SEVENTH AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
EXHIBIT 10.3
EXECUTION COPY
SEVENTH AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
SEVENTH AMENDMENT TO CREDIT AND GUARANTY AGREEMENT, dated as of May 30, 2008 (this
“Amendment”), to the Credit and Guaranty Agreement, dated as of April 30, 2007 (as amended,
restated, supplemented or modified from time to time, the “Credit Agreement”), by and among
Xxxxxxxxx Company, a Michigan corporation (“Holdings”), Xxxxxxxxx Services Company, a
Michigan corporation (“Xxxxxxxxx Services”), certain subsidiaries of Holdings identified on
the signature page hereto as “Borrowers” (such Subsidiaries, together with Xxxxxxxxx Services, are
referred to individually as a “Borrower” and collectively, jointly and severally, as
“Borrowers”), certain subsidiaries of Holdings identified on the signature page hereto as
“Guarantors” (such subsidiaries, together with Holdings, are referred to individually as a
“Guarantor” and collectively, jointly and severally, as “Guarantors”), the lenders
party hereto from time to time (“Lenders”), and Silver Point Finance, LLC (“Silver
Point”), as administrative agent for Lenders (in such capacity, together with its successors
and assigns in such capacity, the “Administrative Agent”) and as collateral agent for
Lenders (in such capacity, together with its successors and assigns in such capacity, the
“Collateral Agent” and together with Administrative Agent, each an “Agent” and
collectively the “Agents”).
WHEREAS, Borrowers and Guarantors have requested that Agents and Lenders agree to amend
certain terms and conditions of the Credit Agreement, in each case, as more fully set forth herein;
and
WHEREAS, Agents and Lenders have agreed to make such amendments to the Credit Agreement, in
each case, subject to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants herein contained,
and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
1. Definitions. All terms used herein which are defined in the Credit Agreement and
not otherwise defined herein are used herein as defined therein.
2. Amendments to Credit Agreement.
(a) Section 1.1 of the Credit Agreement is hereby amended by adding the following new
definitions thereto, in appropriate alphabetical order, to read in its entirety as follows:
“‘Xxxxxxxx Purchase Agreement’ means the Asset Purchase Agreement
dated as of June 2, 2008, by and between Holdings and Xxxxxxxx
Merchandisers, L.P., a Texas limited partnership.”
“‘Initial Xxxxxxxx Closing Date’ means the date on which the WMS
Display Fixture Rights (as defined in the Xxxxxxxx Purchase
Agreement as in effect on the Seventh Amendment Effective Date) are
sold pursuant to the terms of the Xxxxxxxx Purchase Agreement as in
effect on the Seventh Amendment Effective Date, which date shall not
be later than June 4, 2008.”
“‘Seventh Amendment’ means the Seventh Amendment to Credit and
Guaranty Agreement, dated as of May 30, 2008, by and among Credit
Parties, Lenders and Agents.”
“‘Seventh Amendment Effective Date’ has the meaning ascribed to the
term ‘Amendment Effective Date’ in the Seventh Amendment.”
(b) Section 1.1 of the Credit Agreement is hereby amended by amending and restating the
definitions of the following terms contained therein to read in their entirety as follows:
“‘Extraordinary Receipts’ means any cash received by or paid to or
for the account of Holdings or any of it Subsidiaries not in the
ordinary course of business, including any foreign, United States,
state or local tax refunds, pension plan reversions, judgments,
proceeds of settlements or other consideration of any kind in
connection with any cause of action, condemnation awards (and
payments in lieu thereof), indemnity payments and any purchase price
adjustment received in connection with any purchase agreement,
proceeds of insurance (excluding, however, any Net
Insurance/Condemnation Proceeds which are subject to Section
2.13(b)), and including the Incentive Payment (as defined in the
Xxxxxxxx Purchase Agreement as in effect on the Seventh Amendment
Effective Date).”
