AMENDMENTS TO SECURITIZATION AGREEMENTS AND WAIVER
AMENDMENTS TO SECURITIZATION AGREEMENTS AND WAIVER, dated as
of August 18, 2000 (these "Amendments"), among MERISEL AMERICAS, INC. ("Merisel
Americas"), MERISEL CAPITAL FUNDING, INC. ("Merisel Capital Funding"), REDWOOD
RECEIVABLES CORPORATION ("Redwood") and GENERAL ELECTRIC CAPITAL CORPORATION
("GE Capital").
WHEREAS, Merisel Americas, as originator, and Merisel Capital
Funding are parties to an Amended and Restated Receivables Transfer Agreement,
dated as of September 27, 1996, as amended by Amendment No. 1, dated as of
November 7, 1996, Amendment No. 2, dated as of December 19, 1997, Amendment No.
3, dated as of July 31, 1998 (the "MAI Transfer Agreement") and Amendment No. 4,
dated as of March 10, 2000;
WHEREAS, Merisel Capital Funding, as seller (in such capacity,
the "Seller"), Redwood, as purchaser (in such capacity, the "Purchaser"),
GE Capital, as operating agent (in such capacity, the "Operating Agent") and
collateral agent (in such capacity, the "Collateral Agent") and Merisel
Americas, as servicer (in such capacity, the "Servicer") are parties to an
Amended and Restated Receivables Purchase and Servicing Agreement, dated as of
September 27, 1996, as amended by Amendment No. 1, dated as of November 7, 1996,
Amendment No. 2, dated as of December 19, 1997, Amendment No. 3, dated as of
July 31, 1998, Amendment No. 4, dated as of February 22, 1999, Amendment No. 5,
dated as of May 12, 1999, Amendment No. 6, dated as of August 13, 1999,
Amendment No. 7, dated as of March 10, 2000 and Amendment No. 8, dated as of May
17, 2000 (the "Purchase Agreement");
WHEREAS, definitions and interpretations of the Purchase
Agreement are set forth in Annex X thereto, dated as of September 27, 1996, as
amended ("Annex X," and, together with the Purchase Agreement and the MAI
Transfer Agreement, the "Securitization Agreements");
WHEREAS, the Seller and Servicer have requested the Purchaser,
the Operating Agent and the Collateral Agent to waive certain financial
covenants contained in the Purchase Agreement; and
WHEREAS, the parties hereto wish to further amend the
Securitization Agreements (such amendments and waiver is referred to herein as
these "Amendments").
FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND ADEQUACY
OF WHICH ARE HEREBY ACKNOWLEDGED, THE PARTIES HERETO, INTENDING TO BE LEGALLY
BOUND HEREBY, AGREE AS FOLLOWS:
ARTICLE I : DEFINITIONS
SECTION 1.1 All capitalized terms used herein, unless otherwise defined,
are used as defined in the Purchase Agreement.
ARTICLE II : AMENDMENT NO. 9 TO PURCHASE AGREEMENT
SECTION 2.1 Amendments to Article V of the Purchase Agreement. Article V is
hereby amended by deleting the word "and" that appears after clause (k), adding
the word "and" after clause (l) and adding a new Section 5.02(m) to read as
follows:
"(m) if an agreement to enter into a proposed sale is
executed, promptly, notification of the termination or postponement beyond
October 30, 2000 of a Proposed Sale."
SECTION 2.2 Amendments to Article VII of the Purchase Agreement. Section 7.06(e)
is hereby amended by adding to the beginning thereof the phrase "except in the
case of a Proposed Sale which is completed by October 30, 2000,"
SECTION 2.3 Amendments to Article IX of the Purchase Agreement
Section 9.01 is hereby amended by (a) amending and restating Section 9.01(x)
to read as follows:
"(x) (i) if none of the following occur on or prior to September 30,
2000: (i) execution and delivery of a Proposed Sale Agreement or (ii) delivery
to the Operating Agent of a Plan of Disposition; or" and
(b) adding a new Section 9.01(y) to read as follows:
"(y) if none of the following occur by October 30, 2000: (i) a Proposed
Sale, (ii) the commencement of a Plan of Disposition or (iii) the MAI Facility
Unwind;"
SECTION 2.4 Amendments to Exhibit H. The definition of "EBITDA" is
amended and restated to read as follows:
""EBITDA" shall mean, with respect to any Person for any fiscal period,
an amount equal to (a) consolidated net income of the Parent and its
consolidated subsidiaries for such period, minus (b) the sum, without
duplication, of (i) income tax credits, (ii) gain from extraordinary items for
such period, (iii) any aggregate net gain (but not any aggregate net loss)
during such period arising from the sale, exchange or other disposition of
capital assets by such Person (including any fixed assets, whether tangible or
intangible, all inventory sold in conjunction with the disposition of fixed
assets and all securities), and (iv) any other non-cash gains which have been
added in determining consolidated net income, in each case to the extent
included in the calculation of consolidated net income of such Person for such
period in accordance with GAAP, plus (c) the sum, without duplication, of (i)
any provision for income taxes, (ii) Cash Interest Expense, (iii) the Parent's
and its consolidated subsidiaries depreciation and amortization for such period,
(iv) the amount of non-cash charges prior to and including the First Quarter
2000, (v) any non-cash charges after the First Quarter 2000 approved in writing
by the Operating Agent, and (vi) amortized debt discount."
ARTICLE III : AMENDMENT NO. 5 TO MAI TRANSFER AGREEMENT
Section 4.03(d) of the MAI Transfer Agreement is hereby
amended by adding to the beginning thereof the phrase "except in the case of a
Proposed Sale which is completed by October 30, 2000,"
ARTICLE IV : AMENDMENT NO. 4 TO ANNEX X
Annex X is hereby amended as follows:
(a)The definition of "Maximum Purchase Limit" is amended by
changing the reference therein to $500,000,000 to $250,000,000.
(b) a new definition of "MAI Facility Unwind" is hereby added
to read as follows:
"MAI Facility Unwind" means the repurchase by the Seller of
all Receivables originated by Merisel Americas, Inc. that have
been acquired by the Purchaser pursuant to the Purchase
Agreement and are held by the Purchaser on the date of such
repurchase and the creation of a new securitization facility
with the Purchaser and a newly formed special purpose entity
solely covering Receivables originated by MOCA all on terms
and conditions satisfactory to the Purchasers and the
Operating Agent.
(c) a new definition of "Plan of Disposition" is hereby added
to read as follows:
"Plan of Disposition" means a formal plan that has
been approved by the Board of Directors of Merisel, Inc. for
the disposition, winding down or restructuring, by Merisel,
Inc and its Affiliates of its United States distribution
business (which shall not include the distribution business of
Merisel Open Company Alliance Inc.), which plan shall be
acceptable to the Operating Agent and shall include financial
projections for the 12-month period commencing on the first
day of the month following the date on which said plan is
expected to take effect, which projections shall take into
account such disposition or restructuring and shall include,
without limitation, a pro forma income statement, balance
sheet, cash flow statement, availability forecast, and such
other information as the Operating Agent may reasonably
require.
(d) a new definition of "Proposed Sale" is hereby added to
read as follows:
"Proposed Sale" means any sale of a majority of the
outstanding capital stock of Merisel Americas, Inc. or any
merger or consolidation of Merisel Americas, Inc. which
results in a Person other than Merisel, Inc. owning a majority
of the outstanding capital stock of Merisel Americas, Inc. or
any sale of all or substantially all of the assets of Merisel
Americas, Inc. or any sale of all or substantially all of the
inventory and accounts receivable of Merisel Americas, Inc.;
provided, that any such sale, merger or consolidation shall be
acceptable to the Operating Agent; and provided further, that
the MAI Facility Unwind shall have occurred by October 30,
2000, otherwise any such sale, merger or consolidation shall
not qualify as a "Proposed Sale".
(e) a new definition of "Proposed Sale Agreement" is hereby
added to read as follows:
"Proposed Sale Agreement" means an agreement entered
into by Merisel, Inc. and/or Merisel Americas, Inc.
and (y) another Person acceptable to the Operating Agent which
contains the terms and conditions of a Proposed Sale,
which agreement shall be acceptable to the Operating Agent."
ARTICLE V : WAIVER OF DEFAULT UNDER PURCHASE AGREEMENT
SECTION 5.1 The Operating Agent, the Collateral Agent and the Purchaser agree to
waive compliance with the financial covenants set forth in Exhibit H of the
Purchase Agreement for the fiscal quarter ended June 30, 2000 and any Incipient
Event or potential Termination Event directly resulting solely from the
potential breach of the financial covenants contained in Exhibit H of the
Purchase Agreement for the fiscal quarter ended June 30, 2000. No other
provision contained in the Purchase Agreement or any other agreement or document
that has been executed and delivered in connection therewith shall be deemed to
have been waived by the Operating Agent, the Collateral Agent or the Purchaser
including without limitation any representation, warranty, agreement or
covenant.
ARTICLE VI : CONDITIONS PRECEDENT
SECTION 6.1 The effectiveness of these Amendments is subject to the conditions
precedent that the Collateral Agent, the Operating Agent and the Purchaser shall
have received each of the following, in form and substance satisfactory to each
such party:
(a) A certificate of the Secretary of each of the Seller and the Servicer,
dated the date of these Amendments and certifying (i) that attached
thereto is a true and complete copy of a resolution of the Board of
Directors of the Seller or the Servicer, as the case may be,
authorizing the execution, delivery and performance of these
Amendments, and all other documents required or necessary to be
delivered hereunder and that such resolution has not been modified,
rescinded or amended and is in full force and effect and (ii) as to the
incumbency and specimen signature of each Person's officers executing
these Amendments, and all other documents required or necessary to be
delivered hereunder.
(b) The opinion of counsel to the Seller, in form and substance reasonably
satisfactory to the Purchaser, the Operating Agent and the Collateral
Agent, as to certain matters including, without limitation, (i) the
valid existence and good standing of the Seller and Servicer, (ii) the
power and authority of the Seller and Servicer to execute these
Amendments, (iii) the due authorization, execution and delivery of
these Amendments by the Seller and Servicer , (iv) the enforceability
of these Amendments against the Seller and Servicer, (v) that the
execution and delivery of these Amendments (x) does not conflict with
the organizational documents of the Seller or Servicer and (y) does not
violate or constitute a default under any material financing agreements
of the Seller or Servicer.
(c) A certificate of an officer of each of the Seller and the Servicer,
dated the date of these Amendments, certifying that each of the
representations and warranties made by the Seller and the Servicer in
these Amendments is true and correct in all material respects as of the
date hereof.
(d) An Officer's Certificate in form and substance satisfactory to the
Operating Agent to the effect that all of the representations and
warranties in the Transfer Agreement and Purchase Agreement are true
and correct in all material respects as of the date hereof after giving
effect to these Amendments.
(e) The Seller shall pay fees and expenses of the Purchaser incurred in
connection with preparing these Amendments.
ARTICLE VII : SELLER'S AND SERVICER'S REPRESENTATIONS AND WARRANTIES
SECTION 7.1 Each of the Seller and the Servicer represents and warrants that:
(a) these Amendments have been duly authorized, executed and
delivered pursuant to its corporation power;
(b) these Amendments constitute its legal, valid and binding
obligation subject to the effect of bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights generally; and
(c) after giving effect to the amendments referred to herein,
there does not exist any Termination Event.
ARTICLE VIII : MISCELLANEOUS
SECTION 8.1 Confirmation of Purchase Agreement. Each of the Seller and the
Servicer agree that, except for the specific amendments set forth herein,
nothing herein shall be deemed to be a waiver or amendment of any covenant or
agreement contained in the Purchase Agreement and each of the other documents
executed in connection therewith are ratified and confirmed in all respects and
shall remain in full force and effect in accordance with its terms. Each
reference in the Purchase Agreement to "this Agreement" and in each of the other
documents to be executed in connection therewith to the "Purchase Agreement,"
shall mean the Purchase Agreement as amended by these Amendments and as such
agreement may be hereinafter amended or restated. Each reference in the MAI
Transfer Agreement to "this agreement" and in each of the other documents to be
executed in connection therewith to the MAI Transfer Agreement" shall mean the
MAI Transfer Agreement as amended by these Amendments and as such agreement may
be hereinafter amended or restated. Nothing herein shall obligate the Seller,
the Servicer, the Purchaser, the Operating Agent or the Collateral Agent to
enter into any future amendment (whether similar or dissimilar).
SECTION 8.2 Waiver by the Seller and Servicer. Except for manifest errors on the
part of the Operating Agent, each of the Seller and the Servicer hereby waives
any claim, defense, demand, action or suit of any kind or nature whatsoever
against the Purchaser, the Operating Agent and the Collateral Agent arising on
or prior to the date hereof in connection with the Purchase Agreement or the
transactions contemplated thereunder.
SECTION 8.3 Counterparts. Delivery of an executed counterpart of a signature
page to these Amendments by facsimile shall be effective as delivery of a
manually executed counterpart of these Amendments. These Amendments may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
SECTION 8.4 Governing Law. These Amendments shall be governed by, and
construed in accordance with, California law.
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SECTION 8.5 Effective Date of Amendment. Upon the execution and delivery of
these Amendments by the parties hereto and the satisfaction of the conditions
precedent set forth herein, the Purchase Agreement shall be amended by these
Amendments, effective as of the date of hereof.
* * *
IN WITNESS WHEREOF, the Seller, the Servicer, the Collateral
Agent, the Operating Agent and the Purchaser have caused these Amendments to be
duly executed by their respective authorized officers as of the date and year
first above written.
MERISEL CAPITAL FUNDING, INC.,
as Seller
By:___________________________
Title:
Name:
MERISEL AMERICAS, INC.,
as Servicer
By:___________________________
Title:
Name:
GENERAL ELECTRIC CAPITAL CORPORATION,
as Operating Agent and Collateral Agent
By:___________________________
Title:
Name:
REDWOOD RECEIVABLES CORPORATION,
as Purchaser
By:___________________________
Title:
Name:
