THIRD AMENDMENT AND WAIVER TO FOURTH AMENDED AND RESTATED CREDIT AGREEMENT
Exhibit 10.59
THIRD AMENDMENT AND WAIVER TO FOURTH AMENDED AND RESTATED CREDIT AGREEMENT
This THIRD AMENDMENT AND WAIVER TO FOURTH AMENDED AND RESTATED CREDIT AGREEMENT (this
“Amendment”), is dated as of 12 day of June, 2008, by NAVARRE CORPORATION, a Minnesota
corporation (“Borrower”), the Credit Parties signatory hereto, GENERAL ELECTRIC CAPITAL
CORPORATION, a Delaware corporation, as agent (the “Agent”) for itself and the Lenders
under and as defined in the Credit Agreement (as hereinafter defined), and the Lenders. Unless
otherwise specified herein, capitalized terms used in this Amendment shall have the meanings
ascribed to them by the Credit Agreement.
RECITALS
WHEREAS, the Borrower, the Credit Parties, the Agent and the Lenders have entered into that
certain Fourth Amended and Restated Credit Agreement, dated as of March 22, 2007 (as amended,
supplemented, restated or otherwise modified from time to time, the “Credit Agreement”);
and
WHEREAS, the Borrower, the Credit Parties, the Agent and the Lenders have agreed to amend
certain provisions of the Credit Agreement as herein set forth.
NOW THEREFORE, in consideration of the foregoing recital, mutual agreements contained herein
and for good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Borrower, the Credit Parties, the Agent, and the Lenders hereby agree as follows:
SECTION 1. Amendments. Subject to the satisfaction of each of the conditions to
effectiveness set forth in Section 3 hereof, the Credit Agreement is hereby amended as
follows:
(a) Section 1.1 (a) of the Credit Agreement is hereby amended by adding the following
sentence at the end thereof:
“Notwithstanding anything to the contrary set forth herein or otherwise, Borrower may
not repay Revolving Credit Advances so that the outstanding principal balance of the
Revolving Credit Advances is, at any time on or prior to the first anniversary of the Third
Amendment Date, less than the Designated Amount.”
(b) Section 1.5 (a) of the Credit Agreement is hereby amended and restated to read as
its entirety as follows:
“(a) Borrower shall pay interest to Agent, for the ratable benefit of Lenders in accordance
with the Loans being made by each Lender, in arrears on each applicable Interest Payment
Date, at the Index Rate plus 6.25% per annum or, at the election of Borrower, at the
applicable LIBOR Rate plus 7.50% per annum; provided, however, that to the
extent that the outstanding principal balance of the Revolving Credit Advances is in excess
of the Designated Amount, Borrower shall pay interest on such excess principal amount to
Agent, for the ratable benefit of Lenders in accordance with the Loans being made by each
Lender, in arrears on each applicable Interest Payment Date,
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not at the rate as determined
above, but at the Index Rate plus the Applicable Revolver Index Margin per annum or, at the
election of Borrower, at the applicable LIBOR Rate plus the Applicable Revolver LIBOR Margin
per annum, based on the aggregate Revolving Credit Advances outstanding from time to time.