“‘Material Contract’ means, collectively, any contract or other
arrangement to which Holdings or any of its Subsidiaries is a party
(other than the Credit Documents) for which breach, nonperformance,
cancellation or failure to renew could reasonably be expected to
have a Material Adverse Effect, and including, in any event each
contract or agreement to which Holdings or any of its Subsidiaries
is a party involving aggregate consideration payable to or by
Holdings or such Subsidiary of $5,000,000 or more (other than
purchase orders in the ordinary course of the business of Holdings
or such Subsidiary and other than contracts that by their terms may
be terminated by Holdings or such Subsidiary in the ordinary course
of its business upon less than 60 days’ notice without penalty or
premium), and including, without limitation, the Xxxxxxxx Purchase
Agreement and all documents executed or delivered in connection with
any of the foregoing.”
(c) Section 2.13 of the Credit Agreement is hereby amended by adding a new section to the end
thereof to read in its entirety as follows:
(l) Wal-Mart Receipts. For the period from the Initial
Xxxxxxxx Closing Date through the date on which the amendment to
this Agreement described in Section 6.25 becomes effective, no later
than the first Business Day following each date on which Holdings or
any of its Subsidiaries receives any proceeds of any Accounts owing
to Holdings or any of its Subsidiaries from Wal-Mart Stores, Inc. or
any of its Affiliates in respect of U.S. music sales, the Borrowers
shall prepay the Loans and/or the Revolving Commitments shall be
permanently reduced (it being understood that Revolving Commitments
will be permanently reduced only to the extent that Revolving Loans
are prepaid) as set forth in Section 2.14(b)(ii)(2) in an aggregate
amount equal to 75% of such proceeds (after payment of any Working
Capital Obligations then outstanding); provided that the
amount of any mandatory payment required to be made under this
Section 2.13(l) shall be reduced, on a
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dollar-for-dollar basis, by the amount of any corresponding
mandatory prepayment made under the Working Capital Agreement;
(d) Section 6.7(e) of the Credit Agreement is hereby amended and restated to read in its
entirety as follows:
“(e) Minimum Asset Coverage. Credit Parties shall not
permit, at any time, (i) the positive difference between (A) the
Working Capital Borrowing Base at such time (without taking into
account the Term Loan Reserve, the Minimum Availability Amount or
any other Reserves (as defined in the Working Capital Agreement))
and (B) the principal amount of all Indebtedness outstanding
(including without limitation, all undrawn letters of credit) under
the Working Capital Agreement and this Agreement at such time (such
positive difference, the “Minimum Asset Coverage”) to be less than
the correlative amount indicated below under the heading “Minimum
Asset Coverage” for such period, or (ii) the percentage obtained by
dividing (A) the amount specified in clause (i)(B) above at such
time by (B) the amount specified in clause (i)(A) above at such time
to be greater than the percentage specified below under the heading
“Maximum Coverage Percentage” for such period:
| Period | Minimum Asset Coverage | Maximum Coverage Percentage | ||
May 1, 2008 through
May 31, 2008
|
$25,000,000 | 74.1% | ||
June 1, 2008 through
(but not including)
the Initial Xxxxxxxx
Closing Date
|
$30,000,000 | 69.3% | ||
The Initial Xxxxxxxx
Closing Date through
(but not including)
June 8, 2008 (except
to the extent set
forth in the
immediately
succeeding row)
|
$41,000,000 (or, to the extent Holdings delivers a $3,000,000 letter of credit to Xxxxxxxx Merchandisers, L.P. pursuant to the Xxxxxxxx Purchase Agreement as in effect on the Seventh Amendment Effective Date, $38,000,000) | 57.0% (or, to the extent Holdings delivers a $3,000,000 letter of credit to Xxxxxxxx Merchandisers, L.P. pursuant to the Xxxxxxxx Purchase Agreement as in effect on the Seventh Amendment Effective Date, 60.0%) |
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| Period | Minimum Asset Coverage | Maximum Coverage Percentage | ||
The earlier of (x)
the date of receipt
of all payments by or
on behalf of Holdings
in respect of all
Initial WMS Inventory
(as defined in the
Xxxxxxxx Purchase
Agreement as in
effect on the Seventh
Amendment Effective
Date), and (y) June
9, 2008 through June
20, 2008
|
$43,000,000 (or, to the extent Holdings delivers a $3,000,000 letter of credit to Xxxxxxxx Merchandisers, L.P. pursuant to the Xxxxxxxx Purchase Agreement as in effect on the Seventh Amendment Effective Date, $40,000,000) | 54.0% (or, to the extent Holdings delivers a $3,000,000 letter of credit to Xxxxxxxx Merchandisers, L.P. pursuant to the Xxxxxxxx Purchase Agreement as in effect on the Seventh Amendment Effective Date, 57.0%) | ||
June 21, 2008 and all
times thereafter
|
$80,000,000 | 10.0%” |
(e) Article VI of the Credit Agreement is hereby amended by adding a new section to the end
thereof to read in its entirety as follows:
“6.25 Minimum Asset Coverage Covenants. By not later than June 20,
2008, the Credit Parties shall not fail to execute and deliver to
Agents an amendment to this Agreement amending Section 6.7(e) to
provide Minimum Asset Coverage and Maximum Coverage Percentage
levels for the period from June 21, 2008 through April 30, 2012 that
are satisfactory to Agents in their sole discretion (it being
understood that to the extent no such amendment is executed, no
changes will be made to the covenant levels set forth in Section
6.7(e) as in effect on the Seventh Amendment Effective Date).”
