Amendment #7 to Schedule 13D

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Mpur8ozRjoqfH85NakiB/gRq14efdY695koNDZsUO2t+UX0RPi9GB4x70ZMDbB3y wBIgPc4a7Qo2r3+exLxoNA== 0000930661-03-001834.txt : 20030421 0000930661-03-001834.hdr.sgml : 20030421 20030421170215 ACCESSION NUMBER: 0000930661-03-001834 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 20030421 GROUP MEMBERS: JAMES M. FAIL GROUP MEMBERS: JAMES M. FAIL LIVING TRUST GROUP MEMBERS: KATHRYN FAIL LUTTRULL GROUP MEMBERS: P.S.F .HOLDINGS LIMITED PARTNERSHIP GROUP MEMBERS: STONE CAPITAL, INC. GROUP MEMBERS: STONE HOLDINGS, INC. GROUP MEMBERS: STONE INVESTMENTS, INC. GROUP MEMBERS: THE MARTIAL TRUST GROUP MEMBERS: WINN HOLDINGS, LLC FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: IMAGINE INVESTMENTS INC CENTRAL INDEX KEY: 0001051043 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 8150 N CENTRAL EXPRESSWAY STE 1901 CITY: DALLAS STATE: TX ZIP: 75206 BUSINESS PHONE: 2143651900 MAIL ADDRESS: STREET 1: 8150 N CENTRAL EXPRESSWAY STE 1901 CITY: DALLAS STATE: TX ZIP: 75206 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: WICKES INC CENTRAL INDEX KEY: 0000910620 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-LUMBER & OTHER BUILDING MATERIALS DEALERS [5211] IRS NUMBER: 363554758 STATE OF INCORPORATION: DE FISCAL YEAR END: 1228 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-42945 FILM NUMBER: 03657181 BUSINESS ADDRESS: STREET 1: 706 N DEERPATH DR CITY: VERNON HILLS STATE: IL ZIP: 60061 BUSINESS PHONE: 8473673400 MAIL ADDRESS: STREET 1: 706 NORTH DEERPATH DR CITY: VERNON HILLS STATE: IL ZIP: 60061 FORMER COMPANY: FORMER CONFORMED NAME: WICKES LUMBER CO /DE/ DATE OF NAME CHANGE: 19930813 SC 13D/A 1 dsc13da.htm AMENDMENT #7 TO SCHEDULE 13D Amendment #7 to Schedule 13D

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT

TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a)

(Amendment No. 7) (1)

Wickes, Inc.

(Name of Issuer)

Common Stock, par value $.01 per share

(Title of Class of Securities)

967 446 10 5

(CUSIP Number)

Gary M. Goltz

Imagine Investments, Inc.

8150 North Central Expressway, Suite 1901

Dallas, Texas 75206

(214) 365-1905

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

Copies to:

Sally A. Schreiber

Munsch Hardt Kopf & Harr, P.C.

4000 Fountain Place

1445 Ross Avenue

Dallas, Texas 75202

(214) 855-7500

April 4, 2003

(Date of Event Which Requires Filing of This Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f), or 13d-1(g), check the following box ¨.

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

(1) The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see, the Notes).

CUSIP No. 967 446 10 5


1.	Name of Reporting Persons I.R.S. Identification No. of Above Persons (entities only) Imagine Investments, Inc. 75-2709444

2.	Check the Appropriate Box if a Member of a Group (See Instructions) (a) ¨ (b) ¨

3.	SEC Use Only

4.	Source of Funds (See Instructions) WC

5.	Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)	¨

6.	Citizenship or Place of Organization Delaware

Number of

Beneficially

Owned by Each

Reporting Person

With

7. Sole Voting Power

—

8. Shared Voting Power

3,933,443*

9. Sole Dispositive Power

—

10. Shared Dispositive Power

3,933,443*

11.	Aggregate Amount Beneficially Owned by Each Reporting Person 3,933,443

12.	Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)	x

13.	Percent of Class Represented by Amount in Row (11) 47.3%*

14.	Type of Reporting Person CO

* Includes shares subject to option granted to Imagine Investments, Inc. to purchase 53,700 shares of common stock owned by Riverside Group, Inc. Does not include any shares of the Issuer owned by Robert T. Shaw, President and a director of Imagine Investments, Inc. See Item 6.

CUSIP No. 967 446 10 5


1.	Name of Reporting Persons I.R.S. Identification No. of Above Persons (entities only) Stone Investments, Inc. 86-0740106

2.	Check the Appropriate Box if a Member of a Group (See Instructions) (a) ¨ (b) ¨

3.	SEC Use Only

4.	Source of Funds (See Instructions) WC

5.	Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)	¨

6.	Citizenship or Place of Organization Delaware

Number of

Beneficially

Owned by Each

Reporting Person

With

7. Sole Voting Power

—

8. Shared Voting Power

3,933,443*

9. Sole Dispositive Power

—

10. Shared Dispositive Power

3,933,443*

11.	Aggregate Amount Beneficially Owned by Each Reporting Person 3,933,443

12.	Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)	x

13.	Percent of Class Represented by Amount in Row (11) 47.3%*

14.	Type of Reporting Person HC, CO

CUSIP No. 967 446 10 5


1.	Name of Reporting Persons I.R.S. Identification No. of Above Persons (entities only) Stone Capital, Inc. 75-2262907

2.	Check the Appropriate Box if a Member of a Group (See Instructions) (a) ¨ (b) ¨

3.	SEC Use Only

4.	Source of Funds (See Instructions) WC

5.	Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)	¨

6.	Citizenship or Place of Organization Delaware

Number of

Beneficially

Owned by Each

Reporting Person

With

7. Sole Voting Power

—

8. Shared Voting Power

3,933,443*

9. Sole Dispositive Power

—

10. Shared Dispositive Power

3,933,443*

11.	Aggregate Amount Beneficially Owned by Each Reporting Person 3,933,443

12.	Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)	x

13.	Percent of Class Represented by Amount in Row (11) 47.3%*

14.	Type of Reporting Person HC, CO

CUSIP No. 967 446 10 5


1.	Name of Reporting Persons I.R.S. Identification No. of Above Persons (entities only) Stone Holdings, Inc. 75-2681508

2.	Check the Appropriate Box if a Member of a Group (See Instructions) (a) ¨ (b) ¨

3.	SEC Use Only

4.	Source of Funds (See Instructions) WC

5.	Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)	¨

6.	Citizenship or Place of Organization Delaware

Number of

Beneficially

Owned by Each

Reporting Person

With

7. Sole Voting Power

—

8. Shared Voting Power

3,933,443*

9. Sole Dispositive Power

—

10. Shared Dispositive Power

3,933,443*

11.	Aggregate Amount Beneficially Owned by Each Reporting Person 3,933,443

12.	Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)	x

13.	Percent of Class Represented by Amount in Row (11) 47.3%*

14.	Type of Reporting Person HC, CO

CUSIP No. 967 446 10 5


1.	Name of Reporting Persons I.R.S. Identification No. of Above Persons (entities only) P.S.F. Holdings Limited Partnership

2.	Check the Appropriate Box if a Member of a Group (See Instructions) (a) ¨ (b) ¨

3.	SEC Use Only

4.	Source of Funds (See Instructions) WC

5.	Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)	¨

6.	Citizenship or Place of Organization Texas

Number of

Beneficially

Owned by Each

Reporting Person

With

7. Sole Voting Power

—

8. Shared Voting Power

3,933,443*

9. Sole Dispositive Power

—

10. Shared Dispositive Power

3,933,443*

11.	Aggregate Amount Beneficially Owned by Each Reporting Person 3,933,443

12.	Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)	x

13.	Percent of Class Represented by Amount in Row (11) 47.3%*

14.	Type of Reporting Person HC, PN

CUSIP No. 967 446 10 5


1.	Name of Reporting Persons I.R.S. Identification No. of Above Persons (entities only) The Marital Trust established pursuant to the provisions of Section 3 of Article 3 of the agreement establishing the James M. Fail Living Trust.

2.	Check the Appropriate Box if a Member of a Group (See Instructions) (a) ¨ (b) ¨

3.	SEC Use Only

4.	Source of Funds (See Instructions) WC

5.	Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)	¨

6.	Citizenship or Place of Organization Alaska

Number of

Beneficially

Owned by Each

Reporting Person

With

7. Sole Voting Power

—

8. Shared Voting Power

3,933,443*

9. Sole Dispositive Power

—

10. Shared Dispositive Power

3,933,443*

11.	Aggregate Amount Beneficially Owned by Each Reporting Person 3,933,443

12.	Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)	x

13.	Percent of Class Represented by Amount in Row (11) 47.3%*

14.	Type of Reporting Person HC, OO

CUSIP No. 967 446 10 5


1.	Name of Reporting Persons I.R.S. Identification No. of Above Persons (entities only) James M. Fail Living Trust

2.	Check the Appropriate Box if a Member of a Group (See Instructions) (a) ¨ (b) ¨

3.	SEC Use Only

4.	Source of Funds (See Instructions) WC

5.	Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)	¨

6.	Citizenship or Place of Organization Alaska

Number of

Beneficially

Owned by Each

Reporting Person

With

7. Sole Voting Power

—

8. Shared Voting Power

3,933,443*

9. Sole Dispositive Power

—

10. Shared Dispositive Power

3,933,443*

11.	Aggregate Amount Beneficially Owned by Each Reporting Person 3,933,443

12.	Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)	x

13.	Percent of Class Represented by Amount in Row (11) 47.3%*

14.	Type of Reporting Person HC, OO

CUSIP No. 967 446 10 5


1.	Name of Reporting Persons I.R.S. Identification No. of Above Persons (entities only) James M. Fail

2.	Check the Appropriate Box if a Member of a Group (See Instructions) (a) ¨ (b) ¨

3.	SEC Use Only

4.	Source of Funds (See Instructions) WC

5.	Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)	¨

6.	Citizenship or Place of Organization United States

Number of

Beneficially

Owned by Each

Reporting Person

With

7. Sole Voting Power

—

8. Shared Voting Power

3,933,443*

9. Sole Dispositive Power

—

10. Shared Dispositive Power

3,933,443*

11.	Aggregate Amount Beneficially Owned by Each Reporting Person 3,933,443

12.	Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)	x

13.	Percent of Class Represented by Amount in Row (11) 47.3%*

14.	Type of Reporting Person HC, IN

CUSIP No. 967 446 10 5


1.	Name of Reporting Persons I.R.S. Identification No. of Above Persons (entities only) Winn Holdings, LLC 75-2891040

2.	Check the Appropriate Box if a Member of a Group (See Instructions) (a) ¨ (b) ¨

3.	SEC Use Only

4.	Source of Funds (See Instructions) WC

5.	Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)	¨

6.	Citizenship or Place of Organization Texas

Number of

Beneficially

Owned by Each

Reporting Person

With

7. Sole Voting Power

—

8. Shared Voting Power

3,933,443*

9. Sole Dispositive Power

—

10. Shared Dispositive Power

3,933,443*

11.	Aggregate Amount Beneficially Owned by Each Reporting Person 3,933,443

12.	Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)	x

13.	Percent of Class Represented by Amount in Row (11) 47.3%*

14.	Type of Reporting Person HC, OO

CUSIP No. 967 446 10 5


1.	Name of Reporting Persons I.R.S. Identification No. of Above Persons (entities only) Kathryn Fail Luttrull

2.	Check the Appropriate Box if a Member of a Group (See Instructions) (a) ¨ (b) ¨

3.	SEC Use Only

4.	Source of Funds (See Instructions) WC

5.	Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)	¨

6.	Citizenship or Place of Organization United States

Number of

Beneficially

Owned by Each

Reporting Person

With

7. Sole Voting Power

—

8. Shared Voting Power

3,933,443*

9. Sole Dispositive Power

—

10. Shared Dispositive Power

3,933,443*

11.	Aggregate Amount Beneficially Owned by Each Reporting Person 3,933,443

12.	Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)	x

13.	Percent of Class Represented by Amount in Row (11) 47.3%*

14.	Type of Reporting Person HC, IN

SCHEDULE 13D/A

This Amendment No. 7 to Schedule 13D filed on October 15, 1998, with the Securities and Exchange Commission, as amended by that certain Amendment No. 1 to Schedule 13D filed on November 24, 1998, that certain Amendment No. 2 to Schedule 13D filed on January 19, 1999, that certain Amendment No. 3 to Schedule 13D filed on February 8, 1999, that certain Amendment No. 4 to Schedule 13D filed on September 18, 2001, that certain Amendment No. 5 to Schedule 13D filed on February 6, 2002, and that certain Amendment No. 6 to Schedule 13D filed on August 27, 2002 (as so amended, the “Schedule 13D”), with respect to the common stock, par value $.01 per share, of Wickes, Inc., a Delaware corporation (the “Issuer”). The Schedule 13D is hereby incorporated by reference for all purposes. Capitalized terms used but not defined herein shall have the meanings subscribed to them on Schedule 13D.

Item 4. Purpose of Transaction.

Item 4 is hereby amended to read in its entirety as follows:

The purpose of each of the transactions described in Item 6 below was solely for investment purposes.

Pursuant to the transactions to which this Amendment No. 7 to Schedule 13D relates as described in Item 6 below, Imagine Investments has acquired shares that were pledged to it as security for the loans also described in Item 6 below. The Reporting Persons intend to review on a continuing basis their investment in the Issuer. Each of the Reporting Persons is willing to consider a sale, either in the open market or in one or more privately negotiated transactions, of any or all of the shares that it acquired; a future acquisition of additional control of the business of the Issuer by other means, including a tender offer, merger, or other business combination, open market purchases, private transactions, or otherwise; and transactions pursuant to which employees of the Issuer would obtain equity ownership in the Issuer.

