MODIFICATION OF SECURED TERM NOTE,
MORTGAGE, SECURITY AGREEMENT
AND FINANCING STATEMENTS
WHEREAS, FLORIDA Transport Corporation ("Transport") sold all of
the outstanding stock of The San Pedro Mining Corporation ("San
Pedro") to Royalstar Southwest, Inc. ("Royalstar Southwest")
pursuant to a stock purchase agreement dated April 12, 1993; and,
WHEREAS, as part of the sale of the San Pedro Stock, San Pedro,
Royalstar Southwest and Royalstar Resources Ltd. ("Resources"),
executed and delivered to Transport a Secured Term Note dated April
12, 1993 in the original amount of $1,170,000 (the "Note"); and,
WHEREAS, San Pedro executed and delivered to Transport as
security for the Note a document entitled "Mortgage, Security
Agreement and Financing Statement" dated April 12, 1993, which was
recorded on May 20, 1993, in Book 926, Pages 410-432 of the records
of Santa Fe County, New Mexico (the "Mortgage"); and,
WHEREAS, Royalstar Southwest executed and delivered to Transport
a Hypothecation Agreement dated April 12, 1993 whereby the stock of
San Pedro was pledged to Transport as security for the Note; and,
WHEREAS, Royalstar Southwest transferred the stock of San Pedro
to Royalstar Washington, Inc. ("Royalstar Washington"); and,
WHEREAS, Royalstar Washington assumed the liabilities of
Royalstar Southwest under the Note, Mortgage, Hypothecation
Agreement and financing statements filed in the States of Florida,
New Mexico and Arizona; and,
WHEREAS, San Pedro, Royalstar Washington and Resources have
requested Transport to modify the Note, Mortgage, Hypothecation
Agreement and financing statements to provide for interest payments
only for a period of 12 months; and,
WHEREAS, San Pedro, Royalstar Washington and Resources have
agreed to give Transport a lien on the equipment described in
Exhibit "A" attached hereto.
Now therefore, for and in consideration of the deferment of
principal payments for a period of 12 months and the granting of a
security interest in the equipment described in Exhibit "A",
Transport, San Pedro, Royalstar Washington and Resources agree as
follows:
1. The recitals of this agreement are true and correct.
2. The current principal balance of the Note is the sum of $355,000.
Commencing on November 12, 1997, the required monthly payment
of principal shall be deferred for a period of 12 months. The
principal payments of $15,000 per month will resume on
November 12, 1998 and the term of the Note is extended for a
period of 12 months for the deferred payment of principal at
the rate of $15,000 per month.
3. The Note shall bear interest at the rate of 9.5% per annum rather
than at a variable rate. Such interest shall be paid monthly
in arrears with the first payment due on November 12, 1997.
4. There is added as additional security for the Note the equipment
described in Exhibit "A".
5. The Note, Mortgage, Hypothecation Agreement and Financing
Statements are hereby amended to reflect the changes set forth
above and the parties agree to execute amended financing
statements to reflect the amendments.
6. San Pedro, Resources and Royalstar Washington hereby absolutely
release and forever discharge Transport, its employees,
servants, agents, officers, directors, successors and assigns,
from any and all manner of claims, actions, causes of action,
proceedings and damages of every nature and kind whatsoever,
at law or in equity, whether known or unknown, which they ever
had or now have, or which they or their successors or assigns
hereafter can, shall or may have any reason of, from or in
connection with the Stock Purchase Agreement; and
7. Except as herein modified all obligations of San Pedro, Royalstar
Washington and Resources to Transport shall remain in full
force and effect.
In Witness thereof, Transport, San Pedro, Royalstar Washington
and Resources have executed and delivered this Modification
Agreement effective on the 23rd day of December, 1997.
FLORIDA TRANSPORT CORPORATION THE SAN PEDRO MINING CORPORATION
By: /s/ By: /s/
John H. Sottile, President President Paul C. Jones
Attest Attest
By: /s/ By: /s/
Name: Stephen R. Wherry Name: Victor Erickson
Title: Treasurer Title: Director/Secretary
Address: Address:
Suite 500, 100 Rialto Place 1019 Eighth St., Suite 3095
Melbourne, FL 32901 Golden, Colorado 80481
(CORPORATE SEAL) (CORPORATE SEAL)
ROYALSTAR RESOURCES LTD. ROYALSTAR WASHINGTON, INC.
By: /s/ By: /s/
President Paul C. Jones President Paul C. Jones
Attest Attest
By: /s/ By: /s/
Name: Victor Erickson Name: Victor Erickson
Title: Director/Secretary Title: Director/Secretary
Address: Address:
1019 Eighth St., Suite 3095 1019 Eighth St., Suite 3095
Golden, Colorado 80481 Golden, Colorado 80481
(CORPORATE SEAL) (CORPORATE SEAL)
State of Florida
County of Brevard
The foregoing instrument was acknowledged before me on this 9th
day of January, 1998, by John H. Sottile who is personally known by
me.
/s/
Notary Seal Patricia A. Strange
Signature of Notary Public
State of Colorado
County of Denver
The foregoing instrument was acknowledged before me on this 23rd
day of December, 1997, by Paul C. Jones, President of The San Pedro
Mining Corporation, Royalstar Resources Ltd. and Royalstar
Washington, Inc., who is personally known by me.
/s/
Notary Seal Lisa M. Roberts
Signature of Notary Public