As of July 1, 2008, the Applicable Margins are as follows:
Applicable Revolver Index Margin |
1.50 | % | ||
Applicable Revolver LIBOR Margin |
2.75 | % | ||
Applicable L/C Margin |
2.75 | % | ||
Applicable Unused Line Fee Margin |
0.375 | % |
The Applicable Margins shall be adjusted (up or down) prospectively on a quarterly basis as
determined based upon the average daily Borrowing Availability for the then most recently ended
Fiscal Quarter, commencing with the Fiscal Quarter ending on June 30, 2008. All adjustments in the
Applicable Margins thereafter shall be implemented quarterly on a prospective basis at any time
there is a need for an adjustment (the determination as to whether an adjustment is necessary to be
made by Agent in good faith). Adjustments in Applicable Margins will be determined by reference to
the following grids:
| If average daily Borrowing | Level of | |
| Availability for the Fiscal Quarter is: | Applicable Margins: | |
³
$45,000,000
|
Level I | |
³ $35,000,000, but < $45,000,000
|
Level II | |
³ $20,000,000, but < $35,000,000
|
Level III | |
³ $7,500,000, but < $20,000,000
|
Level IV | |
< $7,500,000
|
Level V |
| Level I | Level II | Level III | Level IV | Level V | ||||||||||||||||
Applicable Revolver
Index Margin |
0.75 | % | 1.00 | % | 1.25 | % | 1.50 | % | 1.75 | % | ||||||||||
Applicable Revolver
LIBOR Margin |
2.00 | % | 2.25 | % | 2.50 | % | 2.75 | % | 3.00 | % | ||||||||||
Applicable L/C
Margin |
2.00 | % | 2.25 | % | 2.50 | % | 2.75 | % | 3.00 | % | ||||||||||
Applicable Unused
Line Fee Margin |
0.375 | % | 0.375 | % | 0.375 | % | 0.375 | % | 0.375 | % | ||||||||||
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If any Default or an Event of Default has occurred and is continuing at the time any
reduction in the Applicable Margins is to be implemented, that reduction shall be deferred
until the first day of the first calendar month following the date on which all Defaults or
Events of Default are waived or cured.”
(c) Section 1.9 (c) of the Credit Agreement is hereby amended and restated in its
entirety to read as follows:
“(c) If, on or prior to the third anniversary of the Third Amendment Date, Borrower prepays
the Revolving Loan and/or reduces or terminates the Revolving Loan Commitment, whether
voluntarily or involuntarily and whether before or after acceleration of the Obligations or
if the Revolving Loan Commitments are reduced or terminated, Borrower shall pay to Agent,
for the benefit of Lenders as liquidated damages and compensation for the costs of being
prepared to make funds available hereunder an amount equal to the Applicable Percentage (as
defined below) multiplied by the amount of the reduction of the Revolving Loan Commitment.
As used herein, the term “Applicable Percentage” shall mean (x) one and one half of
one percent (1.5%), in the case of a reduction on or prior to the first anniversary of the
Third Amendment Date, (y) one percent (1%), in the case of a reduction after the first
anniversary of the Third Amendment Date but on or prior to the second anniversary thereof
and (z) one half of one percent (0.5%), in the case of a reduction after the second
anniversary of the Third Amendment Date but on or prior to the third anniversary thereof.
The Credit Parties agree that the Applicable Percentages are a reasonable calculation of
Lenders’ lost profits in view of the difficulties and impracticality of determining actual
damages resulting from an early termination of the Revolving Loan Commitment.
Notwithstanding the foregoing, no prepayment fee shall be payable by Borrower upon a
mandatory prepayment made pursuant to Sections 1.3(b) 1.16(c) or 5.4(d);
provided that Borrower does not permanently reduce or terminate the Revolving Loan
Commitment upon any such prepayment and, in the case of prepayments made pursuant to
Sections 1.3(b)(ii) or (b)(iii), the transaction giving rise to the applicable
prepayment is a sale of a Subsidiary or division of Borrower expressly permitted under
Section 6.”
(d) Section 6.3(a)(vii) of the Credit Agreement is hereby amended and restated in its
entirety to read as follows:
“(vii) [Intentionally Omitted]”
(e) A new Section 6.21, which shall read in it entirety as follows, is hereby added to
the Credit Agreement immediately following Section 6.20:
“6.21 Independent Advisor. The Credit Parties hereby agree that they shall not fail
to engage the Independent Advisor on or prior to July 14, 2008.”
(f) The following definitions are hereby added to Annex A to the Credit Agreement in
alphabetical order:
“Designated Amount” shall mean $6,000,000; provided, however,
on the 15th day after the delivery of the financial statements and related documents
required by clause
3
(c) of Annex E for each Fiscal Year of the Borrower to
end after the Third Amendment Date, as long as the Borrower has provided a calculation, in
detail and form acceptable to the Agent, of the Excess Cash Flow for such Fiscal Year, the
Designated Amount shall be reduced, to an amount not less than zero, by 50% of the Excess
Cash Flow for such Fiscal Year.
