TWELFTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
TWELFTH AMENDMENT
TO AMENDED AND RESTATED CREDIT AGREEMENT
TO AMENDED AND RESTATED CREDIT AGREEMENT
THIS TWELFTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Twelfth
Amendment”) is made and entered into as of June 28, 2007, by and among the financial
institutions identified on the signature pages hereof (such financial institutions, together with
their respective successors and assigns, are referred to hereinafter each individually as a
“Lender” and collectively as the “Lenders”), XXXXX FARGO FOOTHILL, INC., a
California corporation, as administrative agent and collateral agent for the Lenders (in such
capacities, together with any successor administrative agent and collateral agent, the
“Agent”), SILVER POINT FINANCE, LLC, as the co-agent, syndication agent, documentation
agent (in such capacities, together with any successor co-agent, syndication agent, and
documentation agent, the “Co-Agent”), arranger and book runner, SALTON, INC., a Delaware
corporation (the “Parent”), each of the Parent’s Subsidiaries identified on the signature
pages hereof as Borrowers (collectively with the Parent, the “Borrowers”) and each of the
Parent’s Subsidiaries identified on the signature pages hereof as Guarantors (collectively, the
“Guarantors” and, together with the Borrowers, the “Borrower Parties”).
W I T N E S S E T H:
WHEREAS, the Lenders, the Agent, the Co-Agent and the Borrower Parties are parties to that
certain Amended and Restated Credit Agreement, dated as of May 9, 2003 and amended and restated as
of June 15, 2004 (as amended as of August 30, 2004, as of May 11, 2005, as of July 8, 2005, as of
September 22, 2005, as of October 7, 2005, as of November 9, 2005, as of February 8, 2006, as of
May 10, 2006, as of August 15, 2006, as of February 12, 2007 and as of April 13, 2007 and as it may
be further amended, modified, supplemented or amended and restated from time to time, the
“Credit Agreement”);
WHEREAS, the Borrowers have requested, and the Agent, the Co-Agent and the Lenders have
agreed, to amend the definition of Borrowing Base in the Credit Agreement as set forth herein;
NOW, THEREFORE, in consideration of the agreements and provisions herein contained, the
parties hereto do hereby agree as follows:
Section 1. Definitions. Any capitalized terms used but not otherwise defined
herein shall have the meanings ascribed to such terms in the Credit Agreement.
Section 2.
Amendments to the Credit Agreement. The
Credit Agreement is hereby amended, effective as of the date this
Twelfth Amendment becomes effective in accordance with Section 4
hereof, as follows:
2.01 Clause (a)(D) of the definition of “Borrowing Base” is hereby amended by deleting
it in its entirety and inserting the following in lieu thereof:
“(D) the sum of
(i) the lesser of
| (A) | the sum of | ||
| (I) | ten percent (10%) of the Net Amount of Eligible Accounts, plus | ||
| (II) | the sum of (x) twenty-four percent (24%) of the value of the Eligible Landed Inventory, plus (y) twenty-nine percent (29%) of the book value of Eligible In-Transit Inventory valued at the lower of cost (determined on a first-in, first-out basis) or market; and | ||
| (B) | $16,200,000; plus |
| (ii) | $32,189,509.48 |
;provided, that, notwithstanding the foregoing, from and after the earlier
of: (x) August 15 2007 and (y) the date the Agreement and Plan of Merger by
and among Salton, Inc., a Delaware corporation, SFP Merger Sub, Inc., a
Delaware corporation and APN Holding Company, Inc., a Delaware corporation
dated as of February 7, 2007 is terminated or no longer in full force and
effect, the result of this clause (D) shall not exceed $23,000,000,”
2.02
Section 3.1(c) of the Credit is hereby amended by deleting clause
(iv) thereof in its entirety and inserting the following in lieu
thereof: “If the aggregate outstanding principal amount of the
Loans exceeds the sum of (a) the result of the sums of clauses
(a)(A), (a)(B) and (a)(C) of the definition of Borrowing Base, plus
(b) $23,000,000 on the earlier of (x) August 31, 2007
and (y) the date the Agreement and Plan of Merger by and among
Salton, Inc., a Delaware corporation, SFP Merger Sub, Inc., a
Delaware corporation and APN Holding Company, Inc., a Delaware
corporation dated as of February 7, 2007 is terminated or no
longer in full force and effect then, on such date, the Borrowers
shall prepay the outstanding principal amount of the Revolving Loans
(on a ratable basis) in an amount equal to such excess.”
Section 3. Representations and Warranties. In order to induce the Agent, the
Co-Agent and the Lenders to enter into this Twelfth Amendment, the Borrower Parties hereby
represent and warrant that:
3.01 No Default. At and as of the date of this Twelfth Amendment and after giving
effect to this Twelfth Amendment, no Default or Event of Default exists.
3.02 Representations and Warranties True and Correct. At and as of the date of this
Twelfth Amendment and both prior to and after giving effect to this Twelfth Amendment, each of the
representations and warranties contained in the Credit Agreement and other Loan Documents is true
and correct in all material respects.