However, except as set forth above, none of the Reporting Persons has any current plans or proposals with respect to any of the following: (a) the acquisition or disposition of securities of the Issuer; (b) any extraordinary corporate transaction, such as a merger, reorganization, or liquidation, involving either the Issuer or any of its subsidiaries; (c) a sale or transfer of a material amount of assets of the Issuer or any of its subsidiaries; (d) a change in the present board of directors or management of the Issuer, including plans or proposal to change the number or term of directors or to fill any existing vacancies on the board; (e) any material change in the present capitalization or dividend policy of the Issuer; (f) any other material change in the Issuer’s business or corporate structure; (g) any changes in the Issuer’s charter or bylaws that may impede the acquisition of control of the Issuer by any person; (h) causing a class of securities of the Issuer to be delisted from any national securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system or a registered national securities association; (i) a class of securities of the Issuer to become eligible for termination of registration pursuant to Section 12(g)(4) of the Securities Exchange Act of 1934; or (j) any action similar to any of the foregoing. However, the Reporting Persons reserve the right to take any and all such actions in the future.

Item 5. Interest in Securities of the Issuer.

Item 5 is hereby amended and restated to read as follows:

(a)

As a result of the transactions described below in Item 6, as of the date of this Amendment No. 7, Imagine Investments is the record owner of 3,412,743 shares of common stock of the Issuer, which shares represent approximately 41.1% of the issued and outstanding shares of the common stock of the Issuer

as of October 31, 2002, and the beneficial owner of the 53,700 shares of common stock of the Issuer subject to the Liberty Option Agreement (as hereinafter defined), which shares represent approximately 0.7% of the issued and outstanding shares of the common stock of the Issuer as of October 31, 2002, and Stone Investments is the record owner of 467,000 shares of common stock of the Issuer, which shares represent approximately 5.6% of the issued and outstanding shares of the common stock of the Issuer as of October 31, 2002.

By virtue of the relationships described in Item 2 of this Schedule 13D, each of the Reporting Persons may be deemed to share the beneficial ownership of all of the shares of common stock of the Issuer beneficially owned by Imagine Investments and each of the Reporting Persons other than Imagine Investments may be deemed to share the beneficial ownership of all of the shares of common stock of the Issuer beneficially owned by Stone Investments.

(b)

Each of Imagine Investments and Stone Investments has the direct power to vote and direct the disposition of the shares of common stock of the Issuer actually owned by it. By virtue of the relationships described in Item 2 of this Schedule 13D, each of the Reporting Persons may be deemed to share the indirect power to vote and direct the disposition of all of the shares of common stock of the Issuer owned of record by Imagine Investments and each of the Reporting Persons other than Imagine Investments may be deemed to share the indirect power to vote and direct the disposition of all of the shares of common stock of the Issuer owned of record by Stone Investments.

(c)

On April 4, 2003, Imagine Investments acquired 2,797,943 shares of common stock of the Issuer pursuant to that certain Agreement for Conveyance of Shares of Wickes, Inc. in Lieu of Foreclosure and Bill of Sale dated as of April 4, 2003 (the “April 2003 Agreement”) between Imagine Investments, Riverside Group, Inc., a Florida corporation (“Riverside”), and the other parties named therein, in satisfaction of $13,988,715 aggregate amount of indebtedness owed to Imagine Investments by Riverside pursuant to the loans as described in Item 6 below. The parties to the April 2003 Agreement agreed that the amount of the indebtedness exchanged for the shares of the Issuer acquired pursuant thereto was calculated to be $5.00 of indebtedness for each share of common stock of the Issuer even though they believed that the fair market value of a share of common stock of the Issuer as of that date was substantially less. Imagine Investments also acquired an option to purchase 53,700 shares of the Issuer pursuant to a Letter Agreement dated as of April 4, 2003 between Riverside and Imagine Investments (the “Liberty Option Agreement”). The term of the option commenced on such date and terminates ten days following the payment of all remaining debt owed Imagine Investments by Riverside. The exercise price of $5.00 was also agreed upon by the parties even though the parties believed that the fair market value of a share of common stock of the Issuer as of that date was substantially less. See Item 6.

(d)

Not applicable.

(e)

Not applicable.

Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Item

6 is hereby amended and restated to read as follows:

In order to provide a better understanding of the beneficial ownership of common stock of the Issuer by the Reporting Persons, the following chronology is provided:

(a)

Imagine Investments has been, prior to the transactions to which this Amendment No. 7 to Schedule 13D relates (see Items 6(p) and 6(q) below) (the “April 2003 Transactions”), the pledgee of shares of Riverside. Prior to the consummation of the April 2003 Transactions, Riverside owned a significant percentage of the shares of the Issuer and Wilson Financial Corporation currently owns a significant portion of the shares of Riverside. See the Schedule 13D filed by Imagine Investments with respect to Riverside, as the same has been and may be amended from time to time, for more specific information.

(b)

On October 5, 1998, Imagine Investments and Riverside entered into a Stock Purchase Agreement (as amended from time to time, the “Stock Purchase Agreement”), pursuant to which, among other things, (1) Imagine Investments purchased 250,000 shares of common stock of the Issuer from Riverside (3.0% of the outstanding) for $3.25 per share, (2) Riverside granted to Imagine Investments an option (the “Option”) to purchase 750,000 shares of common stock of the Issuer held by Riverside (9.2% of the outstanding) for $3.25 per share (subject to certain limitations that are described below), (3) Riverside had the right to require Imagine Investments to exercise the Option for up to 200,000 shares of common stock of the Issuer underlying the Option, and (4) Riverside granted to Imagine Investments a right of first refusal, for a period of 18 months following the date of the Stock Purchase Agreement, on all of the shares of common stock of the Issuer held by Riverside other than the 250,000 shares purchased by Imagine Investments under the Stock Purchase Agreement (estimated to be approximately 3,599,113 shares (43.9%). As described below, the Option was eventually exercised in full by Imagine Investments, including through the use of the put option by Riverside. Imagine Investments’ right of first refusal under the Stock Purchase Agreement expired on April 5, 2000, without being exercised. In addition, under the Stock Purchase Agreement, (1) Riverside assigned its rights under that certain Registration Rights Agreement dated September 2, 1993, between Riverside and the Issuer, with respect to the shares of common stock of the Issuer acquired by Imagine Investments under the Stock Purchase Agreement, and (2) upon request by Imagine Investments, Riverside agreed to use its best efforts to cause the Issuer to effect the securities law registration of the common stock of the Issuer held by Imagine Investments. The Option could not be exercised by Imagine Investments to the extent it would cause Imagine Investments to become an “interested stockholder,” within the meaning of Section 203 of the Delaware General Corporation Law, of the Issuer unless the Board of Directors of the Issuer approved the acquisition by Imagine Investments of more than 15% of the outstanding common stock of the Issuer.

(c)

On or about November 5, 1998, Riverside exercised its put option under the Stock Purchase Agreement and required Imagine Investments to purchase 200,000 shares of common stock of the Issuer underlying the Option from Riverside.

(d)

On or about December 14, 1998, Imagine Investments acquired 185,000 shares of common stock of the Issuer pursuant to its exercise of a portion of the Option.

(e)

On December 29, 1998, Imagine Investments purchased from Riverside 82,000 shares of common stock of the Issuer, which shares were not subject to the Option, for $3.75 per share.

(f)

On or about January 26, 1999, Imagine Investments exercised the remainder of the Option and acquired 365,000 shares of common stock of the Issuer from Riverside.

(g)

On August 31, 1999, Riverside, borrowed $1,800,000 (as the same has been, and may be further, amended, modified and renewed from time to time, the “1999 Loan”) from Imagine Investments. On August 31, 2000, the 1999 Loan

was modified and renewed and, in connection therewith, Riverside executed and delivered to Imagine Investments a promissory note in the principal amount of $2,021,628, which note amended and restated in its entirety the existing note in the principal amount of $1,800,000. The 1999 Loan was secured by, among other things, 758,155 shares of common stock of the Issuer owned by Riverside (921,845 shares were initially pledged, but 81,970 were released pursuant to a letter agreement dated August 30, 1999, between Riverside and Imagine Investments, and 81,720 shares were released on August 31, 2000, in connection with the modification and renewal of the 1999 Loan) (as such number of shares may be further modified from time to time, the “1999 Pledged Shares”). The 1999 Pledged Shares represented approximately 9.1% of the issued and outstanding shares of common stock of the Issuer as of October 31, 2002. As additional security for the 1999 Loan, Riverside assigned to Imagine Investments any and all registration rights of Riverside with respect to, among other things, the shares of common stock of the Issuer held by Riverside to the extent Imagine Investments has foreclosed upon or otherwise acquired the same. The 1999 Loan has reached its maturity date several times without being paid but has been extended several times, most recently pursuant to that certain Third Amendment to Loan Agreement and Note dated as of November 30, 2002. See Item 6(n) below.

(h)

On or about December 19, 2000, Imagine Investments transferred to Stone Investments 1,082,000 shares of common stock of the Issuer for and in consideration for $4.3125 per share or $4,666,125 in the aggregate.

(i)

On or about March 5, 2001, Stone Investments transferred to Imagine Investments 615,000 shares of common stock of the Issuer for and in consideration for $3.28 per share or $2,017,200 in the aggregate.

(j)

During the period of March through August 2001, Imagine Investments acquired from several persons 11% Secured Promissory Notes dated April 1, 1999 (collectively, the “11% Notes”) with an outstanding principal balance of $9,500,000 (the holders of the Notes being called, collectively, the “Holders”). The 11% Notes were originally sold by Riverside on or about April 1, 1999, pursuant to a Credit Agreement (the “11% Note Credit Agreement”) dated as of April 1, 1999, between Riverside and the Holders and. the 11% Notes. Imagine Investments acquired the 11% Notes pursuant to, among other things, several individual Purchase and Sale of Notes and Interest in Collateral Documents Agreements (collectively, the “Purchase Agreements”) entered into between Imagine Investments and various Holders. Pursuant to the Purchase Agreements, Imagine Investments acquired the 11% Notes in exchange for cash and delivery to the Holders of an aggregate of 601,790 shares of common stock of the Issuer held by Imagine Investments (the “11% Note Purchase Shares”). The Purchase Agreements provided that Imagine Investments had the absolute, irrevocable, and unconditional right and option to purchase the 11% Note Purchase Shares between the date of closing of the purchase of the 11% Notes and December 31, 2001, at a price of $5.025 per share, subject to adjustment as provided therein. The Purchase Agreements also provided that the Holders had the absolute, irrevocable, and unconditional right and the option to require Imagine Investments to purchase the 11% Note Purchase Shares between the date of closing of the purchase of the 11% Notes and December 31, 2001, at a price of $5.025 per share, subject to adjustment as provided therein. Additionally, between the date of closing of the purchase of the 11% Notes and December 31, 2001, Imagine Investments had the right to vote the 11% Note Purchase Shares. As a result of the put/call option and voting provisions of the Purchase Agreements, Imagine Investments was deemed to continue to be the beneficial owner of the 11% Note Purchase Shares. On or about November 1, 2001, Imagine Investments exercised its call option under the Purchase Agreements and purchased all right, title, and interest in and to the 11% Note

Purchase Shares for a purchase price of $5.43 per share, or $3,265,733.80 in the aggregate. The 11% Note Purchase Shares represented approximately 7.2% of the issued and outstanding shares of common stock of the Issuer as of October 31, 2002. The 11% Notes were secured by, among other things, a second lien on 2,016,168 shares of common stock of the Issuer owned by Riverside (the “11% Note Pledged Shares”), which shares represented approximately 24.3% of the issued and outstanding common stock of the Issuer as of October 31, 2002. The 11% Note Pledged Shares were pledged pursuant to the Pledge and Security Agreement (the “11% Note Pledge Agreement”) dated as of April 1, 1999, executed by Riverside and Mitchell W. Legler, as agent for the Holders. Pursuant to the 11% Note Pledge Agreement, Riverside may not sell or encumber the 11% Note Pledged Shares except pursuant to the 11% Note Credit Agreement and the Intercreditor Agreement referred to therein. The 11% Notes have reached their maturity date several times without being paid but have been extended several times, most recently pursuant to that certain Third Amendment to Credit Agreement and Notes dated as of June 25, 2002. See Item 6(o) below.

(k)

On June 25, 2002, the maturity date of the 1999 Loan was extended from December 15, 2000, to September 30, 2002, pursuant to that certain Amendment to Loan Agreement and Note dated as of June 25, 2002.

(l)

On June 25, 2002, the maturity date of the 11% Notes was extended from September 30, 2000, to September 30, 2002, pursuant to that certain Amendment to Credit Agreement and Notes dated as of June 25, 2002.

(m)

Commencing on August 5, 2002 and continuing through February 7, 2003, Imagine Investments loaned Riverside an additional aggregate $858,799 pursuant to various Promissory Notes, which loans were secured by the 1999 Pledged Shares (the “2002/2003 Loans”).

(n)

On September 30, 2002, the maturity date of the 1999 Loan was extended from September 30, 2002, to November 30, 2002, pursuant to that certain Second Amendment to Loan Agreement and Note dated September 30, 2002. On November 30, 2002, the maturity date of the 1999 Loan was extended from November 30, 2002, to January 31, 2003 pursuant to that certain Third Amendment to Loan Agreement and Note dated November 30, 2002.

(o)

On September 30, 2002, the maturity date of the 11% Notes was extended from September 30, 2002, to November 30, 2002, pursuant to that certain Second Amendment to Credit Agreement and Notes dated September 30, 2002. On November 30, 2003, the maturity date of the 11% Notes was extended from November 30, 2002, to January 31, 2003 pursuant to that certain Third Amendment to Credit Agreement and Notes dated November 30, 2002.