“Excess Cash Flow” shall mean, with respect to the Borrower for any period, an
amount (if positive) equal to: (i) the amount for such period of EBITDA, minus (ii) the sum,
without duplication, of the amounts for such period of (a) scheduled repayments of
Indebtedness for borrowed money, (b) Capital Expenditures (net of any proceeds of (y) any
related financing, including purchase money financings, with respect to such expenditures
and (z) any Capital Expenditures made with the proceeds of asset dispositions), (c) Interest
Expense, (d) taxes paid in cash during such period based upon net income, and (e) the
aggregate Net Vendor Advances made during such period.
“Independent Advisor” shall mean a third party advisory firm engaged by the
Credit Parties (from a list of three firms provided by Agent) to review the Projections for
the Fiscal Year ending on or about March 31, 2009, with the scope and timing of such review
to be satisfactory to Agent in its sole discretion.”
“Third Amendment Date” shall mean June 12, 2008
(g) The following definitions set forth in Annex A to the Credit Agreement are hereby
amended and restated in their entirety to read as follows:
“Commitment Termination Date” means the earliest of (a) Xxxxx 00, 0000, (x) the
date of termination of Lenders’ obligations to make Advances and to incur Letter of Credit
Obligations or permit existing Loans to remain outstanding pursuant to Section
8.2(b), and (c) the date of indefeasible prepayment in full by Borrower of the Loans and
the cancellation and return (or stand-by guarantee) of all Letters of Credit or the cash
collateralization of all Letter of Credit Obligations pursuant to Annex B, and the
permanent reduction of the Commitments to zero dollars ($0).
“EBITDA” means, with respect to any Person for any fiscal period, without
duplication, an amount equal to (a) consolidated net income of such Person for such period,
determined in accordance with GAAP, minus (b) the sum of (i) income tax credits,
(ii) interest income, (iii) gain from extraordinary items for such period, (iv) any
aggregate net gain (but not any aggregate net loss) during such period arising from the
sale, exchange or other disposition of capital assets by such Person (including any fixed
assets, whether tangible or intangible, all inventory sold in conjunction with the
disposition of fixed assets and all securities), (v) any other non-cash gains that have been
added in determining consolidated net income, in each case to the extent included in the
calculation of net income of such Person for such period in accordance with GAAP, but
without duplication and (vi) amounts paid on behalf of or for the benefit of Goldhil Media,
Tower Records or any trust, trustee or fund relating thereto or successor to any of the
foregoing, plus (c) the sum of (i) any provision for income taxes, (ii) Interest
Expense, (iii) loss from extraordinary items for such period, (iv) depreciation and
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amortization for such period (other than amortization with respect to Vendor Advances), (v)
amortized debt discount for such period, (vi) the amount of any deduction to consolidated
net income as the result of any grant to any members of the management of such Person of any
Stock, (vii) write-offs of Accounts owing to Borrower from (x) Goldhil Media in the
aggregate amount not to exceed $2,100,000 and (y) Tower Records in the aggregate amount not
to exceed $1,900,000 and (viii) losses arising from the operations of Navarre Entertainment
in an aggregate amount not to exceed (w) $3,233,000 with respect to the 12 month period
ending on March 31, 2008 (x) $1,368,000 with respect to the 12 month period ending on June
30, 2008, (y) $394,000 with respect to the 12 month period ending on September 30, 2008, (z)
$27,000 with respect to the 12 month period ending on December 31, 2008, in each case to the
extent included in the calculation of consolidated net income of such Person for such period
in accordance with GAAP, but without duplication. For purposes of this definition, the
following items shall be excluded in determining consolidated net income of a Person: (1)
the income (or deficit) of any other Person accrued prior to the date it became a Subsidiary
of, or was merged or consolidated into, such Person or any of such Person’s Subsidiaries;
(2) the income (or deficit) of any other Person (other than a Subsidiary) in which such
Person has an ownership interest, except to the extent any such income has actually been
received by such Person in the form of cash dividends or distributions; (3) the
undistributed earnings of any Subsidiary of such Person to the extent that the declaration
or payment of dividends or similar distributions by such Subsidiary is not at the time
permitted by the terms of any contractual obligation or requirement of law applicable to
such Subsidiary; (4) any restoration to income of any contingency reserve, except to the
extent that provision for such reserve was made out of income accrued during such period;
(5) any write-up of any asset; (6) any net gain from the collection of the proceeds of life
insurance policies; (7) any net gain arising from the acquisition of any securities, or the
extinguishment, under GAAP, of any Indebtedness, of such Person, (8) in the case of a
successor to such Person by consolidation or merger or as a transferee of its assets, any
earnings of such successor prior to such consolidation, merger or transfer of assets, and
(9) any deferred credit representing the excess of equity in any Subsidiary of such Person
at the date of acquisition of such Subsidiary over the cost to such Person of the investment
in such Subsidiary.”
