POST CLOSING AGREEMENT
Exhibit
10.25
This
Post
Closing Agreement (this “Agreement”)
is
entered into effective as of June 20, 2008 (“Closing
Date”),
by
and among BANK OF AMERICA, N.A., as a Lender and as administrative agent for
the
Lenders (in its capacity as administrative agent, “Agent”),
SPORT
CHALET, INC., a Delaware corporation (“Borrower”).
RECITALS:
A. Borrower,
Lenders, and Agent are parties to that certain Loan and Security Agreement,
dated as of even date herewith (as such agreement may be amended, restated,
or
otherwise modified from time to time, the “Loan
Agreement”).
Initially capitalized terms used but not defined herein have the respective
meanings set forth in the Loan Agreement.
B. In
connection with execution and delivery of the Loan Agreement, Borrower and
Agent
are entering into the agreements provided hereinbelow.
NOW
THEREFORE, for and in consideration of the premises and mutual agreements herein
contained and other valuable consideration, the receipt and sufficiency of
which
are hereby acknowledged, Borrower and Agent hereby agree as
follows:
AGREEMENT:
1. Post
Closing Deliveries or Actions.
Borrower agrees to deliver, or cause to be delivered, the following items to
Agent, in each case in form and substance satisfactory to Agent and its counsel,
and/or cause the following to occur, in each case on or before expiration of
the
respective specified time periods:
(a) Stock
Certificate.
On or
before June
27, 2008,
Borrower shall have delivered to Agent a validly issued certificate representing
100% of the issued and outstanding Equity Interests of Sport Chalet Team Sales,
Inc.
(b) Landlord
Waivers.
On or
before July
20, 2008,
Borrower shall have delivered to Agent a fully-executed Lien Waiver in
connection with the property
commonly
known as Xxx Xxxxx Xxxxxx Xxxxx, Xx Xxxxxx, XX 00000;
(c) Sport
Chalet Value Services, LLC.
On or
before July
30, 2008,
Borrower shall have delivered to Agent satisfactory certificates of existence,
good standing and tax status (as applicable) for Value Sales from each of the
following jurisdictions: California, Arizona, Nevada, and Utah;
(d) Cash
Management. On
or
before August
25, 2008,
Borrower shall have delivered to Agent duly executed Deposit Account Control
Agreements substantially in the form of Exhibit L attached to the Loan Agreement
with respect to each deposit account of the Obligated Parties, and shall have
made such arrangements with respect to such deposit accounts as may be necessary
to permit Bank of America, as depositary bank, to implement the terms of such
Deposit Account Control Agreements;
(e) Sport
Chalet Team Sales, Inc.
On or
before September
30, 2008,
Borrower shall have (i) delivered to Agent satisfactory certificates of
existence, good standing and tax status (as applicable) for Team Sales from
the
State of California; (ii) caused Team Sales to execute and deliver to Agent
such
agreements as may reasonably be required to cause Team Sales to become an
Obligated Party party to the Loan Agreement, guaranty the Obligations, and
grant
a first priority, perfected security interest (subject only to Permitted Liens)
to Agent in each of the classes of assets as Borrower has granted as Collateral
as security for the Obligations; and (iii) caused counsel for Team Sales to
deliver to Agent a favorable opinion covering the due authorization, execution,
delivery and enforceability of foregoing documents, non-contravention and
perfection of the foregoing security interests, all consistent with the opinions
delivered on behalf of Borrower and Value Services on the Closing
Date;
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(f) Landlord
Waivers.
On or
before September
30, 2008,
Borrower shall have used its commercially reasonable efforts to deliver to
Agent
a fully-executed Lien Waiver in connection with each of the properties listed
on
Exhibit
A
attached
hereto;
(g) Assignment
of Websites.
On or
before September
30, 2008,
Borrower shall have used its commercially reasonable efforts to deliver to
a
fully-executed acknowledgement to the Assignment of Websites and Power of
Attorney, duly executed by Network Solutions, LLC;
The
failure to timely deliver any of the items in clauses (a) through (e) above
or
cause any of the items in clauses (a) through (e) above to occur shall
constitute an Event of Default, and Agent and Lenders shall have all default
rights and remedies granted to them thereunder.
The
failure to timely deliver any of the items required by clause (f) above shall
not constitute an Event of Default. However, upon the failure to timely deliver
the items in clause (f) above, Agent may, in its sole discretion, implement
or
adjust the Collateral Access Reserve in accordance with the terms of the Loan
Agreement in respect of each location for which a fully-executed Lien Waiver
has
not been delivered.
The
failure to timely deliver the acknowledgement required by clause (g) above
shall
not constitute an Event of Default so long as Borrower has used its commercially
reasonably efforts to obtain such acknowledgement.
2. Reliance.
Borrower acknowledges that Agent and Lenders are entering into this Agreement
at
the request of Borrower and hereby expressly acknowledges that Agent and Lenders
are relying upon Borrower’s agreement to strictly comply with the requirements
of this Agreement in accordance with its terms. Nothing in this Agreement limits
any rights of Agent or Lenders, or any obligations of Borrower, as provided
by
the Loan Documents.
3. Successors
and Assigns.
This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto, their heirs, executors, administrators, successors, legal
representatives, and assigns.
4. Miscellaneous.
This
Agreement may be executed in any number of counterparts, each of which shall
be
an original and all of which, when taken together, shall constitute one
agreement and shall be considered to be a Loan Document. This letter, together
with the Loan Agreement and the other Loan Documents, embodies the entire
agreement among the parties with respect to the subject matter hereof and amends
and supersedes all prior agreements and understandings relating to such subject
matter. This letter shall be governed by the laws of the State of California.
To
the extent not prohibited by applicable law, each of the parties hereto waives
its right to a trial by jury, if any, in any action to enforce, defend,
interpret, or otherwise concerning this letter. Without limiting the
applicability of any other provision of the Loan Agreement, the terms of
Sections 14.13 and 14.14 of the Loan Agreement are incorporated herein,
mutatis
mutandis,
and
shall apply to and govern this Agreement.
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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement effective
as of
the day and year first written above.
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SPORT
CHALET, INC.,
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a
Delaware corporation
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By:
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/s/
Xxxxxx Xxxxxxxx
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Name:
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Xxxxxx
Xxxxxxxx
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Title:
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Executive
Vice President and CFO
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Signature
Page
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BANK
OF AMERICA, N.A.,
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as
Agent and Lender
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By:
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/s/
Xxxxxxx Xxxx
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Name:
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Xxxxxxx
X. Xxxx
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Title:
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Vice
President
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Signature
Page
