Exhibit 10.2
 
LETTER AMENDMENT NO. 4 TO FORBEARANCE AGREEMENT
 
 
Dated as of October 20, 2009
 
To:
the Agent and Lenders party to

 
 the Forbearance Agreement

 
 referred to below

 
  Ladies and Gentlemen:
 
We refer to the Forbearance Agreement dated as of September 3, 2009, as amended
by the Letter Amendment to the Forbearance Agreement dated as of September 14,
2009, the Letter Amendment No. 2 to the Forbearance Agreement dated as of
September 30, 2009 and the Letter Amendment No. 3 to the Forbearance Agreement
dated as of October 2, 2009 (such Forbearance Agreement, as so amended, the
“Forbearance Agreement”; capitalized terms used herein and not defined herein
shall have the meanings ascribed thereto in the Forbearance Agreement) among
BANK OF AMERICA, N.A., as Administrative Agent and Collateral Agent for the
Lenders under the Credit Agreement referred to therein (in such capacities, the
“Agent”), the Lenders party thereto, NORTEK, INC. (the “Specified U.S.
Borrower”), VENTROL AIR HANDLING SYSTEMS INC. (the “Canadian Borrower” and,
together with the Specified U.S. Borrower and each other Borrower from time to
time party to the Credit Agreement referred to therein, the “Borrowers”), and
the other Loan Parties (as defined in the Credit Agreement referred to therein).
 
We hereby request, and the Required Lenders hereby agree, that the Forbearance
Agreement be hereby amended as follows:
 
(a)           Section 1(a) of the Forbearance Agreement is hereby amended by
replacing “October 20, 2009” therein with “October 27, 2009”; and
 
(b)           Section 2(p) of the Forbearance Agreement is hereby amended by
replacing “October 20, 2009” therein with “October 27, 2009”.
 
This Letter Amendment shall become effective as of the date first above written
when, and only when:
 
(a)           the Agent shall have received counterparts of this Letter
Amendment executed by the Loan Parties and the Required Lenders or, as to any of
the Required Lenders, advice satisfactory to the Agent that such Lender has
executed this Letter Amendment;
 
(b)           (i) an amendment (the “Lock-Up Amendment”) to the Restructuring
and Lock-Up Agreement, dated as of September 3, 2009 (as amended by that certain
First Amendment to the Restructuring and Lock Up Agreement, dated as of
September 14, 2009, the “Lock-Up Agreement”) shall have been executed and
delivered by the Nortek Parties (as defined in the Lock-Up Agreement) and the
requisite Consenting Debtholders (as defined in the Lock-Up Agreement), in the
form attached as Exhibit A hereto, (ii) except as set forth herein, the Lock-Up
Agreement shall not have been amended, supplemented or otherwise modified except
to the extent satisfactory to the Required Lenders and (iii) the Agent shall
have received a certificate from the Specified U.S. Borrower (A) attaching a
true and complete copy of the Lock-Up Amendment and (B) certifying to the Agent
that the Lock-Up Amendment has become fully effective in accordance with the
terms thereof and of the Lock-Up Agreement; and
 
(c)           immediately prior to the effectiveness of this Letter Amendment,
no Default (other than a Specified Default) shall have occurred and be
continuing.
 
On and after the effectiveness of this Letter Amendment, each reference in the
Forbearance Agreement to “this Agreement”, “hereunder”, “hereof” or words of
like import referring to the Forbearance Agreement, and each reference in the
Loan Documents to the “Forbearance Agreement”, shall mean and be a reference to
the Forbearance Agreement, as modified hereby.  The forbearance agreements
contained in the Forbearance Agreement, as modified hereby, shall be binding on
all Lenders in accordance with Section 11.01 of the Credit Agreement.
 
