EXHIBIT 10.35
ASSUMPTION AGREEMENT, dated as of December 19, 2003, made by,
Xxxxxxx Holdings, Inc , a Delaware corporation (' SIMMONS HOLDCO ), Simmons
Company, a Delaware corporation (' PRE-MERGER XXXXXXX") and certain subsidiaries
of Xxxxxxx listed on the signature pages hereto (the "GUARANTORS") in each case
in favor of DEUTSCHE BANK AG, NEW YORK BRANCH ("DBNY") as Administrative Agent
(in such capacity, the 'ADMINISTRATIVE AGENT") for the banks and other financial
institutions or entities (the ' LENDERS") parties to the Credit Agreement and
Term Loan Agreement referred to below All capitalized terms not defined herein
shall have the meanings given to them in such Credit Agreement and such Term
Loan Agreement, as applicable
WITNESSETH
WHEREAS, THL Bedding Company a Delaware corporation (the
'ACQUISITION COMPANY ) THL-SC Bedding Company, a Delaware corporation
("HOLDINGS") the Lenders, the Administrative Agent, the other Agents, the Swing
Line Lender and the Issuing Bank named therein have entered into the Credit
Agreement dated as of December 19, 2003 (as amended, supplemented or otherwise
modified from time to time, the CREDIT AGREEMENT"),
WHEREAS, in connection with the Credit Agreement, Holdings the
Acquisition Company, Simmons HoldCo, Pre-Merger Simmons and certain of the
Guarantors have entered into the Pledge and Security Agreement (as amended,
supplemented or otherwise modified from time to time, the SECURITY AGREEMENT"),
in favor of DBNY, as Collateral Agent for the benefit of the Lenders,
WHEREAS, Acquisition Company, Holdings, the Lenders, the
Administrative Agent, and the other Agents named therein have entered into the
Senior Unsecured Term Loan and Guaranty Agreement dated as of December 19, 2003
(as amended, supplemented or otherwise modified from time to time the "TERM LOAN
AGREEMENT"),
WHEREAS, pursuant to the Stock Purchase Agreement dated as of
November 17, 2003 between Holdings, the Acquisition Company Simmons HoldCo and
the other sellers party thereto (the "SELLERS"), the Acquisition Company has
agreed to purchase from Sellers certain of the common stock of Simmons HoldCo
(the ACQUISITION ),
WHEREAS immediately following with the consummation of the
Acquisition, (i) Acquisition Company will merge with and into Simmons HoldCo
with Simmons HoldCo being the surviving corporation (the "FIRST Merger"), and
(ii) immediately after the First Merger, Pre-Merger Simmons, a wholly-owned
subsidiary of Simmons HoldCo, will merge with and into Simmons HoldCo (the
"SECOND MERGER", and together with the First Merger, the "MERGERS'), with
Simmons HoldCo being the surviving corporation, changing its name to "XXXXXXX
COMPANY" and a wholly-owned subsidiary of Holdings (such surviving is referred
to herein as "POST-MERGER SIMMONS ), and
WHEREAS, this Assumption Agreement is executed and delivered
pursuant to the Credit Agreement
NOW, THEREFORE, IT IS AGREED
(i) Credit Agreement By executing and delivering this
Assumption Agreement and after giving effect to the Acquisition and the
Mergers Post-Merger Simmons hereby assumes all rights, title,
interests, obligations and liabilities of all and whatever nature of
the Acquisition Company under the Credit Agreement, the Notes, the
Security Agreement and each of the other Credit Documents (in
furtherance of and in addition to, and not in lieu of any assumption or
deemed assumption by operation of law) from and after the date hereof
with the same force and effect as if originally the Company" as such
term is defined under the Credit Agreement and a ' Grantor" under the
Security Agreement and, to the extent the Acquisition Company was a
party thereto, each other Credit Document Without limiting the
generality of the foregoing, Post-Merger Simmons hereby expressly
agrees to observe and perform and be bound by all of the terms
covenants representations, warranties and agreements contained in the
Credit Agreement and each other Credit Document delivered thereunder
which are binding upon, and to be observed or performed by, the
Acquisition Company Post-Merger Simmons hereby ratifies and confirms
the validity of, and all of its obligations and liabilities (including
the Obligations) under, the Credit Agreement and such other Credit
Documents Post-Merger Simmons hereby
839442 New York Server 7A EXECUTION
1
represents and warrants that after giving effect to this Assumption Agreement,
each of the representations and warranties contained in Section 4 of the Credit
Agreement is true and correct in all material respects on and as of the date
hereof
(ii) Guaranty of Credit Agreement By executing and
delivering this Assumption Agreement and after giving effect to the
Acquisition each of Simmons HoldCo Pre-Merger Simmons and the
Guarantors agree (a) that by the execution and delivery hereof each
such Person hereby becomes a Guarantor under the Credit Agreement and
agrees to be bound by all of the terms thereof (b) agrees to
irrevocably and unconditionally guaranty the due and punctual payment
in full of all Obligations when the same shall become due whether at
stated maturity, by required prepayment declaration, acceleration
demand or otherwise (including amounts that would become due but for
the operation of the automatic stay under Section 362(a) of the
Bankruptcy Code) and in accordance with Section 7 of the Credit
Agreement, (c) confirms its obligations as a "Grantor" under the
