Exhibit 10.34
 
 
CONSENT-MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
 
 
CONSENT
 
THIS CONSENT dated as of February 27, 2013 (the or this “Consent”) is between
SCHAWK, INC., a Delaware corporation (the “Company”), and each of the
institutions which is a signatory to this Consent (collectively, the
“Noteholders”).
 
RECITALS:
 
A.           The Company and each of the Noteholders have heretofore entered
into entered into the Note Purchase Agreement dated as of December 23, 2003, as
amended, modified and supplemented by that certain first amendment to Note
Agreement dated January 28, 2005, that certain second amendment to Note
Agreement dated June 11, 2009, that certain third amendment to Note Agreement
dated January 12, 2010, that certain fourth amendment to Note agreement dated
November 17, 2010, that certain fifth amendment to Note agreement dated January
27, 2012 and that certain sixth amendment to Note agreement dated September 5,
2012 (collectively, the “Note Agreement”).  The Company has heretofore issued
the $15,000,000 4.90% Series 2003-A Senior Notes, Tranche A, Due December 31,
2013 and the $10,000,000 4.98% Series 2003-A Senior Notes, Tranche B, Due April
30, 2014 (collectively, the “Notes”) pursuant to the Note Agreement.
 
B.           The Company desires to obtain from the Noteholders the consents,
waivers and agreements set forth in Section 1 of this Consent.
 
C.           Capitalized terms used herein shall have the respective meanings
ascribed thereto in the Note Agreement unless herein defined or the context
shall otherwise require.
 
NOW, THEREFORE, upon the full and complete satisfaction of the conditions
precedent to the effectiveness of this Consent set forth in Section 3.1 hereof,
and in consideration of good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the Company and the Noteholders do
hereby agree as follows:
 
SECTION 1.   CONSENT.
 
The Noteholders (a) consent to the Company or its Subsidiaries making a partial
or complete withdrawal from the GCC/IBT National Pension Plan, which is a
Multiemployer Plan, and in connection with such withdrawal, the Company or its
Subsidiaries incurring withdrawal liability with a present value which has been
estimated to be approximately $31.7 million resulting from such withdrawal and
(b) waive any Event of Default under, or resulting from a breach of,
Sections 5.12(c), 10.11(d), 11(k)(ii) and 11(k)(v) of the Note Agreement as a
result of such withdrawal and the incurrence of such withdrawal liability.  The
Noteholders acknowledge that any such withdrawal liability incurred by the
Company or its Subsidiaries shall not constitute Debt.  Further, the Noteholders
and the Company agree that (i) any non-cash charge to Net Income taken by the
Company or its Subsidiaries in connection with such withdrawal (“Withdrawal
Charge”) shall be deemed an extraordinary non-cash charge, (ii) for the purposes
of clause (ii) of Section 10.19(a) (Minimum Fixed Charge Coverage Ratio), the
Company’s net income tax provision for the period in which such Withdrawal
Charge is taken shall be adjusted by the amount of any financial statement
income tax benefit realized as a result of such Withdrawal Charge, (iii) any
non-cash interest expense accrued by the Company and its Subsidiaries as a
result of such withdrawal liability shall be excluded from Interest Expense,
(iv) any amount paid in any period in cash in respect of such liability shall
reduce EBITDA for such period by such amount and (v) for purposes of clause (ii)
of Section 10.19(a) (Minimum Fixed Charge Coverage Ratio),  the Company’s net
income tax provision for the period in which any such cash payment of the type
described in clause (iv) above is made shall be adjusted by the amount of any
federal, state or local tax benefit realized by the Company or its Subsidiaries
as a result of such cash payment.
 
SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
 
Section 2.1. To induce the Noteholders to execute and deliver this Consent
(which representations shall survive the execution and delivery of this
Consent), the Company represents and warrants to the Noteholders that:
 
(a) this Consent has been duly authorized, executed and delivered by it and this
Consent constitutes the legal, valid and binding obligation, contract and
agreement of the Company enforceable against the Company in accordance with its
terms, except as enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws or equitable principles relating to
or limiting creditors’ rights generally;
 
(b) the execution, delivery and performance by the Company of this Consent (i)
has been duly authorized by all requisite corporate action and, if required,
shareholder action, (ii) does not require the consent or approval of any
governmental or regulatory body or agency, and (iii) will not (A) violate (1)
any provision of law, statute, rule or regulation or its certificate of
incorporation or bylaws, (2) any order of any court or any rule, regulation or
order of any other agency or government binding upon it, or (3) any provision of
any material indenture, agreement or other instrument to which it is a party or
by which its properties or assets are or may be bound, or (B) result in a breach
or constitute (alone or with due notice or lapse of time or both) a default
under any indenture, agreement or other instrument referred to in clause
(iii)(A)(3) of this Section 2.1(b);
 