“Minimum Excess Availability Reserve” shall mean a special Reserve maintained
by Agent in an amount at all times equal to the sum of (i) $11,500,000; provided
that Agent may at any time, in its sole discretion, reduce such amount to $8,500,000
pursuant to a written notice to Borrower specifically referring to this definition
minus (ii) at all times on or prior to October 10, 2008, $6,000,000”
(h) Clause (b) of Annex G to the Credit Agreement is hereby amended and
restated to read in its entirety as follows:
“(b) Minimum Fixed Charge Coverage Ratio. Borrower and its Subsidiaries shall
have on a consolidated basis, as of the last day of the Fiscal Quarter ending on June 30,
2007 and as of the last day of each Fiscal Quarter thereafter, for the 12 month period then
ended, a ratio (the “Fixed Charge Coverage Ratio”) of (A) the sum of (i) EBITDA
plus (ii) the aggregate of all Vendor Advance Expenses for such period, plus
(iii) interest
5
income received during such period minus (iii) Capital Expenditures
during such period (other than Capital Expenditures financed other than with the proceeds of
Loans), minus (iv) income taxes paid in cash during such period, minus (v)
the aggregate of all Vendor Advances made during such period to (B) the sum of, without
duplication, (i) the aggregate of all Interest Expense paid or accrued during such period,
plus (ii) scheduled payments of principal with respect to Indebtedness during such
period (other than scheduled principal payments made by Borrower during such period with
respect to Term Loan B (as defined and under the Existing Credit Agreement) pursuant to the
Existing Credit Agreement), plus, (iii) all Restricted Payments made by a Credit
Party during such period (other than Restricted Payments (a) made to another Credit Party or
(b) which have caused EBITDA to be reduced for such period) of at least the ratio set forth
below opposite such Fiscal Quarter:
| Fiscal Quarter Ending | Ratio | |||
June 30, 2007 |
0.90 :1 | |||
September 30, 2007 |
0.80 :1 | |||
December 31, 2007 |
0.80 :1 | |||
March 31, 2008 |
1.20:1 | |||
June 30, 2008 |
0.85:1 | |||
September 30, 2008 |
1.20:1 | |||
December 31, 2008 |
1.20:1 | |||
March 31, 2009 |
1.30:1 | |||
June 30, 2009 |
1.30:1 | |||
September 30, 2009 |
1.30:1 | |||
December 31, 2009 |
1.30:1 | |||
March 31, 2010 and each Fiscal Quarter ending thereafter” |
1.40:1 | |||
(i) Clause (d) of Annex G to the Credit Agreement is hereby amended and
restated to read in its entirety as follows:
“(d) Minimum EBITDA. Borrower and its Subsidiaries shall have on a
consolidated basis, as of the last day of the Fiscal Quarter ending on June 30, 2007 and as
of the last day of each Fiscal Quarter thereafter, for the 12 month period then ended,
EBITDA of at least the amount set forth below opposite such Fiscal Quarter:
| Fiscal Quarter Ending | Amount | |||
June 30, 2007 |
$ | 32,000,000 | ||
September 30, 2007 |
$ | 26,000,000 | ||
December 31, 2007 |
$ | 27,000,000 | ||
March 31, 2008 |
$ | 27,000,000 | ||
June 30, 2008 |
$ | 22,750,000 | ||
September 30, 2008 |
$ | 25,000,000 | ||
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| Fiscal Quarter Ending | Amount | |||
December 31, 2008 |
$ | 25,000,000 | ||
March 31, 2009 |
$ | 27,000,000 | ||
June 30, 2009 |
$ | 29,000,000 | ||
September 30, 2009 |
$ | 30,000,000 | ||
December 31, 2009 |
$ | 31,000,000 | ||
March 31, 2009 |
$ | 33,000,000 | ||
September 30, 2009 and each Fiscal Quarter ending thereafter |
$ | 35,000,000 | ||
SECTION 2. Limited Waivers. Effective as of March 31, 2008, Agent and Lenders hereby waive
any Event of Default under subsection 8.1 (b) of the Credit Agreement arising solely as a
result of the failure to comply with clause (d) of Annex G for the Fiscal Quarter
ending March 31, 2008. In addition, Agent and Lenders hereby waive the provisions of Section
6.3(b) and Section 6.14 of the Credit Agreement to the extent necessary to permit
Borrower to repay the obligations under the Second Lien Credit Agreement in full on the date
hereof. The waivers set forth above shall be limited precisely as written and shall not be deemed
or otherwise construed to constitute a waiver of any other Default or Event of Default or any other
provision or to prejudice any right, power or remedy which Agent or Lenders may now have or may
have in the future under or in connection with the Credit Agreement or any other Loan Document, all
of which rights, power and remedies are hereby expressly reserved by Agent and Lenders.