3. Consent. (a) Credit Parties have advised Agents and Lenders that Holdings is
entering into the Asset Purchase Agreement with Xxxxxxxx Merchandisers (“Purchaser”), dated
as of June 2, 2008 attached hereto as Annex A (the “Purchase Agreement”) providing for the
sale of certain assets related to the portion of Holdings’ business consisting of distribution of
certain music product to Wal-Mart stores in the United States, including (i) the Initial WMS
Inventory (as defined in the Purchase Agreement as in effect on the Seventh Amendment Effective
Date), (ii) the WMS Display Fixture Rights (as defined in the Purchase Agreement as in effect on
the Seventh Amendment Effective Date), and (iii) the Additional Inventory (as defined in the
Purchase Agreement as in effect on the Seventh Amendment Effective Date).
(b) Subject to the terms and conditions contained herein and notwithstanding anything to the
contrary set forth in the Credit Agreement or any other Credit Document, the Agents and the Lenders
hereby consent to:
(i) the sale of the WMS Display Fixture Rights to Purchaser in accordance with the terms and
conditions of the Purchase Agreement as in effect on the Seventh Amendment Effective Date;
provided, that (A) the cash proceeds of such sale (including the Additional Closing
Payments (as defined in the Purchase Agreement as in effect on the Seventh Amendment Effective
Date)) are at least $8,803,545, (B) all of such cash proceeds are paid to Administrative Agent for
application to the Obligations in accordance with Section 2.14(b)(ii)(2) of the Credit Agreement
(after payment of any Working Capital Obligations then outstanding) (it being understood that
Revolving Commitments will be permanently reduced only to the extent that Revolving Loans are
prepaid), (C) the
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Borrowers pay to the Administrative Agent the Make-Whole Amount and all accrued interest
payable in respect of the amount prepaid pursuant to clause (B) above, (D) such sale or disposition
and application of proceeds shall occur on or before June 4, 2008, (E) as of the date of such sale
and after giving effect thereto, no Default or Event of Default shall have occurred and be
continuing, and (F) the Agents shall have received, in form and substance reasonably satisfactory
to the Agents, true, correct and complete copies of the Purchase Agreement and each other document
executed in connection with any of the foregoing, together with all schedules and exhibits thereto,
duly authorized, executed and delivered by the parties thereto (such documents, collectively, the
“Purchase Documents”);
(ii) a series of sales of the Initial WMS Inventory to Purchaser in accordance with the terms
and conditions of the Purchase Agreement as in effect on the Seventh Amendment Effective Date;
provided, that (A) the cash proceeds of each such sale are equal to an amount not less than
the value of the Initial WMS Inventory sold in such sale (it being understood that (w) each
truckload of the Initial WMS Inventory shall constitute an individual sale, (x) the value of the
Initial WMS Inventory included in each such sale shall be determined in accordance with the terms
of the Purchase Agreement (as in effect on the Seventh Amendment Effective Date) on the date such
Initial WMS Inventory is packed onto the applicable delivery truck and such delivery truck is
sealed, (y) the contents of each such sale and the related dollar amount (determined in accordance
with clause (x)) shall be reflected in the applicable Release referred to below, and (z) the
aggregate cash consideration received in connection with the sale of all Initial WMS Inventory
shall not be less than $10,000,000), (B) all of such cash proceeds are paid to Administrative Agent
for application to the Obligations in accordance with Section 2.14(b)(ii)(2) of the Credit
Agreement (after payment of any Working Capital Obligations then outstanding) (it being understood
that Revolving Commitments will be permanently reduced only to the extent that Revolving Loans are
prepaid), (C) the Borrowers pay to the Administrative Agent the Make-Whole Amount and all accrued