(p)

On April 4, 2003, Imagine Investments entered into the April 2003 Agreement pursuant to which Imagine Investments acquired the 1999 Pledged Shares, the 11% Note Pledged Shares, and an additional 23,420 shares (the “Additional Issuer Shares” and, together with the 1999 Pledged Shares and the 11% Note Pledged Shares, the “Wickes Shares”) of the Issuer that were not otherwise pledged to it. Pursuant to the terms of the April 2003 Agreement, 717,923 shares of the 1999 Pledged Shares were acquired by Imagine Investments in exchange for the deemed payment of $3,589,615.17 of the principal amount outstanding, plus accrued interest through March 31, 2003, on the 1999 Loan and the 2002/2003 Loans. Additionally, 40,232 shares of the 1999 Pledged Shares, the 11% Note Pledged Shares, and the Additional Issuer Shares were acquired by Imagine Investments in exchange for the deemed payment of $10,399,099.83 of the $12,590,022.73 principal amount outstanding, plus accrued interest through March 31, 2003, on the 11% Notes. The parties to the April 2003 Agreement agreed that the amount of the foregoing indebtedness

exchanged for the common stock of the Issuer acquired pursuant thereto was calculated to be $5.00 of indebtedness per each share of common stock of the Issuer even though the parties believed that the fair market value of a share of common stock of the Issuer as of that date was substantially less. In addition, Imagine Investments has agreed to pay Riverside certain amounts that Imagine Investments receives with respect to the Wickes Shares upon the sale, liquidation, or redemption thereof if certain conditions are met.

(q)

On April 4, 2003, Imagine Investments entered into that certain Letter Agreement dated April 4, 2003, between Imagine Investments and Riverside (the “Liberty Option Agreement”) pursuant to which Riverside granted to Imagine Investments an option to purchase the 53,700 shares of common stock of the Issuer that are pledged to Liberty Savings Bank to secure indebtness owed to Liberty Savings Bank by Riverside (the “Liberty Loan”) for an exercise price of $5.00 per share. Pursuant to the provisions of the Liberty Option Agreement, the term of the option commenced on April 4, 2003 and expires ten days following the payment of all remaining debt owed Imagine Investments by Riverside. If Imagine Investments elects to exercise such option, Imagine Investments will acquire the shares subject thereto in exchange for the deemed payment of additional $268,500 of the remaining outstanding principal balance, plus any accrued interest, on the 11% Notes owed to Imagine Investments by Riverside and, upon such exercise, Riverside will discharge the Liberty Loan. The exercise price of $5.00 was agreed upon by the parties even though the parties believed that the fair market value of a share of common stock of the Issuer as of that date was substantially less.

Item 7. Material to be Filed as Exhibits.

7.1.

Stock Purchase Agreement dated as of October 5, 1998, between Riverside and Imagine Investments, pursuant to which, among other things, (1) Imagine Investments purchased 250,000 shares of common stock of the Issuer from Riverside, (2) Riverside granted to Imagine Investments an option to purchase 750,000 shares of common stock of the Issuer held by Riverside, (3) Riverside had the right to put up to 200,000 shares of common stock of the Issuer underlying such option to Imagine Investments, and (4) Riverside granted to Imagine Investments a right of first refusal with respect to up to all of the shares of common stock of the Issuer held by Riverside other than the 250,000 shares purchased by Imagine Investments (incorporated by reference to Exhibit A of the Schedule 13D, filed with the Securities and Exchange Commission on October 15, 1998 (File No. 005-42945)).

7.2.

Amendment No. 1 to Stock Purchase Agreement dated as of November 4, 1998, between Riverside and Imagine Investments (incorporated by reference to Exhibit B of Amendment No. 1 to the Schedule 13D, filed with the Securities and Exchange Commission on November 24, 1998 (File No. 005-42945)).

7.3.

Amendment No. 2 to Stock Purchase Agreement dated as of November 18, 1998, between Riverside and Imagine Investments (incorporated by reference to Exhibit C of Amendment No. 1 to the Schedule 13D, filed with the Securities and Exchange Commission on November 24, 1998 (File No. 005-42945)).

7.4.

Amendment No. 3 to Stock Purchase Agreement dated as of November 30, 1998, between Riverside and Imagine Investments.*

7.5.

Amendment No. 4 to Stock Purchase Agreement dated as of December 9, 1998, between Riverside and Imagine Investments.*

7.6.

Amendment No. 5 to Stock Purchase Agreement dated as of December 23, 1998, between Riverside and Imagine Investments (incorporated by reference to Exhibit B of Amendment No. 2 to the Schedule 13D, filed with the Securities and Exchange Commission on January 19, 1999 (File No. 005-42945)).

7.7.

Letter agreement re: 82,000 shares acquired by Imagine Investments on 12/29/98.*

7.8.

Letter Agreement dated effective January 25, 1999, between Imagine Investments and Riverside, extending the term of the Option under the Stock Purchase Agreement (incorporated by reference to Exhibit B of Amendment No. 3 to the Schedule 13D, filed with the Securities and Exchange Commission on February 8, 1999 (File No. 005-42945)).

7.9.

Letter Agreement dated January 26, 1999, between Imagine Investments and Riverside, regarding the exercise of the remainder of the Option (incorporated by reference to Exhibit C of Amendment No. 3 to the Schedule 13D, filed with the Securities and Exchange Commission on February 8, 1999 (File No. 005-42945)).

7.10.

Credit Agreement dated as of April 1, 1999, among Riverside, as borrower, the Holders, as lenders, and Mitchell W. Legler, as agent for the Holders, relating to the extension of credit by the Holders to Riverside in the aggregate original principal amount of $10,000,000 (incorporated by reference to Exhibit 4.1(a) to Riverside’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1999).

7.11.

Form of 11% Secured Promissory Note dated April 1, 1999 (incorporated by reference to Exhibit 4.1(b) to Riverside’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1999).

7.12.

Pledge and Security Agreement dated as of April 1, 1999, between Riverside and Mitchell W. Legler, as agent for the Holders, relating to, among other things, the shares of common stock of the Issuer pledged by Riverside to Mitchell W. Legler, as agent for the Holders, to secure the extension of credit by the Holders to Riverside in the aggregate original principal amount of $10,000,000, which pledge is subject to the prior pledge of such shares by Riverside to American Founders Life Insurance Company.*

7.13.

Intercreditor Agreement dated as of August 24, 1999, among the Holders, Mitchell W. Legler, as agent for the Holders, and American Founders Life Insurance Company, relating to the priority of AFL with respect to, among other things, the 11% Note Pledged Shares.*

7.14.

Letter Agreement dated August 30, 1999, between Riverside and Imagine Investments, releasing 81,970 shares of common stock of the Issuer held by Riverside from a pledge by Riverside to Imagine Investments to secure the $1,800,000 loan.*

7.15.

Loan Agreement dated as of August 31, 1999, between Imagine Investments, as lender, and Riverside, as borrower, relating to the $1,800,000 loan (incorporated by reference to Exhibit 4.1(a) to Riverside’s Quarterly Report on Form 10-Q for the quarter ended September 30, 1999).

7.16.

Demand Promissory Note dated August 31, 1999, by Riverside in favor of Imagine Investments, in the principal amount of $1,800,000 (incorporated by reference to Exhibit 4.1(b) to Riverside’s Quarterly Report on Form 10-Q for the quarter ended September 30, 1999).

7.17.

Stock Pledge Agreement dated as of August 31, 1999, between Riverside and Imagine Investments, relating to the shares of common stock of the Issuer pledged by Riverside to Imagine Investments to secure the $1,800,000 loan (incorporated by reference to Exhibit 4.1(c) to Riverside’s Quarterly Report on Form 10-Q for the quarter ended September 30, 1999).

7.18.

First Amendment to Loan Agreement and Stock Pledge Agreements dated as of August 31, 2000, between Imagine Investments, as lender, and Riverside, as borrower, renewing and modifying the $1,800,000 loan, including increasing the principal amount thereof to $2,021,628.01 (incorporated by reference to Exhibit 4.1(c) to Riverside’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2000).

7.19.

First Amended and Restated Promissory Note dated August 31, 2000, by Riverside in favor of Imagine Investments, in the principal amount of $2,021,628.01 (incorporated by

reference to Exhibit 4.1(d) to Riverside’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2000).

7.20.

First Amendment to Pledge and Security Agreement dated as of September 15, 2000, between Riverside and Mitchell W. Legler, as agent for the Holders, relating to the addition of collateral to secure the extension of credit by the Holders to Riverside in the aggregate original principal amount of $10,000,000, which pledge is subject to the prior pledge of such shares by Riverside to American Founders Life Insurance Company.*

7.21.

Estoppel Agreement dated as of February 20, 2001, between Riverside and Imagine Investments, pursuant to which, among other things, Riverside warrants the validity and enforceability of the 11% Notes.*

7.22.

Assignment of Notes and Interest in Collateral Documents dated February 7, 2001, among Imagine Investments and Cecil Altmann, pursuant to which such person assigned the 11% Note in favor of such person to Imagine Investments.*

7.23.

Assignment of Notes and Interest in Collateral Documents dated February 15, 2001, among Imagine Investments and Southern Farm Bureau Casualty Insurance Company, pursuant to which such entity assigned the 11% Note in favor of such entity to Imagine Investments. *

7.24.

Nonrecourse Assignment of Loan Documents dated February 15, 2001, between Imagine Investments and American Centennial Insurance Company, pursuant to which American Centennial Insurance Company assigned the 11% Note in its favor to Imagine Investments.*

7.25.

Form of Purchase and Sale of Notes and Interest in Collateral Documents Agreement, among Imagine Investments, Stone Holdings, as guarantor, and each of the following Holders on the dates indicated, pursuant to which such Holder assigned the 11% Note in favor of such Holder to Imagine Investments: Kenneth M. Kirschner (March 20, 2001); Lovco, Inc. (March 20, 2001); Creek Farms Corp. (March 20, 2001); East Adams Corporation (March 20, 2001); Frederick H. Schultz 1994 Trust (March 20, 2001); Fujita Investment Company Limited (March 26, 2001); and North American Company for Life and Health Insurance (April 6, 2001) (incorporated by reference to Exhibit 1 of Amendment No. 4 to the Schedule 13D, filed with the Securities and Exchange Commission on September 18, 2001 (File No. 005-42945)).

7.26.

Allonges, between Imagine Investments and each of the following Holders on the dates indicated, pursuant to which such Holder assigned the 11% Note in favor of such Holder to Imagine Investments: Bost & Company (Note 008 and Note 009) and Pitt & Company (Note 010 and Note 011).*

7.27.

Forbearance Agreement dated as of March 1, 2001, between Imagine Investments and Riverside, relating to the forbearance by Imagine Investments of the enforcement of its rights with respect to the 11% Notes (incorporated by reference to Exhibit 4.1(i) to Riverside’s Annual Report on Form 10-K for the year ended December 31, 2000).

7.28.

Forbearance Agreement dated as of April 13, 2001, between Imagine Investments and Riverside, relating to the forbearance by Imagine Investments of the enforcement of its rights with respect to the 11% Notes (incorporated by reference to Exhibit 4.1(b) to Riverside’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2001).

7.29.

Forbearance Agreement dated as of May 14, 2001, between Imagine Investments and Riverside, relating to the forbearance by Imagine Investments of the enforcement of its rights with respect to the 11% Notes (incorporated by reference to Exhibit 4.1(c) to Riverside’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2001).

7.30.

Forbearance Agreement dated as of June 15, 2001, between Imagine Investments and Riverside, relating to the forbearance by Imagine Investments of the enforcement of its rights with respect to the 11% Notes (incorporated by reference to Exhibit 4.1(a) to Riverside’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2001).

7.31.

Forbearance Agreement dated as of July 15, 2001, between Imagine Investments and Riverside, relating to the forbearance by Imagine Investments of the enforcement of its rights with respect to the 11% Notes (incorporated by reference to Exhibit 4.1(b) to Riverside’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2001).

7.32.

Amendment to Loan Agreement and Note dated as of June 25, 2002, between Riverside and Imagine Investments, pursuant to which, among other things, the maturity date of the 1999 Loan was extended to September 30, 2002.*

7.33.

Amendment to Credit Agreement and Notes dated as of June 25, 2002, between Riverside and Imagine Investments, pursuant to which, among other things, the maturity date of the 11% Notes was extended to September 30, 2002.*

7.34.

Promissory Note dated August 5, 2002, by Riverside in favor of Imagine Investments, in the principal amount of $116,000.*

7.35.

Second Amendment to Loan Agreement and Note dated as of September 30, 2002, between Riverside and Imagine Investments, pursuant to which, among other things, the maturity date of the 1999 Loan was extended to November 30, 2002.+

7.36.

Third Amendment to Loan Agreement and Note dated as of November 30, 2002, between Riverside and Imagine Investments, pursuant to which, among other things, the maturity date of the 1999 Loan was extended to January 31, 2003.+

7.37.

Second Amendment to Credit Agreement and Notes dated as of September 30, 2002, between Riverside and Imagine Investments, pursuant to which, among other things, the maturity date of the 11% Notes was extended to November 30, 2002.+

7.38.

Third Amendment to Credit Agreement and Notes dated as of November 30, 2002, between Riverside and Imagine Investments, pursuant to which, among other things, the maturity date of the 11% Notes was extended to January 31, 2003.+

7.39.

Agreement for Conveyance of Shares of Wickes, Inc. in Lieu of Foreclosure and Bill of Sale dated as of April 4, 2003, by and among Riverside, J. Steven Wilson, Wilson Financial Corporation, and Imagine Investments.+

7.40.

Letter Agreement dated as of April 4, 2003, between Imagine Investments and Riverside, providing for the grant of an option to purchase 53,700 shares of common stock of Wickes, Inc. to Imagine Investments from Riverside.+

7.41.