The Forbearance Agreement and each of the other Loan Documents, as specifically
amended or otherwise modified by this Letter Amendment, are and shall continue
to be in full force and effect and are hereby in all respects ratified and
confirmed.  The execution, delivery and effectiveness of this Letter Amendment
shall not, except as expressly provided herein, operate as a waiver of any
right, power or remedy of any Secured Party or the Agent under any of the Loan
Documents, nor constitute a waiver of any provision of any of the Loan
Documents.  Nothing contained in this Letter Amendment and no action by, or
inaction on the part of, any Secured Party or the Agent shall, or shall be
deemed to, directly or indirectly (i) constitute a consent to or waiver of any
past, present or future violation of any provision of the Credit Agreement or
any other Loan Document, (ii) except as expressly set forth herein, amend,
modify or operate as a waiver of any provision of the Credit Agreement or any
other Loan Document or of any right, power, or remedy of the Agent or any
Secured Party thereunder or (iii) constitute a course of dealing or other basis
for altering any obligation of the Loan Parties under the Loan Documents or any
other contract or instrument. The Loan Parties and the Required Lenders hereby
agree that this Letter Amendment shall be a Loan Document for all purposes of
the Credit Agreement and the other Loan Documents.
 
Each Loan Party ratifies and reaffirms the validity and enforceability (without
defense, counterclaim or offset of any kind and not subject to any avoidance,
reduction, recharacterization, subordination (whether equitable, contractual or
otherwise but subject to the Intercreditor Amendment), counterclaim,
cross-claim, defense, disallowance, impairment, objection or any challenges
under any applicable Law or by any Person) of the Liens and security interests
granted to secure any of the Obligations to and for the benefit of the Secured
Parties, pursuant to the Loan Documents.  Each Loan Party acknowledges and
agrees that all such Liens and security interests granted by it secure, and
shall continue to secure, the Obligations and the Guaranties from and after the
date hereof.
 
In consideration of the Lenders’ execution and delivery of this Letter
Amendment, each Loan Party and each of their successors and assigns (including,
without limitation, any receiver or trustee, collectively, the “Releasors”) does
hereby forever acquit, waive, release and discharge each of the Agent and each
Lender party hereto and each of their respective successors, assigns,
affiliates, directors, officers, employees, agents, attorneys, consultants,
advisors and other Related Parties (collectively, the “Releasees”) of and from
any and all claims (including, without limitation, any liabilities, damages,
demands and causes of action to the extent arising therefrom) whatsoever, in law
or in equity, whether known or unknown, which the Releasors ever had, have now,
or hereinafter can, shall or may have against any Releasee by reason of (a) any
matter arising on or prior to the date hereof out of the Credit Agreement, the
Forbearance Agreement or the other Loan Documents and (b) any and all other
actions or omissions relating in any way thereto done or omitted to be done on
or prior to the date hereof.  This paragraph shall survive (i) the expiration or
termination of the Forbearance Period, of the Forbearance Agreement and of this
Letter Amendment and (ii) the termination of the Credit Agreement, the payment
in full of all Obligations and the termination of all Commitments.
 
This Letter Amendment may be executed by one or more of the parties to this
Letter Amendment on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.  Any party hereto may execute and deliver a counterpart of this
Letter Amendment by delivering by facsimile transmission or electronic mail in
portable document format a signature page of this Letter Amendment signed by
such party, and such signature shall be treated in all respects as having the
same effect as an original signature.
 
This Letter Amendment shall be governed by, and construed in accordance with,
the laws of the State of New York.
 
 

 
Very truly yours,
 
NORTEK, INC., as the Specified U.S.
Borrower and as a Guarantor
 
 
By:  /s/Edward J. Cooney
Name:  Edward J. Cooney
Title:    Vice President and Treasurer
     
VENTROL AIR HANDLING SYSTEMS INC.,
As the Canadian Borrower
 
By:  /s/Edward J. Cooney
Name:  Edward J. Cooney
Title:    Vice President and Treasurer

 
AIGIS MECHTRONICS, INC.
BROAN-MEXICO HOLDINGS, INC.
BROAN-NUTONE LLC
BROAN-NUTONE STORAGE SOLUTIONS LP
CES GROUP, INC.
CES INTERNATIONAL LTD.
CLEANPAK INTERNATIONAL, INC.
ELAN HOME SYSTEMS, L.L.C.
GEFEN, INC.
GOVERNAIR CORPORATION
GTO, INC.
HC INSTALLATIONS, INC.
HOMELOGIC LLC
HUNTAIR, INC.
INTERNATIONAL ELECTRONICS, INC.
LINEAR H.K. LLC
LINEAR LLC
LITE TOUCH, INC.
MAGENTA RESEARCH LTD.
MAMMOTH-WEBCO, INC.
NILES AUDIO CORPORATION
NORDYNE INC.
NORDYNE INTERNATIONAL, INC.
NORTEK INTERNATIONAL, INC.
NUTONE LLC
OMNIMOUNT SYSTEMS, INC.
OPERATOR SPECIALTY COMPANY, INC.
PACIFIC ZEPHYR RANGE HOOD, INC.
PANAMAX INC.
RANGAIRE GP, INC.
RANGAIRE LP, INC.
SECURE WIRELESS, INC.
SPEAKERCRAFT, INC.
TEMTROL, INC.
WDS LLC
XANTECH CORPORATION
ZEPHYR CORPORATION
 
 
as a Borrower and Guarantor
 
 
By:        /s/ Edward J. Cooney             
Name:  Edward J. Cooney
Title:     Vice President and Treasurer
 
(of entity listed or as an officer of the managing member, sole member or
general partner)

 
BROAN-NUTONE CANADA INC.
INNERGY TECH INC.
VENMAR CES, INC.
VENMAR VENTILATION INC.
VENMAR VENTILATION (H.D.H.) INC.
 
as a Guarantor
 
 
By:   /s/ Edward J. Cooney                      
Name:  Edward J. Cooney
Title:     Vice President and Treasurer

 
 
Acknowledged and Agreed:

 
BANK OF AMERICA, N.A.,

 
as Agent

By:
/s/ Richard Levenson

 
Name:  Richard Levenson

 
Title:    Senior Vice President

 
BANK OF AMERICA, N.A.,

 
as U.S. L/C Issuer and Canadian L/C Issuer

By:
/s/ Richard Levenson

 
Name:  Richard Levenson

 
Title:    Senior Vice President

Acknowledged and Agreed:

WELLS FARGO FOOTHILL, LLC
 
By:        /s/ Ilene Silberman
Name:  Ilene Silberman
Title:     Vice President

Acknowledged and Agreed:

WELLS FARGO FOOTHILL CANADA ULC
 
By:        /s/ Sanat Amladi
Name:  Kurt Duerfeldt
Title:    Vice President

Exhibit A to

Letter Amendment No. 4 to Forebearance Agreement

Form of Lock-Up Amendment

SECOND AMENDMENT TO THE
RESTRUCTURING AND LOCK UP AGREEMENT

WHEREAS, the Parties entered into that certain Restructuring and Lock Up
Agreement, dated as of September 3, 2009 and amended on September 14, 2009 (the
“Agreement”) for the purpose of mutually agreeing to the terms of a pre-packaged
bankruptcy filing of the Nortek Parties;

WHEREAS, the Agreement provides that (a) no later than October 20, 2009, the
Nortek Parties shall file voluntary petitions for relief under chapter 11 of the
Bankruptcy Code, (b) the Agreement may be terminated by a specified vote of the
Consenting Debtholders on October 20, 2009, unless the Nortek Parties have
commenced chapter 11 cases and (c) the Forbearance Period shall terminate on the
earlier of (i) the Commencement Date, (ii) the date of an occurrence of a
Forbearance Default or (iii) October 20, 2009;

WHEREAS, in entering into the Agreement, it was the intention of the Parties
thereto that the Nortek Parties would commence their chapter 11 cases no later
than October 20, 2009;

WHEREAS, the Agreement provides that once effective, it may be amended in
accordance with Section 8 of the Agreement; and
 
 
WHEREAS, the Nortek Parties and the Consenting Debtholders constituting the
Requisite Debtholder Consent have agreed to enter into this amendment of the
Agreement (this “Second Amendment”) to amend the Agreement, effective as of
October 19, 2009, to extend the date by which the Nortek Parties shall be
required to commence the chapter 11 cases.

NOW, THEREFORE, in consideration of the foregoing, the mutual agreements and
covenants contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

1.           In Section 2.01 of the Agreement, “October 20, 2009” shall be
deleted, and “11:59 PM, prevailing Eastern time, on October 27, 2009” shall be
inserted in lieu thereof.

2.           In Section 3.03(a)(iii) of the Agreement, “October 20, 2009” shall
be deleted, and “11:59 PM, prevailing Eastern time, on October 27, 2009” shall
be inserted in lieu thereof.

3.           In Section 7.01(g) of the Agreement, “October 20, 2009” shall be
deleted, and “11:59 PM, prevailing Eastern time, on October 27, 2009” shall be
inserted in lieu thereof.

4.           The Parties also clarify and confirm their agreement that Section
11.6 of the Prepackaged Plan is intended to provide that each Person who is
entitled to receive a distribution under the Prepackaged Plan shall release all
“Released Parties” (as defined in the Prepackaged Plan) in respect of any and
all applicable Claims, demands, causes of action and the like that such Person
may have (including, without limitation, any NTK 10-3/4% Notes Claims or NTK
Holdings Senior Secured Loan Claims (each as defined in the Prepackaged Plan)
such Person may hold), without regard to whether or not the Prepackaged Plan is
confirmed with respect to NTK Holdings and/or Nortek Holdings.

5.           This Second Amendment may be executed in one or more counterparts,
each of which, when so executed, shall constitute an original and all of which
shall constitute one instrument.  The counterparts may be delivered by facsimile
transmission or by electronic mail in portable document format (.pdf).

6.           This Second Amendment shall be effective as of October 19, 2009,
upon the execution of the Nortek Parties and the Consenting Debtholders
constituting the Requisite Debtholder Consent, and shall only be amended in
accordance with Section 8 of the Agreement.

7.           Except as specifically amended or consented to herein, there are no
other amendments, modifications, or other alterations to the Agreement.

8.           Capitalized terms not defined herein shall have the meanings given
to them in the Agreement, and in the event of any inconsistency between the two,
the Agreement shall control.
IN WITNESS WHEREOF, the Parties have executed this Second Amendment on the day
and year first above written.
 

NTK HOLDINGS, INC.

By:  ______________________________
Name:  Edward J. Cooney
Title:     Vice President and Treasurer

NORTEK HOLDINGS, INC.

By:  ______________________________
Name:    Edward J. Cooney
Title:       Vice President and Treasurer

NORTEK, INC.

By:  ______________________________
Name:      Edward J. Cooney
Title:         Vice President and Treasurer
 
 
 
AIGIS MECHTRONICS, INC.
BROAN-MEXICO HOLDINGS, INC.
BROAN-NUTONE LLC
BROAN-NUTONE-STORAGE SOLUTIONS LP
CES GROUP, INC.
CES INTERNATIONAL LTD.
CLEANPAK INTERNATIONAL, INC.
ELAN HOME SYSTEMS, L.L.C.
GEFEN, INC.
GOVERNAIR CORPORATION
GTO, INC.
HC INSTALLATIONS, INC.
HUNTAIR, INC.
INTERNATIONAL ELECTRONICS, INC.
LINEAR LLC
LINEAR H.K. LLC
LITE TOUCH, INC.
MAGENTA RESEARCH LTD.
MAMMOTH-WEBCO, INC.
NILES AUDIO CORPORATION
NORDYNE INC.
NORDYNE INTERNATIONAL, INC.
NORTEK INTERNATIONAL, INC.
NUTONE INC.
OMNIMOUNT SYSTEMS, INC.
OPERATOR SPECIALTY COMPANY, INC.
PACIFIC ZEPHYR RANGE HOOD, INC.
PANAMAX INC.
RANGAIRE GP, INC.
RANGAIRE LP, INC.
SECURE WIRELESS, INC.
SPEAKERCRAFT, INC.
TEMTROL, INC.
XANTECH CORPORATION
ZEPHYR CORPORATION

By           _____________________
Name:    Edward J. Cooney
Title:       Vice President and Treasurer

 
(of entity listed or as an officer of the managing member, sole member or
general partner)

 
 
 
[CONSENTING DEBTHOLDER]

By:  ___________________________
Name:
Title:

Address: _________________________
       _________________________
       _________________________
Attn:         _________________________
Tel:          _________________________
Fax:         _________________________

Aggregate principal amount of Notes beneficially owned or managed on behalf of
accounts that hold or beneficially own such Notes:

8-1/2% Notes:  $_____________

10% Notes:  $_______________

10-3/4% Notes:  $___________________