Exhibit10(f)(3)
Inter Act Electronic Marketing, Inc.
5032 Parkway Plaza Blvd.
Charlotte, NC 28217
Tel. 704-329-6900 Fax 704-329-6927
June 16, 2000
Mr. Stephen R. Leeolou Mr. Haynes Griffin
9801 Deerbrook Lane 309 Sunset Drive
Charlotte, NC 28210 Greensboro, NC 27408
Mr. Stuart S. Richardson Mr. L. Richardson Preyer, Jr.
32 Bibbins Road 3309 Carriage Trail
Easton, CT 06612 Hillsborough NC 27278
Piedmont Harbor-Piedmont Associates Mr. Robert A. Silverberg
Limited Partnership 1777 Larimer Street, #2310
701 Green Valley Road Denver, CO 80202
Greensboro, NC 27408
Attn: General Partner
Mr. Richard A. Horvitz
85 Stonewood Drive
Moreland Hills, OH 44022
Re: Guaranties of $5,000,000 First Union Financing
Gentlemen:
Reference is made to the proposed $5,000,000 Promissory Note (the "First
Union Note") dated as of the date hereof, and any related Security Agreement as
from time to time in effect, made by the undersigned InterAct Electronic
Marketing, Inc. (the "Company"), as borrower, in favor of First Union National
Bank ("First Union"). Further reference is made to the proposed Unconditional
Guaranties of even date with the First Union Note (each a "Guaranty" and,
together, the "Guaranties") made or to be made by each of you in favor of First
Union.
As consideration for your execution and delivery of your respective
Guaranties, the Company hereby agrees to pay to each of you a guarantor's fee in
an amount per annum
Guarantors of First Union Financing
June 16, 2000
Page 2
calculated by multiplying (x) the maximum principal amount of the Company's
obligations under the First Union Note guaranteed by you by (y) the difference
between (i) the effective rate of interest (not including any penalty or default
rates), as determined on any date of payment of such fee, payable by the Company
pursuant to its unguaranteed bridge financing (the "First Greenwich Financing")
with First Greenwich Capital, LLC ("First Greenwich") dated May 19, 2000, as
from time to time in effect (or at any time after such financing has been repaid
in full, the last effective interest rate thereunder) and (ii) the effective
rate of interest (not including any penalty or default rates), as determined on
any date of payment of such fee, payable by the Company under the First Union
Note and (z) .01. Such payment or payments shall be made on the same date or
dates as interest is required to be paid under the First Union Note with a final
payment (prorated as necessary for any partial period) payable on the same date
as repayment in full of the Company's obligations under the Loan Agreement
(whether by payments made under the Guaranties or otherwise).
As further consideration for your respective Guaranties, in the event that
any of you is required to make your payment with respect to your Guaranty, the
Company hereby agrees to grant to such of you as make such a Guaranty payment,
on the date of such Guaranty payment, a five-year warrant to purchase for $14
per share that number of shares of common stock of the Company (rounded up to
the nearest whole number) as would be determined by multiplying (x) the
principal amount paid by you with respect to your Guaranty by (y) .05 and then
dividing the product thereof by 14. Such warrant shall otherwise be on terms
and in a form substantially equivalent to the form of warrant proposed to be
issued to First Greenwich in the event of nonpayment under the First Greenwich
Financing.
In the event that any of you is required to make any payment on your
Guaranty, the Company hereby confirms your right of subrogation to any and all
rights of First Union (including without limitation any security interests of
First Union in the Company's assets) and agrees that the Company shall
immediately reimburse you for all amounts paid to First Union under your
Guaranty. The Company further agrees that, if it shall fail to immediately
repay you, from and after the time at which you are subrogated to the rights of
First Union under the First Union Note, the rate of interest under the First
Union Note for which the Company shall be obligated to you shall be increased to
the lesser of 22.5% or the maximum rate allowed by law, that being the default
rate specified by First Greenwich in its unguaranteed financing.
You hereby agree among yourselves and for the benefit of the Company, that
should you exercise your subrogation rights and be substituted for First Union,
as lender, then any actions by you pursuant to any of First Union's loan
documents (including without limitation designation of an agent or collateral
agent to take actions on your behalf) may and shall be taken only upon the
approval of a majority in interest (by principal amount) of holders of such
former First Union obligations, such approval to be evidenced in writing to the
Company.
Except as herein otherwise specifically provided, the rights and priorities
of the parties shall be determined in accordance with applicable law. This
agreement shall be governed by the
Guarantors of First Union Financing
June 16, 2000
Page 3
laws of the State of North Carolina and shall inure to the benefit of you and
your respective successors and assigns.
If the foregoing corresponds with your understanding of our agreement,
kindly sign both original counterparts of this letter delivered to you and
return to the Company one original counterpart signed by you, at which time this
letter shall become binding on the Company. This letter may be executed in
multiple counterparts, each of which shall be deemed to be one and the same
original.
Very truly yours,
INTERACT ELECTRONIC MARKETING, INC.
By: /s/ Thomas J. McGoldrick
Title: CFO
ACCEPTED AND AGREED:
/s/ Stephen R. Leeolou
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Stephen R. Leeolou
/s/ Stuart S. Richardson
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Stuart S. Richardson
PIEDMONT HARBOR-PIEDMONT ASSOCIATES LIMITED PARTNERSHIP
By: /s/ Stuart S. Richardson
Stuart S. Richardson, General Partner
Guarantors of First Union Financing
June 16, 2000
Page 4
ACCEPTED AND AGREED:
/s/ Richard A. Horvitz
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Richard A. Horvitz
/s/ Haynes G. Griffin
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Haynes G. Griffin
/s/ L. Richardson Preyer, Jr.
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L. Richardson Preyer, Jr.
/s/ Robert A. Silverberg
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Robert A. Silverberg