Exhibit 10.2
 
New Century Equity Holdings Corp.
200 Crescent Court, Suite 1400
Dallas, Texas 75201
 

 
February 13, 2009
 

Horst Dieter Esch
1090 Primrose Place
Park City, UT 84098

Dear Dieter:
 
Reference is hereby made to:
 
(a) that certain Loan Agreement, dated as of December 21, 2005, as amended,
modified or supplemented, from time to time (the “Loan Agreement”, and together
with all documents ancillary to the Loan Agreement, the “Loan Documents”),
between Wilhelmina International Ltd., a New York corporation (the “Company”),
and Signature Bank (“Signature Bank”);
 
(b) that certain agreement, dated as of August 25, 2008 (the “Acquisition
Agreement”), by and among New Century Equity Holdings Corp., a Delaware
corporation (“NCEH” or “we”), Wilhelmina Acquisition Corp., a New York
corporation (“Wilhelmina Acquisition”), Dieter Esch (“Esch” or “you”), Lorex
Investments AG, a Swiss corporation, Brad Krassner (“Krassner”), Krassner Family
Investments Limited Partnership, a Nevada limited partnership, the Company,
Wilhelmina – Miami, Inc., a Florida corporation (“Wilhelmina Miami”), Wilhelmina
Artist Management LLC, a New York limited liability company (“WAM”), Wilhelmina
Licensing LLC, a Delaware limited liability company (“Wilhelmina Licensing”),
Wilhelmina Film & TV Productions LLC, a New York limited liability company
(“Wilhelmina TV”, and together with the Company, Wilhelmina Miami, WAM and
Wilhelmina Licensing, the “Wilhelmina Companies”), Sean Patterson, and the
shareholders of Wilhelmina Miami; and
 
(c) that certain allocation letter dated August 25, 2008 (the “Allocation
Letter”) between Esch and Krassner directing NCEH with respect to the payment of
proceeds under Section 2.3(d) of the Acquisition Agreement.
 
Capitalized terms used but not defined herein shall have the respective meanings
given to such terms in the Acquisition Agreement unless the context otherwise
requires.
 
For good and valuable consideration (including in order to facilitate a mutually
beneficial closing under the Acquisition Agreement), the receipt and sufficiency
of which is hereby acknowledged, you and we hereby agree as follows:
 

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A.
Escrow

 
Notwithstanding the provisions of Section 2.3 of the Acquisition Agreement and
the directions set forth in the Allocation Letter, one million seven hundred and
fifty thousand dollars ($1.75 million) of the cash proceeds to be paid to Esch
at Closing (taking into account the terms of the Allocation Letter) (such
amount, “Bank Holdback Amount”) shall instead be paid to and  held in escrow by
the Escrow Agent until the occurrence of either (a) a Holdback Release Event (as
defined below) or (b) Bank Payoff Event (as defined below).  Funds held in
escrow pursuant to the foregoing shall remain strictly in the custody and
control of the Escrow Agent until any release pursuant to Section B below and
shall be invested in a money market fund invested principally in US
Treasuries.  The “Escrow Agent” shall initially be Olshan Grundman Frome
Rosenzweig & Wolosky LLP (“Olshan”) (to whom the Bank Holdback Amount proceeds
shall be remitted promptly following Closing, and no later then three (3)
Business Days thereafter to enable preparation of an appropriate account);
provided that, within fifteen (15) days following the Closing, Esch and NCEH
shall use their reasonable best efforts to select a mutually acceptable third
party escrow agent, which third party shall become the “Escrow Agent” hereunder
upon execution of an applicable assignment from Olshan or a similar document
which includes the precise obligations hereunder (which other escrow document
may include such other customary terms applicable to escrow agents as are
mutually acceptable to the parties).
 

 
B.
Release

 
Upon the occurrence of a Holdback Release Event, the Escrow Agent shall pay
directly to you by check or wire (at your election) from escrow all or any
remaining portion (as applicable) of the Bank Holdback Amount then held in
escrow by the Escrow Agent.  For the avoidance of doubt, in the event that a
Bank Payoff Event occurred and all or a portion of the Bank Holdback Amount was
paid by the Escrow Agent to Signature Bank, NCEH shall have no liability to Esch
for proceeds payable under the Acquisition Agreement (which proceeds were
escrowed hereunder and paid to Signature Bank) other than in respect of amounts
set forth in any issued Notes (as defined below) in accordance with the terms
thereof.
 
A “Holdback Release Event” shall mean (1) the closing of (and initial funding to
NCEH under) a new revolving bank facility (other than under the Loan Documents)
for NCEH or the Company which provides committed working capital financing to
NCEH or the Company on terms acceptable to NCEH in its absolute discretion and
of a size materially comparable to the bank facility (including the term loan)
under the Loan Documents or (2) the extension by Signature Bank of the Loan
Documents (including the maturity of the revolving credit note) for a term
extending to December 31, 2009 or later without (a) any adverse change in the
terms of the Loan Documents (as of the date hereof) that is not immaterial (it
being understood and agreed that an increase in the rate of interest by 1% or
less shall be deemed immaterial) and (b) any requirement that additional equity
capital in NCEH or the Company (or any of its subsidiaries) be contributed or
raised.
 