interest payable in respect of the amount prepaid pursuant to clause (B) above, (D) all such sales
or dispositions and application of proceeds shall occur on or before June 16, 2008, and (E) as of
the date of each such sale and after giving effect thereto, no Default or Event of Default shall
have occurred and be continuing;
(c) The Collateral Agent, with the consent of the Lenders, agrees to execute and deliver to
Xxxxxxxx Merchandisers L.P. a release of liens in the form attached hereto as Exhibit A (the
“Release”) on the date of each proposed sale described in Section 3(b) above, following the
satisfaction of the conditions described in sub-clauses (E) and (F) (in the case of clause (i)
thereof) and sub-clause (E) (in the case of clause (ii) above) (it being understood and agreed by
each Credit Party that the failure to satisfy any other condition specified in clause (i) or (ii)
on the date of any such sale shall result in an immediate Event of Default under the Credit
Agreement). The Credit Parties hereby acknowledge and consent to the Release.
(d) Except as provided in Section 3(b), the Credit Agreement and the other Credit Documents
shall remain in full force and effect, and the foregoing waivers and consents shall be limited to
the matters set forth herein and shall not extend to any other transaction. The foregoing waivers
and consents do not allow any other or further departure from the terms of the Credit Agreement or
any other Credit Document.
4. Conditions to Effectiveness. This Amendment shall become effective (the
“Amendment Effective Date”) upon satisfaction in full of the following conditions
precedent:
(a) Immediately after giving effect to this Amendment, (i) the representations and
warranties contained in this Amendment, the Credit Agreement and the other Credit Documents
shall be correct on and as of the date of this Amendment as though made on and as of such
date (except where such representations and warranties relate to an earlier date in which
case
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such representations and warranties shall be true and correct as of such earlier date)
and (ii) no Default or Event of Default shall have occurred and be continuing (or would
result from this Amendment becoming effective in accordance with its terms).
(b) Administrative Agent shall have received counterparts of this Amendment that bear
the signatures of each of Credit Parties, Agents and Lenders.
(c) Administrative Agent shall have received a copy of an amendment (or similar
agreement), in form and substance reasonably satisfactory to Agents, duly executed by Credit
Parties, Working Capital Agent, and Working Capital Lenders amending and waiving the
corresponding provisions of the Working Capital Agreement.
5. Credit Parties’ Representations and Warranties. Each Credit Party represents and
warrants to Agents and Lenders as follows:
(a) Such Credit Party (i) is duly organized, validly existing and in good standing
under the laws of the state of its organization and (ii) has all requisite power, authority
and legal right to execute, deliver and perform this Amendment and to perform the Credit
Agreement, as amended hereby.
(b) The execution, delivery and performance by such Credit Party of this Amendment and
the Purchase Documents and the performance by such Credit Party of the Credit Agreement, as
amended hereby (i) have been duly authorized by all necessary action, (ii) do not and will
not violate or create a default under such Credit Party’s organizational documents, any
applicable law or any contractual restriction binding on or otherwise affecting such Credit
Party or any of such Credit Party’s properties, and (iii) except as provided in the Credit
Documents, do not and will not result in or require the creation of any Lien, upon or with
respect to such Credit Party’s property.
(c) No authorization or approval or other action by, and no notice to or filing with,
any governmental authority is required in connection with the due execution, delivery and
performance by such Credit Party of this Amendment or the Purchase Documents or the
performance by such Credit Party of the Credit Agreement, as amended hereby.
