Exhibit 99.2
Greenwich Capital Financial Products, Inc.
000 Xxxxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
July 6, 2005
Fleetwood Enterprises, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxxx, Xxxxx 00000
Re: Guaranty - Tangible Net Worth and Leverage Tests
Ladies and Gentlemen:
Reference is hereby made to the Guaranty, dated as of December 30,
2003, made by FLEETWOOD ENTERPRISES, INC. (the Guarantor") in favor of
GREENWICH CAPITAL FINANCIAL PRODUCTS, INC. (the "Lender"), as amended
(the "Guaranty"). Capitalized terms used but not defined herein shall
have the meanings set forth in the Guaranty.
Pursuant to the Guaranty, the Guarantor has agreed that it shall
not permit (i) the ratio of its Total Indebtedness to Tangible Net
Worth at any time to be greater than 3.5:1 (the "Leverage Covenant")
and (ii) its Tangible Net Worth to be less than the sum of (a)
$110,000,000 plus (b) an amount equal to 50% of the aggregate positive
quarterly Net Income (without deduction for quarterly losses) (the "TNW
Covenant"; and together with the Leverage Covenant, the "Covenants").
The Lender hereby acknowledges that the Guarantor will not be in
compliance with the Covenants when the Guarantor reports its financial
results for the Guarantor's fiscal year ending on April 24, 2005, nor
for each of the two fiscal months of May and June 2005. With regard to
such failures, the Lender hereby waives its right pursuant to Section
16(a) of the Guaranty to declare an Event of Default under the Guaranty
and hereby agrees that such failure during such period shall not be
deemed to be a breach of any representations, warranties or financial
covenant in the Guaranty.
Additionally, effective as of the date hereof, for good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and for the mutual covenants herein contained, the Lender
and the Guarantor hereby agree to amend the Guaranty as follows:
(a) Section 3(b)(i) of the Guaranty is hereby deleted in its
entirety and replaced with the following:
"(i) Maintenance of Tangible Net Worth. The Tangible Net
Worth of the Guarantor, on a consolidated basis and on any given
day, shall be equal to or greater than the sum of (i) $10,000,000
plus (ii) an amount equal to 50% of the aggregate positive
quarterly Net Income (without deduction for quarterly losses)
commencing with Net Income for the quarter beginning in April,
2005;"
(b) Section 3(b)(ii) of the Guaranty is hereby deleted in its
entirety.
(c) The Guaranty is hereby amended by adding the following after
Section 26 of the Guaranty:
"27. Additional Fee. The Guarantor shall pay Lender a fee
equal to one percent (1%) of the Maximum Credit on or before
August 15, 2005; provided that, such fee shall be fully creditable
towards any Termination Fee payable by the Borrower pursuant to
Section 3.06 of the Agreement."
The parties hereto acknowledge and agree that subject to the
provisions of this waiver letter, the provisions of the Guaranty remain
in full force and effect and that the execution of this waiver letter
by the Lender does not operate as a waiver of any of its rights,
powers, or privileges under the Guaranty or under any of the other Loan
Documents, including without limitation any future breaches of, or
Defaults or Events of Default under, the Guaranty, including any based
on the failure by the Guarantor to maintain the Covenants.
This waiver letter constitutes the entire agreement relating to
the subject matter hereof between the parties hereto and supersedes any
prior oral or written agreement between the parties hereto.
This waiver letter shall be construed in accordance with the laws
of the State of New York and the obligations, rights, and remedies of
the parties hereunder shall be determined in accordance with such laws
without regard to conflict of laws doctrine applied in such state
(other than Sections 5-1401 and 5-1402 of the New York General
Obligations Law).
This waiver letter may be executed in any number of counterparts,
each of which (including any copy hereof delivered by facsimile) shall
constitute one and the same original instrument, and either party
hereto may execute this waiver letter by signing any such counterpart.
Please confirm that the foregoing specifies the terms of our
agreement by signing and returning the enclosed copy of this waiver
letter to Greenwich Capital Financial Products, Inc., at 000 Xxxxxxxxx
Xxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000, Attention: Xxxx Xxxxxxxxx.
Very truly yours,
GREENWICH CAPITAL FINANCIAL
PRODUCTS, INC.
By: /s/ Xxx Xxxxxxxxx
Name: Xxx Xxxxxxxxx
Title: V.P.
Acknowledged and Agreed:
FLEETWOOD ENTERPRISES, INC.
By: /s/ Xxxxxxx X. XxXxxx
Name: Xxxxxxx X. XxXxxx
Title: SVP, General Counsel