Power of Attorney.+

* (incorporated by reference to the exhibit of the same number of Amendment No. 6 to the Schedule 13D, filed with the Securities and Exchange Commission on August 27, 2002.

+ Filed herewith.

[Signature page follows.]

SIGNATURE

After reasonable inquiry, and to the best of each of the undersigned’s knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

IMAGINE INVESTMENTS, INC., a Delaware corporation

By:		/s/ Gary M. Goltz
Name:		Gary M. Goltz
Title:		Vice President
Date:		April 16, 2003

STONE INVESTMENTS, INC., a Delaware corporation

By:		/s/ Gary M. Goltz
Name:		Gary M. Goltz
Title:		Vice President
Date:		April 16, 2003

STONE CAPITAL, INC., a Delaware corporation

By:		/s/ Gary M. Goltz
Name:		Gary M. Goltz
Title:		Vice President
Date:		April 16, 2003

STONE HOLDINGS, INC., a Delaware corporation

By:		/s/ Gary M. Goltz
Name:		Gary M. Goltz
Title:		Executive Vice President
Date:		April 16, 2003

P.S.F. HOLDINGS LIMITED PARTNERSHIP, a Texas limited partnership

By:		Winn Holdings, LLC,
		a Texas limited liability company, its general partner

By:		*
		Kathryn Fail Luttrull Sole member

Date:

THE MARITAL TRUST

By:		*
		James M. Fail Trustee

Date:

THE JAMES M. FAIL LIVING TRUST

By:		*
		James M. Fail Trustee

Date:

*
James M. Fail

Date:

WINN HOLDINGS, LLC,
a Texas limited liability company

By:		*
		Kathryn Fail Luttrull Sole member

Date:

*
Kathryn Fail Luttrull

Date:

/s/ Gary M. Goltz
*By Gary M. Goltz, as Attorney-in-Fact

Date:		April 16, 2003

EX-7.35 3 dex735.txt SECOND AMENDMENT TO LOAN AGREEMENT EXHIBIT 7.35 SECOND AMENDMENT TO LOAN AGREEMENT AND NOTE THIS SECOND AMENDMENT TO LOAN AGREEMENT AND NOTE ("Amendment") is entered into as of September 30, 2002 (the "Amendment Date"), by and between IMAGINE INVESTMENTS, INC., a Delaware corporation ("Lender"), whose address is 8150 North Central Expressway, Suite 1901, Dallas, Texas 75206 and RIVERSIDE GROUP, INC., a Florida corporation ("Borrower"), whose address is 7800 Belfort Parkway, Suite 100, Jacksonville, Florida 32256. WHEREAS, On August 31, 1999, Borrower and Lender entered into that certain Loan Agreement (as the same may have been amended, modified, renewed, extended or restated from time to time, the "Loan Agreement"); WHEREAS, pursuant to that certain First Amendment to Loan Agreement and Stock Pledge Agreements (the "First Amendment") dated August 31, 2000 between Borrower and Lender, Borrower executed and delivered to Lender that certain First Amended and Restated Promissory Note in the principal amount of Two Million Twenty-One Thousand Six Hundred Twenty-Eight and .01/100 Dollars ($2,021,628.01) (the "Note") WHEREAS, Borrower has requested and, subject to the terms and conditions of this Amendment, Lender has agreed, to extend the maturity of the Indebtedness (as defined in the Loan Agreement) as further evidenced by the Note and the other Loan Documents to November 30, 2002. NOW, THEREFORE, notwithstanding anything to the contrary contained in the Note or any of the other Loan Documents, Borrower and Lender agree as follows: 1. Defined Terms. All terms used herein and not otherwise defined herein shall have the meanings given to them in the Loan Agreement. 2. Reaffirmation of Indebtedness. Borrower and Lender hereby acknowledge and confirm that: (a) the outstanding principal balance and accrued interest of the Note as of the Amendment Date is equal to $2,565,716.12, (b) Borrower's obligation to repay the outstanding principal balance and accrued interest of the Note and all other Indebtedness is unconditional and not subject to any offsets, defenses or counterclaims, and (c) by entering into this Amendment, Lender does not waive or release any term or condition of the Note or the other Loan Documents or any of its rights or remedies under such Loan Documents, or applicable law, except as set forth herein. 3. Interest. Interest on the unpaid principal of the Indebtedness continues to accrue at the rate of twelve and three fourths of one percent (12.75%) per annum, effective as of December 15, 2000, until all of the Indebtedness (including, without limitation, principal and interest) is indefeasibly paid in full. 4. Payment of Principal and Interest on the Indebtedness. The Note and each of the other Loan Documents are hereby amended to extend the maturity date of the Indebtedness (regardless of the stated date of the maturity of the Indebtedness for the Note or the other Loan Documents) to November 30, 2002, at which time all Indebtedness (including, without limitation, principal and interest) shall be due and payable in full. AMENDMENT TO LOAN AGREEMENT AND NOTE Page 1 5. Reinstatement of Note and Loan Documents. Lender, without prejudice to or waiver of any right or remedy available to it by reason of the occurrence subsequent to the date hereof of any event or condition constituting a Possible Default or Event of Default or any other default or event of default that has occurred and is continuing under the Note or the other Loan Documents hereby agrees to take no action with respect to any such Possible Default or Event of Default or any other default or event of default that has occurred and is continuing under the Note or the other Loan Documents which heretofore has occurred, until no earlier than November 30, 2002. Borrower and Lender hereby agree that the Note and the Loan Documents are fully reinstated in accordance with their terms and conditions, as amended, by this Amendment, as if no Possible Default or Event of Default or any other default or event of default that has occurred and is continuing under the Note or the other Loan Documents had occurred in the payment of the Indebtedness prior to the date of this Agreement, but only until November 30, 2002. It is expressly understood that Lender will and does hereafter require full performance of any and all terms, conditions and requirements of all Loan Documents, as amended by this Amendment. It is further understood and agreed that the validity and perfection of the liens and security interests granted under the Loan Documents are not diminished or impaired in any way by this Amendment. Borrower agrees to perform and/or observe the terms and provisions of the Loan Documents to which it is a party, as amended by this Amendment. 6. No Commitment to Make Further Advances. Notwithstanding anything to the contrary contained herein or in any other Loan Document (including, without limitation, the Loan Agreement) any and all commitments of Lender to advance funds or issue letters of credit to, or on behalf of, Borrower are terminated and Lender shall have no further obligation to advance funds or issue letters of credit to, or on behalf of, Borrower. 7. Expenses. All expenses incurred by Borrower or Lender in connection with this transaction, including, but not limited to, attorneys' fees, shall be borne by Borrower and to the extent Lender's expenses are not paid by Borrower within 10 days of Lender submitting an invoice therefor to Borrower, the amount of such expenses shall be added to the outstanding principal amount of the Indebtedness and shall accrue interest in accordance with Paragraph 3 hereof. 8. Ratification of Prior Instruments and Priorities. Except as herein expressly amended, each and every term, condition, warranty and provision of the Note and the other Loan Documents shall remain in full force and effect and the Note and other Loan Documents as amended through even date herewith are hereby ratified, confirmed and approved by the parties hereto. Nothing herein shall be construed to alter or affect the priority of the liens, security interests or title created by the Loan Documents. Any provision herein that might otherwise be construed to conflict with the desire of Lender that the liens, security interests and title of the Loan Documents be maintained and preserved prior to any and all encumbrances affecting the Collateral arising subsequent to the execution of the Loan Documents shall, at Lender's option, be void and of no force and effect; it being the expressly declared intention of the parties hereto that no novation of the Loan Documents be created hereby. Any promissory note or other indebtedness described in the Loan Documents as the obligation secured thereby shall hereafter mean the Note as modified by this Agreement and the Indebtedness. The Loan Documents as modified and amended hereby are hereby ratified and confirmed in all respects. 9. Representations and Warranties. Borrower hereby represents and warrants that: (a) Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of Florida; (b) Borrower has all requisite power and authority and all necessary consents, approvals, licenses, permits and other authorizations (i) to own and operate the Collateral, (ii) to execute and deliver this Amendment and all other documents and agreements to be executed by Borrower in connection herewith, and (iii) to carry out and comply with the terms of the Note and the other Loan Documents, as AMENDMENT TO LOAN AGREEMENT AND NOTE Page 2 amended by this Amendment; (c) the Note and the other Loan Documents remain in full force and effect and constitute, and upon the execution and delivery of this Amendment will continue to constitute, the legal, valid and binding obligations of Borrower enforceable in accordance with their terms; (f) Borrower is the sole legal and beneficial owner of the Collateral; and (g) neither the execution and delivery of this Amendment nor the consummation of the transactions contemplated herein nor compliance by Borrower with the provisions of the Loan Documents, as amended by this Amendment, will conflict with or result in a breach of, or constitute a default under, any of the terms, conditions or provisions of any law, rule, regulation, order, writ, injunction or decree of any court or governmental authority to which Borrower is subject, or of the articles of incorporation, bylaws or any other organizational document of Borrower, or of any indenture, mortgage, deed of trust, promissory note, loan agreement or any other agreement or undertaking to which Borrower is a party or by which Borrower or its properties may be bound or subject. 10. Conditions to Effectiveness of this Amendment. This Amendment shall not become effective until, and shall become effective when, each and every one of the following conditions shall have been satisfied: a. executed counterparts of this Amendment, duly executed by Borrower and Lender, shall have been delivered to Lender; b. Lender shall have received a copy of the resolutions of the Board of Directors of Borrower authorizing the execution, delivery and performance by Borrower of this Amendment and any and all documents relating thereto, certified by Borrowers' Secretary or an Assistant Secretary; and c. the representations and warranties of Borrower set forth herein are true and correct on and with respect to the date hereof. 11. Defenses. Borrower covenants and warrants that there are no defenses, counterclaims or offsets to the Note, the other Loan Documents or the Indebtedness, and Borrower hereby waives any defense, claim or counterclaim against Lender. 12. Further Assurances. Borrower, upon request from Lender, agrees to execute such other and further documents as may be reasonably necessary or appropriate to consummate the transactions contemplated herein or to perfect the liens and security interests intended to secure the payment of the Indebtedness. 13. Business and Financial Information. Borrower will promptly furnish to Lender from time to time such information regarding the Collateral and/or the business and affairs and financial condition of Borrower as Lender may reasonably request, and will furnish such items Lender. 14. Descriptive Headings. Descriptive headings are inserted for convenience and reference only and do not in any way limit or amplify the terms and provisions hereof. 15. Default. If Borrower shall fail to perform or observe any of the covenants or agreements contained herein or if any statement, representation or warranty contained herein is false, misleading or erroneous in any material respect, an Event of Default shall be deemed to have occurred and Lender shall be entitled at its option to exercise any and all of the rights and remedies granted pursuant to any of the Loan Document or which Lender may otherwise be entitled, whether at law or in equity. AMENDMENT TO LOAN AGREEMENT AND NOTE Page 3 16. FINAL AGREEMENT. THE NOTE AND THE OTHER LOAN DOCUMENTS, AS AMENDED HEREBY, REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES HERETO RELATED TO THE SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES HERETO. AMENDMENT TO LOAN AGREEMENT AND NOTE Page 4 IN WITNESS WHEREOF, the parties hereto have each executed this Amendment as of September 30, 2002. LENDER: IMAGINE INVESTMENTS, INC. By: /s/ Gary M. Goltz --------------------------------------------- Name: Gary M. Goltz ------------------------------------------- Title: Vice President ------------------------------------------ BORROWER: RIVERSIDE GROUP, INC., a Florida corporation By: /s/ Catherine J. Gray --------------------------------------------- Name: Catherine J. Gray ------------------------------------------- Title: Senior Vice President and CFO ------------------------------------------ AMENDMENT TO LOAN AGREEMENT AND NOTE Page 5 EX-7.36 4 dex736.txt THIRD AMENDMENT TO LOAN AGREEMENT EXHIBIT 7.36 THIRD AMENDMENT TO LOAN AGREEMENT AND NOTE THIS THIRD AMENDMENT TO LOAN AGREEMENT AND NOTE ("Amendment") is entered into as of November 30, 2002 (the "Amendment Date"), by and between IMAGINE INVESTMENTS, INC., a Delaware corporation ("Lender"), whose address is 8150 North Central Expressway, Suite 1901, Dallas, Texas 75206 and RIVERSIDE GROUP, INC., a Florida corporation ("Borrower"), whose address is 7800 Belfort Parkway, Suite 100, Jacksonville, Florida 32256. WHEREAS, On August 31, 1999, Borrower and Lender entered into that certain Loan Agreement (as the same may have been amended, modified, renewed, extended or restated from time to time, the "Loan Agreement"); WHEREAS, pursuant to that certain First Amendment to Loan Agreement and Stock Pledge Agreements (the "First Amendment") dated August 31, 2000 between Borrower and Lender, Borrower executed and delivered to Lender that certain First Amended and Restated Promissory Note in the principal amount of Two Million Twenty-One Thousand Six Hundred Twenty-Eight and .01/100 Dollars ($2,021,628.01) (the "Note") WHEREAS, Borrower has requested and, subject to the terms and conditions of this Amendment, Lender has agreed, to extend the maturity of the Indebtedness (as defined in the Loan Agreement) as further evidenced by the Note and the other Loan Documents to January 31, 2003. NOW, THEREFORE, notwithstanding anything to the contrary contained in the Note or any of the other Loan Documents, Borrower and Lender agree as follows: 1. Defined Terms. All terms used herein and not otherwise defined herein shall have the meanings given to them in the Loan Agreement. 2. Reaffirmation of Indebtedness. Borrower and Lender hereby acknowledge and confirm that: (a) the outstanding principal balance and accrued interest of the Note as of the Amendment Date is equal to $2,609,391.71, (b) Borrower's obligation to repay the outstanding principal balance and accrued interest of the Note and all other Indebtedness is unconditional and not subject to any offsets, defenses or counterclaims, and (c) by entering into this Amendment, Lender does not waive or release any term or condition of the Note or the other Loan Documents or any of its rights or remedies under such Loan Documents, or applicable law, except as set forth herein. 3. Interest. Interest on the unpaid principal of the Indebtedness continues to accrue at the rate of twelve and three fourths of one percent (12.75%) per annum, effective as of December 15, 2000, until all of the Indebtedness (including, without limitation, principal and interest) is indefeasibly paid in full. 4. Payment of Principal and Interest on the Indebtedness. The Note and each of the other Loan Documents are hereby amended to extend the maturity date of the Indebtedness (regardless of the stated date of the maturity of the Indebtedness for the Note or the other Loan Documents) to January 31, 2003, at which time all Indebtedness (including, without limitation, principal and interest) shall be due and payable in full. AMENDMENT TO LOAN AGREEMENT AND NOTE Page 1 5. Reinstatement of Note and Loan Documents. Lender, without prejudice to or waiver of any right or remedy available to it by reason of the occurrence subsequent to the date hereof of any event or condition constituting a Possible Default or Event of Default or any other default or event of default that has occurred and is continuing under the Note or the other Loan Documents hereby agrees to take no action with respect to any such Possible Default or Event of Default or any other default or event of default that has occurred and is continuing under the Note or the other Loan Documents which heretofore has occurred, until no earlier than January 31, 2003. Borrower and Lender hereby agree that the Note and the Loan Documents are fully reinstated in accordance with their terms and conditions, as amended, by this Amendment, as if no Possible Default or Event of Default or any other default or event of default that has occurred and is continuing under the Note or the other Loan Documents had occurred in the payment of the Indebtedness prior to the date of this Agreement, but only until January 31, 2003. It is expressly understood that Lender will and does hereafter require full performance of any and all terms, conditions and requirements of all Loan Documents, as amended by this Amendment. It is further understood and agreed that the validity and perfection of the liens and security interests granted under the Loan Documents are not diminished or impaired in any way by this Amendment. Borrower agrees to perform and/or observe the terms and provisions of the Loan Documents to which it is a party, as amended by this Amendment. 6. No Commitment to Make Further Advances. Notwithstanding anything to the contrary contained herein or in any other Loan Document (including, without limitation, the Loan Agreement) any and all commitments of Lender to advance funds or issue letters of credit to, or on behalf of, Borrower are terminated and Lender shall have no further obligation to advance funds or issue letters of credit to, or on behalf of, Borrower. 7. Expenses. All expenses incurred by Borrower or Lender in connection with this transaction, including, but not limited to, attorneys' fees, shall be borne by Borrower and to the extent Lender's expenses are not paid by Borrower within 10 days of Lender submitting an invoice therefor to Borrower, the amount of such expenses shall be added to the outstanding principal amount of the Indebtedness and shall accrue interest in accordance with Paragraph 3 hereof. 8. Ratification of Prior Instruments and Priorities. Except as herein expressly amended, each and every term, condition, warranty and provision of the Note and the other Loan Documents shall remain in full force and effect and the Note and other Loan Documents as amended through even date herewith are hereby ratified, confirmed and approved by the parties hereto. Nothing herein shall be construed to alter or affect the priority of the liens, security interests or title created by the Loan Documents. Any provision herein that might otherwise be construed to conflict with the desire of Lender that the liens, security interests and title of the Loan Documents be maintained and preserved prior to any and all encumbrances affecting the Collateral arising subsequent to the execution of the Loan Documents shall, at Lender's option, be void and of no force and effect; it being the expressly declared intention of the parties hereto that no novation of the Loan Documents be created hereby. Any promissory note or other indebtedness described in the Loan Documents as the obligation secured thereby shall hereafter mean the Note as modified by this Agreement and the Indebtedness. The Loan Documents as modified and amended hereby are hereby ratified and confirmed in all respects. 