(d) This Amendment and the Credit Agreement, as amended hereby, and the Purchase
Documents constitute the legal, valid and binding obligations of such Credit Party,
enforceable against such Credit Party in accordance with their terms except to the extent
the enforceability thereof may be limited by any applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws from time to time in effect affecting generally
the enforcement of creditors’ rights and remedies and by general principles of equity.
(e) Immediately after giving effect to this Amendment, (i) the representations and
warranties contained in the Credit Agreement are correct on and as of the date of this
Amendment as though made on and as of the date hereof (except where such representations and
warranties relate to an earlier date in which case such representations and warranties shall
be true and correct as of such earlier date), and (ii) no Default or Event of Default has
occurred and is continuing (or would result from this Amendment becoming effective in
accordance with its terms).
6. Continued Effectiveness of Credit Agreement. Each Credit Party hereby confirms and
agrees that (a) the Credit Agreement and each other Credit Document to which it is a party is, and
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shall continue to be, in full force and effect and is hereby ratified and confirmed in all
respects except that on and after the Amendment Effective Date all references in any such Credit
Document to “the Credit Agreement”, “hereto”, “hereof”, “hereunder”, “thereto”, “thereof”,
“thereunder” or words of like import referring to the Credit Agreement shall mean the Credit
Agreement as amended by this Amendment, (b) to the extent that any such Credit Document purports to
assign or pledge to Collateral Agent, for the ratable benefit of Lenders, or to grant to Collateral
Agent, for the ratable benefit of Lenders a security interest in or Lien on, any Collateral as
security for the Obligations of the Credit Party, or any of their respective Subsidiaries from time
to time existing in respect of the Credit Agreement and the other Credit Documents, such pledge,
assignment and/or grant of the security interest or Lien is hereby ratified and confirmed in all
respects, (c) the execution and delivery of this Amendment does not limit any other action that the
Administrative Agent is entitled to take, or that the Credit Parties are required to perform, under
the Fifth Amendment Fee Letter, and (d) no amendment or waiver of any terms or provisions of the
Credit Agreement, or the amendments or waivers granted hereunder, shall relieve any Credit Party
from complying with such terms and provisions other than as expressly amended or waived hereby or
from complying with any other term or provision thereof or herein.
7. Release. Each Credit Party hereby acknowledges and agrees that: (a) neither it nor
any of its Affiliates has any claim or cause of action against any Agent or any Lender (or any of
their respective Affiliates, officers, directors, employees, attorneys, consultants or agents) and
(b) each Agent and each Lender has heretofore properly performed and satisfied in a timely manner
all of its obligations to Credit Parties and their Affiliates under the Credit Agreement and the
other Credit Documents. Notwithstanding the foregoing, Credit Parties wish (and Agents and Lenders
agree) to eliminate any possibility that any past conditions, acts, omissions, events or
circumstances would impair or otherwise adversely affect any Agent’s or any Lenders’ rights,
interests, security and/or remedies under the Credit Agreement and the other Credit Documents.
Accordingly, for and in consideration of the agreements contained in this Amendment and other good
and valuable consideration, each Credit Party (for itself and its Affiliates and the successors,
assigns, heirs and representatives of each of the foregoing) (collectively, the
“Releasors”) does hereby fully, finally, unconditionally and irrevocably release and
forever discharge each Agent and each Lender and each of their respective Affiliates, officers,
directors, employees, attorneys, consultants and agents (collectively, the “Released
Parties”) from any and all debts, claims, obligations, damages, costs, attorneys’ fees, suits,
demands, liabilities, actions, proceedings and causes of action, in each case, whether known or
unknown, contingent or fixed, direct or indirect, and of whatever nature or description, and
whether in law or in equity, under contract, tort, statute or otherwise, which any Releasor has
heretofore had or now or hereafter can, shall or may have against any Released Party by reason of
any act, omission or thing whatsoever done or omitted to be done, arising out of, connected with or
related in any way to the Credit Agreement or any other Credit Document, or any act, event or
transaction related or attendant thereto, or the agreements of any Agent or any Lender contained
therein, or the possession, use, operation or control of any of the assets of any Credit Party, or
the making of any Loans or other advances, or the management of such Loans or advances or the
Collateral.
