AMENDMENT NO. 1 TO GUARANTY AND SECURITY AGREEMENT
AMENDMENT
NO. 1 TO GUARANTY AND SECURITY AGREEMENT
Amendment
No. 1, dated
as
of June 5, 2007 to
the
Guaranty
and security Agreement, dated
as
of October 24, 2006 (the “Guaranty
and Security Agreement”),
by
The
Bombay Company, Inc., BBA Holdings, LLC., Bombay International, Inc.
and
The
Bombay Furniture Company, Inc.
(collectively, the “Grantors”)
in
favor of General Electric Capital Corporation, as administrative agent and
collateral agent for the Secured Parties (in such capacity, the “Agent”).
Capitalized terms used herein and not otherwise defined herein shall have the
meanings ascribed to them in the Guaranty and Security Agreement.
W
i t n e s s e t h:
Whereas,
the
Borrowers have requested that the Agent amend the Guaranty and Security
Agreement as set forth below; and
Whereas,
the
Lenders and the Agent have approved such amendment;
Now,
Therefore, in
consideration of the premises and the covenants and obligations contained
herein, the sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:
| Section 1. |
Amendments
to the Guaranty and Security
Agreement
|
(a) The
definition of “Excluded Property” in Section 1.1 of the Guaranty and Security
Agreement is hereby amended in its entirety as follows:
“Excluded
Property”
means
any Permit, license, contract, instrument or other agreement held by any Grantor
that prohibits or requires the consent of any Person other than the Borrowers
and their Affiliates as a condition to the creation by such Grantor of a Lien
thereon, or any Permit, lease, license contract or other agreement held by
any
Grantor to the extent that any Requirement of Law applicable thereto prohibits
the creation of a Lien thereon, but only to the extent, and for so long as,
such
prohibition is not terminated or rendered unenforceable or otherwise deemed
ineffective by the UCC or any other Requirement of Law; provided,
however,
“Excluded
Property”
shall
not include any proceeds, substitutions or replacements of Excluded Property
(unless such proceeds, substitutions or replacements would constitute Excluded
Property) or any Lease or Leasehold.
(b) Section
1.1 of the Guaranty and Security Agreement is hereby amended by inserting the
following definitions of “Lease” and “Leasehold” in their appropriate
alphabetical order:
“Lease”
means
any lease or other agreement, no matter how styled or structured, pursuant
to
which any Borrower is entitled to the use or occupancy of any
space.
“Leasehold”
means
any lease, leasehold estate or interest of any Borrower in each of the
properties at or upon which any such Borrower conducts business, offers any
Inventory for sale, or maintains any of the Collateral, whether or not for
retail sale, together with the Borrower’s interest in any of the improvements
and fixtures
located
upon or appurtenant to each such estate or interest, including, without
limitation, any rights of any such Borrower to payment, proceeds or value of
any
kind or nature realized upon the sale, transfer or assignment of any such estate
or interest, whether or not such sale, assignment or transfer occurs during
any
case commenced under the Bankruptcy Code.
(c) The
definition of “Software” in Section 1.1 of the Guaranty and Security Agreement
is hereby deleted in its entirety.
(d) Section
3.1 of the Guaranty and Security Agreement is hereby amended in its entirety
as
follows:
“Section
3.1 Collateral.
For the
purposes of this Agreement, all personal property, tangible and intangible,
now
owned or at any time hereafter acquired by a Grantor or in which a Grantor
now
has or at any time in the future may acquire any right, title or interests
is
collectively referred to as the “Collateral”,
which
term shall include, without limitation, all of the following:
(a) all
accounts;
(b) all
inventory, equipment and other goods;
(c) all
fixtures;
(d) all
documents;
(e) all
general intangibles;
(f) all
securities accounts and deposit accounts (other than Excluded Deposit Accounts),
including Store Accounts, Concentration Accounts, the Cash Collateral Account
and all deposits and credits therein;
(g) all
investment property; provided, if the grant of a Lien and security interest
under this Agreement in investment property consisting of equity interests
of an
Excluded Foreign Subsidiary of a Grantor would subject a Grantor to a tax on
the
earnings and profits of such Excluded Foreign Subsidiary under Section 956
of
the Internal Revenue Code, then, in such event (and only for so long as such
tax
would be imposed), not more than sixty-five percent (65%) of the voting equity
securities and one hundred percent (100%) of the non-voting equity securities
of
such Excluded Foreign Subsidiary shall be deemed part of the Collateral and
subject to the Lien and security interest of the Administrative Agent granted
hereby;
(h) all
software;
(i) all
letters of credit, letter-of-credit rights, instruments, promissory notes,
drafts and chattel paper (including electronic chattel paper and tangible
chattel paper);
(j) all
supporting obligations with respect to any of the foregoing;
2
(k) all
books, records, and information relating to any of the foregoing and/or to
the
operation of any Grantor’s business, and all rights of access to such books,
records, and information, and all property in which such books, records, and
information are stored, recorded and maintained;
(l) all
commercial tort claims;
(m) all
money
or other assets of such Grantor, including without limitation all money and
assets of such Grantor held by any Secured Party, including all property of
every description, in the custody of or in transit to such Secured Party for
any
purpose, including safekeeping, collection or pledge, for the account of such
Grantor or as to which such Grantor may have any right or power, including
but
not limited to cash; and
(n) all
Leases and Leaseholds;
(o) to
the
extent not otherwise included, all proceeds of the foregoing including the
proceeds of insurance, all property or money resulting from the Sale of any
of
the foregoing and all other rights to payment not included in the
foregoing;
provided, however, that
“Collateral”
shall
not include any Excluded Property; and provided,
further,
that if
and when any property shall cease to be Excluded Property, such property shall
be deemed at all times from and after the date hereof to constitute
Collateral.”
(e) Section
4.1 of the Guaranty and Security Agreement is hereby amended in its entirety
to
read as follows:
“Section
4.1 Title;
No Other Liens.
Such
Grantor (a) is the record and beneficial owner of the Collateral pledged by
it
hereunder constituting instruments and investment property and (b) has rights
in
or the power to transfer each other item of Collateral in which a Lien is
granted by it hereunder, free and clear of any other Lien (except for Permitted
Liens).”
(f) Section
4.2 of the Guaranty and Security Agreement is hereby amended as
follows:
(i) by
deleting “and” immediately preceding (iii) and by inserting “ and (iv) in the
case of Leases and Leaseholds,
compliance with applicable state law for the perfection of such Lien”
immediately following “electronic chattel paper”
(ii) by
inserting the following language at the end of the section, immediately
preceding the period: “;
it
being understood that, subject to the Intercreditor Agreement, the
Administrative Agent will not seek to perfect its Lien in Leases and Leaseholds
absent the occurrence of an Event of Default and, following the occurrence
and
during the continuation of an Event of Default, and as requested by the
Administrative Agent, Borrowers shall endeavor to take such action as may
reasonably be necessary to perfect the Administrative Agent’s Lien in Leases and
Leaseholds”
3
(g) Section
5.1 of the Guaranty and Security Agreement is hereby amended by inserting
Section 5.1(d), immediately following Section 5.1(c) as follows:
“(d)
Such
Grantor shall not authorize or permit any assignment, pledge, Lien, security
interest, encumbrance, restriction or any hypothecation of any Lease or
Leasehold, except as shall be permitted under the Credit
Agreement”.
(h) Section
5.4(b) of the Guaranty and Security Agreement is hereby amended in its entirety
to read as follows:
“(b)
Such
Grantor shall not grant “control” (within the meaning of such term under Article
90306 of the UCC) over any investment property or deposit account to any Person
other than the Administrative Agent, except as otherwise contemplated by the
Intercreditor Agreement.”
(i) The
following sentence is added at the end of Section 6.4 is amended in its entirety
to read as follows: “The proceeding provisions of this Section are subject to
the Intercreditor Agreement, and in the event of any conflict the provisions
of
the Intercreditor Agreement shall control.
| Section 2. |
Grant
of Security Interest in
Collateral
|
Each
Grantor, as collateral security for the prompt and complete payment and
performance when due (whether at stated maturity, by acceleration or otherwise)
of the Secured Obligations (as defined in the Guaranty and Security Agreement)
of such Grantor, hereby mortgages, pledges and hypothecates to the Agent for
the
benefit of the Secured Parties, and grants to the Agent for the benefit of
the
Secured Parties a Lien on and security interest in, all of its right, title
and
interest in, to and under the Collateral of such Grantor; provided,
however,
that,
if and when any property that at any time constituted Excluded Property becomes
Collateral, the Agent shall have, and at all times from and after the date
hereof be deemed to have had, a security interest in such property.
| Section 3. |
Reference
to the Effect on the Loan
Documents
|
(a) As
of the
date hereof, each reference in the Guaranty and Security Agreement to “this
Agreement,” “hereunder,” “hereof,” “herein,” or words of like import, and each
reference in the other Loan Documents to the Guaranty and Security Agreement
(including, without limitation, by means of words like “thereunder”, “thereof”
and words of like import), shall mean and be a reference to the Guaranty and
Security Agreement as modified hereby, and this Amendment and the Guaranty
and
Security Agreement shall be read together and construed as a single
agreement.
(b) Except
as
expressly modified hereby, all of the terms and provisions of the Guaranty
and
Security Agreement and all other Loan Documents are and shall remain in full
force and effect and are hereby ratified and confirmed.
(c) The
execution, delivery and effectiveness of this Amendment shall not, except as
expressly provided herein, operate as a waiver of any right, power or remedy
of
the Lenders or the Agent under any of the Loan Documents, nor constitute a
waiver or amendment of any other provision of any of the Loan Documents or
for
any purpose except as expressly set forth herein.
(d) This
Amendment shall be deemed a Loan Document.
4
| Section 4. |
Execution
in Counterparts
|
This
Amendment may be executed in any number of counterparts and by different parties
in separate counterpart (including by facsimile), each of which when so executed
shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement. Signature pages may be detached from
multiple separate counterparts and attached to a single counterpart so that
all
signature pages are attached to the same document. Delivery of an executed
counterpart by telecopy shall be effective as delivery of a manually executed
counterpart of this Amendment.
| Section 5. |
Governing
Law
|
This
Amendment shall be governed by and construed in accordance with the law of
the
State of New York.
| Section 6. |
Section
Titles
|
The
Section titles contained in this Amendment are and shall be without substantive
meaning or content of any kind whatsoever and are not a part of the agreement
between the parties hereto.
| Section 7. |
Notices
|
All
communications and notices hereunder shall be given as provided in the Credit
Agreement.
| Section 8. |
Severability
|
The
fact
that any term or provision of this Amendment is held invalid, illegal or
unenforceable as to any person in any situation in any jurisdiction shall not
affect the validity, enforceability or legality of the remaining terms or
provisions hereof or the validity, enforceability or legality of such offending
term or provision in any other situation or jurisdiction or as applied to any
person.
| Section 9. |
Successors
|
The
terms
of this Amendment shall be binding upon, and shall inure to the benefit of,
the
Lenders, the other parties hereto and their respective successors and
assigns.
| Section 10. |
Waiver
of Jury Trial
|
Each
of
the parties hereto irrevocably waives trial by jury in any action or proceeding
with respect to this Amendment or any other Loan Document.
[Signature
Pages Follow]
5
In
Witness Whereof,
the
parties hereto have caused this Amendment to be executed by their respective
officers thereunto duly authorized, as of the date first written
above.
The
Bombay Company, Inc.,
as
Grantor
By:__________________________
Name:
Title:
BBA
Holdings, LLC,
as
Grantor
By:__________________________
Name:
Title:
Bombay
International, Inc.,
as
Grantor
By:__________________________
Name:
Title:
The
Bombay Furniture Company, Inc.,
as
Grantor
By:__________________________
Name:
Title:
Accepted
and Agreed
as
of the
date first above written:
General
Electric Capital corporation,
as
Administrative Agent
By:___________________________
Name:
Title: