Exhibit 10.2

 

SECOND AMENDMENT TO TERM LOAN CREDIT AND SECURITY AGREEMENT

 

This Second Amendment to Term Loan Credit and Security Agreement (the
“Amendment”) is made this ______ day of March, 2017 by and among EVINE Live
Inc., a Minnesota corporation (“Evine”); ValueVision Interactive, Inc., a
Minnesota corporation; VVI Fulfillment Center, Inc., a Minnesota corporation;
ValueVision Media Acquisitions, Inc., a Delaware corporation; ValueVision
Retail, Inc., a Delaware corporation, Norwell Television, LLC, a Delaware
limited liability company, and PW Acquisition Company, LLC, a Minnesota limited
liability company (each a “Borrower”, and collectively “Borrowers”); the
financial institutions which are now or which hereafter become a party thereto
as lenders (the “Lenders”) and GACP Finance Co., LLC (“GACP”), as agent for
Lenders (GACP, in such capacity, the “Agent”).

 

BACKGROUND

 

A.       On March 10, 2016, certain Borrowers, Lenders and Agent entered into,
inter alia, that certain Term Loan Credit and Security Agreement (as same has
been or may be amended, modified, renewed, extended, replaced or substituted
from time to time, the “Loan Agreement”) to reflect certain financing
arrangements between the parties thereto. The Loan Agreement and all other
documents executed in connection therewith to the date hereof are collectively
referred to as the “Existing Financing Agreements.” All capitalized terms not
otherwise defined herein shall have the meaning ascribed thereto in the Loan
Agreement.

 

B.        The Borrower intend to make a voluntary prepayment of the principal
amount under the Loan Agreement in an aggregate principal amount equal to
$9,500,000 (plus all accrued and unpaid interest and fees (including any
Prepayment Premium or prepayment fees thereon)) (the “March 2017 Prepayment”)
and in connection therewith have requested a waiver of the required 10 Business
Days’ prior written notice under Section 2.3(d) of the Loan Agreement.

 

C.       The Borrowers have requested and the Agent and the Lenders have agreed
to amend certain terms and provisions contained in the Loan Agreement subject to
the terms and conditions of this Amendment.

 

   

 

 

NOW, THEREFORE, with the foregoing background hereinafter deemed incorporated by
reference herein and made part hereof, the parties hereto, intending to be
legally bound, promise and agree as follows:

 

1.       Amendment. Upon the Effective Date, the Loan Agreement shall be amended
as follows:

 

Section 6.5(b) of the Loan Agreement shall be deleted in its entirety and
replaced as follows:

 

(b)       Minimum EBITDA. (i) If the PNC Credit Agreement (or any refinancing
indebtedness in respect thereof) is in effect, if at any time during any fiscal
quarter, (x) an Event of Default is continuing or (y) Borrowers’ Undrawn
Availability (as defined in the PNC Credit Agreement as in effect on the date
hereof) is equal to or less than $18,000,000, cause to be achieved a minimum
EBITDA of not less than the following amounts as of the end of the fiscal
quarter immediately prior to the fiscal quarter during which Borrowers’ Undrawn
Availability was less than the foregoing amount or during which such Event of
Default occurred and as of the end of each fiscal quarter thereafter until such
Event of Default is waived or Undrawn Availability at all times during a
subsequent fiscal quarter is not less than $18,000,000 or (ii) the PNC Credit
Agreement (or any refinancing indebtedness in respect thereof) is no longer
effect, if at any time during any fiscal quarter, (x) an Event of Default is
continuing or (y) Borrowers’ Liquidity is equal to or less than $7,500,000,
cause to be achieved a minimum EBITDA of not less than the following amounts as
of the end of each fiscal quarter (in each case to be tested for the four
quarter period then ending on or about the date specified below):

 

Quarters Ending Amount January 31, 2016, April 30, 2016, July 31, 2016, October
31, 2016 $10,000,000 January 31, 2017, April 30, 2017, July 31, 2017, October
31, 2017 $14,000,000 January 31, 2018, April 30, 2018, July 31, 2018, October
31, 2018 $16,000,000

 

Each fiscal year thereafter, the EBITDA to be tested in each fiscal quarter
during such year, shall be an amount equal to 115% of the prior fiscal year
covenant amount.