8. Miscellaneous.
(a) This Amendment may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of this Amendment by telefacsimile or electronic method shall be
equally as effective as delivery of an original executed counterpart of this Amendment.
(b) Section and paragraph headings herein are included for convenience of reference
only and shall not constitute a part of this Amendment for any other purpose.
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(c) This Amendment shall be governed by, and construed in accordance with, the laws of
the State of New York. Each of the parties to this Amendment hereby irrevocably waives all
rights to trial by jury in any action, proceeding or counterclaim arising out of or relating
to this Amendment.
(d) Borrowers will pay on demand all reasonable fees, costs and expenses of Agents and
Lenders in connection with the preparation, execution and delivery of this Amendment or
otherwise payable under the Credit Agreement, including, without limitation, reasonable fees
disbursements and other charges of counsel to Agents and Lenders.
(e) This Amendment is a Credit Document executed pursuant to the Credit Agreement and
shall be construed, administered and interpreted in accordance with the terms thereof.
Accordingly, it shall be an Event of Default under the Credit Agreement if any
representation or warranty made or deemed made by any Credit Party under or in connection
with this Amendment shall have been incorrect when made or deemed made or if any Credit
Party fails to perform or comply with any covenant or agreement contained herein.
[remainder of this page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and
delivered by their respective officers thereunto duly authorized as of the date first written
above.
| BORROWERS: XXXXXXXXX CATEGORY MANAGEMENT COMPANY |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| XXXXXXXXX SERVICES COMPANY |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| XXXXXXXXX REAL ESTATE LLC |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| ARTIST TO MARKET DISTRIBUTION LLC |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| REPS, L.L.C. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
Seventh Amendment To Credit And Guaranty Agreement
| GUARANTORS: XXXXXXXXX COMPANY |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| CRAVE ENTERTAINMENT GROUP, INC. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| XXXXXX ADVERTISING COMPANY |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| XXXXXXXXX COMPANY OF CANADA LIMITED |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| XXXXXXXXX UK LIMITED |
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| By: | ||||
| Name: | ||||
| Title: | ||||
Seventh Amendment To Credit And Guaranty Agreement
| SVG DISTRIBUTION, INC. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| CRAVE ENTERTAINMENT, INC. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
Seventh Amendment To Credit And Guaranty Agreement
| ADMINISTRATIVE AGENT AND COLLATERAL AGENT: SILVER POINT FINANCE, LLC, as Administrative Agent and Collateral Agent |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
Seventh Amendment To Credit And Guaranty Agreement
| LENDERS: SPF CDO I, LTD. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| SPCP GROUP, LLC |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| THERMOPYLAE FUNDING CORP. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| FIELD POINT I, LTD. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| FIELD POINT II, LTD. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
Seventh Amendment To Credit And Guaranty Agreement
EXHIBIT A
Silver Point Finance, LLC
Xxx Xxxxxxxxx Xxxxx, Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Xxx Xxxxxxxxx Xxxxx, Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Xxxxxxxx Merchandisers, L.P.
000 X.X. 00xx Xxxxxx
Xxxxxxxx, XX 00000
000 X.X. 00xx Xxxxxx
Xxxxxxxx, XX 00000
Re: RELEASE AND TERMINATION OF LIENS
Ladies and Gentlemen:
Reference is hereby made to the Credit and Guaranty Agreement, dated as of April 30, 2007 (as
amended, restated, supplemented or modified from time to time, the “Credit Agreement”), by
and among Xxxxxxxxx Company, a Michigan corporation (“Holdings”), Xxxxxxxxx Services
Company, a Michigan corporation (“Xxxxxxxxx Services”), certain subsidiaries of Holdings
identified on the signature page thereto as “Borrowers” (such Subsidiaries, together with Xxxxxxxxx
Services, are referred to individually as a “Borrower” and collectively, jointly and severally, as
“Borrowers”), certain subsidiaries of Holdings identified on the signature page thereto as
“Guarantors” (such subsidiaries, together with Holdings, are referred to individually as a
“Guarantor” and collectively, jointly and severally, as “Guarantors”, and the
Guarantors, together with the Borrowers, are referred to individually as a “Credit Party”
and collectively, jointly and severally, as “Credit Parties”), the lenders party thereto
from time to time (“Lenders”), and Silver Point Finance, LLC, as administrative agent for
Lenders (in such capacity, together with its successors and assigns in such capacity, the
“Administrative Agent”) and as collateral agent for Lenders (in such capacity, together
with its successors and assigns in such capacity, the “Collateral Agent” and together with
Administrative Agent, each an “Agent” and collectively the “Agents”). The
Collateral Agent, on behalf of itself and the Lenders, holds a security interest in and lien on the
assets and property of Holdings. The Collateral Agent and the Lenders have been advised that
Holdings is selling, conveying, transferring and assigning to Xxxxxxxx Merchandisers, L.P.