9. Representations and Warranties. Borrower hereby represents and warrants that: (a) Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of Florida; (b) Borrower has all requisite power and authority and all necessary consents, approvals, licenses, permits and other authorizations (i) to own and operate the Collateral, (ii) to execute and deliver this Amendment and all other documents and agreements to be executed by Borrower in connection herewith, and (iii) to carry out and comply with the terms of the Note and the other Loan Documents, as AMENDMENT TO LOAN AGREEMENT AND NOTE Page 2 amended by this Amendment; (c) the Note and the other Loan Documents remain in full force and effect and constitute, and upon the execution and delivery of this Amendment will continue to constitute, the legal, valid and binding obligations of Borrower enforceable in accordance with their terms; (f) Borrower is the sole legal and beneficial owner of the Collateral; and (g) neither the execution and delivery of this Amendment nor the consummation of the transactions contemplated herein nor compliance by Borrower with the provisions of the Loan Documents, as amended by this Amendment, will conflict with or result in a breach of, or constitute a default under, any of the terms, conditions or provisions of any law, rule, regulation, order, writ, injunction or decree of any court or governmental authority to which Borrower is subject, or of the articles of incorporation, bylaws or any other organizational document of Borrower, or of any indenture, mortgage, deed of trust, promissory note, loan agreement or any other agreement or undertaking to which Borrower is a party or by which Borrower or its properties may be bound or subject. 10. Conditions to Effectiveness of this Amendment. This Amendment shall not become effective until, and shall become effective when, each and every one of the following conditions shall have been satisfied: a. executed counterparts of this Amendment, duly executed by Borrower and Lender, shall have been delivered to Lender; b. Lender shall have received a copy of the resolutions of the Board of Directors of Borrower authorizing the execution, delivery and performance by Borrower of this Amendment and any and all documents relating thereto, certified by Borrowers' Secretary or an Assistant Secretary; and c. the representations and warranties of Borrower set forth herein are true and correct on and with respect to the date hereof. 11. Defenses. Borrower covenants and warrants that there are no defenses, counterclaims or offsets to the Note, the other Loan Documents or the Indebtedness, and Borrower hereby waives any defense, claim or counterclaim against Lender. 12. Further Assurances. Borrower, upon request from Lender, agrees to execute such other and further documents as may be reasonably necessary or appropriate to consummate the transactions contemplated herein or to perfect the liens and security interests intended to secure the payment of the Indebtedness. 13. Business and Financial Information. Borrower will promptly furnish to Lender from time to time such information regarding the Collateral and/or the business and affairs and financial condition of Borrower as Lender may reasonably request, and will furnish such items Lender. 14. Descriptive Headings. Descriptive headings are inserted for convenience and reference only and do not in any way limit or amplify the terms and provisions hereof. 15. Default. If Borrower shall fail to perform or observe any of the covenants or agreements contained herein or if any statement, representation or warranty contained herein is false, misleading or erroneous in any material respect, an Event of Default shall be deemed to have occurred and Lender shall be entitled at its option to exercise any and all of the rights and remedies granted pursuant to any of the Loan Document or which Lender may otherwise be entitled, whether at law or in equity. AMENDMENT TO LOAN AGREEMENT AND NOTE Page 3 16. FINAL AGREEMENT. THE NOTE AND THE OTHER LOAN DOCUMENTS, AS AMENDED HEREBY, REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES HERETO RELATED TO THE SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES HERETO. AMENDMENT TO LOAN AGREEMENT AND NOTE Page 4 IN WITNESS WHEREOF, the parties hereto have each executed this Amendment as of November 30, 2002. LENDER: IMAGINE INVESTMENTS, INC. By: /s/ Gary M. Goltz --------------------------------------------- Name: Gary M. Goltz ------------------------------------------- Title: Vice President ------------------------------------------ BORROWER: RIVERSIDE GROUP, INC., a Florida corporation By: /s/ Catherine J. Gray --------------------------------------------- Name: Catherine J. Gray ------------------------------------------- Title: Senior Vice President and CFO ------------------------------------------ AMENDMENT TO LOAN AGREEMENT AND NOTE Page 5 EX-7.37 5 dex737.txt SECOND AMENDMENT TO CREDIT AGREEMENT EXHIBIT 7.37 SECOND AMENDMENT TO CREDIT AGREEMENT AND NOTES THIS SECOND AMENDMENT TO CREDIT AGREEMENT AND NOTES ("Amendment") is entered into as of September 30, 2002 (the "Amendment Date"), by and between IMAGINE INVESTMENTS, INC., a Delaware corporation ("Lender"), whose address is 8150 North Central Expressway, Suite 1901, Dallas, Texas 75206 and RIVERSIDE GROUP, INC., a Florida corporation ("Borrower"), whose address is 7800 Belfort Parkway, Suite 100, Jacksonville, Florida 32256. WHEREAS, On or about April 1, 1999, Borrower borrowed the aggregate sum of Ten Million Dollars ($10,000,000) from several different entities (collectively, the "Original Note Holders" and each individually, an "Original Note Holder") pursuant to a Credit Agreement dated as of April 1, 1999 (the "Credit Agreement") and a promissory note made by Borrower in favor of each Original Note Holder (collectively, the "Original Notes" and each individually, an "Original Note"); WHEREAS, On or prior to June 25, 2002, Lender purchased or otherwise acquired from the Original Note Holders all of their respective rights, titles and interests in the Original Notes (collectively, the "Notes" and each individually, a "Note"), the Credit Agreement, all other loan documents and security documents related thereto (collectively, the "Loan Documents") and the collateral securing the Notes; WHEREAS, on June 25, 2002, Lender and Borrower entered into an Amendment to Credit Agreement and Notes (the "First Amendment"), wherein the Lender agreed to renew and extend the maturity of the indebtedness, liabilities and obligations (the "Indebtedness") evidenced by the Notes and the other Loan Documents to September 30, 2002; and WHEREAS, Borrower has requested and, subject to the terms and conditions of this Amendment, Lender has agreed to renew and extend the maturity of the Indebtedness evidenced by the Notes and the other Loan Documents to November 30, 2002. NOW, THEREFORE, notwithstanding anything to the contrary contained in the Notes or any of the other Loan Documents, Borrower and Lender agree as follows: 1. Defined Terms. All terms used herein and not otherwise defined herein shall have the meanings given to them in the Credit Agreement and the First Amendment. 2. Reaffirmation of Indebtedness. Borrower and Lender hereby acknowledge and confirm that: (a) the outstanding principal balance of and accrued interest on the Indebtedness as of the Amendment Date is $12,068,954.26, (b) Borrower's obligation to repay the outstanding principal balance and accrued interest of each Note and all other Indebtedness is unconditional and not subject to any offsets, defenses or counterclaims, and (c) by entering into this Amendment, Lender does not waive or release any term or condition of the Notes or the other Loan Documents or any of its rights or remedies under such Loan Documents, or applicable law, except as set forth herein. 3. Interest. Notwithstanding anything to the contrary contained in the Notes or the other Loan Documents, the interest on the unpaid principal of the Indebtedness continues to accrue at the rate of eleven percent (11%) per annum, effective as of September 30, 2000, until all of the Indebtedness AMENDMENT TO CREDIT AGREEMENT AND NOTES Page 1 (including, without limitation, principal and interest) is indefeasibly paid in full. The Lender and the Borrower hereby reaffirm this amendment. 4. Extension of Maturity Date. Each of the Notes and the other Loan Documents is hereby amended to extend the maturity date of the Indebtedness (regardless of the stated date of the maturity of the Indebtedness for such Note or Loan Document) to November 30, 2002, at which time all Indebtedness (including, without limitation, principal and interest) shall become due and payable in full. 5. Reinstatement of Notes and Loan Documents. Lender, without prejudice to or waiver of any right or remedy available to it by reason of the occurrence subsequent to the date hereof of any event or condition constituting a Default or Event of Default or any other default or event of default that has occurred and is continuing under any of the Notes or the other Loan Documents hereby agrees to take no action with respect to any such Default or Event of Default or any other default or event of default that has occurred and is continuing under any of the Notes or the other Loan Documents which heretofore has occurred, until November 30, 2002. Borrower and Lender hereby agree that the Notes and the Loan Documents are fully reinstated in accordance with their terms and conditions, as amended, by this Amendment, as if no Default or Event of Default or any other default or event of default that has occurred and is continuing under any of the Notes or the other Loan Documents had occurred in the payment of the Indebtedness prior to the date of this Agreement, but no later than November 30, 2002. It is expressly understood that Lender will and does hereafter require full performance of any and all terms, conditions and requirements of all Loan Documents, as amended by this Amendment. It is further understood and agreed that the validity and perfection of the liens and security interests granted under the Loan Documents are not diminished or impaired in any way by this Amendment. Borrower agrees to perform and/or observe the terms and provisions of the Loan Documents to which it is a party, as amended by this Amendment. 6. No Commitment to Make Further Advances. Notwithstanding anything to the contrary contained herein or in any other Loan Document (including, without limitation, the Credit Agreement) any and all commitments of Lender to advance funds or issue letters of credit to, or on behalf of, Borrower are terminated and Lender shall have no further obligation to advance funds or issue letters of credit to, or on behalf of, Borrower. 7. Expenses. All expenses incurred by Borrower or Lender in connection with this transaction, including, but not limited to, attorneys' fees, shall be borne by Borrower and to the extent Lender's expenses are not paid by Borrower within 10 days of Lender submitting an invoice therefor to Borrower, the amount of such expenses shall be added to the outstanding principal amount of the Indebtedness and shall accrue interest in accordance with Paragraph 3 hereof. 8. Ratification of Prior Instruments and Priorities. Except as herein expressly amended, each and every term, condition, warranty and provision of the Notes and the other Loan Documents as amended through even date herewith shall remain in full force and effect and such Notes and other Loan Documents as amended through even date herewith are hereby ratified, confirmed and approved by the parties hereto. Nothing herein shall be construed to alter or affect the priority of the liens, security interests or title created by the Loan Documents. Any provision herein that might otherwise be construed to conflict with the desire of Lender that the liens, security interests and title of the Loan Documents be maintained and preserved prior to any and all encumbrances affecting the Collateral arising subsequent to the execution of the Loan Documents shall, at Lender's option, be void and of no force and effect; it being the expressly declared intention of the parties hereto that no novation of the Loan Documents be created hereby. Any promissory note or other indebtedness described in the Loan Documents as the obligation secured thereby shall hereafter mean the Notes as modified by this Agreement and the AMENDMENT TO CREDIT AGREEMENT AND NOTES Page 2 Indebtedness. The Loan Documents as modified and amended hereby are hereby ratified and confirmed in all respects. 9. Representations and Warranties. Borrower hereby represents and warrants that: (a) Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of Florida; (b) Borrower has all requisite power and authority and all necessary consents, approvals, licenses, permits and other authorizations (i) to own and operate the Collateral, (ii) to execute and deliver this Amendment and all other documents and agreements to be executed by Borrower in connection herewith, and (iii) to carry out and comply with the terms of the Notes and the other Loan Documents, as amended by this Amendment; (c) the Notes and the other Loan Documents remain in full force and effect and constitute, and upon the execution and delivery of this Amendment will continue to constitute, the legal, valid and binding obligations of Borrower enforceable in accordance with their terms; (f) Borrower is the sole legal and beneficial owner of the Collateral; and (g) neither the execution and delivery of this Amendment nor the consummation of the transactions contemplated herein nor compliance by Borrower with the provisions of the Loan Documents, as amended by this Amendment, will conflict with or result in a breach of, or constitute a default under, any of the terms, conditions or provisions of any law, rule, regulation, order, writ, injunction or decree of any court or governmental authority to which Borrower is subject, or of the articles of incorporation, bylaws or any other organizational document of Borrower, or of any indenture, mortgage, deed of trust, promissory note, loan agreement or any other agreement or undertaking to which Borrower is a party or by which Borrower or its properties may be bound or subject. 10. Conditions to Effectiveness of this Amendment. This Amendment shall not become effective until, and shall become effective when, each and every one of the following conditions shall have been satisfied: a. executed counterparts of this Amendment, duly executed by Borrower and Lender, shall have been delivered to Lender; b. Lender shall have received a copy of the resolutions of the Board of Directors of Borrower authorizing the execution, delivery and performance by Borrower of this Amendment and any and all documents relating thereto, certified by Borrowers' Secretary or an Assistant Secretary; and c. the representations and warranties of Borrower set forth herein are true and correct on and with respect to the date hereof. 11. Defenses. Borrower covenants and warrants that there are no defenses, counterclaims or offsets to any of the Notes, the other Loan Documents or the Indebtedness, and Borrower hereby waives any defense, claim or counterclaim against Lender. 12. Further Assurances. Borrower, upon request from Lender, agrees to execute such other and further documents as may be reasonably necessary or appropriate to consummate the transactions contemplated herein or to perfect the liens and security interests intended to secure the payment of the Indebtedness. 13. Business and Financial Information. Borrower will promptly furnish to Lender from time to time such information regarding the Collateral and/or the business and affairs and financial condition of Borrower as Lender may reasonably request, and will furnish such items Lender. AMENDMENT TO CREDIT AGREEMENT AND NOTES Page 3 14. Descriptive Headings. Descriptive headings are inserted for convenience and reference only and do not in any way limit or amplify the terms and provisions hereof. 15. Default. If Borrower shall fail to perform or observe any of the covenants or agreements contained herein or if any statement, representation or warranty contained herein is false, misleading or erroneous in any material respect, an Event of Default shall be deemed to have occurred and Lender shall be entitled at its option to exercise any and all of the rights and remedies granted pursuant to any of the Loan Document or which Lender may otherwise be entitled, whether at law or in equity. 16. FINAL AGREEMENT. THE NOTES AND THE OTHER LOAN DOCUMENTS, AS AMENDED HEREBY, REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES HERETO RELATED TO THE SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES HERETO. IN WITNESS WHEREOF, the parties hereto have each executed this Amendment as of September 30, 2002. LENDER: IMAGINE INVESTMENTS, INC. By: /s/ Gary M. Goltz --------------------------------------------- Name: Gary M. Goltz ------------------------------------------- Title: Vice President ------------------------------------------ BORROWER: RIVERSIDE GROUP, INC., a Florida corporation By: /s/ Catherine J. Gray --------------------------------------------- Name: Catherine J. Gray ------------------------------------------- Title: Senior Vice President and CFO ------------------------------------------ AMENDMENT TO CREDIT AGREEMENT AND NOTES Page 4 EX-7.38 6 dex738.txt THIRD AMENDMENT TO CREDIT AGREEMENT EXHIBIT 7.38 THIRD AMENDMENT TO CREDIT AGREEMENT AND NOTES THIS THIRD AMENDMENT TO CREDIT AGREEMENT AND NOTES ("Amendment") is entered into as of November 30, 2002 (the "Amendment Date"), by and between IMAGINE INVESTMENTS, INC., a Delaware corporation ("Lender"), whose address is 8150 North Central Expressway, Suite 1901, Dallas, Texas 75206 and RIVERSIDE GROUP, INC., a Florida corporation ("Borrower"), whose address is 7800 Belfort Parkway, Suite 100, Jacksonville, Florida 32256. WHEREAS, On or about April 1, 1999, Borrower borrowed the aggregate sum of Ten Million Dollars ($10,000,000) from several different entities (collectively, the "Original Note Holders" and each individually, an "Original Note Holder") pursuant to a Credit Agreement dated as of April 1, 1999 (the "Credit Agreement") and a promissory note made by Borrower in favor of each Original Note Holder (collectively, the "Original Notes" and each individually, an "Original Note"); WHEREAS, On or prior to June 25, 2002, Lender purchased or otherwise acquired from the Original Note Holders all of their respective rights, titles and interests in the Original Notes (collectively, the "Notes" and each individually, a "Note"), the Credit Agreement, all other loan documents and security documents related thereto (collectively, the "Loan Documents") and the collateral securing the Notes; WHEREAS, on June 25, 2002, Lender and Borrower entered into an Amendment to Credit Agreement and Notes (the "First Amendment"), wherein the Lender agreed to renew and extend the maturity of the indebtedness, liabilities and obligations (the "Indebtedness") evidenced by the Notes and the other Loan Documents to September 30, 2002; and WHEREAS, Borrower has requested and, subject to the terms and conditions of this Amendment, Lender has agreed to renew and extend the maturity of the Indebtedness evidenced by the Notes and the other Loan Documents to January 31, 2003. NOW, THEREFORE, notwithstanding anything to the contrary contained in the Notes or any of the other Loan Documents, Borrower and Lender agree as follows: 1. Defined Terms. All terms used herein and not otherwise defined herein shall have the meanings given to them in the Credit Agreement and the First Amendment. 2. Reaffirmation of Indebtedness. Borrower and Lender hereby acknowledge and confirm that: (a) the outstanding principal balance of and accrued interest on the Indebtedness as of the Amendment Date is $12,243,598.10, (b) Borrower's obligation to repay the outstanding principal balance and accrued interest of each Note and all other Indebtedness is unconditional and not subject to any offsets, defenses or counterclaims, and (c) by entering into this Amendment, Lender does not waive or release any term or condition of the Notes or the other Loan Documents or any of its rights or remedies under such Loan Documents, or applicable law, except as set forth herein. 