Exhibit (10)(a)(viii)
October 30, 1996
Hauppauge Record Manufacturing Ltd.
00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxx
Re: Fee Letter
Reference is made to the Amended and Restated Loan and Security Agreement
dated as of October 30, 1996 (as amended, restated, modified, supplemented and
in effect from time to time, the "LSA") between Hauppauge Record Manufacturing
Ltd., a New York corporation ("Borrower"), and American National Bank and Trust
Company of Chicago ("ANB"). Capitalized terms used herein without otherwise
being defined shall have the same meanings herein as set forth in the LSA.
As consideration for ANB's consent to the Merger under the Hauppauge LSA
and AFL LSA and agreement to restructure the credit facilities described therein
as provided in the LSA, Borrower agrees to pay to ANB the following fees:
(a) Borrower shall pay ANB a non-refundable restructuring fee (the
"Restructuring Fee") in an amount of $250,000, such Restructuring Fee to be
paid in installments of $62,500 on the date of the acceptance of this
letter by Borrower, $62,500 on August 1, 1997 and $125,000 on October 31,
1997; provided, however, that notwithstanding the foregoing the unpaid
amount of the Restructuring Fee shall become
immediately due and payable, if earlier, upon the termination of the LSA;
and provided further, however, that if the LSA has not been terminated
prior to October 31, 1997 the $125,000 installment due on such date shall
not be required to be paid by Borrower if on and as of date (a) no Default
or Event of Default has occurred and is continuing, and (b) Borrower shall
have made all principal and interest payments required to be paid on the
Term Loan when due, including without limitation all payments pursuant to
subsections 2.3(E), (F),(G) and (I) of the LSA.
(b) Borrower shall pay ANB a non-refundable fee of $25,000 on October
31, 1996, which fee shall be paid in lieu of the fee due to Lender under
subsection 2.7(H) of the AFL LSA; provided, however, that notwithstanding
the foregoing such fee shall become immediately due and payable, if
earlier, upon the termination of the LSA.
(c) Borrower shall pay ANB a non-refundable fee of $100,000 on
December 31, 1998; provided, however, that notwithstanding the foregoing
such fee shall become immediately due and payable, if earlier, upon the
termination of the LSA; and provided further, however, that no such fee
shall be required to be paid by Borrower if the Additional Loan has been
paid full on or before December 31, 1997 and the LSA has not been
terminated on or before such date.
All fees payable hereunder shall be paid in immediately available funds. By
acceptance of this letter, you hereby authorize Lender to debit the Loan Account
from time to time to pay ANB the foregoing fees.
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This Fee Letter may be executed in any number of counterparts, each of
which shall be an original and all of which when taken together, shall
constitute the original. This Fee Letter shall be governed by and construed in
accordance with the internal laws (and not the conflicts of law provisions) of
the State of Illinois.
If you are in agreement with the foregoing, please indicate your acceptance
of the terms hereof by signing in the appropriate space below and returning the
executed duplicate of the Fee Letter to ANB.
Very truly yours,
AMERICAN NATIONAL BANK AND
TRUST COMPANY OF CHICAGO
By: /s/ Xxxxxxxxx Xxxxxxx
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Name: Xxxxxxxxx Xxxxxxx
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Title: Vice President
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Agreed to and accepted as of
the date first above written:
HAUPPAUGE RECORD MANUFACTURING LTD.
By: /s/ Xxxxxx Xxxxxxx
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Name: Xxxxxx Xxxxxxx
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Title: Chief Financial Officer
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