Exhibit 10.27.7
EIGHTH AMENDMENT TO LOAN AND SECURITY AGREEMENT
     This Eighth Amendment to Loan and Security Agreement (this “Amendment”) is
dated as of the 15th day of December, 2009, by and among EMERSON RADIO CORP.
(“ERC US”), a Delaware corporation, EMERSON RADIO MACAO COMMERCIAL OFFSHORE
LIMITED (“ER Macao”), a Macao corporation, MAJEXCO IMPORTS, INC. (“MI”), a
California corporation, EMERSON RADIO (HONG KONG) LIMITED (“ER Hong Kong”), a
Hong Kong corporation, and EMERSON RADIO INTERNATIONAL LTD. (“ER BVI”), a
British Virgin Island company, jointly and severally as co-borrowers and
co-obligors, except as set forth in Section 11.8 of the Loan Agreement, as
defined below (collectively, the “Borrowers” and each is referred to
individually herein as a “Borrower”), and WACHOVIA BANK, NATIONAL ASSOCIATION, a
national banking association (together with its successors and assigns, “Bank”).
BACKGROUND
          A. Borrowers and Bank are parties to a certain Loan and Security
Agreement dated as of December 23, 2005 (as the same has been and may be amended
or otherwise modified from time to time, the “Loan Agreement”), and the other
Loan Documents (as defined in the Loan Agreement). Capitalized terms used herein
and not otherwise defined shall have the respective meanings set forth in the
Loan Agreement.
          B. Borrowers and Bank are parties to a certain Seventh Amendment to
Loan and Security Agreement dated as of July 13, 2009 (the “Seventh Amendment”).
          C. Borrowers have requested and Bank has agreed to amend certain terms
of the Loan Agreement, subject to the terms, conditions and provisions of this
Amendment.
          NOW, THEREFORE, with the foregoing Background hereinafter deemed
incorporated by this reference, the parties hereto, intending to be legally
bound, promise and agree as follows:
     1. AMENDMENTS TO LOAN AGREEMENT
     Upon the effectiveness of this Amendment, the Loan Agreement is amended as
follows:
          1.1 Fixed Charge Coverage Ratio. The OLEVIA Purchase (as defined in
the Seventh Amendment) and the Real Estate Purchase (as defined in the Seventh
Amendment) shall be excluded from the determination of the Fixed Charge Coverage
Ratio for the applicable calculation periods.
          1.2 Capital Expenditures. Notwithstanding Section 7.2 of the Loan
Agreement, Borrowers shall not expend on gross fixed assets (including gross
leases to be capitalized under GAAP and leasehold improvements) an amount
exceeding $5,000,000 in the aggregate during the fiscal year ending March 31,
2010.
     2. CONFIRMATION OF INDEBTEDNESS
          Each Borrower hereby confirms and agrees that, as of the close of
business on the date hereof, the total principal amount of outstanding Revolver
Loans under the Loan Agreement is

 

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$0, and the face amount of all outstanding Letters of Credit is $1,568,391.87
and that each Borrower is unconditionally liable to Bank for such amounts,
together with all accrued and unpaid interest and expenses through the date
hereof, without any set-off, deduction, counterclaim or defense.
     3. FURTHER ASSURANCES
          Each Borrower hereby agrees to take all such actions and to execute
and/or deliver to Bank all such agreements, instruments, certificates,
assignments, financing statements and other documents, as Bank may reasonably
require from time to time, to effectuate and implement the purposes of this
Amendment.
     4. CONFIRMATION OF COLLATERAL
          Each Borrower covenants, confirms and agrees that as security for the
repayment of the Obligations, Bank has, and shall continue to have, and is
hereby granted a continuing lien on and security interest in the Collateral
(including the Smith Barney Securities), all whether now owned or hereafter
acquired, created or arising, including all proceeds thereof. Each Borrower
acknowledges and agrees that nothing herein contained in any way impairs Bank’s
existing rights and priority in the Collateral.
     5. REPRESENTATIONS AND WARRANTIES
          Each Borrower warrants and represents to Bank that:
          5.1 By execution of this Amendment, Borrowers confirm that all
representations and warranties made by Borrowers to Bank shall be true and
correct in all material respects, with the same effect as though the
representations and warranties had been made on and as of the date hereof,
except to the extent such representation and warranty are made as of a specific
prior date.
          5.2 The execution and delivery by each Borrower of this Amendment and
the performance of the transactions herein contemplated (i) are and will be
within its power, (ii) have been authorized by all necessary action, and
(iii) are not and will not be in contravention of any order of court or other
agency of government, of law, of any organization document of such Borrower or
of any indenture, agreement or undertaking to which such Borrower is a party or
by which the property of such Borrower is bound, or be in conflict with, result
in a breach of or constitute (with due notice and/or lapse of time) a default
under any such indenture, agreement or undertaking, or result in the imposition
of any lien, charge or encumbrance of any nature on any of the properties of
such Borrower.
          5.3 This Amendment and any assignment or other instrument, document or
agreement executed and delivered in connection herewith, will constitute the
legal, valid and binding obligations of each Borrower, enforceable in accordance
with their respective terms, subject only to bankruptcy and similar laws
affecting creditors’ rights generally.
          5.4 There are no outstanding Defaults or Events of Default under any
of the Loan Documents.
          5.5 There has been no change which could have a Material Adverse
Effect on any Borrower since the date of the most recent financial statements of
such Borrower delivered to

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Bank from time to time.
     6. EFFECTIVENESS CONDITIONS
          This Amendment shall not be effective until the following conditions
have been met to the sole satisfaction of Bank (which satisfaction shall be
evidenced by Bank’s counter-execution and delivery to ERC US of a fully executed
counterpart of this Amendment):
               (i) Borrowers shall have executed and delivered to Bank this
Amendment.
               (ii) Borrowers shall have paid to Bank, in immediately available
funds, a non-refundable waiver and amendment fee in an amount equal to $2,500,
which fee is fully earned by Bank upon the execution of this Amendment.
     7. REAFFIRMATION
          This Amendment shall be incorporated into and made part of the Loan
Agreement. Except as expressly modified by the terms hereof, all of the terms
and conditions of the Loan Agreement, and all of the other Loan Documents, are
hereby reaffirmed and shall continue in full force and effect as therein
written.
     8. RELEASE
          As further consideration for the agreement of Bank to enter into this
Amendment, each Borrower hereby waives, releases, and discharges Bank, all
affiliates of Bank and all of the directors, officers, employees, attorneys and
agents of Bank and all affiliates of such Persons, from any and all known
claims, demands, actions or causes of action existing as of the date hereof,
arising out of or in any way relating to this Amendment, the Loan Agreement, the
Loan Documents and/or any documents, agreements, instruments, dealings or other
matters connected with this Amendment, the Loan Agreement, the Loan Documents or
the administration thereof.
     9. MISCELLANEOUS
          9.1 Integrated Agreement. The Loan Documents and this Amendment shall
be construed as integrated and complementary of each other, and as augmenting
and not restricting Bank’s rights, remedies and security. If, after applying the
foregoing, an inconsistency still exists, the provisions of this Amendment shall
control.
          9.2 Severability. Any provision hereof, or of the Loan Agreement or
any other Loan Document that is prohibited or unenforceable in any jurisdiction
shall be, as to such jurisdiction, ineffective to the extent of such prohibition
or unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
          9.3 Non-Waiver. No omission or delay by Bank in exercising any right
or power under this Amendment, or the Loan Documents or any related agreement
will impair such right or power or be construed to be a waiver of any Default or
Event of Default or an acquiescence therein, and any single or partial exercise
of any such right or power will not preclude other or further

