Exhibit 10:
AMENDED PAYMENT AGREEMENT
This Amended Agreement between NBI, Inc., a Delaware corporation ("NBI"),
and the Internal Revenue Service, Department of the Treasury, United States of
America ("IRS"), dated as of April 9, 1998 (the "Agreement").
WHEREAS, NBI is as of this date obligated to the IRS in the amount of
$5,278,000 in principal (the "Remaining Principal Amount") pursuant to a
Stipulation and Agreement Re Internal Revenue Service Tax Claim and Tax
Liabilities dated June 12, 1991 (the "Stipulation"), which as a part of NBI's
chapter 11 bankruptcy reorganization, settled certain tax obligations and
interest thereon of NBI from previous tax years; and
WHEREAS, NBI and the IRS previously entered into that certain Payment
Agreement dated as of March 19, 1996 (the "Original Agreement") (any term not
otherwise defined herein shall have the meaning set forth in the Original
Agreement); and
WHEREAS, NBI and the IRS have agreed on certain different payment terms
for such obligation and this Agreement shall, in all respects, amend and
supersede the Original Agreement and the Stipulation;
NOW, THEREFORE, the parties agree as follows:
1. Repayment Terms. NBI shall repay the Remaining Principal Amount
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in two installments: (a) on or before December 31, 1998, NBI shall pay the IRS
the sum of $3,500,000.00, and (b) on or before December 31, 1999, NBI shall
pay the IRS the remaining $1,778,000.00. Upon satisfying such payments, the
Remaining Principal Amount shall be deemed satisfied in full. NBI may prepay
all or any portion of the Remaining Principal Amount at any time without
premium or penalty. NBI agrees to remit the $3,500,000.00 payment to the IRS
as soon as practicable after such amount becomes available to NBI, but in no
event later than December 31, 1998.
2. Collateral. NBI owns all the capital stock of American Glass,
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Inc. d/b/a L.E. Smith Glass Company, a glass products manufacturer located in
Mount Pleasant, Pennsylvania ("American Glass"). NBI also owns all of the
capital stock of NBI Properties, Inc. f/k/a Belle Vernon Motel Corporation
which owns and operates the Belle Vernon Holiday Inn located in Belle Vernon,
Pennsylvania ("NBI Properties"). Pursuant to a Pledge Agreement dated as of
March 19, 1996 which was executed in connection with the Original Agreement,
NBI granted the IRS a valid first security interest in all the capital stock
of American Glass and NBI Properties to secure the obligations under the
Original Agreement, as evidenced by the related physical stock certificates,
which have previously been delivered to the IRS. The capital stock of
American Glass and NBI Properties shall similarly secure the obligations of
NBI to the IRS under this Agreement. Upon the full payment of the Remaining
Principal Amount, the Pledge Agreement and the IRS security interest in the
capital stock of American Glass and NBI Properties will terminate and such
stock certificates shall be returned to NBI.
3. Default Provisions. In the event of a failure of NBI to make any
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payment provided in paragraph 1. hereof, an event of default shall have
occurred fifteen (15) days after written notice and demand from IRS to NBI in
respect of such payment unless NBI has previously (a) cured the default by
payment of the amount due, or (b) given written notice to IRS that it disputes
the existence of the default with a recitation of the reasons why, with
supporting documentation. In the event of a failure of NBI to take any other
action required by this Agreement, an event of default shall have occurred
thirty (30) days after written notice and demand from IRS to NBI in respect of
such failure unless NBI had previously (a) cured the default, or (b) given
written notice to IRS that it disputes the existence of the default with a
recitation of the reasons why, with supporting documentation. In the event of
a continuing event of default, IRS may by written notice to NBI declare the
Remaining Principal Amount due and payable and interest thereon at the
statutory rate provided under the Internal Revenue Code since the last
interest payment made by NBI under the Original Agreement, and the IRS shall
be entitled to pursue its remedies. Nothing herein shall limit the rights and
remedies of the IRS or NBI with respect to post-effective date taxes.