3.03 Corporate Power, Etc. The Borrower Parties (a) have all requisite corporate
power and authority to execute and deliver this Twelfth Amendment and to consummate the
transactions contemplated hereby and (b) have taken all action, corporate or otherwise, necessary
to authorize the execution and delivery of this Twelfth Amendment and the consummation of the
transactions contemplated hereby.
3.04 No Conflict. Neither the execution and delivery of this Twelfth Amendment nor
consummation of the transactions contemplated hereby will (a) conflict with or result in any breach
or violation of any provision of the certificate of incorporation, certificate of formation or
by-laws of the Borrower Parties, (b) result in any breach or violation of, or constitute a default
(or an event which, with notice or lapse of time or both, would constitute a default) under, or
result in the termination of, or accelerate the performance required by, or result in the creation
of a Lien upon any of the properties or assets of the Borrower Parties under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, deed of trust, license, lease
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agreement or other instrument or obligation to which the Borrower Parties are parties or to
which any of their properties or assets are subject, (c) require any consent, approval,
authorization or permit of, or filing with or notification to, any third party or any Governmental
Authority, or (d) violate any order, writ, injunction, decree, judgment, ruling, law, statute, rule
or regulation of any Governmental Authority.
3.05 Binding Effect. This Twelfth Amendment has been duly executed and delivered by
the Borrower Parties and constitutes the legal, valid and binding obligation of the Borrower
Parties, enforceable against the Borrower Parties in accordance with its terms, except as such
enforceability may be limited by (a) applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws, now or hereafter in effect, relating to or affecting the enforcement of
creditors’ rights generally, and (b) the application of general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
Section 4. Conditions. This Twelfth Amendment shall be effective upon the
fulfillment by the Borrower Parties, in a manner satisfactory to the Co-Agent, the Agent and the
Lenders, of all of the following conditions precedent set forth in this Section 5 (such
date, the “Effective Date”):
4.01 Execution of the Twelfth Amendment. Each of the parties hereto shall have
executed an original counterpart of this Twelfth Amendment and shall have delivered (including by
way of telefacsimile or electronic mail) the same to the Co-Agent.
4.02 Representations and Warranties. As of the Effective Date, the representations
and warranties set forth in Section 4 hereof shall be true and correct.
4.03 Delivery of Other Documents. The Co-Agent and the Agent shall have received all
such other instruments, documents and agreements as the Co-Agent or the Agent may reasonably
request, in form and substance reasonably satisfactory to the Co-Agent and the Agent.
Section 5. Miscellaneous.
5.01 Continuing Effect. Except as specifically provided herein, the Credit Agreement
and the other Loan Documents shall remain in full force and effect in accordance with their
respective terms and are hereby ratified and confirmed in all respects.
5.02 No Waiver; Reservation of Rights. This Twelfth Amendment is limited as specified
and the execution, delivery and effectiveness of this Twelfth Amendment shall not operate as a
modification, acceptance or waiver of any provision of the Credit Agreement, or any other Loan
Document, except as specifically set forth herein. Notwithstanding anything contained in this
Twelfth Amendment to the contrary, the Agent, the Co-Agent and the Lenders expressly reserve the
right to exercise any and all of their rights and remedies under the Credit Agreement, any other
Loan Document and applicable law in respect of any Default or Event of Default.
5.03 References.
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(a) From and after the Effective Date, (i) the Credit Agreement, the other Loan Documents and
all agreements, instruments and documents executed and delivered in connection with any of the
foregoing shall each be deemed amended hereby to the extent necessary, if any, to give effect to
the provisions of this Twelfth Amendment and (ii) all of the terms and provisions of this Twelfth
Amendment are hereby incorporated by reference into the Credit Agreement, as applicable, as if such
terms and provisions were set forth in full therein, as applicable.
(b) From and after the Effective Date, (i) all references in the Credit Agreement to “this
Agreement”, “hereto”, “hereof”, “hereunder” or words of like import referring to the Credit
Agreement shall mean the Credit Agreement as amended hereby and (ii) all references in the Credit
Agreement, the other Loan Documents or any other agreement, instrument or document executed and
delivered in connection therewith to “Credit Agreement”, “thereto”, “thereof”, “thereunder” or
words of like import referring to the Credit Agreement shall mean the Credit Agreement as amended
hereby.
5.04 Governing Law. THIS TWELFTH AMENDMENT, AND ALL MATTERS ARISING OUT OF OR
RELATING TO THE SUBJECT MATTER HEREOF, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.
5.05 Severability. The provisions of this Twelfth Amendment are severable, and if any
clause or provision shall be held invalid or unenforceable in whole or in part in any jurisdiction,
then such invalidity or unenforceability shall affect only such clause or provision, or part
thereof, in such jurisdiction and shall not in any manner affect such clause or provision in any
other jurisdiction, or any other clause or provision in this Twelfth Amendment in any jurisdiction.