 

2.       Representations and Warranties. Each of the Borrowers hereby:

 

(a)       reaffirms all representations and warranties made to Agent and Lenders
under the Loan Agreement and all of the Other Documents and confirms that after
giving effect to any updated schedules all are true and correct in all material
respects as of the date hereof (except to the extent any such representations
and warranties specifically relate to a specific date, in which case such
representations and warranties were true and correct in all material respects on
and as of such other specific date);

 

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(b)       reaffirms all of the covenants contained in the Loan Agreement and all
of the Other Documents, covenants to abide thereby until all Obligations and
other liabilities of Borrowers and Guarantors to Agent and Lenders under the
Loan Agreement and all of the Other Documents of whatever nature and whenever
incurred, are satisfied and/or released by Agent and Lenders;

 

(c)       represents and warrants that no Default or Event of Default has
occurred and is continuing under any of the Loan Agreement or any of the Other
Documents;

 

(d)       represents and warrants that it has the authority and legal right to
execute, deliver and carry out the terms of this Amendment, that such actions
were duly authorized by all necessary limited liability company or corporate
action, as applicable, and that the officers executing this Amendment on its
behalf were similarly authorized and empowered, and that this Amendment does not
contravene any provisions of its certificate of incorporation or formation,
operating agreement, bylaws, or other formation documents, as applicable, or of
any contract or agreement to which it is a party or by which any of its
properties are bound; and

 

(e)       represents and warrants that this Amendment and all assignments,
instruments, documents, and agreements executed and delivered in connection
herewith, are valid, binding and enforceable in accordance with their respective
terms, except as such enforceability may be limited by any applicable
bankruptcy, insolvency, moratorium or similar laws affecting creditors’ rights
generally.

 

3.       Conditions Precedent/Effectiveness Conditions. This Amendment shall be
effective upon the occurrence of the following conditions precedent, each in
form and substance satisfactory to Agent (the “Effective Date”):

 

(a)       Agent’s receipt of this Amendment fully executed by the Borrowers and
the Lenders;

 

(b)       Agent’s receipt of a fully executed amendment to the PNC Credit
Agreement in form and substance satisfactory to the Agent, which also permits
the making and receipt of the March 2017 Prepayment in an aggregate principal
amount of $9,500,000 plus $113,050.00 on account of accrued and unpaid interest
through March 21, 2017 (with interest accruing at a daily rate of $5,383.33 per
day thereafter) and fees plus $190,000 on account of the Prepayment Premium;

 

(c)       Agent’s receipt a fully executed amendment to the Intercreditor
Agreement;

 

(d)       Agent shall have received a secretary and incumbency certificate for
each Borrower identifying all authorized officers with specimen signatures, a
certificate of no change to the organizational documents of each Borrower, and
authorizing resolutions of each Borrower authorizing the execution of this
Amendment and the transactions contemplated herein;

 

(e)       Agent shall have received the executed legal opinion of Damon Schramm,
Esq in form and substance satisfactory to Agent which shall cover such matters
incident to the transactions contemplated by this Amendment as Agent may
reasonably require and each Borrower hereby authorizes and directs such counsel
to deliver such opinions to Agent and Lenders;

 

(f)       Agent shall have received Uniform Commercial Code, judgment and state
and federal tax lien searches against Borrowers showing no Liens on any of the
Collateral, other than Permitted Encumbrances;

 

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(g)       Agent shall have received a closing certificate signed by the Chief
Financial Officer of each Borrower dated as of the Effective Date, stating that
(i) all representations and warranties set forth in the Loan Agreement and the
Other Documents are true and correct in all material respects on and as of such
date after giving effect to the updated schedules, except to the extent such
representation or warranty was expressly made as of an earlier date, in which
case, such representation and warranty was true and correct in all material
respects on and as of such earlier date, (ii) each Borrower is on such date in
compliance in all material respects with all the terms and provisions set forth
in the Loan Agreement and the Other Documents and (iii) on such date no Default
or Event of Default has occurred or is continuing;