SECTION 3. Conditions to Effectiveness. The effectiveness of this Amendment is subject to
the satisfaction of each the following conditions precedent:
(a) this Amendment shall have been duly executed and delivered by the Borrower, the Credit
Parties, the Agent and each Lender;
(b) Borrower shall have executed and delivered to Agent that certain fee letter supplement,
dated as of the date hereof, between GE Capital and the Borrower (the “Fee Letter
Supplement”); and
(c) Agent shall have received such other documents, instruments, agreements and legal opinions
as Agent shall reasonably request in connection with the transactions contemplated by this
Amendment, including those listed in the Closing Checklist attached hereto as Annex A, each
in form and substance reasonably satisfactory to Agent.
SECTION 4. Representations and Warranties. In order to induce the Agent and each Lender to
enter into this Amendment, each Credit Party hereby represents and warrants to the Agent and each
Lender, which representations and warranties shall survive the execution and delivery of this
Amendment, that:
(a) all of the representations and warranties contained in the Credit Agreement and in each
Loan Document are true and correct as of the date hereof after giving effect to this Amendment,
except to the extent that any such representations and warranties expressly relate to an earlier
date;
7
(b) the execution, delivery and performance by such Credit Party of this Amendment has been
duly authorized by all necessary corporate, limited liability company or partnership action
required on its part and this Amendment, and the Credit Agreement is the legal, valid and binding
obligation of such Credit Party enforceable against such Credit Party in accordance with its terms,
except as its enforceability may be affected by the effect of bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect relating to or
affecting the rights or remedies of creditors generally;
(c) neither the execution, delivery and performance of this Amendment by such Credit Party,
the performance by such Credit Party of the Credit Agreement nor the consummation of the
transactions contemplated hereby does or shall contravene, result in a breach of, or violate (i)
any provision of any Credit Party’s certificate or articles of incorporation or bylaws or other
similar documents, or agreements, (ii) any law or regulation, or any order or decree of any court
or government instrumentality, or (iii) any indenture, mortgage, deed of trust, lease, agreement or
other instrument to which any Credit Party or any of its Subsidiaries is a party or by which any
Credit Party or any of its Subsidiaries or any of their property is bound, except in any such case
to the extent such conflict or breach has been waived herein or by a written waiver document, a
copy of which has been delivered to Agent on or before the date hereof; and
(d) no Default or Event of Default has occurred and is continuing (other than those waived
pursuant hereto).
SECTION 5. Intercreditor Agreement. Lenders hereby authorize and direct Agent to execute
such documents as are necessary or appropriate to permit Borrower to repay the obligations under
the Second Lien Credit Agreement in full on the date hereof.
SECTION 6. Reference to and Effect Upon the Credit Agreement.
(a) Except as specifically set forth above, the Credit Agreement and the other Loan Documents
shall remain in full force and effect and are hereby ratified and confirmed; and
(b) The amendments set forth herein are effective solely for the purposes set forth herein and
shall be limited precisely as written, and shall not be deemed to (i) be a consent to any
amendment, waiver or modification of any other term or condition of the Credit Agreement or any
other Loan Document, (ii) operate as a waiver or otherwise prejudice any right, power or remedy
that the Agent or the Lenders may now have or may have in the future under or in connection with
the Credit Agreement or any other Loan Document or (iii) constitute an amendment or waiver of any
provision of the Credit Agreement or any Loan Document, except as specifically set forth herein.