 Upon the occurrence of a Bank Payoff Event (which may occur one or more times),
the Escrow Agent shall release and pay from escrow all or such portion (as
determined by NCEH upon written notice to the Escrow Agent) of the Bank Holdback
Amount in cash to Signature Bank in satisfaction of all or a portion of amounts
(principal and/or interest) outstanding due to Signature Bank under the Loan
Documents; provided that, if Esch and NCEH deliver a Mutual Deferral Notice,
then the Escrow Agent shall release such funds only upon subsequent direction by
NCEH (provided that a Bank Payoff Event continues to apply).  A “Mutual Deferral
Notice” shall mean a notice signed by both Esch and NCEH directing the Escrow
Agent to not release all or any portion of the Bank Holdback Notice until
further notice by NCEH.
 

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A “Bank Payoff Event” shall mean:
 
(1) written notification by Signature Bank to the Company of the occurrence of
any Event of Default (as defined in the Loan Documents) under the Loan
Documents;
 
(2) written notification to the Company by Signature Bank of the termination of
the Loan Agreement (or any termination or reduction in the committed financing
thereunder) and/or notification of any mandatory repayment of principal by the
Company under any of the Loan Documents (including the revolving credit note) or
acceleration thereof;
 
(3) Signature Bank’s failure to acknowledge in a writing reasonably satisfactory
to NCEH that Signature Bank does not possess liens on, or security interests in,
any shares of stock in the Company or Wilhelmina Miami or any membership or
other equity interests in the other Wilhelmina Transferred Companies, or
Signature Bank’s failure or refusal to release any such liens held by Signature
Bank on such shares of stock or on any membership or other equity interests
(through the return of share certificates to the Company or other appropriate
action as reasonably requested by Purchaser’s counsel) and, in either case, such
failure (or refusal to release) continues for a period of thirty calendar days
following the Closing Date; or
 
(4) written notification to NCEH or the Company by Signature Bank of
any  requirement by Signature Bank that, in order to extend the term of the Loan
Agreement, additional equity capital in NCEH or the Company (or any of its
subsidiaries) is required to be contributed or raised.
 
An email communication shall be deemed written notification described in the
foregoing clauses (1)-(4).
 

 
C.
Issuance of Notes

 
           In the event that the Escrow Agent pays Signature Bank any portion of
the Bank Holdback Amount from escrow (any such payment, a “Payback Amount”) upon
a Bank Payoff Event, NCEH shall promptly issue to Esch, in replacement thereof,
a promissory note (a “Note”) in the form set forth as Exhibit A hereto in the
principal amount of such Payback Amount.  NCEH may issue one or more such Notes
to Esch, not to exceed an aggregate principal amount (between all such Notes)
equal to the Bank Holdback Amount.  Notes shall be issued directly to Esch and
shall not be held in escrow.
 

 
D.
Termination

 
This letter agreement shall terminate upon the release and payment by the Escrow
Agent to Esch and/or to Signature Bank of all remaining amounts held in escrow
pursuant to Section A.  The termination of this letter agreement shall have no
effect on any Notes issued by NCEH pursuant to paragraph C above, which Notes
shall remain in full force and effect.
 

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E.
Other

 
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ANY CHOICE OR CONFLICT OF LAW
PROVISION OR RULE (WHETHER OF THE STATE OF NEW YORK OR ANY OTHER JURISDICTION)
THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION OTHER
THAN THE STATE OF NEW YORK.  EACH OF ESCH AND NCEH HEREBY IRREVOCABLY SUBMITS TO
THE EXCLUSIVE PERSONAL AND SUBJECT MATTER JURISDICTION OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND THE SUPREME COURT OF
THE STATE OF NEW YORK LOCATED IN THE BOROUGH OF MANHATTAN OVER ANY SUIT, ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.  EACH OF ESCH AND
NCEH HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW (A) ANY
OBJECTION THAT THEY MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT; AND (B) ANY CLAIM THAT ANY SUCH
SUIT, ACTION OR PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
 
EACH OF ESCH AND NCEH HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY LAW, ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
(WHETHER BASED UPON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY.
 
  This letter agreement and any Note issued pursuant to the terms hereof shall
constitute the entire understanding between NCEH and Esch with respect to the
subject matter hereof and supersedes all other agreements and understandings
among NCEH and Esch with respect hereto. NCEH and Esch acknowledge and agree
that the agreement set forth herein does not require any amendment to the
Acquisition Agreement and shall operate as a standalone side agreement between
NCEH and Esch.  Each of NCEH and Esch is represented by counsel in connection
with the negotiation and execution hereof.

Please execute below to indicate your agreement to the terms hereof.

[Signature Page Follows]
 

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[Signature Page to Esch Letter re Bank Holdback Amount]

Regards,

New Century Equity Holdings Corp.
   
/s/ John Murray
Name: John Murray
Title: Chief Financial Officer
 

Acknowledged and Agreed:
   
/s/ Horst Dieter Esch
Horst Dieter Esch