In the event of a dispute over the existence of an event of default and
the inability of the parties to resolve such a dispute within twenty (20) days
after NBI gives written notice that such dispute exists, the parties jointly
or separately must submit the dispute to the United States Bankruptcy Court
for the District of Colorado for adjudication within fifteen (15) days of the
expiration of the twenty (20) day resolution period. Such submission will not
relieve the parties of any continuing obligation under this Agreement which
might arise following such submission unless such obligation is the subject of
the dispute. Failure of the party disputing the existence of an event of
default to make such submission to the court within the referenced time period
will constitute an admission of default and trigger the remedies available.
In the event NBI incurs undisputed post-petition Federal Tax Liabilities,
an event of default under this Agreement shall have occurred fifteen (15) days
after written notice and demand from IRS to NBI for payment of such undisputed
liabilities unless NBI has previously (a) paid the undisputed liability, with
undisputed interest and penalties, if any, or (b) given written notice to IRS
that it disputes the existence of the default, with a recitation of the
reasons why, with supporting documentation. In the case of an event of
default or a dispute, the provisions of the preceding paragraph shall apply.
4. Effects of this Agreement, etc. This Agreement constitutes the
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entire agreement among the parties with respect to the subject matter hereof.
This Agreement is binding on the parties hereto and their successors and
assigns and shall have the effect of amending, replacing and modifying the
payment and all other terms of the Stipulation and the Original Agreement
(including, without limitation, the requirement to pay past, current or future
interest in respect of this obligation). This Agreement may only be modified
in writing executed by the parties and its construction or interpretation
shall be governed by the laws of the State of Colorado.
5. Financial Reporting. Within five (5) days after NBI shall file
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with the Securities and Exchange Commission (a) any report or proxy statement,
or amendment thereto, under the Securities Exchange Act of 1934, or (b) any
registration statement, or amendment thereto, under the Securities Act of
1933, the Debtor shall mail such document to the IRS. NBI shall promptly mail
to IRS the consolidated monthly financial statements of NBI at the time such
statements are generally circulated within NBI. IRS shall also have the right
at reasonable times and upon reasonable notice to NBI to obtain financial and
business information from NBI concerning the business and operations of NBI
and its subsidiaries as would be relevant to a lender. Such statements and
information shall be treated as confidential information by the IRS.
6. Notice. Notice required hereunder shall be in writing and shall
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be delivered by hand, facsimile or deposited in the United States mail
addressed to:
NBI, Inc.
Attn: Marjorie A. Cogan
1880 Industrial Circle, Suite F
Longmont, CO 80501
Facsimile: (303) 684-2804
with a copy to:
NBI, Inc.
Attn: Morris D. Weiss
701 Brickell Avenue, Suite 2100
Miami, FL 33131
Facsimile: (305) 577-3225
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above
(provided that notice of any change of address shall be effective only upon
receipt thereof). Any notice given by delivery, mail or courier, shall be
effective when received by NBI. Any notice given by facsimile shall be
effective upon oral or machine confirmation of transmission.
7. Descriptive Headings. The descriptive headings are inserted for
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convenience of reference only and are not intended to be a part of or to
affect the meaning or interpretation of this Agreement.
8. Parties in Interest. This Agreement shall be binding upon and
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inure solely to the benefit of each party hereto, and nothing in this
Agreement, express or implied, is intended to confer upon any other person any
rights or remedies of any nature whatsoever under or by reason of this
Agreement.
9. Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be deemed to be an original, but all of
which shall constitute one and the same Agreement. A facsimile signature will
be treated as if it is an original signature.
INTERNAL REVENUE SERVICE
By: /s/ Thomas Moore
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Name: Thomas Moore
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Title: Chief Special Procedures
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NBI, Inc.
By: /s/ Jay H. Lustig
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Jay H. Lustig, Chairman