NINTH AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
Exhibit 10.2
EXECUTION COPY
NINTH AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
NINTH AMENDMENT TO CREDIT AND GUARANTY AGREEMENT, dated as of July 24, 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 their entirety as follows:
“‘Canadian Purchase Agreement’ means the Asset Purchase Agreement,
dated as of July 24, 2008, by and between Canadian OpCo, Holdings,
Xxxxxxxx Merchandisers-Canada, Inc., a Delaware corporation and
Xxxxxxxx Merchandisers, L.P., a Texas limited partnership.”
“‘Ninth Amendment’ means the Ninth Amendment to Credit and Guaranty
Agreement, dated as of July 24, 2008, by and among Credit Parties,
Lenders and Agents.”
“‘Ninth Amendment Effective Date’ has the meaning ascribed to the
term ‘Amendment Effective Date’ in the Ninth 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 and
proceeds of insurance (excluding, however, any Net
Insurance/Condemnation Proceeds which are subject to Section
2.13(b)).”
“‘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 the Canadian Purchase Agreement and all documents
executed or delivered in connection with any of the foregoing.”
(c) Section 1.1 of the Credit Agreement is hereby amended by amending and restating clause
(iv) of the definition of the term “Indebtedness” contained therein to read in its entirety as
follows:
“(iv) any obligation owed for all or any part of the deferred
purchase price of property or services (excluding trade payables
incurred in the ordinary course of business) which purchase price is
(a) due more than four (4) months from the date of incurrence of the
obligation in respect thereof or (b) evidenced by a note or similar
written instrument;”
(d) Section 1.1 of the Credit Agreement is hereby amended by adding the following sentence to
the end of the definition of “Net Asset Sale Proceeds” contained therein:
“For the avoidance of doubt, it is understood and agreed that 100%
of the amount of the Hold Back (as defined in the Canadian Purchase
Agreement, as in effect on the Ninth Amendment Effective Date),
including all amounts payable under the Promissory Note (as defined
in the Canadian Purchase Agreement, as in effect on the Ninth
Amendment Effective Date), shall be deemed to constitute ‘Net Asset
Sale Proceeds’ upon receipt of any such amount by Holdings or any of
its Subsidiaries and, notwithstanding anything to the contrary
contained in Section 2.14(b), shall be applied to the Obligations (after payment of any
Working Capital Obligations then outstanding) as follows (A) first,
to the Tranche B Term Loans until paid in full; and (B) second, to
the
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Revolving Loans until paid in full (it being understood that the
Revolving Commitment shall be permanently reduced by the amount of
any such prepayment).”
(e) Section 2.13(l) of the Credit Agreement is hereby amended and restated to read in its
entirety as follows:
(l) Certain Receipts. Commencing on the date of the closing
of the acquisition contemplated by the Canadian Purchase Agreement,
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 Canadian OpCo in respect of the distribution of
music products in Canada, the Borrowers shall prepay the Loans in an
aggregate amount equal to 100% of such proceeds (after payment of
any Working Capital Obligations then outstanding) as follows: (i)
first, to the Tranche B Term Loans until paid in full; and (ii)
second, to the Revolving Loans, until paid in full (it being
understood that the Revolving Commitment shall be permanently
reduced by the amount of any such prepayment); provided that
the amount of any mandatory payment required to be made under this
Section 2.13(l) shall be reduced, on a dollar-for-dollar basis, by
the amount of any corresponding mandatory prepayment made under the
Working Capital Agreement;
(f) Section 6.25 of the Credit Agreement is hereby amended and restated to read in its
entirety as follows:
“6.25 Delivery of Amendment. By not later than August 1, 2008, the
Credit Parties shall not fail to execute and deliver to Agents an
amendment to this Agreement in form and substance satisfactory to
Agents.”
3. Consent. (a) Credit Parties have advised Agents and Lenders that Canadian OpCo and
Holdings are entering into an Asset Purchase Agreement, dated as of July 24, 2008, with Xxxxxxxx
Merchandisers-Canada, Inc., a Delaware corporation (the “Purchaser”) and Xxxxxxxx
Merchandisers, L.P., a Texas limited partnership (“Merchandisers”), in the form of Annex A
attached hereto (the “Purchase Agreement”), which Purchase Agreement provides for the sale
of certain assets related to Canadian OpCo’s business consisting of the distribution of certain
music product in Canada.
