XXXXXX MAY HOLDINGS, INC.
XXXXXXXXX XXXXX CORPORATION
0000 Xxxx Xxxxxxx Xxxxxxxxx
Xxxxxxx, XX 00000
October 2, 2001
To the Purchasers under
the Securities Purchase
Agreement dated as of
October 30, 1991, as amended
Ladies and Gentlemen:
Reference is made to that certain Securities Purchase Agreement dated
as of October 30, 1991, as amended (the "Agreement") among Xxxxxx May Holdings,
Inc., a Delaware corporation ("Holdings"), Xxxxxxxxx Xxxxx Corporation, an
Illinois corporation (the "Company"), and the undersigned Purchasers.
All capitalized terms used herein and not otherwise defined shall have
the respective meanings assigned to such terms in the Agreement.
The Company has advised the Purchasers that the Company intends to
cause its wholly-owned subsidiary, Sweet Factory Group, Inc., a Delaware
corporation ("SFG"), and its three wholly-owned subsidiaries, Sweet Factory,
Inc., SF Candy Company and SF Properties, Inc., each a Delaware corporation, to
file a voluntary petition (the "Petition") under Chapter 11 of the United States
Bankruptcy Code (the "Sweet Factory Bankruptcy").
In addition, the Company also has advised the Purchasers that the
Company intends to enter into an overadvance agreement (the "Overadvance
Agreement") with The CIT Group/Business Credit, Inc. ("CIT"), the agent and sole
lender under the Company's revolving credit facility, pursuant to which, among
other things, CIT will grant a $5.0 million overadvance (the "Overadvance") to
the Company through December 27, 2001. As a condition precedent to the
Overadvance Agreement, CIT has required that certain of Holdings' stockholders
(the "Participants") agree to participate in 50% of any Overadvance that remains
outstanding on December 28, 2001. In consideration for the Participants'
agreement to participate in the Overadvance, the Company desires to pay to
certain of the Participants a participation fee in the aggregate amount of up to
$125,000 in cash (the "Participation Fee").
1. Each Purchaser, by its execution of this letter below, acknowledges
and agrees that neither the Sweet Factory Bankruptcy nor the Company's payment
of the Participation Fee shall constitute an Event of Default under the
Agreement.
-1-
2. Except as specifically modified by this letter, the Agreement shall
remain in full force and effect and is hereby ratified and confirmed. The
execution, delivery and performance of this letter shall not, except as
expressly provided herein, constitute a waiver of any provisions of, or operate
as a waiver of any right, power or remedy of the Purchasers under, the
Agreement.
3. This letter may be executed in any number of counterparts and by
the different parties hereto in separate counterparts, each of which
counterparts when executed and delivered shall be an original, but all of which
together shall constitute one and the same instrument.
4. THIS LETTER AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF
NEW YORK.
[signature pages follow]
-2-
XXXXXX MAY HOLDINGS, INC.
By: /s/ XXXXXXX X. XXXXXX
-------------------------------------
Title: Vice President - Chief Financial
Officer
XXXXXXXXX XXXXX CORPORATION
By: /s/ XXXXXXX X. XXXXXX
-------------------------------------
Title: Vice President - Chief Financial
Officer
Acknowledged and agreed to as of the date set forth opposite their signature.
TCW SPECIAL PLACEMENTS FUND III
Dated: October 2, 2001
By: TCW Capital
Its: Managing General Partner
By: TCW Asset Management Company
Its: Managing General Partner
By: /s/ XXXXXXX X. XXXXX
----------------------------
Title: Group Managing Director
TCW CAPITAL, as Investment Manager
pursuant to an Investment Management
Agreement dated as of June 19, 1989
Dated: October 2, 2001
By: TCW Asset Management Company
Its: Managing General Partner
By: /s/ XXXXXXX X. XXXXX
----------------------------
Title: Group Managing Director
TCW CAPITAL, as Investment Manager
pursuant to an Investment Management
Agreement dated as of April 18, 1990
Dated: October 2, 2001
By: TCW Asset Management Company
Its: Managing General Partner
By: /s/ XXXXXXX X. XXXXX
----------------------------
Title: Group Managing Director
-3-
MEZZANINE CAPITAL
Dated: October 2, 2001
By: TCW Asset Management Company
Its: Managing General Partner
By: /s/ XXXXXXX X. XXXXX
----------------------------
Title: Group Managing Director
JZ EQUITY PARTNERS PLC
(f/k/a MCIT (EXISTING POOL) LIMITED)
Dated: October 2, 2001
By: /s/
-------------------------------------
Title: Investment Adviser
WCT INVESTMENT PTE. LTD
Dated: October 2, 2001
By: /s/ XXXXX X. XXXXXX
-------------------------------------
Title: Director
JORDAN INDUSTRIES, INC.
Dated: October 2, 2001
By: /s/ XXXXXX X. XXXXX
-------------------------------------
Title:
----------------------------------
-4-