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exercise thereof or the exercise of any other right, and no waiver will be valid
unless in writing and signed by Bank and then only to the extent specified.
Bank’s rights and remedies are cumulative and concurrent and may be pursued
singly, successively or together.
          9.4 Headings. The headings of any paragraph of this Amendment are for
convenience only and shall not be used to interpret any provision of this
Amendment.
          9.5 Survival. All warranties, representations and covenants made by
Borrowers herein, or in any agreement referred to herein or on any certificate,
document or other instrument delivered by it or on its behalf under this
Amendment, shall be considered to have been relied upon by Bank. All statements
in any such certificate or other instrument shall constitute warranties and
representations by Borrower hereunder. All warranties, representations, and
covenants made by Borrowers hereunder or under any other agreement or instrument
shall be deemed continuing until the Obligations are indefeasibly paid and
satisfied in full.
          9.6 Successors and Assigns. This Amendment shall be binding upon and
shall inure to the benefit of Borrowers and Bank, and their respective
successors and assigns; provided, that Borrowers may not assign any of its
rights hereunder without the prior written consent of Bank, and any such
assignment made without such consent will be void.
          9.7 Governing Law. This Amendment, the Loan Agreement and the Loan
Documents shall be deemed contracts made under the laws of the State of the
Jurisdiction and shall be governed by and construed in accordance with the laws
of said state (excluding its conflict of laws provisions if such provisions
would require application of the laws of another jurisdiction) except insofar as
the laws of another jurisdiction may, by reason of mandatory provisions of law,
govern the perfection, priority and enforcement of security interests in the
Collateral.
          9.8 WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
EACH BORROWER BY EXECUTION HEREOF AND BANK BY ACCEPTANCE HEREOF, KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT EACH MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AMENDMENT, THE LOAN AGREEMENT, THE LOAN DOCUMENTS OR ANY AGREEMENT
CONTEMPLATED TO BE EXECUTED IN CONNECTION WITH THIS AMENDMENT OR THE LOAN
AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY WITH RESPECT HERETO. THIS PROVISION
IS A MATERIAL INDUCEMENT TO BANK TO ENTER INTO AND ACCEPT THIS AMENDMENT.
          9.9 Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original and all of
which when taken together shall constitute but one and the same instrument. Any
signature delivered by a party by facsimile transmission or .pdf shall be deemed
to be an original signature hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]

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     IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
and delivered by their duly authorized officers as of the date first above
written.

          BORROWERS:   EMERSON RADIO CORP.
      By:   /s/ Greenfield Pitts         Name:   Greenfield Pitts       
Title:   Group CFO        EMERSON RADIO MACAO COMMERCIAL OFFSHORE LIMITED
      By:   /s/ Lau Ho Kit, Ivan         Name:   LAU HO KIT, IVAN       
Title:   CFO ASIAN OPERATIONS        MAJEXCO IMPORTS, INC.
      By:   /s/ Greenfield Pitts         Name:   Greenfield Pitts       
Title:   President     

          (SEAL) [y85258y8525801.gif] SIGNED, SEALED and DELIVERED
as a Deed for and in the name of
EMERSON RADIO (HONG KONG) LIMITED
by its attorney
  )
)
)
)     /s/ Lau Ho Kit, Ivan         Name:   LAU HO KIT, IVAN  )      in the
presence of  )   

            Witness:
            Name:   AU MEI YI, ANGEL        Signature:   /s/ Au Mei Yi, Angel   
   

            EMERSON RADIO INTERNATIONAL LTD.
      By:   /s/ Lau Ho Kit, Ivan         Name:   LAU HO KIT, IVAN       
Title:   CFO-ASIAN OPERATIONS     

[SIGNATURE PAGE TO EIGHTH AMENDMENT
TO LOAN AND SECURITY AGREEMENT]

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          BANK:   WACHOVIA BANK, NATIONAL ASSOCIATION
      By:   /s/ Georgios C. Kyvernitis         Name:   Georgios C. Kyvernitis   
    Title:   Director     

[SIGNATURE PAGE TO EIGHTH AMENDMENT
TO LOAN AND SECURITY AGREEMENT]

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