Exhibit 99.2
TRANSACTION AGREEMENT,
dated as of July 16, 2004,
among
CAPRI CAPITAL LIMITED PARTNERSHIP,
CAPRI ACQUISITION, INC. and CAPRI HOLDINGS, LLC
and
CM INVESTOR LLC
TABLE OF CONTENTS
Page
ARTICLE I CERTAIN DEFINITIONS..................................................2
SECTION 1.1 Certain Definitions....................................2
ARTICLE II TRANSACTIONS.......................................................10
SECTION 2.1 Assignment of Existing Term Loan......................10
SECTION 2.2 Initial Advance.......................................10
SECTION 2.3 .....................................................10
ARTICLE III CLOSING CONDITIONS................................................11
SECTION 3.1 Initial Advance Closing Conditions....................11
SECTION 3.2 CCA Purchase Advance Closing Conditions...............14
ARTICLE IV REPRESENTATIONS AND WARRANTIES.....................................15
SECTION 4.1 Representations and Warranties........................15
ARTICLE V COVENANTS...........................................................16
SECTION 5.1 Covenants in Transaction Documents....................16
ARTICLE VI ANNUAL SUPPLEMENTAL FEE............................................16
SECTION 6.1 Annual Supplemental Fee...............................16
SECTION 6.2 Calculation, Time and Manner of Payment...............16
SECTION 6.3 Deferral Option.......................................16
SECTION 6.4 Amendment on Exercise of Purchase Option..............17
SECTION 6.5 Calculation and Payment of Fees.......................17
ARTICLE VII PURCHASE OPTION...................................................17
SECTION 7.1 Purchase Option.......................................17
ARTICLE VIII TERMINATION......................................................18
SECTION 8.1 Termination...........................................18
ARTICLE IX TRANSACTION FEE....................................................18
SECTION 9.1 Transaction Fee.......................................18
ARTICLE X MISCELLANEOUS.......................................................18
SECTION 10.1 Amendment; Waiver.....................................18
SECTION 10.2 Expenses..............................................19
SECTION 10.3 Assignment; Parties in Interest.......................19
SECTION 10.4 Further Assurances....................................19
SECTION 10.5 Entire Agreement......................................19
SECTION 10.6 Headings; References..................................20
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SECTION 10.7 Notices...............................................20
SECTION 10.8 Consent to Jurisdiction...............................21
SECTION 10.9 Waiver of Jury Trial..................................21
SECTION 10.10 Governing Law.........................................21
SECTION 10.11 Counterparts..........................................22
SCHEDULES
Schedule 3.1(e) Security Filings
EXHIBITS
Exhibit A Assignment of Existing Term Loan
Exhibit B Allonge
Exhibit C Option Agreement
Exhibit D Release by Credit Enhancers
Exhibit E Release by Term Loan Banks
Exhibit F Amended and Restated Term Loan Agreement
Exhibit G Affiliate Interest Security Agreement
Exhibit H Assets Security Agreement
Exhibit I Associates Security Agreement
Exhibit J Stock and CRC Membership Interests
Security Agreement
Exhibit K Capri Holdings Security Agreement
Exhibit L-1 CCA Majority Interest Security Agreement
Exhibit L-2 CCA Minority Interest Security Agreement
Exhibit L-3 CCA Assets Security Agreement
Exhibit M Finance Security Agreement
Exhibit N CCM Security Agreement
Exhibit O Partnership Interest Security Agreement
Exhibit P Servicing Rights Security Agreement
Exhibit Q ▇▇▇▇▇▇ Amendment
Exhibit R Fargo Amendment
Exhibit S Primo Amendment
Exhibit T ▇▇▇▇▇▇ Guaranty
Exhibit U Fargo Guaranty
Exhibit V Primo Guaranty
Exhibit W General Partner Guaranty
Exhibit X CRC Guaranty
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TRANSACTION AGREEMENT
THIS TRANSACTION AGREEMENT (this "Agreement") is made as of July 16,
2004, by and among (i) CAPRI CAPITAL LIMITED PARTNERSHIP, a Delaware limited
partnership ("CCLP"), CAPRI ACQUISITION, INC., an Illinois corporation ("CAI"
and, together with CCLP, the "Borrowers" and each a "Borrower") and CAPRI
HOLDINGS, LLC, an Illinois limited liability company ("Capri Holdings") and (ii)
CM Investor LLC, a Delaware corporation (the "Lender").
RECITALS
--------
WHEREAS, the Borrowers are party to that certain Credit Agreement dated
as of November 19, 1999 (as amended by the First Amendment to Existing Term Loan
Agreement (as defined below) and the Second Amendment to Existing Term Loan
Agreement (as defined below), the "Existing Term Loan Agreement") made by and
among the Borrowers, American National Bank and Trust Company of Chicago ("ANB")
and Comerica Bank, a Michigan banking corporation ("Comerica");
WHEREAS, Bank One, N.A. ("Bank One" and, together with Comerica, the
"Existing Term Loan Banks" and each an "Existing Term Loan Bank") is the
successor-in-interest to ANB under the Existing Term Loan Agreement;
WHEREAS, pursuant to the Existing Term Loan Agreement, the Existing Term
Loan Banks have made a term loan to the Borrowers in the currently outstanding
principal amount of $55,000,000 (the "Existing Term Loan");
WHEREAS, the Borrowers are party to that certain Amended and Restated
Credit Enhancement Umbrella Agreement dated as of November 19, 1999 (as amended
by the First Amendment to Credit Enhancement Agreement (as defined below) and
the Second Amendment to Credit Enhancement Agreement (as defined below) the
"Credit Enhancement Agreement") made by and among CAI, CCLP and Capri Holdings,
and the Board of Trustees of the General Retirement System of the City of
Detroit ("GRS") and the Board of Trustees of the Policemen and Firemen
Retirement System of the City of Detroit ("PFRS" and, together with GRS, the
"Credit Enhancers" and each a "Credit Enhancer");
WHEREAS, pursuant to the Credit Enhancement Agreement, the Credit
Enhancers have provided to the Existing Term Loan Banks credit enhancement for
the obligations of the Borrowers in respect of the Existing Term Loan;
WHEREAS, the Borrowers desire that the Lender acquire the Existing Term
Loan from the Existing Term Loan Banks and, in addition, loan to the Borrowers
$29,000,000 to satisfy obligations of the Borrowers to the Credit Enhancers and
for other purposes set forth herein (the "Additional Loan"), with such
additional loan being consolidated with the Existing Term Loan pursuant to the
Amended and Restated Term Loan Agreement (as defined in Section 1.1 below) (such
consolidated loan, the "Loan") and the Lender is willing to make such
acquisition and Loan on and subject to the terms and conditions set forth
herein;
WHEREAS, $17,000,000 of the Additional Loan (the "Initial Advance") will
be advanced on the Closing Date (as hereafter defined) and the remaining
$12,000,000 of the Additional Loan (the "CCA Purchase Advance") will be advanced
on the CCA Purchasing Closing Date (as hereafter defined) to pay the purchase
price of the acquisition of the 49% interest in Capri Capital Advisers LLC (CCA)
owned by Capital Associates Group ("CAG").
WHEREAS, Capri Holdings is a wholly-owned subsidiary of CCLP and will
derive substantial benefit from the making of the Consolidated Term Loan to the
Borrowers; and
WHEREAS, immediately prior to the closing of the Initial Advance on the
Closing Date, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇▇▇▇▇▇"), ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III ("Primo") and
▇▇▇▇▇ ▇. Fargo ("Fargo" and, together with ▇▇▇▇▇▇ and Primo, the "Capri
Principals") will transfer their partnership interests in CCLP to Capri Realty
Capital, LLC, a Delaware limited liability company ("CRC"), and amend the
partnership agreement of CCLP to reflect such transfer and to admit CRC as a
limited partner of CCLP with an 89% membership interest therein, and to add the
Credit Enhancement Clawback Right (as hereafter defined) to such partnership
agreement.
NOW, THEREFORE, in consideration of the premises, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
SECTION 1.1 Certain Definitions.
As used in this Agreement, the following terms shall have the meanings
set forth below:
"Additional Loan" has the meaning ascribed thereto in the
Recitals.
"Affiliate" of a Person means (a) any Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person and (b) any member of a controlled group of corporations or a group of
trades or businesses under common control with such Person and (c) any director,
executive officer, partner or member of such Person. Control (including, with
correlative meanings, the terms "controlled by" and "under common control
with"), as used herein, means the possession, directly or indirectly, of the
power in any form to direct or cause the direction of the management and
policies of the person in question.
"Affiliate Interest Security Agreement" means that certain
Security Agreement dated the Closing Date made by CCLP, Capri Holdings, CAI and
CRC in favor of Lender, pursuant to which CCLP, Capri Holdings and ▇▇▇ ▇▇▇▇▇
Lender a security interest in and to all of the interests of CCLP, Capri
Holdings and CAI in any of their affiliates and subsidiaries, in the form
attached hereto as Exhibit G.
"Agreement" has the meaning ascribed thereto in the preamble to
this Agreement.
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"Amended and Restated Term Loan Agreement" means that certain
Amended and Restated Credit Agreement dated the Closing Date by and among the
Borrowers and the Lender, in the form attached hereto as Exhibit F.
"Amended and Restated Term Loan Documents" means the Amended and
Restated Term Loan Agreement, the Note, the Security Agreements, the Guaranties
and all other instruments, agreement and documents heretofore or hereafter
executed or delivered in connection therewith, in each case, as amended,
modified or supplemented from time to time.
"Amendments to Employment Agreements" means the ▇▇▇▇▇▇ Amendment,
the Primo Amendment and the Fargo Amendment, or any of them, as the context may
require.
"ANB" has the meaning ascribed thereto in the Recitals.
"Assets Security Agreement" means that certain Security Agreement
dated the Closing Date made by CCLP, Capri Holdings, CAI, Associates, Finance
and CRC in favor of Lender, pursuant to which CCLP, Capri Holdings and ▇▇▇ ▇▇▇▇▇
Lender a security interest in and to all of the assets of CCLP, Capri Holdings
and CAI, in the form attached hereto as Exhibit H.
"Assignment of Existing Term Loan Assignment" means the
assignments of the Existing Term Loan and all rights under the Existing Term
Loan Agreement and the documents executed in connection therewith, including the
security interests relating thereto, and the Allonges in respect of the
promissory notes evidencing the Existing Term Loan to be executed and delivered
by the Existing Term Loan Banks to the Lender on the Closing Date, substantially
in the form attached hereto as Exhibits A and B.
"Associates" means Capri Capital Associates, LLC, a Delaware
limited liability company.
"Associates Security Agreement" means that certain Amended and
Restated Security Agreement dated the Closing Date by and between Capri Holdings
and Lender, pursuant to which Capri Holdings grants Lender a security interest
in the limited liability company interests of Capri Holdings in Associates, in
the form attached hereto as Exhibit I.
"Bank One" has the meaning ascribed thereto in the preamble to
this Agreement.
"Borrower" and "Borrowers" have the meaning ascribed thereto in
the preamble to this Agreement.
"CAG" has the meaning ascribed thereto in the Recitals.
"CAI" has the meaning ascribed thereto in the preamble to this
Agreement.
"Capri Companies" means CAI, CCLP, CRC, Capri Holdings,
Associates and Finance and their Subsidiaries, and "Capri Company" means CAI,
CCLP, CRC, Capri Holdings, Associates and Finance or their Subsidiaries, as the
context may require.
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"Capri Holdings" has the meaning ascribed thereto in the preamble
to this Agreement.
"Capri Holdings Security Agreement" means that certain Amended
and Restated Security Agreement dated the Closing Date by and between CCLP and
Lender, pursuant to which CCLP grants Lender a security interest in the limited
liability company interests of CCLP in Capri Holdings, in the form attached
hereto as Exhibit K.
"Capri Parties" means the Capri Companies and the Capri
Principals, or any of them, as the context may require.
"Capri Principals" has the meaning ascribed thereto in the
Recitals.
"▇▇▇▇▇▇" has the meaning ascribed thereto in the Recitals.
"▇▇▇▇▇▇ Amendment" means the amendment entered into on or before
the Closing Date, in the form attached hereto as Exhibit Q, amending Carter's
employment agreement with CCLP to extend the term of the employment agreement
and provide that the non-competition provisions thereof will continue to apply
after any termination of Carter's employment or expiration of such employment
agreement following the Borrowers' failure to pay the Consolidated Term Loan
when due, whether at scheduled maturity, by acceleration or otherwise.
"▇▇▇▇▇▇ Guaranty" means that certain Guaranty dated the Closing
Date entered into by and between ▇▇▇▇▇▇ and the Lender, in the form attached
hereto as Exhibit T.
"Cash Operating Expenditures" means cash payments for ordinary
and necessary operating expenses incurred in the Capri Companies' business of
Mortgage Banking, cash payments of principal and interest, including interest on
secured warehouse lines of credit and interest on secured tax and interest
investment arbitrage lines of credit utilized by CCLP or any Subsidiary, due on
outstanding Debt, cash payments for income taxes payable by Capri or any
Subsidiary, cash payments for capital expenditures subject to the limitations of
Section 2.23 of Schedule 7.11 to the Amended and Restated Term Loan Agreement,
and cash payments to or on behalf of the partners of Capri subject to the
limitations of Section 2.21 of Schedule 7.11 to the Amended and Restated Term
Loan Agreement. Cash payments by the Capri Companies for purposes other than the
foregoing are expressly excluded from Cash Operating Expenditures.
"CCA" has the meaning ascribed thereto in the Recitals.
"CCA Assets Security Agreement" means that certain Security
Agreement dated the CCA Purchase Closing Date made by CRC and CCLP in favor of
the Lender, pursuant to which CRC and CCLP grant Lender a security interest in
and to all of the assets of CCA, in the form attached hereto as Exhibit L-3.
"CCA Minority Interest" means the 49% membership interest in CCA
owned by CAG prior to the Closing Date
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"CCA Minority Interest Security Agreement" means that certain
Security Agreement dated the Closing Date by and between CRC and Lender,
pursuant to which CRC grants Lender a security interest in the CCA Minority
Interest purchased by CRC pursuant to the CCA Purchase Agreement, in the form
annexed hereto as Exhibit L-1.
"CCA Majority Interest Security Agreement" means that certain
Security Agreement dated the Closing Date by and between CCLP and Lender,
pursuant to which CCLP grants Lender a security interest in its 51% membership
interest in CCA in the form attached hereto as Exhibit L-2.
"CCA Purchase Advance" has the meaning ascribed thereto in the
Recitals.
"CCA Purchase Advance Notice" has the meaning ascribed thereto in
Section 2.3.
"CCA Purchase Agreement" means the purchase agreement dated on or
prior to the Closing Date entered into by and between CRC, as purchaser, and
CAG, as seller, pursuant to which CAG agrees to sell to CRC on the Closing Date
the CCA Minority Interest.
"CCA Purchase Closing Date" means the date on which all of the
conditions in Section 3.2 have been satisfied or waived and the CCA Purchase
Advance is advanced hereunder pursuant to this Agreement and the Amended and
Restated Term Loan Agreement.
"CCLP" has the meaning ascribed thereto in the preamble to this
Agreement.
"CCM" means Capri Capital Management, LLC, an Illinois limited
liability company.
"CCM Security Agreement" means that Certain Security Agreement
dated the Closing Date by and between CCLP and Lender, pursuant to which CCLP
grants Lender a security interest in the limited liability company interests of
CCLP in CCM, in the form attached hereto as Exhibit N.
"Closing Date" means the date on which all of the conditions in
Section 3.1 have been satisfied or waived and (i) the Assignment of Existing
Term Loan is executed and delivered by the Term Loan Banks to the Lender, and
(ii) the Initial Advance is advanced hereunder pursuant to this Agreement and
the Amended and Restated Term Loan Agreement.
"Collateral" means, collectively all of the collateral in which a
security interest is granted to the Lender pursuant to the Security Agreements.
"Comerica" has the meaning ascribed thereto in the preamble to
this Agreement.
"CRC" has the meaning ascribed thereto in the Recitals.
"CRC Guaranty" means that certain Guaranty dated the Closing Date
entered into by and between CRC and the Lender, in the form attached hereto as
Exhibit X.
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"Credit Enhancement Agreement" has the meaning ascribed thereto
in the Recitals.
"Credit Enhancement Clawback Agreement" means the Agreement
Relating to Amended and Restated Credit Enhancement Umbrella Agreement dated on
or about July 15, 2004 by and among CAI, CCLP, Capri Holdings, the CRC
Principals and the Credit Enhancers.
"Credit Enhancement Clawback Right" means the right granted by
certain of Capri Parties to the Credit Enhancers providing for payment to the
Credit Enhancers of a portion of the proceeds if certain subsequent transactions
involving the acquisition of CCLP are entered into (but excluding such
acquisitions by the party providing financing for the repayment of the Existing
Term Loan and the payment of the Credit Enhancement Termination Fee), pursuant
to the Credit Enhancement Clawback Agreement.
"Credit Enhancement Documents" means the Credit Enhancement
Agreement and the guaranties, security agreements and other documents and
instruments executed in connection therewith, as the same have been amended, and
the Credit Enhancement Clawback Agreement.
"Credit Enhancement Termination Fee" means the fee in the amount
of $14,500,000 payable to the Credit Enhancers by the Borrowers in full
satisfaction of all obligations of the Borrowers and their affiliates to GRS and
PFRS pursuant to the Credit Enhancement Documents, except for the Credit
Enhancement Clawback Right.
"Credit Enhancer" and "Credit Enhancers" have the meaning
ascribed thereto in the Recitals.
"Debt" has the meaning ascribed thereto in Schedule 7.11 to the
Amended and Restated Term Loan Agreement.
"Default" has the meaning ascribed thereto in the Amended and
Restated Term Loan Agreement.
"Event of Default" has the meaning ascribed thereto in the
Amended and Restated Term Loan Agreement.
"Existing Term Loan" has the meaning ascribed thereto in the
Recitals.
"Existing Term Loan Agreement" has the meaning ascribed thereto
in the Recitals.
"Existing Term Loan Bank" and "Existing Term Loan Banks" have the
meaning ascribed thereto in the Recitals.
"Existing Term Loan Documents" means the Existing Term Loan
Agreement and the notes, guaranties, security agreements and other documents and
instruments executed in connection therewith.
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"Fargo" has the meaning ascribed thereto in the Recitals.
"Fargo Amendment" means the amendment entered into on or before
the Closing Date, in the form attached hereto as Exhibit R, amending Fargo's
employment agreement with CCLP to extend the term of the employment agreement
and provide that the non-competition provisions thereof will continue to apply
after any termination of Fargo's employment or expiration of such employment
agreement following the Borrowers' failure to pay the Consolidated Term Loan
when due, whether at scheduled maturity, by acceleration or otherwise.
"Fargo Guaranty" means that certain Guaranty dated the Closing
Date entered into by and between Fargo and the Lender, in the form attached
hereto as Exhibit U.
"Finance" means Capri Capital Finance, LLC, a Delaware limited
liability company.
"Finance Security Agreement" means that certain Amended and
Restated Security Agreement dated the Closing Date by and between Capri Holdings
and Lender, pursuant to which Capri Holdings grants Lender a security interest
in the limited liability company interests of Capri Holdings in Finance, in the
form attached hereto as Exhibit M.
"Financial Statements" has the meaning ascribed thereto in the
Amended and Restated Term Loan Agreement.
"First Amendment to Credit Enhancement Agreement" means that
certain first Amendment to Amended and Restated Credit Enhancement Umbrella
Agreement dated as of June 13, 2003 and effective as of April 28, 2003, made by
and among CAI, CCLP, Capri Holdings and the Credit Enhancers.
"First Amendment to Existing Term Loan Agreement" means that
certain First Amendment to Credit Agreement dated as of April 28, 2003 made by
and among CCLP, CAI and the Existing Term Loan Banks.
"Fiscal Year" means the Companies' fiscal year for financial
accounting purposes each of which ends on December 31.
"General Partner" means CPC Realty Advisors, Inc., an Illinois
corporation.
"General Partner Guaranty" means that certain Guaranty dated the
Closing Date entered into by and between the General Partner and the Lender, in
the form attached hereto as Exhibit W.
"GRS" has the meaning ascribed thereto in the Recitals.
"Guaranties" means the ▇▇▇▇▇▇ Guaranty, the Fargo Guaranty, the
CPC Guaranty, the Primo Guaranty and the CRC Guaranty, or any of them, as the
context may require.
"Initial Advance" has the meaning ascribed thereto in the
Recitals.
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"Lender" has the meaning ascribed thereto in the preamble to this
Agreement.
"Lien" has the meaning ascribed thereto in the Amended and
Restated Term Loan Agreement.
"Loan" has the meaning ascribed thereto in the recitals.
"Mortgage Banking" means the business of underwriting or
originating commercial or multi-family mortgage loans only, holding or
warehousing such loans, marketing such loans to investors, and managing or
servicing such loans during their repayment term.
"Net Cash Flow" means the Capri Companies' and their Affiliates'
total cash revenue of all types and from all sources less Cash Operating
Expenditures plus the aggregate excess, if any, of the actual Cash Operating
Expenditures over the budgeted Cash Operating Expenditures in the approved
Semi-Annual Budget Plans (as such term is defined in Schedule 7.11 to the
Amended and Restated Term Loan Agreement).
"Note" has the meaning ascribed thereto in the Amended and
Restated Term Loan Agreement.
"Obligations" has the meaning ascribed thereto in the Amended and
Restated Term Loan Agreement.
"Option Agreement" has the meaning ascribed thereto in Section
7.1.
"Partnership Interest Security Agreement" means that certain
Security Agreement dated the Closing Date by and among CAI, General Partner, CRC
and Lender, pursuant to which CAI,, General Partner and CRC grant Lender a
security interest in and to the partnership interests of CAI, General Partner in
CCLP, and CRC in the form attached hereto as Exhibit O.
"Permitted Liens" has the meaning ascribed thereto in Section
3.1(e).
"Person" means an individual, partnership, limited partnership,
limited liability company, corporation, association, trust, unincorporated
organization or any other entity or organization, including a government or
agency or political subdivision thereof.
"PFRS" has the meaning ascribed thereto in the Recitals.
"Primo" has the meaning ascribed thereto in the Recitals.
"Primo Amendment" means the amendment entered into on or before
the Closing Date, in the form attached hereto as Exhibit S, amending Primo's
employment agreement with CCLP to extend the term of the employment agreement
and provide that the non-competition provisions thereof will continue to apply
after any termination of Primo's employment or expiration of such employment
agreement following the Borrowers' failure to pay the Consolidated Term Loan
when due, whether at scheduled maturity, by acceleration or otherwise.
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"Primo Guaranty" means that certain Guaranty dated the Closing
Date entered into by and between Primo and the Lender, in the form attached
hereto as Exhibit V.
"Purchase Option" has the meaning ascribed thereto in Section
7.1.
"Releases by Credit Enhancers" means (i) the release executed by
GRS releasing CCLP and its Affiliates from all liabilities to GRS pursuant to
the Credit Enhancement Documents, except for the Credit Enhancement Clawback
Right, and (ii) the release executed by PFRS releasing CCLP and its Affiliates
from all liabilities to PFRS pursuant to the Credit Enhancement Documents,
except for the Credit Enhancement Clawback Right, each in the form attached
hereto as Exhibit D.
"Releases by Term Loan Banks" means (i) the release executed by
Bank One releasing CCLP and its Affiliates from all liabilities to Bank One
pursuant to the Existing Term Loan Documents, and (ii) the release executed by
Comerica releasing CCLP and its Affiliates from all liabilities to Comerica
pursuant to the Existing Term Loan Documents, each in the form attached hereto
as Exhibit E.
"Second Amendment to Credit Enhancement Agreement" means that
certain Second Amendment to Amended and Restated Credit Enhancement Umbrella
Agreement dated January, 2004 and effective as of January 15, 2004, made by and
among CAI, CCLP, Capri Holdings and the Credit Enhancers.
"Second Amendment to Existing Term Loan Agreement" means that
certain Second Amendment to Credit Agreement dated as of January 29, 2004 dated
as of January 29, 2004 made by and among CCLP, CAI and the Term Loan Banks.
"Security Agreements" means, collectively, the (i) Capri Holdings
Security Agreement, (ii) CCA Minority Interest Security Agreement, (iii) CCA
Majority Interest Security Agreement, (iv) CCM Security Agreement, (v)
Associates Security Agreement, (vi) Finance Security Agreement, (vii) Affiliate
Interest Security Agreement, (viii) Assets Security Agreement, (ix) Partnership
Interest Security Agreement, (x) Servicing Rights Security Agreement, (xi) Stock
and CRC Membership Interests Security Agreement and (xii) the CCA Assets
Security Agreement, in each case, as amended, modified or supplemented from time
to time.
"Servicing Rights Security Agreement" means that certain Security
Agreement dated the Closing Date made by CCLP, CAI and Capri Holdings in favor
of Lender, pursuant to which CCLP, CAI and Capri Holdings grant Lender a
security interest in and to that certain Servicing Rights Portfolio (as defined
therein), in the form attached hereto as Exhibit P.
"Stock and CRC Membership Interests Security Agreement" means
that certain Security Agreement dated the Closing Date by and among ▇▇▇▇▇▇,
▇▇▇▇▇, Fargo and Lender, pursuant to which ▇▇▇▇▇▇, ▇▇▇▇▇ and Fargo grant to
lender a security interest in their shares of common capital stock of CAI and of
General Partner, and in their limited liability company membership interests in
CRC, in the form annexed hereto as Exhibit J.
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"Subsidiary" has the meaning ascribed thereto in the Amended and
Restated Term Loan Agreement.
"Transaction Documents" means this Agreement, the Assignment of
Existing Term Loan, the Option Agreement, the Releases by Credit enhancers, the
Releases by Term Loan Banks, the Amendments to Employment Agreements, the
Guaranties, the Security Agreements, the Amended and Restated Term Loan
Agreement and all other Amended and Restated Term Loan Documents, and all other
instruments, agreements and documents heretofore or hereafter executed or
delivered in connection therewith, in each case, as amended, modified or
supplemented from time to time.
"Transaction Fee" has the meaning ascribed thereto in Section
9.1.
"UCC" means the Uniform Commercial Code as in effect from time to
time in the State of New York.
ARTICLE II
TRANSACTIONS
SECTION 2.1 Assignment of Existing Term Loan. Subject to the terms and
conditions of this Agreement, on the Closing Date the Lender shall acquire the
Existing Term Loan from the Existing Term Loan Banks pursuant to the Assignment
of Existing Term Loan, in consideration of the payment by the Lender to the
Existing Term Loan Banks of the amount of $55,000,000. The Assignment of
Existing Term Loan shall include representations and warranties by the Existing
Term Loan Banks as to authority to transfer the Existing Term Loan and all
rights under the Existing Term Loan Documents, ownership and transferability of
the Existing Term Loan and all rights under the Existing Term Loan Documents,
the outstanding balance of the Existing Term Loan as of the Closing Date, and
that they have provided to the Lender true and complete copies of all documents
relating to the Existing Term Loan.
SECTION 2.2 Initial Advance. Subject to the terms and conditions of this
Agreement and the Amended and Restated Term Loan Agreement, the Lender shall on
the Closing Date advance the Initial Advance to the Borrowers. The proceeds of
the Loan shall be used for the purposes set forth in Section 1.4 of the Amended
and Restated Term Loan Agreement. The Loan shall be repaid as provided in the
Amended and Restated Term Loan Documents.
SECTION 2.3
(a)Additional Advance. Subject to the terms and conditions set
forth herein, subsequent to the Closing Date but on or before August 1, 2004 ,
the Borrowers shall have the right to request that the Lender make the CCA
Purchase Advance in the amount of up to $12,000,000, which shall be utilized by
the Borrowers solely for the purpose of making a loan to CRC, the proceeds of
which shall be used solely for the purpose of paying the purchase price to
acquire the CCA Minority Interest, by delivering a written notice to the Lender
(the "CCA Purchase Advance Notice"). The CCA Purchase Advance Notice shall be
given at least three Business Days prior to the requested date of the CCA
Purchase Advance and shall state
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the requested date of the CCA Purchase Closing Date, which may be changed by the
Borrowers on two Business Days notice.
(b)On the CCA Purchase Closing Date, the Lender shall loan to the
Borrowers the CCA Purchase Advance.
ARTICLE III
CLOSING CONDITIONS
SECTION 3.1 Initial Advance Closing Conditions. The obligation of the
Lender to make the Initial Advance on the Closing Date is subject to the
satisfaction on or before the Closing Date (unless otherwise noted) of the
following conditions precedent, each in form and substance satisfactory to the
Lender:
(a) Transaction Documents. The Lender shall have received:
(i) this Agreement;
(ii) the Note
(iii) the Assignment of Existing Term Loan;
(iv) the Option Agreement;
(v) the Releases by Credit Enhancers;
(vi) the Releases by Term Loan Banks;
(vii) the ▇▇▇▇▇▇ Amendment;
(viii) the Fargo Amendment;
(ix) the Primo Amendment;
(x) the Capri Holdings Security Agreement;
(xi) the CCA Majority Interest Security Agreement;
(xii) The CCM Security Agreement;
(xiii) the Associates Security Agreement;
(xiv) the Finance Security Agreement;
(xv) the Affiliate Interest Security Agreement;
(xvi) the Assets Security Agreement;
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(xvii) the Partnership Interest Security Agreement;
(xviii) the Servicing Rights Security Agreement;
(xix) the Stock and CRC Membership Interests Security
Agreement;
(xx) the ▇▇▇▇▇▇ Guaranty;
(xxi) the Fargo Guaranty;
(xxii) the Primo Guaranty;
(xxiii) the General Partner Guaranty;
(xxiv) the CRC Guaranty;
(xxv) the Amended and Restated Term Loan Agreement;
and each of the other Transaction Documents (together with all amendments,
supplements, exhibits and schedules thereto), each of which (w) shall have been
duly authorized, executed and delivered by the Capri Parties, the Existing Term
Loan Banks or the Credit Enhancers, as applicable, (x) shall be dated the
Closing Date (or other date acceptable to the Lender), (y) shall be in form and
substance satisfactory to the Lender, and (z) shall be in full force and effect.
(b)Representations and Warranties True and Correct. Each of the
representations and warranties made by the Capri Parties (or any of them) in the
Amended and Restated Term Loan Documents shall be true and correct as of the
Closing Date.
(c)No Default or Event of Default. No Default or Event of Default
shall have occurred and be continuing.
(d)No Material Adverse Change. Between January 1, 2004 and the
Closing Date, nothing shall have occurred which has had, or is reasonably likely
to have, a material adverse effect on the business, operations, property,
assets, condition (financial or otherwise) or prospects of the Capri Parties,
taken as a whole.
(e)Consents and Approvals. All necessary governmental and third
party approvals and/or consents in connection with the transactions contemplated
by this Agreement and the other Transaction Documents, including without
limitation ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac approvals, shall have been obtained and
remain in effect, and all applicable waiting periods shall have expired without
any action being taken by any competent authority which restrains, prevents, or
imposes materially adverse conditions upon, the consummation of the transactions
contemplated by this Agreement and the other Transaction Documents.
Additionally, there shall not exist any judgment, order, injunction or other
restraint issued or filed or a hearing seeking injunctive relief or other
restraint pending or notified prohibiting or imposing materially adverse
conditions upon the transactions contemplated by this Agreement and the other
Transaction Documents. Satisfaction of this condition shall also be a condition
12
to the obligations of the Capri Parties to consummate the transactions
contemplated by this Agreement and the other Transaction Documents.
(f)Corporate Documents. The Lender shall have received the
following (each to be properly executed and completed), in form and substance
satisfactory to the Lender:
(i)the opinion of ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP, legal
counsel to the Capri Parties;
(ii) copy of the organizational documents of each of the
Capri Companies, certified by the proper officer of each such Capri Company or
the General Partner, as applicable;
(iii) copies of resolutions of the applicable boards of
directors or managers of the Capri Companies authorizing the execution and
delivery of the respective Transaction Documents to which each of them is a
party, certified by officers or managers of the Capri Companies, and of all
other legal documents or proceedings taken by the Capri Companies in connection
with the execution and delivery of the Transaction Documents to the extent the
Lender may reasonably request;
(iv) a certificate of an officer or manager of each of the
following Persons, each dated the Closing Date, certifying the names and true
signatures of the incumbent officers or comparable authorized Persons of such
Person, authorized to sign, on behalf of such Person and any of the other Capri
Parties, as applicable, the Transaction Documents to which such Person or such
other Capri Party, as applicable, is a party and each other document to be
delivered by such Person or such other Capri Party, as applicable, from time to
time in connection with the Transaction Documents (and the Lender may
conclusively rely on such certificate as to the continuing status of such
individuals as authorized signatories of such Person or such other Capri Party,
as applicable, until it receives notice in writing to the contrary from such
Person):
(A) CCLP;
(B) CAI;
(C) Capri Holdings;
(D) Associates;
(E) Finance;
(F) the General Partner;
(G) CRC; and
(H) CCA
13
(v)a certificate of an officer of the General Partner and
an officer of CAI certifying as of the Closing Date that (A) each of the
representations and warranties made by the Capri Parties (or any of them) in the
Transaction Documents are true and correct as of the Closing Date, (B) no
Default or Event of Default shall have occurred and be continuing, and (C) all
of the conditions set forth herein have been satisfied as of the Closing Date.
(g)Security Agreements; Filings. The filing of all UCC-1
financing statements or other instruments shall have been made in such manner
and in such places listed on Schedule 3.1(e) and otherwise as are required under
applicable law to establish and perfect the Liens over the Collateral granted in
favor of the Lender pursuant to the Security Agreements, in each case to provide
the Lender with a first priority Lien on the Collateral, subject only to Liens
expressly permitted pursuant to Section 7.6 of the Amended and Restated Term
Loan Agreement ("Permitted Liens").
(h)Lien Search Reports; Termination Statements. The Lender
shall have received satisfactory reports, dated as of a reasonably current date,
of UCC, judgment and tax lien searches, in each case conducted by search firms
acceptable to the Lender in each location relevant to the Capri Parties granting
security interests and the Collateral. The Lender shall have received duly
executed termination statements and releases in form and substance satisfactory
to the Lender with respect to all UCC financing statements filed against any of
the Capri Parties and naming GRS or PFRS as secured parties and any other
filings or recordings with respect to the Collateral revealed in the
aforementioned searches, except for UCC financing statements filed in respect of
the Existing Term Loan, which shall be assigned to the Lender pursuant to the
Assignment of Existing Term Loan and in respect of which UCC-3 statements will
be filed reflecting such assignment.
(i)Pledged Stock. The Lender shall have received the
original certificates evidencing all of the stock in CAI and the General
Partner, which stock is pledged to the Lender pursuant to the Security
Agreements, together with undated stock powers duly executed in blank in
connection therewith.
(j)Additional Matters. The Lender shall have received such
other certificates, opinions, documents and instruments as may be reasonably
requested by the Lender, including without limitation all partnership and other
proceedings and all other documents (including all documents referred to herein
and not appearing as exhibits hereto) and all legal matters in connection with
the transactions contemplated by this Agreement shall be satisfactory in form
and substance to the Lender.
SECTION 3.2 CCA Purchase Advance Closing Conditions. The obligation of
the Lender to make the CCA Purchase Advance is subject to the satisfaction on or
before the CCA Purchase Closing Date (unless otherwise noted) of the following
conditions precedent, each in form and substance satisfactory to the Lender:
(a)Each of the representations and warranties made by the Capri
Parties (or any of them) in the Amended and Restated Term Loan Documents and the
other Transaction
14
Documents shall be true and correct in all material respects as of the CCA
Purchase Date (as if made on and as of the CCA Purchase Date).
(b)No Default or Event of Default (as such terms are defined in
the Amended and Restated Term Loan Agreement) shall have occurred and be
continuing under the Amended and Restated Tem Loan Documents.
(c)Between the Closing Date and the CCA Purchase Advance Date,
nothing shall have occurred which has had, or is reasonably likely to have, a
material adverse effect on the business, operations, property, assets, condition
(financial or otherwise) or prospects of the Capri Parties, taken as a whole.
(d)Simultaneously with the making of the CCA Purchase Advance,
CRC shall have (i) acquired the CCA Minority Interest on terms reasonably
satisfactory to the Lender, and (ii) executed and delivered to the Lender the
CCA Minority Interest Security Agreement and the CCA Assets Security Agreement.
(e)The Lender shall have received a certificate of an officer of
the General Partner and an officer of CAI certifying on the Closing Date that
the foregoing conditions have been satisfied.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.1 Representations and Warranties.
(a)The Borrowers and Capri Holdings jointly and severally
represent and warrant to the Lender, as an inducement to the Lender to enter
into this Agreement and to consummate the transactions contemplated hereby, that
all of the representations and warranties made by the Capri Parties, or any of
them, in the Transaction Documents, are true and correct in all material
respects (disregarding for this purpose any standard of materiality contained in
such representations and warranties) as of the date of this Agreement and, if
different, the Closing Date.
(b)The Borrowers have delivered to the Lender true and correct
copies of the Existing Term Loan Documents and the Credit Enhancement Documents.
The Existing Term Loan Banks have duly and effectively assigned to the Lender
all of their rights under the Existing Term Loan Documents pursuant to the
Assignment of Existing Term Loan, and the Existing Term Loan Banks have no
further rights under or relating to the Existing Term Loan Documents except as
provided in the Assignment of Existing Term Loan. The Credit Enhancement
Documents have been duly and effectively terminated and released and the Credit
Enhancers have no further rights under or relating to the Credit Enhancement
Documents, except for the Credit Enhancement Clawback Right. The Credit
Enhancement Clawback Right does not apply to any transfer to Lender or its
Affiliates of interests in the Borrowers or their Subsidiaries.
15
ARTICLE V
COVENANTS
SECTION 5.1 Covenants in Transaction Documents. The Borrowers and Capri
Holdings jointly and severally covenant and agree with the Lender, as an
inducement to the Lender to enter into this Agreement and to consummate the
transactions contemplated hereby, that the Borrowers and Capri Holdings shall,
and shall cause the other Capri Parties to, comply in all material respects
(disregarding for this purpose any standard of materiality contained in such
covenants and other agreements) with all of the covenants and other agreements
made by the Capri Parties, or any of them, in the Transaction Documents.
ARTICLE VI
ANNUAL SUPPLEMENTAL FEE
SECTION 6.1 Annual Supplemental Fee. In addition to the interest payable
under the Note, as additional consideration for acquiring the Existing Term Loan
and providing the Additional Loan to, among other things, allow CCLP to pay the
Credit Enhancement Termination Fee and purchase the CCA Minority Interest, the
Lender shall be entitled to receive an annual supplemental fee from CCLP, Capri
Holdings and CAI of fifty percent (50%) of the Fiscal Year Net Cash Flow of the
Capri Companies and their Affiliates (the "Annual Supplemental Fee").
SECTION 6.2 Calculation, Time and Manner of Payment. The Annual
Supplemental Fee shall be calculated during the term of this Agreement
(including any extensions or renewals) as of the end of each Fiscal Year. The
Annual Supplemental Fee shall be due and payable within thirty (30) calendar
days after the end of each Fiscal Year. It is understood that the Annual
Supplemental Fee will be calculated annually based on unaudited internal
financial information of the Capri Companies and the Annual Supplemental Fee
paid at the end of each Fiscal Year in accordance with the provisions of this
Section will be subject to reasonable adjustment based on final audited
Financial Statements for such Fiscal Year, provided that such final audited
Financial Statements are provided to the Lender no later than ninety (90) days
after the end of such Fiscal Year. Any additional amounts due to the Lender
resulting from such adjustment shall be due and payable to the Lender within
ninety (90) calendar days after the end of the affected Fiscal Year. Any amounts
due to CCLP, CAI and Capri Holdings resulting from such adjustments shall be
credited towards the next payment due to the Lender under the Note.
Notwithstanding the foregoing and Section 6.1, for any period during the term of
this Agreement (including any extensions or renewals) comprising a partial
Fiscal Year, the Annual Supplemental Fee applicable to such period shall equal
fifty percent (50%) of the Net Cash Flow of the Capri Companies for such partial
Fiscal Year.
SECTION 6.3 Deferral Option. At the option of CCLP, CAI and Capri
Holdings, payment to the Lender of up to ten percent (10%) of any Annual
Supplemental Fee may be deferred. Any such deferred amounts will accrue interest
on a daily compounded basis at the prevailing bank prime rate. Any such deferred
amounts and accrued interest thereon may be paid
16
to the Lender by CCLP, CAI and Capri Holdings at any time; all such deferred
amounts and all accrued interest thereon shall become due and payable
immediately on the occurrence of any Event of Default.
SECTION 6.4 Amendment on Exercise of Purchase Option. In the event the
Purchase Option is exercised, the parties hereto hereby agree to enter into an
amendment to this Agreement to the following effect:
The Annual Supplemental Fee shall be eliminated and replaced by the
following provisions:
The Lender's limited partnership interest capital account will be
credited for the same amount as would be calculated under the provisions of
Section 6.1 of this Agreement applicable to calculation of the Annual
Supplemental Fee for the applicable period. All such amounts credited to the
Lender's limited partnership interest capital accounts will be distributed to
the Lender in the same manner as provided in Section 6.1 of this Agreement and,
upon such distribution, will be charged to the Lender's limited partnership
interest capital account. Any such amount paid to the Lender as a partnership
distribution will satisfy, automatically and dollar for dollar, Capri's
obligation under this Agreement to pay the Lender the corresponding Annual
Supplemental Fee. In the event of termination of this Agreement, distribution of
all such amounts credited to the Lender's limited partnership interest capital
account and unpaid at the date of such termination will be immediately payable.
All other provisions of this Agreement will remain in full force and
effect upon exercise of the Purchase Option.
SECTION 6.5 Calculation and Payment of Fees. Along with each payment of
an Annual Supplemental Fee, CCLP, on behalf of the Capri Companies, shall also
deliver to the Lender a written certificate, in form and substance acceptable to
the Lender and signed by the chief executive officer and chief financial officer
of CCLP that explains in reasonable detail the calculation of the due and
payable Annual Supplemental Fee.
ARTICLE VII
PURCHASE OPTION
SECTION 7.1 Purchase Option.
(a)On the Closing Date CCLP shall execute and deliver to the
Lender an option agreement in the form of Exhibit C (the "Option Agreement")
granting to the Lender an option (the "Purchase Option") to purchase a
nondilutable voting limited partnership interest in CCLP equal to Sixty-Five
Percent (65%) of the outstanding total voting partnership interests in CCLP at
an exercise price of $2.00, such interest to have the characteristics described
in the Option Agreement or elsewhere in this Agreement. The Purchase Option
shall be non-dilutable, i.e., without the written consent of the Lender CCLP
will not (i) issue or deliver to any Person any interest in CCLP that was not in
existence and outstanding on the date hereof or (ii) recognize any purported
transfer or assignment of interests in CCLP, to any
17
Person other than (A) one who is presently a partner in CCLP (B), CRC or (C) the
Lender, or recognize any purported transfer or assignment of any interest in
CCLP that is subject to the Purchase Option. The Option Agreement shall provide
that the Purchase Option may not be exercised prior to January 15, 2004, and may
not be exercised if the Obligations are paid in full on or prior to such date.
(b)In the event that the Purchase Option is exercised, CCLP and
its principals will cooperate fully, and to the satisfaction of the Lender, with
any and all efforts the Lender may undertake, at its sole discretion, either
independently or in concert with CCLP, with respect to disposition of the
Lender's interests in CCLP in any manner that the Lender determines to be in its
interest and which complies with all applicable laws (including, without
limitation, all securities laws).
ARTICLE VIII
TERMINATION
SECTION 8.1 Termination. This Agreement shall terminate when all of the
Obligations are fully paid, satisfied or discharged; provided, that the parties'
rights, obligations and remedies hereunder shall survive any such termination to
the extent expressly provided herein. Termination pursuant to this Section 8.1
shall include, but not be limited to, early payoff of the Loan and mutual
written agreement between the parties hereto.
ARTICLE IX
TRANSACTION FEE
SECTION 9.1 Transaction Fee. If (i) prior to payment in full of the
obligations under the Loan, any acquisition of equity interests in, or any
substantial portion of the assets (except for sales of assets held in commingled
funds or in separate accounts of clients, and sales of assets, such as mortgage
loans, in the ordinary course of business consistent with past practice) of, any
of the Capri Companies, is consummated with any Person other than the Lender and
its Affiliates, or any of the Capri Parties enters into any agreement with
respect to, or granting a right to acquire, such interests or assets with any
party other than the Lender and its Affiliates or (ii) the Loan is repaid out of
the proceeds of any financing or equity provided by a third party other than the
Lender or one or more of its Affiliates, the Capri Parties shall pay to the
Lender the amount of $3,000,000 in cash (the "Transaction Fee"), concurrently
with such consummation or entry into agreement, as applicable.
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Amendment; Waiver.
(a)This Agreement may not be amended except by an instrument in
writing executed by each of CCLP and the Lender.
18
(b)Any failure of any party to comply with any provision hereof
may be waived by the party entitled to the benefit thereof only by a written
instrument signed by the party granting such waiver, but such waiver or failure
to insist upon strict compliance with such provision shall not operate as a
waiver of or estoppel with respect to any subsequent or other failure.
SECTION 10.2 Expenses.
All costs and expenses, including, without limitation, fees and
disbursements of counsel, advisors and accountants, incurred by the Capri
Parties in connection with this Agreement and the transactions contemplated
hereby shall be paid out of the proceeds of the Loan advanced on the Closing
Date, provided, that if such proceeds are not sufficient to pay all of such
expenses of the Capri Parties, then the Capri Principals shall pay such excess
amount of expenses and such amount shall not be paid by the Capri Companies
(except to the extent that such amounts are paid from the proceeds of any
financing the proceeds of which are used to repay the Loan).
SECTION 10.3 Assignment; Parties in Interest.
This Agreement and all of the provisions hereof shall be binding upon
and inure to the benefit of, and be enforceable by, the parties hereto and their
respective successors and permitted assigns, but neither this Agreement nor any
of the rights, interests or obligations herein shall be assigned, except by
operation of law by any party hereto without the prior written consent of the
other party, which consent may be withheld by any party in its sole discretion.
Nothing in this Agreement, express or implied, is intended to confer upon any
third person or entity any rights or remedies of any nature whatsoever under
this Agreement.
SECTION 10.4 Further Assurances.
Each of CCLP, CAI and Capri Holdings agrees that, from and after the
date hereof, upon the reasonable request of the Lender and without further
consideration, such party will, and will cause its Subsidiaries and Affiliates
to, execute and deliver to the Lender such documents and further assurances and
will take such other actions as the Lender may reasonably request in order to
carry out the purpose and intention of this Agreement.
SECTION 10.5 Entire Agreement.
This Agreement and the Schedules and Exhibits and other writings
referred to herein or delivered pursuant hereto which form a part hereof contain
the entire understanding of the parties with respect to the subject matter
hereof and all earlier drafts of this Agreement or any Schedule or Exhibit
hereto and all negotiations, conversations, correspondence or other
communications relating to the transactions and agreements contemplated by this
Agreement are hereby merged with and into this Agreement in such a way as to
prevent any party to this Agreement from referring to such drafts, negotiations,
conversations, correspondence or other communications in any subsequent dispute
between any of the parties hereto. This Agreement supersedes all prior
agreements and understandings between the parties with respect to the subject
matter hereof.
19
SECTION 10.6 Headings; References.
The Article and Section headings contained in this Agreement are for
reference purposes only and will not affect in any way the meaning or
interpretation of this Agreement. Unless the context otherwise requires,
references in this Agreement to Sections, Articles, Schedules and Exhibits are
references to Sections and Articles of, and Schedules and Exhibits to, this
Agreement.
SECTION 10.7 Notices.
All notices and other communications given or made pursuant hereto shall
be in writing and delivered by hand or sent by registered or certified mail
(postage prepaid, return receipt requested) or by nationally recognized
overnight air courier service and shall be deemed to have been duly given or
made as of the date delivered if delivered personally, or if mailed, on the
third Business Day after mailing (on the first Business Day after mailing in the
case of a nationally recognized overnight air courier service) to the parties at
the following addresses:
If to CCLP, to:
Capri Capital Limited Partnership
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
with a copy to:
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
If to the Lender, to:
CharterMac Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
with a copy to:
Proskauer Rose LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
20
and, in case of any notice of default by the Lender to
CCLP or other Capri Parties, with a copy to:
▇▇▇▇▇▇ Mae
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Any party may by notice given in accordance with this Section 10.7 to the other
parties designate another address or Person for receipt of notices hereunder.
SECTION 10.8 Consent to Jurisdiction. EACH BORROWER AND CAPRI HOLDINGS
ACKNOWLEDGES THAT THE LENDER'S PRINCIPAL OFFICE IS LOCATED IN NEW YORK, NEW YORK
AND THAT THE LENDER MAY BE IRREPARABLY HARMED IF IT IS REQUIRED TO INSTITUTE OR
DEFEND ANY ACTION IN ANY JURISDICTION OTHER THAN THE SOUTHERN DISTRICT OF NEW
YORK OR NEW YORK COUNTY, NEW YORK. THEREFORE, EACH BORROWER AND CAPRI HOLDINGS
IRREVOCABLY AGREES THAT ANY SUIT, ACTION OR OTHER LEGAL PROCEEDING BY SUCH
BORROWER OR CAPRI HOLDINGS RELATING TO THIS AGREEMENT OR THE OTHER TRANSACTION
DOCUMENTS SHALL BE BROUGHT ONLY IN THE CIRCUIT COURT OF NEW YORK COUNTY OR IN
THE SOUTHERN DISTRICT OF NEW YORK. EACH BORROWER AND CAPRI HOLDINGS CONSENTS TO
THE JURISDICTION OF EACH SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDINGS BY
THE LENDER AND WAIVES ANY OBJECTION WHICH SUCH BORROWER OR CAPRI HOLDINGS MAY
HAVE TO THE LAYING OF VENUE IN ANY SUCH SUIT, ACTION OR PROCEEDING IN EITHER
SUCH COURT. EACH BORROWER AND CAPRI HOLDINGS AGREES TO JOIN THE LENDER IN ANY
PETITION FOR REMOVAL TO EITHER SUCH COURT.
SECTION 10.9 Waiver of Jury Trial. EACH BORROWER AND CAPRI HOLDINGS
HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT THAT SUCH
BORROWER OR CAPRI HOLDINGS MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION ARISING
IN ANY WAY IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER TRANSACTION
DOCUMENTS, OR ANY OTHER STATEMENTS OR ACTIONS OF THE LENDER. EACH BORROWER AND
CAPRI HOLDINGS ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT FOR THE
LENDER TO ENTER INTO THIS AGREEMENT AND EACH OTHER TRANSACTION DOCUMENT, AND
THAT THIS WAIVER SHALL BE EFFECTIVE AS TO EACH OF THE OTHER TRANSACTION
DOCUMENTS AS IF FULLY INCORPORATED THEREIN.
SECTION 10.10 Governing Law. This Agreement and the other Transaction
Documents, and the rights and duties of the parties hereto, shall be construed
and determined in accordance with the laws of the State of New York, without
regard to conflicts of law doctrine.
21
SECTION 10.11 Counterparts.
This Agreement may be executed in one or more counterparts, and by the
different parties hereto in separate counterparts, each of which when executed
shall be deemed to be an original but all of which when taken together shall
constitute one and the same agreement.
[Signature pages follow.]
22
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above written.
BORROWERS: CAPRI CAPITAL LIMITED PARTNERSHIP
By:
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
Title: Co-Chairman
CAPRI ACQUISITION, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
Title: Co-Chairman
CAPRI HOLDINGS: CAPRI HOLDINGS, LLC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Co-Chairman
LENDER: CM INVESTOR LLC
By: Charter Mac Corporation, its Sole Member
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Executive Officer
Schedule 3.1(e)
Security Agreement Filings
Delaware Secretary of State
---------------------------
CCLP, Associates, Finance, CRC
Illinois Secretary of State
---------------------------
Capri Holdings, CAI, Fargo, Primo, General Partner
California
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▇▇▇▇▇▇