(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 the sale of the Purchased Assets to Purchaser in accordance with the terms and
conditions of the Purchase Agreement as in effect on the Ninth Amendment Effective Date;
provided, that (i) the cash proceeds of such sale (including the Incentive Payment (as
defined in the Xxxxxxxx Purchase Agreement as in effect on the Seventh Amendment Effective Date)
but excluding the amounts payable under the Promissory Note referred to in clause (vii) below) that
will be received on the date of such sale are at least $5,000,000, (ii) all of such cash proceeds
are paid to Administrative Agent for application to the Obligations (after payment of any Working
Capital Obligations then outstanding) as follows: (A) first, to the Tranche B Term Loans until
paid in full; and (B) second, to the Revolving Loans, until paid in full (it being understood that the Revolving Commitment shall be
permanently reduced by the amount of any such prepayment); provided, that the amount of any
mandatory payment required to be made under this clause (ii) shall be reduced, on a
dollar-for-dollar basis, by the amount of
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any corresponding mandatory prepayment made under the
Working Capital Agreement, (iii) the Borrowers pay to the Administrative Agent all accrued interest
payable in respect of the amount prepaid pursuant to clause (ii) above (it being understood that
the Make-Whole Amount payable in respect of the amount prepaid pursuant to clause (ii) above shall
be paid-in-kind on such date by capitalizing such Make-Whole Amount and adding it to the
outstanding principal amount of the Tranche B Term Loan, whereupon such Make-Whole Amount shall (A)
constitute a portion of the outstanding Tranche B Term Loan for purposes of the Credit Agreement
and all other Credit Documents, (B) be secured by the Collateral, (C) constitute a portion of the
Obligations owing by the Credit Parties to Agents and Lenders, and (D) be payable on the Term Loan
Maturity Date), (iv) such sale or disposition and application of proceeds shall occur on or before
October 15, 2008, (v) as of the date of such sale and after giving effect thereto, (A) no Default
or Event of Default shall have occurred and be continuing, and (B) all material creditors of
Canadian OpCo not paid immediately upon the closing of the Purchase Agreement shall have delivered
to Canadian OpCo, a Bulk Sales Act Waiver, substantially in the form of Exhibit B hereto, and the
Agents shall have received a certificate from an Authorized Officer of Holdings and Canadian OpCo,
certifying that the statements contained in sub-clauses (A) and (B) above are true and correct,
(vi) 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”), and (vii) the Agents shall have received a Pledge Amendment to the
Canadian Security Agreement, accompanied by the original Promissory Note (as defined in the
Canadian Purchase Agreement (as in effect on the Ninth Amendment Effective Date), appropriate
instruments of transfer executed in blank and an acknowledgement duly executed by the Purchaser
with respect to such pledge, in each case, in form and substance satisfactory to the Agents;
(c) The Collateral Agent, with the consent of the Lenders, agrees to execute and deliver to
Purchaser (i) a release of liens in the form attached hereto as Exhibit A (the “Release”)
on the date of the proposed sale described in Section 3(b) above, following the satisfaction of the
conditions described in sub-clauses (v), (vi) and (vii) of Section 3(b) above (it being understood
and agreed by each Credit Party that the failure to satisfy any other condition specified in
Section 3(b) on the date of any such sale shall result in an immediate Event of Default under the
Credit Agreement), and (ii) a waiver in the form attached hereto as Exhibit B (the “Bulk Sales
Act Waiver”) on the date of the proposed sale described in Section 3(b) above, following the
satisfaction of all of the conditions described in Section 3(b) above. The Credit Parties hereby
acknowledge and consent to the Release and the Bulk Sales Act Waiver.
(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. Waiver. (a) The Company, in its capacity as Borrower Representative, has advised
the Agents that certain Events of Default have occurred under Section 8.1(c) of the Credit
Agreement, due to the incurrence of certain Indebtedness by the Credit Parties resulting from the
failure of the Credit Parties to pay all trade payables in excess of $2,000,000 within 60 days of
the due date therefor in violation of Section 6.1 of the Credit Agreement (such Events of Default,
the “Specified Events of Default”). At the request of the Credit Parties, effective upon the
Amendment Effective Date, each of the Agents and the Lenders hereby waives each Specified Event of Default that occurred prior to
the date hereof.
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(b) The waivers and consents set forth in Section 4(a) above shall be effective only in this
specific instance and for the specific purposes set forth herein, and (b) do not allow for any
other or further departure from the terms and conditions of the Credit Agreement (including,
without limitation, any further violation of Section 6.1 of the Credit Agreement) or any other
Credit Document, which terms and conditions shall continue in full force and effect.
5. 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 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.
6. 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,
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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).
7. 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
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.
8. 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,
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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.
9. 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.
(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 |
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| 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 |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| REPS, L.L.C. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| 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: | ||||
| SVG DISTRIBUTION, INC. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| CRAVE ENTERTAINMENT, INC. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| ADMINISTRATIVE AGENT AND COLLATERAL AGENT: SILVER POINT FINANCE, LLC, as Administrative Agent and Collateral Agent |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| 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: | ||||
EXHIBIT A TO NINTH AMENDMENT
Silver Point Finance, LLC
Xxx Xxxxxxxxx Xxxxx, Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Xxx Xxxxxxxxx Xxxxx, Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Xxxxxxxx Merchandisers-Canada, Inc.
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 Xxxxxxxxx Company of Canada Limited, a
corporation organized under the laws of the Province of Ontario (“Seller”). The Collateral
Agent and the Lenders have been advised that Seller is selling, conveying, transferring and
assigning to Xxxxxxxx Merchandisers-Canada, Inc., a Delaware corporation (the “Purchaser”)
the Purchased Assets (as defined in the Asset Purchase Agreement, dated as of July , 2008, by and
between Seller, Holdings, Purchaser, and Xxxxxxxx Merchandisers, L.P., as in effect on the date
hereof). 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 $5,000,000 in immediately available funds to the bank account
specified on Schedule I 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 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 |
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| By: | ||||
| Name: | ||||
| Title: | ||||
Schedule I
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
EXHIBIT B TO NINTH AMENDMENT
FORM 2
(Section 8 (1) (c))
Bulk Sales Act
WAIVER
In the matter of the sale in bulk
Between
Seller
-and-
Buyer
I, , of the of , in the
of , a secured (or unsecured) trade creditor of the above-named
seller, hereby waive the provisions of the Bulk Sales Act that require that adequate provision be
made for the immediate payment in full of my claim forthwith after completion of the sale, and I
hereby acknowledge and agree that the buyer may pay or deliver the proceeds of the sale to the
seller and thereupon acquire the property of the seller in the stock without making provision for
the immediate payment of my claim and that any right to recover payment of my claim may, unless
otherwise agreed, be asserted against the seller only.
Dated at this day of , 20
Witness:
ANNEX A TO NINTH AMENDMENT
PURCHASE AGREEMENT
PURCHASE AGREEMENT
See attached.