3. Interest. Notwithstanding anything to the contrary contained in the Notes or the other Loan Documents, the interest on the unpaid principal of the Indebtedness continues to accrue at the rate of eleven percent (11%) per annum, effective as of September 30, 2000, until all of the Indebtedness AMENDMENT TO CREDIT AGREEMENT AND NOTES Page 1 (including, without limitation, principal and interest) is indefeasibly paid in full. The Lender and the Borrower hereby reaffirm this amendment. 4. Extension of Maturity Date. Each of the Notes and the other Loan Documents is hereby amended to extend the maturity date of the Indebtedness (regardless of the stated date of the maturity of the Indebtedness for such Note or Loan Document) to January 31, 2003, at which time all Indebtedness (including, without limitation, principal and interest) shall become due and payable in full. 5. Reinstatement of Notes and Loan Documents. Lender, without prejudice to or waiver of any right or remedy available to it by reason of the occurrence subsequent to the date hereof of any event or condition constituting a Default or Event of Default or any other default or event of default that has occurred and is continuing under any of the Notes or the other Loan Documents hereby agrees to take no action with respect to any such Default or Event of Default or any other default or event of default that has occurred and is continuing under any of the Notes or the other Loan Documents which heretofore has occurred, until January 31, 2003. Borrower and Lender hereby agree that the Notes and the Loan Documents are fully reinstated in accordance with their terms and conditions, as amended, by this Amendment, as if no Default or Event of Default or any other default or event of default that has occurred and is continuing under any of the Notes or the other Loan Documents had occurred in the payment of the Indebtedness prior to the date of this Agreement, but no later than January 31, 2003. It is expressly understood that Lender will and does hereafter require full performance of any and all terms, conditions and requirements of all Loan Documents, as amended by this Amendment. It is further understood and agreed that the validity and perfection of the liens and security interests granted under the Loan Documents are not diminished or impaired in any way by this Amendment. Borrower agrees to perform and/or observe the terms and provisions of the Loan Documents to which it is a party, as amended by this Amendment. 6. No Commitment to Make Further Advances. Notwithstanding anything to the contrary contained herein or in any other Loan Document (including, without limitation, the Credit Agreement) any and all commitments of Lender to advance funds or issue letters of credit to, or on behalf of, Borrower are terminated and Lender shall have no further obligation to advance funds or issue letters of credit to, or on behalf of, Borrower. 7. Expenses. All expenses incurred by Borrower or Lender in connection with this transaction, including, but not limited to, attorneys' fees, shall be borne by Borrower and to the extent Lender's expenses are not paid by Borrower within 10 days of Lender submitting an invoice therefor to Borrower, the amount of such expenses shall be added to the outstanding principal amount of the Indebtedness and shall accrue interest in accordance with Paragraph 3 hereof. 8. Ratification of Prior Instruments and Priorities. Except as herein expressly amended, each and every term, condition, warranty and provision of the Notes and the other Loan Documents as amended through even date herewith shall remain in full force and effect and such Notes and other Loan Documents as amended through even date herewith are hereby ratified, confirmed and approved by the parties hereto. Nothing herein shall be construed to alter or affect the priority of the liens, security interests or title created by the Loan Documents. Any provision herein that might otherwise be construed to conflict with the desire of Lender that the liens, security interests and title of the Loan Documents be maintained and preserved prior to any and all encumbrances affecting the Collateral arising subsequent to the execution of the Loan Documents shall, at Lender's option, be void and of no force and effect; it being the expressly declared intention of the parties hereto that no novation of the Loan Documents be created hereby. Any promissory note or other indebtedness described in the Loan Documents as the obligation secured thereby shall hereafter mean the Notes as modified by this Agreement and the AMENDMENT TO CREDIT AGREEMENT AND NOTES Page 2 Indebtedness. The Loan Documents as modified and amended hereby are hereby ratified and confirmed in all respects. 9. Representations and Warranties. Borrower hereby represents and warrants that: (a) Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of Florida; (b) Borrower has all requisite power and authority and all necessary consents, approvals, licenses, permits and other authorizations (i) to own and operate the Collateral, (ii) to execute and deliver this Amendment and all other documents and agreements to be executed by Borrower in connection herewith, and (iii) to carry out and comply with the terms of the Notes and the other Loan Documents, as amended by this Amendment; (c) the Notes and the other Loan Documents remain in full force and effect and constitute, and upon the execution and delivery of this Amendment will continue to constitute, the legal, valid and binding obligations of Borrower enforceable in accordance with their terms; (f) Borrower is the sole legal and beneficial owner of the Collateral; and (g) neither the execution and delivery of this Amendment nor the consummation of the transactions contemplated herein nor compliance by Borrower with the provisions of the Loan Documents, as amended by this Amendment, will conflict with or result in a breach of, or constitute a default under, any of the terms, conditions or provisions of any law, rule, regulation, order, writ, injunction or decree of any court or governmental authority to which Borrower is subject, or of the articles of incorporation, bylaws or any other organizational document of Borrower, or of any indenture, mortgage, deed of trust, promissory note, loan agreement or any other agreement or undertaking to which Borrower is a party or by which Borrower or its properties may be bound or subject. 10. Conditions to Effectiveness of this Amendment. This Amendment shall not become effective until, and shall become effective when, each and every one of the following conditions shall have been satisfied: a. executed counterparts of this Amendment, duly executed by Borrower and Lender, shall have been delivered to Lender; b. Lender shall have received a copy of the resolutions of the Board of Directors of Borrower authorizing the execution, delivery and performance by Borrower of this Amendment and any and all documents relating thereto, certified by Borrowers' Secretary or an Assistant Secretary; and c. the representations and warranties of Borrower set forth herein are true and correct on and with respect to the date hereof. 11. Defenses. Borrower covenants and warrants that there are no defenses, counterclaims or offsets to any of the Notes, the other Loan Documents or the Indebtedness, and Borrower hereby waives any defense, claim or counterclaim against Lender. 12. Further Assurances. Borrower, upon request from Lender, agrees to execute such other and further documents as may be reasonably necessary or appropriate to consummate the transactions contemplated herein or to perfect the liens and security interests intended to secure the payment of the Indebtedness. 13. Business and Financial Information. Borrower will promptly furnish to Lender from time to time such information regarding the Collateral and/or the business and affairs and financial condition of Borrower as Lender may reasonably request, and will furnish such items Lender. AMENDMENT TO CREDIT AGREEMENT AND NOTES Page 3 14. Descriptive Headings. Descriptive headings are inserted for convenience and reference only and do not in any way limit or amplify the terms and provisions hereof. 15. Default. If Borrower shall fail to perform or observe any of the covenants or agreements contained herein or if any statement, representation or warranty contained herein is false, misleading or erroneous in any material respect, an Event of Default shall be deemed to have occurred and Lender shall be entitled at its option to exercise any and all of the rights and remedies granted pursuant to any of the Loan Document or which Lender may otherwise be entitled, whether at law or in equity. 16. FINAL AGREEMENT. THE NOTES AND THE OTHER LOAN DOCUMENTS, AS AMENDED HEREBY, REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES HERETO RELATED TO THE SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES HERETO. IN WITNESS WHEREOF, the parties hereto have each executed this Amendment as of November 30, 2002. LENDER: IMAGINE INVESTMENTS, INC. By: /s/ Gary M. Goltz --------------------------------------------- Name: Gary M. Goltz ------------------------------------------- Title: Vice President ------------------------------------------ BORROWER: RIVERSIDE GROUP, INC., a Florida corporation By: /s/ Catherine J. Gray --------------------------------------------- Name: Catherine J. Gray ------------------------------------------- Title: Senior Vice President and CFO ------------------------------------------ AMENDMENT TO CREDIT AGREEMENT AND NOTES Page 4 EX-7.39 7 dex739.txt AGREEMENT FOR CONVEYANCE OF SHARES OF WICKES EXHIBIT 7.39 AGREEMENT FOR CONVEYANCE OF SHARES OF WICKES, INC. IN LIEU OF FORECLOSURE AND BILL OF SALE THIS AGREEMENT FOR CONVEYANCE OF SHARES OF WICKES, INC. IN LIEU OF FORECLOSURE AND BILL OF SALE (this "Agreement"), dated as of this ___ day of April, 2003, by and among (i) RIVERSIDE GROUP, INC., a Florida corporation having its principal office in Jacksonville, Florida ("Borrower"), (ii) J. STEVEN WILSON, an individual resident of Jacksonville, Florida ("Wilson"), (iii) WILSON FINANCIAL CORPORATION. , a Florida corporation having its principal office in Jacksonville, Florida ("Wilson Financial"), and (IV) IMAGINE INVESTMENTS, INC., a Delaware corporation ("Lender"). PRELIMINARY STATEMENTS A. As of March 31, 2003, Borrower is indebted to Lender, including accrued interest, in the amount of $3,589,615.17 ("Riverside A-1 Debt"), as evidenced by those Promissory Notes listed on Exhibit A-1 (the "A-1 Notes"), and Borrower is indebted to Lender, including accrued interest, in the amount of $12,590,022.75 (together with interest accruing after that date, the "Riverside A-2 Debt" and, together with the A-1 Debt, hereinafter referred to as the "Riverside Debt"), as evidenced by those Promissory Notes listed on Exhibit A-2 (the "A-2 Notes" and, together with the A-1 Notes, hereinafter referred to as the "Riverside Notes"). B. Borrower is in default in the payment of the Riverside Debt and the Riverside Notes. C. The Riverside A-1 Debt and A-1 Notes are secured by the bona fide pledge of and encumbrance on various assets owned by Borrower (and its affiliates), including but not limited to the pledge of 758,155 shares (the "A-1 Pledged Shares") of the common capital stock of Wickes, Inc., a Delaware corporation ("Wickes). The Riverside A-2 Debt and A-2 Notes are secured by the bona fide pledge of and encumbrance on various assets owned by Borrower (and its affiliates), including but not limited to the pledge of 2,016,168 shares of the common capital stock of Wickes (the "A-2 Pledged Shares"). Borrower owns an additional 23,420 shares of Wickes common stock (the "Cantor Fitzgerald Wickes Shares" and, together with the A-1 Pledged Shares and the A-2 Pledged Shares, are hereinafter referred to as the "Wickes Shares") that are not pledged to anyone. D. Borrower has requested that Lender accept the absolute conveyance to Lender of all of the Wickes Shares in exchange for a portion of the Riverside Debt in the amount of $13,988,715. NOW, THEREFORE, in consideration of the premises, the mutual covenants herein contained and for other good and valuable consideration, the parties hereto hereby agree as follows: 1. Borrower hereby transfers, sells, sets over, grants and delivers to Lender the absolute ownership of all of the Wickes Shares, which constitute approximately 34.3% of all of the issued and outstanding common stock in Wickes. Borrower reiterates that this is an absolute transfer and sale and not a pledge, hypothecation, mortgage, or any similar manner of security interest. Borrower acknowledges that it has no rights to reacquire any of the Wickes Shares from Lender, and Lender is free to do whatever it pleases with the Wickes Shares. Such transfer of 717,923 of the A-1 Pledged Shares is in exchange for the deemed payment of $3,589,615.17 of the Riverside A-1 Debt and the A-1 Notes, and such transfer of 40,232 of the A-1 Pledged Shares, the Cantor Fitzgerald Wickes Shares, and the A-2 Pledged Shares is in exchange for the deemed payment of $10,399,099.83 of the Riverside A-2 Debt and the A-2 Notes. The Riverside Debt deemed paid as a result of such transfer is called the "Exchanged Debt." Borrower acknowledges that the conveyance of the Wickes Shares to Lender pursuant to this Agreement is in lieu of Lender's foreclosure on the Wickes Shares, which Borrower acknowledges and agrees Lender is entitled to effectuate as of the date hereof (except as to the Cantor Fitzgerald Wickes Shares). All interest on the A-1 Notes that accrues after March 31, 2003 shall be paid by Borrower at the same time as the Remaining Riverside Debt is due. The parties acknowledge and agree that the amount of the Exchanged Debt has been calculated solely, for the purposes of this Agreement, at the rate of $5.00 of Riverside Debt per Wickes Share, but the parties acknowledge that they believe that the fair market value of each such Wickes Share is substantially less than such amount. Lender represents and warrants that it is acquiring the Wickes Shares without a view toward distribution. Contemporaneously herewith, Borrower has delivered to Lender the certificates representing 758,155 of the Wickes Shares identified on Exhibit B attached hereto and made a part hereof. Borrower represents to Lender that 2,016,168 of the Wickes Shares (the "Pledged Shares") are owned by Borrower but have been pledged to the parties (the "Third Party Creditors") identified on Exhibit C attached hereto and made a part hereof, pursuant to the arrangements set forth on Exhibit C and securing the amount of debt identified on Exhibit C (the "Third Party Debt"). Notwithstanding that these Pledged Shares are pledged to the Third Party Creditors and the certificates for the same are held by the Third Party Creditors, Borrower nevertheless has absolutely sold, and hereby does absolutely sell, to Lender, all of the Wickes Shares, including the Pledged Shares. Borrower agrees to immediately give written notice to the Third Party Creditors that it has sold the Pledged Shares to Lender, by execution and delivery of the letter in the form of Exhibit D attached hereto and made a part hereof. Borrower agrees to pay and discharge the Third Party Debt in accordance with their respective terms and agrees not to increase the amount of the Third Party Debt, directly or indirectly, and not to default thereunder, and not to allow the Third Party Creditors to foreclose on the Pledged Shares and not to extend or modify the terms of the Third Party Debt in any manner whatsoever. Borrower agrees to pay the Third Party Debt by no later than September 30, 2003 and to cause the Third Party Creditors to deliver the certificates for all of the Pledged Shares to Lender, free and clear of all liens, pledges, security interests and other encumbrances, by no later than September 30, 2003. Further, Borrower represents to Lender that certificates representing 23,420 shares of the Wickes Shares were being held at Cantor Fitzgerald in the World Trade Center when it was destroyed (the "Cantor Fitzgerald Wickes Shares"), free and clear of all liens, security interests, pledges, encumbrances and the like. Notwithstanding that the certificates for the Cantor Fitzgerald Wickes Shares have not been delivered to the Lender contemporaneously herewith, Borrower nevertheless has absolutely sold, and hereby does absolutely sell to Lender, the Cantor Fitzgerald Wickes Shares. Borrower agrees to take all actions necessary to cause the transfer agent to issue replacement certificates for the Cantor Fitzgerald Wickes Shares in the name of the Lender and to deliver certificates for the same in the name of Imagine by no later than June 30, 2003, free and clear of all liens, security interests, pledges, encumbrances and the like. 2. Borrower represents and warrants to Lender as follows: (a) Attached hereto and made a part hereof as Exhibit E is the last audit report of Borrower through the year-ended December 31, 2001, and an interim set of financial statements of Borrower through September 30, 2002 (the "Financial Statements"). The Financial Statements are true and accurate and fairly present the financial condition of Borrower as of the respective dates indicated and have been prepared with generally accepted accounting principles, consistently applied. (b) Except as set forth on Schedule 2(b) hereof, Borrower does not have any other indebtedness for borrowed money, except that owed to Lender and that owed to the Third Party Creditors. (c) Borrower owns all of the Wickes Shares, free and clear of all liens, encumbrances, pledges and the like, other than the pledge to the Third Party Creditors. No other person or entity has any right or option to purchase any of the Wickes Shares. The Wickes Shares are all of the shares and interest in Wickes that Borrower owns, in whole or in part, except that Borrower owns an additional 53,700 shares of common stock in Wickes that are pledged to Liberty. Except as set forth on Schedule 2(c) hereof, neither Borrower nor Wilson nor Wilson Financial has any rights whatsoever to acquire any additional shares of stock in Wickes. (d) The Board of Directors of Borrower has approved the transactions contemplated by this Agreement, and shareholders who own 57% of the issued and outstanding common stock of Borrower have signed a letter stating that they are aware of the transactions contemplated by this Agreement and do not object to the same. Borrower has delivered copies of resolutions of such Board and such letter to Lender, and all of the same are true and accurate and in full force and effect as of the date hereof. All necessary corporate and shareholder actions required to make this Agreement fully enforceable have been taken. Ownership of all of the Wickes Shares has been transferred to the Lender. (e) Borrower is not in default under any of the Third Party Debt, except as a result of it being cross-defaulted to the Riverside Debt. (f) Borrower has received a current fairness opinion from TM Capital Corp. that the Wickes Shares are worth between $.42 and $.98 per Wickes Share. 