 
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(c) as of the date hereof and after giving effect to this Consent, no Default or
Event of Default has occurred which is continuing and no condition exists which
has resulted in, or could reasonably be expected to have, a Material Adverse
Effect;
 
(d) all the representations and warranties contained in Section 5 of the Note
Agreement and in the Subsidiary Guaranty are true and correct in all material
respects with the same force and effect as if made by the Company and the
Subsidiary Guarantors, respectively, on and as of the date hereof;
 
(e) all Subsidiaries that are required to enter into the Subsidiary Guaranty or
enter into a joinder agreement in respect of the Subsidiary Guaranty pursuant to
Section 9.6 of the Note Agreement have so entered into the Subsidiary Guaranty
or a joinder agreement in respect of the Subsidiary Guaranty and are listed on
the signature pages to this Consent as Subsidiary Guarantors; and
 
(f) other than as expressly set forth in the Bank Credit Agreement Consent (as
defined below) or as expressly set forth in the Private Placement Note Agreement
Consent (as defined below), neither the Company nor any of its Subsidiaries on
or prior to the Consent Effective Date has paid or agreed to pay, nor will the
Company or any of its Subsidiaries pay or agree to pay on or after to the
Consent Effective Date, any fees or other compensation to the Administrative
Agent, any Bank Lender or any holder of the  notes issued pursuant to the
Private Placement Note Documents for or with respect to the Bank Credit
Agreement Consent (as defined below) or the Private Placement Note Agreement
Consent (as defined below) (in each case other than for the reimbursement of out
of pocket expenses in connection therewith).
 
SECTION 3. CONDITIONS TO EFFECTIVENESS OF THIS CONSENT.
 
Section 3.1. This Consent shall not become effective until, and shall become
effective when, each and every one of the following conditions shall have been
satisfied:
 
(a) executed counterparts of this Consent, duly executed by the Company, each of
the Subsidiary Guarantors and the Noteholders, shall have been delivered to the
Noteholders;
 
(b) the Company shall have delivered to the Noteholders executed copies of (i)
the Consent Memorandum dated as of the date hereof among the Company, certain
Subsidiaries of the Company named therein, JPMorgan Chase Bank, N.A., as agent,
and the other financial institutions party thereto (the “Bank Credit Agreement
Consent”), and (ii) the Consent dated as of the date hereof among the Company
and the holders of the 2005 Notes and any other notes issued pursuant to the
Private Placement Note Docuemnts (the “Private Placement Note Agreement
Consent”), and all related agreements, documents and instruments, in each case,
in connection therewith, all of which shall be in form and substance
satisfactory to the Noteholders;
 
(c) the Company shall have paid an amendment fee in an aggregate amount of
$10,000 to the Noteholders pro rata based upon the principal amount of the Notes
outstanding as of the Consent Effective Date held by each Noteholder; and
 
the representations and warranties of the Company set forth in Section 2 hereof
are true and correct on and with respect to the date hereof.
 
Upon receipt of all of the foregoing, this Consent shall become effective (the
“Consent Effective Date”).

SECTION 4. MISCELLANEOUS.
 
Section 4.1. This Consent shall be construed in connection with and as part of
the Note Agreement and, except as expressly provided in this Consent, all terms,
conditions and covenants contained in the Note Agreement, the Subsidiary
Guaranty and the Notes are hereby ratified and shall be and remain in full force
and effect.
 
Section 4.2. Except as expressly provided in this Consent, the execution,
delivery and effectiveness of this Consent shall not (a) amend the Note
Agreement, the Subsidiary Guaranty or any Note, (b) operate as a waiver of any
right, power or remedy of any Noteholder, or (c) constitute a waiver of, or
consent to any departure from, any provision of the Note Agreement, the
Subsidiary Guaranty or any Note at any time.
 
Section 4.3. Any and all notices, requests, certificates and other instruments
executed and delivered after the execution and delivery of this Consent may
refer to the Note Agreement without making specific reference to this Consent
but nevertheless all such references shall include this Consent unless the
context otherwise requires.  At all times on and after the Consent Effective
Date, each reference to the Note Agreement in any other document, instrument or
agreement shall mean and be a reference to the Note Agreement as modified by
this Consent.
 
Section 4.4. The descriptive headings of the various Sections or parts of this
Consent are for convenience only and shall not affect the meaning or
construction of any of the provisions hereof.
 