 

(h)       Agent shall have received on behalf of the Lenders a wire transfer in
immediately available funds of the March 2017 Prepayment in an aggregate
principal amount of $9,500,000 plus $$113,050.00 on account of accrued and
unpaid interest through March 21, 2017 (with interest accruing at a daily rate
of $5,383.33 per day thereafter) and fees plus $190,000 on account of the
Prepayment Premium; and

 

(i)       Agent’s receipt of such other documents as Agent or counsel to Agent
may reasonably request.

 

4.       Waiver. Subject to the occurrence of the Effective Date, the Agent and
Lenders waive 10 Business Days’ prior written notice to Agent required under
Section 2.3(c) in connection with the March 2017 Prepayment.

 

5.       Further Assurances. Each of the Borrowers hereby agrees to take all
such actions and to execute and/or deliver to Agent and Lenders all such
documents, assignments, financing statements and other documents, as Agent and
Lenders may reasonably require from time to time, to effectuate and implement
the purposes of this Amendment.

 

6.       Payment of Expenses. Borrowers shall pay or reimburse Agent and Lenders
for its reasonable attorneys’ fees and expenses in connection with the
preparation, negotiation and execution of this Amendment and the documents
provided for herein or related hereto.

 

7.       Reaffirmation of Loan Agreement. Except as modified by the terms
hereof, all of the terms and conditions of the Loan Agreement, as amended, and
all of the Other Documents are hereby ratified and reaffirmed and shall continue
in full force and effect as therein written.

 

8.       Miscellaneous.

 

(a)       Third Party Rights. No rights are intended to be created hereunder for
the benefit of any third party donee, creditor, or incidental beneficiary.

 

(b)       Headings. The headings of any paragraph of this Amendment are for
convenience only and shall not be used to interpret any provision hereof.

 

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(c)       Modifications. No modification hereof or any agreement referred to
herein shall be binding or enforceable unless in writing and signed on behalf of
the party against whom enforcement is sought.

 

(d)       Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of New York applied to contracts to be
performed wholly within the State of New York.

 

(e)       Counterparts. This Amendment may be executed in any number of and by
different parties hereto on separate counterparts, all of which, when so
executed, shall be deemed an original, but all such counterparts shall
constitute one and the same agreement. Any signature delivered by a party by
facsimile transmission or PDF shall be deemed to be an original signature
hereto.

 

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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: EVINE LIVE INC.                   By:         Name: Timothy Peterman
    Title: Chief Financial Officer             VALUEVISION INTERACTIVE, INC.    
              By:         Name: Timothy Peterman     Title: Chief Financial
Officer             VVI FULFILLMENT CENTER, INC.                   By:        
Name: Timothy Peterman     Title: Chief Financial Officer            
VALUEVISION MEDIA ACQUISITIONS, INC.                   By:         Name: Timothy
Peterman     Title: Chief Financial Officer             VALUEVISION RETAIL, INC.
                  By:         Name: Timothy Peterman     Title: Chief Financial
Officer             NORWELL TELEVISION, LLC                   By:         Name:
Timothy Peterman     Title: Chief Financial Officer  

 

  PW ACQUISITION COMPANY, LLC                   By:         Name: Timothy
Peterman     Title: Chief Financial Officer  

 

[SIGNATURE PAGE TO SECOND AMENDMENT TO TERM LOAN CREDIT AND SECURITY AGREEMENT]

 

 

AGENT: GACP FINANCE CO., LLC as Agent                   By:                     
John Ahn, President           LENDERS: GACP I, L.P., as Lender                  
By:                      John Ahn, President             Address:            
GACP I, L.P.     Attn:  Robert A. Louzan     73 Old Ridgefield Road, Suite 6    
Wilton, CT 06897  

 

[SIGNATURE PAGE TO SECOND AMENDMENT TO TERM LOAN CREDIT AND SECURITY AGREEMENT]