(“Purchaser”) certain assets consisting of the equipment and inventory listed on
Schedule I attached hereto (“Purchased Assets”). As a condition to such proposed
sale, the Collateral Agent is required to release all of its liens on such Purchased Assets.
1. Release of Security Interest. Effective upon receipt by the Administrative Agent
of the payment set forth in Section 2 hereof, the Collateral Agent hereby releases, terminates and
discharges, without recourse and without any representation or warranty of any kind, express or
implied, all security interests and liens of any nature whatsoever in its favor in or on the
Purchased Assets. Nothing contained herein shall be deemed a release or termination by the
Collateral Agent of any security interests in and liens on any assets of any Credit Party other
than the Purchased Assets, all of which shall continue in full force and effect. Except as
specifically set forth herein, nothing contained herein shall be construed in any manner to
constitute a waiver, release or termination or to otherwise limit or impair any of the obligations
or indebtedness of any Credit Party or any other person or entity to the Agents and the
Lenders, or any duties, obligations or responsibilities of the Credit Parties or any other person
or entity to the Agents and the Lenders.
2. Effectiveness of Release. The release, termination and discharge of the Collateral
Agent’s security interests in and liens on the Purchased Assets pursuant to Section 1 hereof shall
be effective, without further action by the Collateral Agent, upon the Administrative Agent’s
receipt, from or on behalf of the Credit Parties (including by direct payment by the Purchaser), of
an aggregate amount of not less than $ ___ in immediately available funds to the bank account
specified on Schedule II hereto by not later than noon (New York City time) on ___,
2008. (To the extent such payment is not received by such time, this Release and Termination of
Liens shall terminate and be of no further force or effect.)
3. Further Assurances. The Collateral Agent hereby agrees that, after receipt of the
payment set forth in Section 2 hereof by the Administrative Agent, it will file, at the Borrowers’
sole cost and expense, a UCC financing statement amendment in the form attached hereto as Annex
A. The Collateral Agent will, at the reasonable request of the Borrowers or the Purchaser and
after receipt of the payment set forth in Section 2 hereof by the Administrative Agent, execute
and/or deliver such instruments and other writings as may be necessary to effect or evidence the
termination of the liens of the Collateral Agent on the Purchased Assets, but without
representation, warranty or recourse to the Agents or the Lenders and at the sole cost and expense
of the Borrowers.
4. Miscellaneous. Delivery of an executed counterpart of this Release and Termination
of Liens by facsimile or electronic mail shall be equally effective as delivery of a manually
executed counterpart. This Release and Termination of Liens shall be governed by and interpreted
and determined in accordance with the laws of the State of New York (without regard to principles
of conflict of laws).
| Very truly yours, | ||||||
| SILVER POINT FINANCE, LLC, as Collateral Agent and on behalf of the Lenders |
||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
Schedule I
Purchased Assets
Purchased Assets
Schedule II
Bank Account Details
Bank Account Details
Citibank, NA
ABA # 000000000
A/C Name: Silver Point Finance, LLC
A/C # 48680439
RE: Xxxxxxxxx / Sweep Payment
ABA # 000000000
A/C Name: Silver Point Finance, LLC
A/C # 48680439
RE: Xxxxxxxxx / Sweep Payment
ANNEX A
PURCHASE AGREEMENT
PURCHASE AGREEMENT
See attached.