Security Agreement and each other Credit Document, and (d) represents
and warrants that each of the representations and warranties set forth
in Section 4 of the Credit Agreement is true and correct in all
material respects both before and after giving effect to this
Assumption Agreement
(iii) Term Loan Agreement By executing and delivering this
Assumption Agreement, and after giving effect to the Acquisition and
the Mergers, Post-Merger Simmons hereby assumes all rights, title,
interests obligations and liabilities of all and whatever nature of the
Acquisition Company under the Term Loan Agreement, the Notes and each
of the other Credit Documents (in furtherance of and in addition to,
and not in lieu of, any assumption or deemed assumption by operation of
law) from and after the date hereof with the same force and effect as
if originally the "Company' as such term is defined under the Term Loan
Agreement and, to the extent the Acquisition Company was a party
thereto, each other Credit Document Without limiting the generality of
the foregoing Post-Merger Simmons hereby expressly agrees to observe
and perform and be bound by all of the terms, covenants,
representations, warranties and agreements contained in the Term Loan
Agreement and each other Credit Document delivered thereunder which are
binding upon, and to be observed or performed by, the Acquisition
Company Post-Merger Simmons hereby ratifies and confirms the validity
of, and all of its obligations and liabilities (including the
Obligations) under, the Term Loan Agreement and such other Credit
Documents Post-Merger Simmons hereby represents and warrants that after
giving effect to this Assumption Agreement each of the representations
and warranties contained in Section 4 of the Term Loan Agreement is
true and correct in all material respects on and as of the date hereof
(iv) Guaranty of Term Loan Agreement By executing and
delivering this Assumption Agreement and after giving effect to the
Acquisition, each of Simmons HoldCo Pre-Merger Simmons and the
Guarantors agree (a) that by the execution and delivery hereof each
such Person hereby becomes a Guarantor under the Term Loan Agreement
and agrees to be bound by all of the terms thereof, (b) agrees to
irrevocably and unconditionally guaranty the due and punctual payment
in full of all Obligations when the same shall become due, whether at
stated maturity, by required prepayment, declaration, acceleration
demand or otherwise (including amounts that would become due but for
the operation of the automatic stay under Section 362(a) of the
Bankruptcy Code) and in accordance with Section 7 of the Term Loan
Agreement, and (c) represents and warrants that each of the
representations and warranties set forth in Section 4 of the Term Loan
Agreement is true and correct in all material respects both before and
after giving effect to this Assumption Agreement
(v) Effect on the Credit Agreement, the Term Loan
Agreement and Credit Documents On and after the effectiveness of this
Assumption Agreement and after giving effect to the Mergers, each
reference in each of the Credit Agreement, the Term Loan Agreement and
each other Credit Document (as such term is defined in each of the
Credit Agreement and the Term Loan Agreement) to the Company," or words
to that effect shall mean and be a reference to
839442 New York Server 7A EXECUTION
2
Post-Merger Simmons and Post-Merger Simmons shall be the Company" for all
purposes of the Credit Agreement, the Term Loan Agreement and the other Credit
Documents (as such term is defined in each of the Credit Agreement and the Term
Loan Agreement)
(vi) Governing Law This Assumption Agreement shall be
governed by, and construed in accordance with, the laws of the State of
New York
(vii) Credit Document This Agreement shall constitute a
Credit Document
[The remainder of this page is intentionally left blank]
839442 New York Server 7A EXECUTION
3
IN WITNESS WHEREOF, the undersigned has caused this Assumption
Agreement to be duly executed and delivered as of the date first above written
XXXXXXX HOLDINGS, INC
By /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
SIMMONS COMPANY
By /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
THE XXXXXXX MANUFACTURING CO , LLC
By /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
GALLERY CORP
By /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
WORLD OF SLEEP OUTLETS LLC
By /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
839442 New York Server 7A EXECUTION
4
SIMMONS CONTRACT SALES, LLC
By /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
WINDSOR BEDDING CO LLC
By /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
SC HOLDINGS, INC
By /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
SLEEP COUNTRY USA, INC
By /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
DREAMWELL, LTD
By /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
XXXXXXX CAPITAL MANAGEMENT, LLC
By /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
839442 New York Server 7A EXECUTION
5
Acknowledged
THL SC BEDDING COMPANY
By /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------------------
Name Xxxxxxx X. Xxxxxxxxx
Title
839442 New York Server 7A EXECUTION
6
DEUTSCHE BANK AG, NEW YORK BRANCH,
as Administrative Agent
By /s/ Xxxx Xxx Xxxxx
----------------------------------------
Name Xxxx Xxx Xxxxx
Managing Director
839442 New York Server 7A EXECUTION
7
