and substance similar to Exhibit A attached hereto, and (ii) a
      mortgage against real property located at Commerce and Callaghan streets
      in San Antonio, TX to secure Jack J. Walker’s guaranty, which mortgage
      must be in form and substance satisfactory to Lender, but which mortgage
      will be held in escrow by Lender until any Default occurs, at which time
      Lender may record the
mortgage.  

            

    

    

    
      	
               
      

            	
              (d)

            	
              Borrower
      shall pay Lender a forbearance fee of Sixty Thousand and No/100 Dollars
      ($60,000) upon the earlier of (i) the termination date of the Second
      Forbearance Agreement, or (2) closing of the capital raise referred to in
      Section 6(b) above.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
 

    8.           Each
Obligor acknowledges that (a) except as expressly set forth herein, Lender has
not agreed to (and has no obligation whatsoever to discuss, negotiate or agree
to) any restructuring, modification, amendment, waiver or forbearance with
respect to the Obligations or any of the terms of the Loan Documents, (b) no
understanding with respect to any other restructuring, modification, amendment,
waiver or forbearance with respect to the Obligations or any of the terms of the
Loan Documents shall constitute a legally binding agreement or contract, or have
any force or effect whatsoever, unless and until reduced to writing and signed
by authorized representatives of each Obligor and Lender, and (c) the execution
and delivery of this Second Forbearance Agreement has not established any course
of dealing between the parties hereto or created any obligation or agreement of
Lender with respect to any future restructuring, modification, amendment, waiver
or forbearance with respect to the Obligations or any of the terms of the Loan
Documents.

     

    9.           To
induce Lender to enter into this Second Forbearance Agreement and grant the
accommodations set forth herein, each Obligor (a) acknowledges and agrees that
no right of offset, defense, counterclaim, claim or objection exists in favor of
any Obligor against Lender arising out of or with respect to the Loan Agreement,
the Guarantees, any other Loan Document, the Obligations, or any other
arrangement or relationship between Lender and any Obligor, and (b) releases,
acquits, remises and forever discharges Lender and its affiliates and all of
their past, present and future officers, directors, employees, agents,
attorneys, representatives, successors and assigns from any and all claims,
demands, actions and causes of action, whether at law or in equity, and whether
known or unknown, which any Obligor may have by reason of any manner, cause or
things to and including the date of this Second Forbearance Agreement with
respect to matters arising out of or with respect to the Loan Agreement, the
First Forbearance Agreement, the Guarantees, any other Loan Document, the
Obligations, or any other arrangement or relationship between Lender and any
Obligor.

     

    10.         To
induce Lender to enter into this Second Forbearance Agreement, each Obligor
hereby represents and warrants that, as of the date hereof, and after giving
effect to the terms hereof, there exists no Default under the First Forbearance
Agreement, the Loan Agreement or any of the other Loan Documents, other than the
Existing Default.

     

    11.         Borrower
hereby restates, ratifies, and reaffirms each and every term, condition,
representation and warranty, with the exception of Section 4(a)(ix) and Section
4(a)(vi) of the Loan Agreement, heretofore made by it under or in connection
with the execution and delivery of the Loan Agreement, as amended hereby, and
the other Loan Documents, as fully as though such representations and warranties
had been made on the date hereof and with specific reference to the First
Forbearance Agreement, this Second Forbearance Agreement and the other Loan
Documents.  With respect to Section 4(a)(vi) of the Loan Agreement,
Borrower herewith discloses the existence of an adversarial proceeding in
bankruptcy court with Linens ‘N Things regarding a claim of preferential
payment.

     

    12.         Except
as expressly set forth herein, the Loan Agreement shall be and remain in full
force and effect as originally written, and shall constitute the legal, valid,
binding and enforceable obligations of Borrower to Lender.  Guarantor
acknowledges and agrees that his Guaranty remains in full force and effect after
giving effect to this Second Forbearance Agreement and constitutes the legal,
valid, binding and enforceable obligations of Guarantor to Lender.

     

    13.         Each
Obligor hereby acknowledges that Lender shall not be obligated to release its
security interest in any Collateral unless and until the Obligations have been
paid in full in cash and the Loan Agreement has been terminated.

     

    14.         This
Second Forbearance Agreement constitutes a Loan Document, and any breach of any
representation, warranty, covenant, agreement or obligation of Borrower or
Guarantors hereunder shall constitute a Default, which shall terminate Lender’s
obligation to forbear hereunder and entitle Lender to exercise all of its rights
and remedies under the First Forbearance Agreement, the Loan Agreement, the
Guaranty and the other Loan Documents.

     

    15.         Each
Obligor hereby knowingly, intelligently and voluntarily renounces and waives any
and all notice or right to notice, including without limitation any and all
rights that Borrower or Guarantors may have under Section 9-601 et seq. of the Uniform
Commercial Code to notice of Lender’s intended disposition of any or all of the
Collateral, and Lender may, on or after the Forbearance Termination date,
dispose of the Collateral or any portion thereof without further notice to
Borrower or Guarantors, if Borrower is in default.  THE WAIVER OF
NOTICE AS PROVIDED IN THIS PARAGRAPH IS KNOWINGLY AND INTELLIGENTLY GIVEN AFTER
DEFAULT UNDER ONE OR MORE OF THE LOAN DOCUMENTS AND IS ACKNOWLEDGED TO BE
COMMERCIALLY REASONABLE IN ALL RESPECTS.

     

    16.         Each
Obligor agrees to take such further action as Lender shall reasonably request in
connection herewith to evidence the amendments herein contained to the Loan
Agreement.

     

    17.         This
Second Forbearance Agreement may be executed in any number of counterparts and
by different parties hereto in separate counterparts, each of which, when so
executed and delivered, shall be deemed to be an original and all of which
counterparts, taken together, shall constitute but one and the same
instrument.

     

    18.         This
Second Forbearance Agreement shall be binding upon and inure to the benefit of
the successors and permitted assigns of the parties hereto.

     

    19.         This
Second Forbearance Agreement shall be governed by, and construed in accordance
with, the laws of the State of Oklahoma.

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    IN
WITNESS WHEREOF, Borrower, Guarantor and Lender have caused this Second
Forbearance Agreement to be duly executed as of the date first above
written.

     

    

     

    FCC, LLC d/b/a FIRST
CAPITAL

    

    

    By:  /s/Lee E.
Elmore                             
           

        
   Lee E. Elmore, Senior Vice President

    

    

    

    AEROGROW INTERNATIONAL,
INC.

    

    

    By: /s/ Jervis B.
Perkins                                      

           Jervis
B. Perkins, Chief Executive Officer

    

    Attest:

    

    /s/
Elizabeth
Stagg                                              

    Elizabeth
Stagg, Secretary

    

    

    (Corporate Seal)

    

    

    GUARANTOR

    

    /s/ Jack J.
Walker                                                     

    JACK J. WALKER

    

    

    
      
        
        

      

      
        4

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