5.06 Counterparts. This Twelfth Amendment may be executed in any number of
counterparts, each of which counterparts when executed and delivered shall be an original, but all
of which shall together constitute one and the same instrument. Delivery of an executed
counterpart of this Twelfth Amendment by telefacsimile or electronic mail shall be equally
effective as delivery of a manually executed counterpart. A complete set of counterparts shall be
lodged with the Borrower Parties, the Agent, the Co-Agent and each Lender.
5.07 Headings. Section headings in this Twelfth Amendment are included herein for
convenience of reference only and shall not constitute a part of this Twelfth Amendment for any
other purpose.
5.08 Binding Effect; Assignment. This Twelfth Amendment shall be binding upon and
inure to the benefit of the Borrower Parties, the Agent, the Co-Agent and the Lenders and their
respective successors and assigns; provided, however, that the rights and
obligations of the Borrower Parties under this Twelfth Amendment shall not be assigned or delegated
without the prior written consent of the Agent, the Co-Agent and the Lenders.
5.09 Expenses. The Borrowers agree to pay the Agent and Co-Agent upon demand, for all
reasonable expenses, including reasonable fees of attorneys and paralegals for the Agent,
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the Co-Agent and the Lenders (who may be employees of the Agent, Co-Agent or the Lenders),
incurred by the Agent, the Co-Agent and the Lenders in connection with the preparation, negotiation
and execution of this Twelfth Amendment and any document required to be furnished herewith.
5.10 Integration. This Twelfth Amendment, together with the other Loan Documents,
incorporates all negotiations of the parties hereto with respect to the subject matter hereof and
is the final expression and agreement of the parties hereto with respect to the subject matter
hereof.
[Signature pages follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Twelfth Amendment to be executed by
their respective officers thereunto duly authorized, as of the date first above written.
| BORROWERS: | ||||||
| SALTON, INC., a Delaware corporation | ||||||
| By: | /s/ Xxxxxxx Xxxx | |||||
| Title: | Interim Chief Executive Officer and Chief Financial Officer |
|||||
| TOASTMASTER INC., a Missouri corporation | ||||||
| By: | /s/ Xxxxxxx Xxxx | |||||
| Title: | Interim Chief Executive Officer and Chief Financial Officer |
|||||
| SALTON TOASTMASTER LOGISTICS LLC, a Delaware limited liability company | ||||||
| By: | /s/ Xxxxxxx Xxxx | |||||
| Title: | Interim Chief Executive Officer and Chief Financial Officer |
|||||
| GUARANTORS: | ||||||
| HOME CREATIONS DIRECT, LTD., a Delaware corporation |
||||||
| By: | /s/ Xxxxxxx Xxxx | |||||
| Title: | Interim Chief Executive Officer and Chief Financial Officer |
|||||
| SONEX INTERNATIONAL CORPORATION, a Delaware corporation | ||||||
| By: | /s/ Xxxxxxx Xxxx | |||||
| Title: | Interim Chief Executive Officer and Chief Financial Officer |
|||||
| ICEBOX, LLC, an Illinois limited liability company | ||||||
| By: | /s/ Xxxxxxx Xxxx | |||||
| Title: | Interim Chief Executive Officer
and Chief Financial Officer |
|||||
| FAMILY PRODUCTS INC., a Delaware corporation | ||||||
| By: | /s/ Xxxxxxx Xxxx | |||||
| Title: | Interim Chief Executive Officer
and Chief Financial Officer |
|||||
| SALTON HOLDINGS, INC., a Delaware corporation | ||||||
| By: | /s/ Xxxxxxx Xxxx | |||||
| Title: | Interim Chief Executive Officer
and Chief Financial Officer |
|||||
| AGENT, CO-AGENT AND LENDERS: | ||||||
| XXXXX FARGO FOOTHILL, INC. as the Administrative Agent, the Collateral Agent and as a Lender |
||||||
| By: | /s/ Xxxxxxx X. Xxxxxx | |||||
| Its: | ||||||
| SILVER POINT FINANCE, LLC, as the Co-Agent, the Documentation Agent, and the Syndication Agent | ||||||
| By: | /s/ Xxxxxxx Xxxxxxxx | |||||
| Its: | ||||||
| SPIRET IV LOAN TRUST 2003-A, as a Lender | ||||||
| By: WILMINGTON TRUST COMPANY, not in its individual capacity but solely as trustee |
||||||
| By: | /s/ Xxxxx X. Xxxxxxx | |||||
| Its: | Assistant Vice President | |||||
| FIELD POINT I, LTD., as a Lender | ||||||
| By: | /s/ Xxxxxxx Xxxxxxxx | |||||
| Its: | ||||||
| FIELD POINT II, LTD., as a Lender | ||||||
| By: | /s/ Xxxxxxx Xxxxxxxx | |||||
| Its: | ||||||
| FIELD POINT III, LTD., as a Lender | ||||||
| By: | /s/ Xxxxxxx Xxxxxxxx | |||||
| Its: | ||||||
| FIELD POINT IV, LTD., as a Lender | ||||||
| By: | /s/ Xxxxxxx Xxxxxxxx | |||||
| Its: | ||||||