3. Borrower acknowledges and agrees that if it does not deliver to Lender certificates for the Pledged Shares, free and clear of all liens, pledges, security interests and other encumbrances, by September 30, 2003, then an amount equal to the product of (i) $5.00 per share multiplied by (ii) the number of Wickes Shares as to which stock certificates for such Wickes Shares have not been delivered to Lender and duly transferred by such date, free and clear of all liens, pledges, security interests and other encumbrances, plus interest on such amount at the rate of ten percent (10%) per annum, from the date hereof through September 30, 2003, shall be deemed to be immediately due and owing by Borrower to Lender immediately and shall bear interest from such date at the highest default rate specified in the loan documents governing the Riverside Debt and shall be secured by all other security for the Riverside Debt, but nevertheless, Lender shall continue to be deemed the absolute owner of all the Wickes Shares including the Pledged Shares. If Borrower defaults with respect to any of the Third Party Debt, Borrower authorizes Lender (should it so choose in its sole discretion), to purchase and/or pay off any or all of the Third Party Debt; in such event, the entire amount so expended by Lender in connection therewith shall be immediately due and payable by Borrower to Lender and shall bear interest from such date at the highest default rate specified in the loan documents governing the Riverside Debt and shall be secured by all security for the Riverside Debt, and Lender shall be subrogated in all respects to the Third Party Debt and all collateral for the same. Borrower agrees to execute and deliver to Lender all instruments and documents requested by Lender to further document and perfect such encumbrances, pledges, security interests and the like, to secure such Third Party Debt and the Remaining Riverside Debt. 4. Borrower acknowledges that after consummation of this Agreement, Borrower continues to be indebted to Lender under the A-2 Notes in the amount of $2,190,922.90, which amount includes accrued interest through March 31, 2003 (the "Remaining Riverside Debt"), interest continues to accrue on the Remaining Riverside Debt at the rate(s) provided in the documents governing the same from and after March 31, 2003. The Remaining Riverside Debt shall continue to bear interest at the rates provided in the loan documents governing the same and shall be payable in accordance with the terms therein provided. The Remaining Riverside Debt (and all of Borrower's obligations under this Agreement) shall be secured by all of the collateral presently securing the Riverside Debt under the loan documents therefor, including specifically all collateral for the A-1 Notes, and Borrower hereby regrants a pledge of, security interest in and encumbrance on all of the collateral presently securing the A-1 Notes, to secure the Remaining Riverside Debt. Further Borrower shall execute and deliver to Lender all instruments and documents requested by Lender to further document and perfect such pledges and security interests. No collateral for the Riverside Debt, other than the Wickes Shares sold to Lender herewith, is released by Lender. Borrower has no defenses or offsets to the payment of the Remaining Riverside Debt. 5. Each of Borrower, Wilson and Wilson Financial, on behalf of themselves and their respective heirs, successors and assigns, subsidiaries and affiliated corporations, partnerships, limited liability companies and other legal entities, and their respective directors, officers, trustees, managers, members, shareholders, partners, assigns, attorneys, insurers, representatives, successors, agents and employees, does hereby release and discharge Lender, its subsidiaries and affiliated corporations, partnerships, limited liability companies and other legal entities, and their respective directors, officers, trustees, managers, members, shareholders, partners, assigns, attorneys, insurers, representatives, successors, agents and employees from any and all claims, demands, causes of action, damages, liabilities, actions and the like, whether under federal, state or local law, statute or ordinance, known or unknown, matured or unmatured, absolute or contingent, which any of them have or may have against Lender, arising out of or in connection with any matter occurring in whole or in part through and including the date of this Agreement. 6. Wilson and Wilson Financial do not object to the transactions contemplated by this Agreement and agree that their respective obligations to Lender under the loans to them and/or guarantees of such loans are not in any way released or diminished by this Agreement. 7. In the event that during the period commencing with the date hereof and ending two years after the date hereof (the "Period"), the Lender sells or otherwise disposes of all of the Wickes Shares or receives from Wickes in liquidation or in redemption for the Wickes Shares an amount (the "Excess") in excess of the "Threshold Amount," as hereinafter defined, Lender shall pay the Borrower fifty percent (50%) of such Excess above the Threshold Amount (the "Contingent Payment"), as additional consideration for the Wickes Shares, but only on the condition that the entire amount of the Remaining Riverside Debt has been paid in full to Lender prior to such date or is paid in full out of such Contingent Payment. The "Threshold Amount" means the sum of (i) the Exchanged Debt, plus (ii) yield computed as interest on the amount of the Exchanged Debt at the "prime rate" (defined as the "prime rate" as published in The Wall Street Journal from time to time), and adjusted on the first day of every calendar quarter) from and after the date hereof through the date of determination. Borrower hereby grants a security interest in the Contingent Payment to Lender, under the Uniform Commercial Code, as enacted in the Commonwealth of Kentucky (the "UCC"), to secure the Remaining Riverside Debt and any and all other indebtedness or obligations of any kind whatsoever that may now or hereafter in the future, including future advances, be owed by Borrower to Lender, and Lender shall have all of the rights of a secured party under the UCC in connection therewith. Borrower agrees to execute all UCC-1 Financing Statements and other agreements in connection with the grant of the foregoing security interest as Lender may request from time to time and further agrees to pay all filing and recording fees with respect thereto. Lender shall have absolutely no obligation to sell the Wickes Shares or to seek the sale, merger or liquidation of Wickes, and Borrower absolutely waives all claims whatsoever against Lender in connection with the Wickes Shares, regardless whether Lender does or does not sell such Wickes Shares and regardless whether Lender seeks the liquidation, sale or merger of Wickes. Borrower acknowledges and agrees that Lender has no obligation to seek any of the foregoing. If Lender receives the Excess after the expiration of the Period, Lender shall have no obligation whatsoever to make the Contingent Payment or to pay any other amount whatsoever to Borrower. 8. All notices, requests, demands and other communications required or permitted to be given or made under this Agreement shall be in writing and shall be deemed to have been given (a) on the date of personal delivery or transmission by telegram, cable, telex or facsimile transmission, or (b) three (3) days following the date of deposit in the United States mail, postage prepaid, by registered or certified mail, return receipt requested, or (c) one (1) day following the date of delivery to a nationally recognized overnight courier service, in each case, addressed as follows, or to such other address, person or entity as any party shall designate by notice to the others in accordance herewith: If to Borrower: Riverside Group, Inc. 7800 Belfort Parkway Suite 100 Jacksonville, FL 32256 Facsimile No.: 904/296-0584 Attn: President If to J. Steven Wilson: J. Steven Wilson 7800 Belfort Parkway Suite 100 Jacksonville, Florida 32256 Facsimile No.: 904/296-0584 If to Wilson Financial: Wilson Financial Corporation 7800 Belfort Parkway Suite 100 Jacksonville, Florida 32256 Facsimile No.: 904/296-0584 Attn: President If to Lender: Imagine Investments, Ind. 8150 North Central Expressway Suite 1901 Dallas, Texas 75206 Facsimile No.: 214/365-6905 Attn: Gary Goltz With copy to: Michael M. Fleishman Greenebaum Doll & McDonald PLLC 3300 National City Tower Louisville, Kentucky 40202 Facsimile No.: (502) 540-2106 9. No waiver by any party of compliance by the other with any term or condition of this Agreement shall be valid unless in writing and signed by the party against whom enforcement of such waiver is sought. No waiver by any party shall be construed to be a continuing waiver, nor a waiver of a similar or another provision. 10. Every provision of this Agreement is and shall be severable from all others. If any term, condition or provision is declared by any court of competent jurisdiction to be void, invalid or unenforceable, the remaining provisions of this Agreement shall not be affected and shall remain in full force and effect. 11. This Agreement constitutes the entire agreement between the parties concerning its subject matter and supersedes all prior written or oral agreements, excepting the various loan documents governing the Remaining Riverside Debt. No representations, inducement, promise or agreement not embodied in this Agreement or attached hereto was made by any party. Except as otherwise provided herein, no amendment of this Agreement shall be binding unless in writing and signed by all of the parties hereto. 12. This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Kentucky. 13. This Agreement shall be binding upon, and inure to the benefit of, each of the parties hereto, and their respective heirs, personal representatives, successors and assigns. 14. No right or remedy conferred upon or reserved to any of the parties under the terms of this Agreement is intended to be, nor shall it be deemed, exclusive of any other right or remedy provided herein or by law or equity, but each shall be cumulative of every other right or remedy. 15. This Agreement may be executed in several counterparts, any of which shall be treated for all purposes as an original, and all of which shall be treated as one and the same. agreement. IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day, month and year first above written. Riverside Group, Inc. By: /s/ J. Steven Wilson ---------------------------------- Title: Chairman/CEO ---------------------------------- ("Borrower") /s/ J. Steven Wilson ---------------------------------------- J. Steven Wilson ("Wilson") Wilson Financial Corporation By: /s/ J. Steven Wilson ---------------------------------- Title: President ---------------------------------- ("Wilson Financial") Imagine Investments, Inc. By: /s/ Gary M. Goltz ---------------------------------- Title: Vice President ---------------------------------- ("Lender") LIST OF EXHIBITS Exhibit A-1 List of A-1 Notes Exhibit A-2 List A-2 Notes Exhibit B Certificates Evidencing 758,155 Shares of Wickes Stock Exhibit C List of Pledged Shares Exhibit D Letter to Third Party Creditors Exhibit E Borrower's Audit Report and Financial Statement EX-7.40 8 dex740.txt LETTER AGREEMENT EXHIBIT 7.40 IMAGINE INVESTMENTS, INC. 8150 North Central Expressway Suite 1901 Dallas, Texas 75206 April 4, 2003 Riverside Group, Inc. 7800 Belfort Parkway Jacksonville, FL 32256 Attn: J. Steven Wilson Gentlemen: Contemporaneously herewith, the undersigned and you (along with others) are entering that certain Agreement for Conveyance of Shares of Wickes, Inc. in Lieu of Foreclosure and Bill of Sale, of even date with the date of this letter, providing for the conveyance of 2,797,743 shares of the common capital stock of Wickes, Inc. by Riverside Group, Inc. ("Riverside") to Imagine Investments, Inc. ("Imagine") (the "Agreement"). All capitalized terms used in this letter and not otherwise defined herein shall have the same meaning as given them in the Agreement. In addition to the Wickes Shares sold and conveyed by Riverside to Imagine pursuant to the Agreement, Riverside owns an additional 53,700 shares of the common capital stock of Wickes, Inc. (the "Additional Wickes Shares"), that are pledged to Liberty Savings Bank to secure an indebtedness in the principal amount of $113,000 (the "Liberty Pledge"). In consideration of the Agreement, Riverside hereby grants to Imagine, the exclusive option to purchase all of the Additional Wickes Shares, free and clear of all liens, encumbrances, pledges, securing interests and the like (the "Option"). The term of the Option shall commence on the date hereof and shall terminate ten (10) days after the Remaining Riverside Debt (and all other amounts owed by Riverside to Imagine) has been paid in full. If Imagine elects to exercise the Option, Imagine will exchange an additional $268,500 of Riverside Debt owed on the Riverside Notes identified in the Agreement as the A-2 Notes as a "deemed payment" in exchange for the Additional Wickes Shares, in the same manner as set forth in the Agreement. Riverside agrees that it shall discharge the debt secured by the Liberty Pledge and to deliver certificates for the Additional Wickes Shares, together with blank stock powers with signatures guaranteed, to Imagine at c/o Gary Goltz, 8150 North Central Expressway, Suite 1901, Dallas, Texas 75206, within ten (10) business days after Imagine has given Riverside written notice that it has exercised the Option. At its sole option and without any obligation to do so, Imagine may pay the entire indebtedness secured by the Liberty Pledge, and all of the provisions of Paragraph 3 of the Agreement shall apply with respect thereto. Further, the undersigned hereby agree that if Imagine exercises the Option, all of the provisions of the Agreement are hereby incorporated by reference in this letter and shall apply to the Additional Wickes Shares, just as if the Additional Wickes Shares had been made the subject of the Agreement, in addition to the Wickes Shares. If the Holder of the Liberty Pledge forecloses on the Additional Shares, Riverside shall not be deemed to be in breach of this letter agreement but Riverside shall immediately give written notice to Imagine if any such foreclosure proceedings are initiated and shall keep it promptly advised regarding all developments in such foreclosure. Please sign this letter where indicated below to acknowledge your acceptance hereof as a legally binding contract on both your and our part. Very truly yours, Imagine Investments, Inc. By: /s/ Gary M. Goltz ---------------------------------- Title: Vice President ---------------------------------- Agreed to: Riverside Group, Inc. By: /s/ J. Steven Wilson -------------------------------- Title: Chairman/CEO -------------------------------- Date: 4/4/03 -------------------------------- EX-7.41 9 dex741.txt POWER OF ATTORNEY EXHIBIT 7.41 POWER OF ATTORNEY Know all by these presents, that each of the undersigned hereby constitutes and appoints Harry T. Carneal and Gary M. Goltz, acting jointly or singly, as the undersigned's true and lawful attorney-in-fact or attorneys-in-fact to: (1) execute for and on behalf of the undersigned, in the undersigned's capacity as an officer, director or beneficial owner of common stock of Wickes, Inc. (the "Issuer"), the Statement on Schedule 13D and any amendment(s) thereto in accordance with Section 13(d) of the Securities Exchange Act of 1934 and the rules thereunder; (2) do and perform any and all acts for and on behalf of the undersigned which may be necessary or desirable to complete and execute any such Statement on Schedule 13D and any amendment(s) thereto and timely file such Statement and any amendment(s) thereto with the Securities and Exchange Commission and any stock exchange or similar authority; and (3) take any other action of any type whatsoever in connection with the foregoing which, in the opinion of such attorney-in-fact, may be of benefit to, in the best interest of, or legally required by, the undersigned, it being understood that the documents executed by such attorney-in-fact on behalf of the undersigned pursuant to this Power of Attorney shall be in such form and shall contain such terms and conditions as such attorney-in-fact may approve in such attorney-in-fact's discretion. The undersigned hereby grant to such attorney-in-fact full power and authority to do and perform any and every act and thing whatsoever requisite, necessary, or proper to be done in the exercise of any of the rights and powers herein granted, as fully to all intents and purposes as the undersigned might or could do if personally present, with full power of substitution or revocation, hereby ratifying and confirming all that such attorney-in-fact, or such attorney-in-fact's substitute or substitutes, shall lawfully do or cause to be done by virtue of this Power of Attorney and the rights and powers herein granted. The undersigned acknowledges that the foregoing attorneys-in-fact, in serving in such capacity at the request of the undersigned, are not assuming, nor is the Issuer assuming, any of the undersigned's responsibilities to comply with Section 13 of the Securities Exchange Act of 1934. This Power of Attorney shall remain in full force and effect until the undersigned is no longer required to file a Statement on Schedule 13D with respect to the undersigned's holdings of and transactions in securities issued by the Issuer, unless earlier revoked by the undersigned in a signed writing delivered to the foregoing attorneys-in-fact. [Signature pages follow.] 1 IN WITNESS WHEREOF, each of the undersigned has caused this Power of Attorney to be executed on the date or dates indicated below. IMAGINE INVESTMENTS, INC., a Delaware corporation By: /s/ Harry T. Carneal ---------------------------------------- Name: Harry T. Carneal -------------------------------------- Title: Executive Vice President ------------------------------------- Date: October 24, 2002 -------------------------------------- STONE INVESTMENTS, INC., a Delaware corporation By: /s/ Harry T. Carneal ---------------------------------------- Name: Harry T. Carneal -------------------------------------- Title: President ------------------------------------- Date: October 24, 2002 -------------------------------------- STONE CAPITAL, INC., a Delaware corporation By: /s/ Harry T. Carneal ---------------------------------------- Name: Harry T. Carneal -------------------------------------- Title: President ------------------------------------- Date: October 24, 2002 -------------------------------------- STONE HOLDINGS, INC., a Delaware corporation By: /s/ Harry T. Carneal ---------------------------------------- Name: Harry T. Carneal -------------------------------------- Title: President ------------------------------------- Date: October 24, 2002 -------------------------------------- P.S.F. HOLDINGS LIMITED PARTNERSHIP, a Texas limited partnership By: Winn Holdings, LLC, a Texas limited liability company, its general partner By: /s/ Kathryn Fail Luttrull ---------------------------------------- Kathryn Fail Luttrull Sole member Date: October 24, 2002 -------------------------------------- 2 THE MARITAL TRUST By: /s/ James M. Fail ---------------------------------------- James M. Fail Trustee Date: October 24, 2002 -------------------------------------- THE JAMES M. FAIL LIVING TRUST By: /s/ James M. Fail ---------------------------------------- James M. Fail Trustee Date: October 24, 2002 -------------------------------------- /s/ James M. Fail ------------------------------------------- James M. Fail Date: October 24, 2002 -------------------------------------- WINN HOLDINGS, LLC, a Texas limited liability company By: /s/ Kathryn Fail Luttrull ---------------------------------------- Kathryn Fail Luttrull Sole member Date: October 24, 2002 -------------------------------------- /s/ Kathryn Fail Luttrull ------------------------------------------- Kathryn Fail Luttrull Date: October 24, 2002 -------------------------------------- 3 -----END PRIVACY-ENHANCED MESSAGE-----