Section 4.5. This Consent shall be governed by and construed in accordance with
the laws of the State of New York excluding choice-of-law principles of the law
of such State that would require the application of the laws of a jurisdiction
other than such State.
 
Section 4.6. The Company hereby confirms its obligations under the Note
Agreement, whether or not the transactions hereby contemplated are consummated,
to pay, promptly after request, the reasonable fees and expenses of Choate, Hall
& Stewart, LLP, special counsel to the Noteholders, in connection with the
negotiation, preparation, approval, execution and delivery of this Consent.
 
 
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The execution hereof by you shall constitute a contract between us for the uses
and purposes hereinabove set forth, and this Consent may be executed in any
number of counterparts, each executed counterpart constituting an original, but
all together only one agreement.
 
Very truly yours,
 

 
SCHAWK, INC.
 
 
By:
/s/Timothy J. Cunningham
 

 
 
Name:
Timothy J. Cunningham

 
 
Title:
Executive Vice President & CFO

 
Each of the Subsidiary Guarantors hereby (i) consents to the foregoing Consent
and ratifies the consents contained therein, (ii) ratifies and reaffirms all of
its obligations and liabilities under each Subsidiary Guaranty (as defined in
the Note Agreement referred to in the Consent) notwithstanding the Consent or
otherwise, (iii) confirms that each Subsidiary Guaranty remains in full force
and effect after giving effect to the Consent, (iv) represents and warrants that
there is no defense, counterclaim or offset of any type or nature under any
Subsidiary Guaranty, (v) agrees that nothing in any Subsidiary Guaranty, the
Note Agreement, the Consent or any other agreement or instrument relating
thereto requires the consent of any Subsidiary Guarantor or shall be deemed to
require the consent of any Subsidiary Guarantor to any future amendment or other
modification to the Note Agreement, and (vi) waives acceptance and notice of
acceptance hereof.
 

 
SCHAWK USA, INC.
 
By:       /s/Timothy J.
Cunningham                                                            
Name: Timothy J.
Cunningham                                                            
Its: Vice President                                                            
 
SCHAWK WORLDWIDE HOLDINGS INC.
 
By:       /s/Timothy J.
Cunningham                                                            
Name: Timothy J.
Cunningham                                                            
Its: Vice President                                                            
 
SCHAWK LLC
By: Schawk USA Inc., its Sole Member
 
By:       /s/Timothy J.
Cunningham                                                            
Name: Timothy J.
Cunningham                                                            
Its: Vice President                                                            
 
SCHAWK HOLDINGS INC.
 
By:       /s/Timothy J.
Cunningham                                                            
Name: Timothy J.
Cunningham                                                            
Its: Vice President                                                            
 
SEVEN SEATTLE, INC.
 
By:       /s/Timothy J.
Cunningham                                                            
Name: Timothy J.
Cunningham                                                            
Its: Vice President                                                            
 
SCHAWK DIGITAL SOLUTIONS INC.
 
By:       /s/Timothy J.
Cunningham                                                            
Name: Timothy J.
Cunningham                                                            
Its: Vice President                                                            
 
MIRAMAR EQUIPMENT, INC.
 
By:       /s/Timothy J.
Cunningham                                                            
Name: Timothy J.
Cunningham                                                            
Its: Vice President                                                            
 
KEDZIE AIRCRAFT, LLC
By: Schawk USA Inc., its Sole Member
 
By:       /s/Timothy J.
Cunningham                                                            
Name: Timothy J.
Cunningham                                                            
Its: Vice President                                                            
 
SCHAWK LATIN AMERICA HOLDINGS LLC
 
By:       /s/Timothy J.
Cunningham                                                            
Name: Timothy J.
Cunningham                                                            
Its: Vice President                                                            
   

 
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Accepted as of the date first written above.
 
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
 
 
By:
Babson Capital Management LLC,

 
 
as Investment Adviser

 
 
By:
/s/Elisabeth A. Perenick
 

 
 
Name:
Elisabeth A. Perenick

 
 
Title:
Managing Director

 
C.M. LIFE INSURANCE COMPANY
 
 
By:
Babson Capital Management LLC,

 
 
as Investment Adviser

 
 
By:
/s/Elisabeth A. Perenick
 

 
 
Name:
Elisabeth A. Perenick

 
 
Title:
Managing Director

 
MASS MUTUAL ASIA LIMITED
 
 
By:
Babson Capital Management LLC,

 
 
as Investment Adviser

 
 
By:
/s/Elisabeth A. Perenick
 

 
 
Name:
Elisabeth A. Perenick

 
 
Title:
Managing Director

 

 

 
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