Upon the effectiveness of this Amendment, each reference in the Credit Agreement to “this
Agreement”, “herein”, “hereof” and words of like import and each reference in the Credit Agreement
and the Loan Documents to the Credit Agreement shall mean the Credit Agreement as amended hereby.
This Amendment shall be construed in connection with and as part of the Credit Agreement.
8
SECTION 7. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS OF THE STATE OF ILLINOIS.
SECTION 8. Headings. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute part of this Amendment for any other
purposes.
SECTION 9. Counterparts. This Amendment may be executed in any number of counterparts,
each of which when so executed shall be deemed an original, but all such counterparts shall
constitute one and the same instrument.
(signature pages follow)
9
IN WITNESS WHEREOF, the parties hereto have executed and delivered this Amendment as of
the date first written above.
| BORROWER: | ||||||
| NAVARRE CORPORATION | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
[Signature Page to Second Amendment To Fourth Amended and Restated Credit Agreement]
S-2
| GENERAL ELECTRIC CAPITAL CORPORATION, as Agent and Lender | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
[Signature Page to Second Amendment To Fourth Amended and Restated Credit Agreement]
S-2
IN WITNESS WHEREOF, this Amendment has been duly executed as of the date first written above
by below Persons in their capacity as Credit Parties not as Borrower.
| ENCORE SOFTWARE, INC., as Credit Party | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| BCI ECLIPSE COMPANY, LLC, as Credit Party | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| FUNIMATION PRODUCTIONS LTD., as Credit Party | ||||||
| By: | Xxxxxxx XX, LLC, its General Partner | |||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| ANIMEONLINE, LTD (F/K/A THE FUNIMATION STORE LTD.), as Credit Party |
||||||
| By: | Xxxxxxx XX, LLC, its General Partner | |||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| XXXXXXX XX, LLC, as Credit Party | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
[Signature Page to Second Amendment To Fourth Amended and Restated Credit Agreement]
S-3
| NAVARRE CLP, LLC, as Credit Party | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| XXXXXXX XX, LLC, as Credit Party | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| NAVARRE LOGISTICAL SERVICES, INC., as Credit Party | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| NAVARRE DIGITAL SERVICES, INC., as Credit Party | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| NAVARRE ONLINE FULFILLMENT SERVICES, INC., as Credit Party |
||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| NAVARRE DISTRIBUTION SERVICES, INC., as Credit Party | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
[Signature Page to Second Amendment To Fourth Amended and Restated Credit Agreement]
S-4
| FUNIMATION CHANNEL, INC., as Credit Party | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
[Signature Page to Second Amendment To Fourth Amended and Restated Credit Agreement]
S-5
ANNEX A
CLOSING CHECKLIST
REGARDING
THIRD AMENDMENT
TO
FOURTH AMENDED AND RESTATED CREDIT AGREEMENT
by and among
GENERAL ELECTRIC CAPITAL CORPORATION,
as Agent,
NAVARRE CORPORATION,
as Borrower,
THE OTHER CREDIT PARTIES NAMED THEREIN
and
THE LENDERS FROM TIME TO TIME SIGNATORY THERETO
June 12, 2008
Set forth below is a Closing Checklist which lists documents and information to be
delivered in connection with Third Amendment to Fourth Amended and Restated Credit Agreement
(“Amendment”) listed herein as Document No. 1, the other Loan Documents and the
transactions contemplated thereunder. All documents are dated as of June 12, 2008 unless otherwise
indicated.
I. PARTIES TO THE TRANSACTION
1.
|
General Electric Capital Corporation (“Agent”) | |
2.
|
Monroe Capital Advisors, LLC (“Second Lien Agent” or “Monroe”) | |
3.
|
Navarre Corporation, a Minnesota corporation (“Navarre” or “Borrower”) | |
4.
|
Encore Software, Inc. (f/k/a Encore Acquisition Corporation), a Minnesota corporation (“Encore”) | |
5.
|
BCI Eclipse Company, LLC, a Minnesota limited liability company (“BCI”) | |
6.
|
Xxxxxxx XX, LLC, a Minnesota limited liability company (“CP”) | |
7.
|
Navarre CLP, LLC, a Minnesota limited liability company (“CLP”) | |
8.
|
Xxxxxxx XX, LLC, a Minnesota limited liability company (“CS”) | |
9.
|
FUNimation Productions Ltd., a Texas limited partnership (“Productions”) | |
10.
|
animeOnline, Ltd. (f/k/a The FUNimation Store Ltd.), a Texas limited partnership (“animeOnline”) | |
11.
|
Navarre Logistical Services, Inc., a Minnesota corporation (“Navarre Logistical”) | |
12.
|
Navarre Digital Services, Inc., a Minnesota corporation (“Navarre Digital”) | |
13.
|
Navarre Online Fulfillment Services, Inc., a Minnesota corporation (“Navarre Online”) | |
14.
|
Navarre Distribution Services, Inc., a Minnesota corporation (“Navarre Distribution”) | |
15.
|
FUNimation Channel, Inc., a Minnesota corporation (“Channel” and together with Borrower, Encore, BCI, CP, CLP, CS, Productions, animeOnline, Navarre Logistical, Navarre Digital, Navarre Online, Navarre Distribution and Navarre Entertainment, each a “Credit Party” and collectively, the “Credit Parties”) | |
16.
|
Xxxx Xxxxxx (“Borrower’s Internal Counsel” or “BIC”) | |
17.
|
Xxxxx Day (“Monroe’s Counsel” or “JD”) | |
18.
|
Xxxxxx & Xxxxxxx (“Agent’s Counsel” or “L&W”) |
LOAN DOCUMENTS
| 1. | Third Amendment to Fourth Amended and Restated Credit Agreement (“Amendment”) |
Annexes to Amendment
| (i) | Annex A – Closing Checklist |
CORPORATE AND ORGANIZATIONAL DOCUMENTS
| 1. | Borrower and Credit Parties |
| (i) | Secretary’s Certificate for each Credit Party, to include: |
| (a) | Certification that no change or modification have been made to such Credit Party’s Articles/Certificate of Incorporation or By-Laws, Certificate of Organization or Operating Agreement, Certificate of Organization or Partnership Agreement, as applicable, since March 22, 2007 | ||
| (b) | Certified copies of Resolutions authorizing the execution, delivery and performance by such Credit Party of the Amendment, the other Loan Documents and the transactions to be consummated in connection therewith | ||
| (c) | Incumbency for such Credit Party |
PAYOFF DOCUMENTS
| 2. | Monroe Payoff Letter | |
| 3. | UCC-3 Termination Statements identified on Exhibit A hereto | |
| 4. | IP Releases with respect to Patent, Copyright and Trademark Security Agreements identified on Exhibit B hereto |
MISCELLANEOUS CLOSING DOCUMENTS
| 5. | Supplemental Fee Letter | |
| 6. | Monroe Side Letter | |
| 7. | Letter of Direction | |
| 8. | Notice of Borrowing |
EXHIBIT A
UCC-3 Termination Statements
| FILING NUMBER/DATE OF | ||||
| FINANCING STATEMENTS | ||||
| LOAN PARTY | JURISDICTION | TO BE TERMINATED | ||
Navarre Logistical
Services, Inc.
|
Minnesota Secretary of State | 200716029579 dated 03/22/2007 | ||
Navarre Digital
Services, Inc.
|
Minnesota Secretary of State | 200716029529 dated 03/22/2007 | ||
Navarre Online
Fulfillment Services,
Inc.
|
Minnesota Secretary of State | 200716029618 dated 03/22/2007 | ||
Navarre Distribution
Services, Inc.
|
Minnesota Secretary of State | 200716029555 dated 03/22/2007 | ||
Navarre Entertainment
Media, Inc.
|
Minnesota Secretary of State | 200716029567 dated 03/22/2007 | ||
FUNimation Channel, Inc.
|
Minnesota Secretary of State | 200716029480 dated 03/22/2007 | ||
[Other Monroe liens] |
EXHIBIT B
IP Releases
