Exhibit 10.2


 


JUNIOR PARTICIPATION AGREEMENT


 


JUNIOR
PARTICIPATION AGREEMENT (“Agreement”), is entered into as of February 22,
2010 by and among The Christopher John Kliefoth Revocable Trust
UA 07-10-2007 and Richard Horowitz (collectively or individually, “you” or
the “Junior Participants”), financial institutions set forth on the signature page hereto
(each a “Lender” and collectively, “Lenders”) and PNC Bank, National
Association (“PNC”), as agent for Lenders (in such capacity, the “Agent”).


 


1.             This Agreement will confirm your
participation with Agent and Lenders in the Revolving Advances made pursuant
to, and as such term is defined in, that certain Revolving Credit, Term Loan
and Security Agreement by and among Agent, Lenders and WM Coffman LLC (“Borrower”)
dated as of June 8, 2009 as heretofore and hereafter amended, supplemented
and/or otherwise modified, including without limitation by that certain
Forbearance and Amendment Agreement dated as of February 12, 2010 (the
“Loan Agreement”).  All capitalized terms
used but not otherwise defined in this Agreement shall have the meanings
ascribed to such terms in the Loan Agreement.


 


2.             Your participation in the Revolving
Advances is without recourse to Agent and Lenders and is subject to the terms
and provisions of this Agreement, the Loan Agreement and the Other Documents.


 


3.             Upon your remittance to Agent of
the sum of Two Hundred Fifty Thousand Dollars ($250,000), consisting of
$125,000 from each of the Junior Participants, Agent and Lenders shall sell to
you and you shall be deemed to have purchased from Agent and Lenders, on the
terms and conditions set forth in this Agreement, a junior and subordinate
“last out” participation (the “Junior Participation”) in the Revolving Advances
in such amount, but only in the manner and to the extent set forth in this
Agreement.


 


4.             You shall at all times have an
undivided but subordinated interest, to the extent of your Junior
Participation, in all Collateral heretofore or hereafter granted and/or
assigned to Agent and Lenders by Borrower from time to time or held by Agent
and Lenders pursuant to the Loan Agreement and the Other Documents.  You agree that Agent may from time to time,
in its sole discretion and without consulting or giving you any notice thereof,
amend, modify and/or renew the Loan Agreement and the Other Documents as Agent
determines in its sole and absolute discretion, and your Junior Participation
shall continue notwithstanding and such amendment, modification and/or renewal.  Agent shall provide to you promptly after the
execution and delivery thereof by the applicable parties, copies of any
amendments, modifications, supplements or other revisions to the Loan Agreement
and the Other Documents.  Notwithstanding
the foregoing, Agent shall provide you with not less than three (3) business
days written notice (unless such notice period is impracticable under any
applicable exigent circumstances, in which case Agent shall provide you with
such notice as is reasonably practicable) prior to taking any action, including
without limitation amending, modifying or supplementing the Loan Agreement
and/or the Other Documents, that is materially adverse to your interests.


 


5.             It is understood and agreed that
your Junior Participation shall constitute a junior and subordinate
participation in the outstanding Revolving Advances.


 


 

















 


6.             All amounts payable to you (whether
regarding principal, interest or otherwise) shall be repayable by Agent and
Lenders to you only on the termination of all of the transactions of Borrower
with Agent and Lenders, and only out of any surplus received by Agent and
Lenders remaining after the payment in full in cash to Agent and Lenders of all
Obligations owing to us under the Loan Agreement and the Other Documents
(exclusive of your Junior Participation), including expenses, interest and
charges, and owing to any senior participant of all monies owing to it under
its participation with Agent and Lenders. 
Such surplus, if any, shall be turned over to you, but in no event shall
the amount so turned over exceed the amount of your Junior Participation plus
accrued interest.  Other than the
principal amount of your Junior Participation plus accrued interest, you shall
not be entitled to any compensation or other payment with respect to your Junior
Participation.  By your confirmation and
acceptance of this Agreement, you represent that you are entitled to receive
any payments to be made to you hereunder without the withholding of any tax and
that, upon Agent’s request, you will furnish to Agent such certifications,
statements and other documents deemed necessary or appropriate by Agent to
evidence your exemption from the withholding of any tax imposed by any
applicable jurisdiction or to enable Agent to comply with any applicable laws
or regulations relating thereto.


 


7.             The amount of accrued interest owed
to you with respect to your Junior Participation (the “Junior Participant’s
Interest Amount”) shall by calculated at the Contract Rate, adjusted when said
interest rate changes.  The calculation
of the Junior Participant’s Interest Amount interest shall be made by Agent and
such calculation shall be binding on all parties absent manifest error.  The Junior Participant’s Interest Amount
shall merely be a calculation of the amount to be paid to you out of the
surplus (if any) described above, and neither Agent nor Borrower shall be
obligated to pay, collect or segregate such Junior Participant’s Interest
Amount in a deposit account or similar account. 
If the amount of Revolving Advances is less than the amount of your
Junior Participation, you shall not receive any accrued interest on the amount
by which your Junior Participation exceeds the outstanding amount of Revolving
Advances.


 


8.             The Junior Participation shall be
acquired by you without recourse to Agent and Lenders and for your own account
and risk.  You hereby acknowledge that
you have, independently and without reliance upon us and based on such other
documents and information as you have deemed appropriate, made your own
commercial analysis and decision to enter into this Agreement, are not relying
and will not rely in the future upon any financial projections, estimates,
appraisals, financial summaries or credit memoranda prepared by or on behalf of
Agent and Lenders and given directly or indirectly to you to assist you in
making your own independent credit analysis. 
You further represent that (a) you have such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of your Junior Participation; and (b) you have the
ability to bear the economic risks of the Junior Participation and can afford
the complete loss of such Junior Participation.


 


9.             The account of Borrower and all
transactions in connection therewith shall be conducted solely in Agent’s and
Lenders’ names, without charge for administration or clerical expenses except
to the extent same may be chargeable to Borrower under the Loan Agreement and
the Other Documents.  You acknowledge
that Agent and Lenders have made no representations or warranties, express or
implied, as to Borrower, the Loan Agreement, the Other Documents, the
transactions or the Collateral, or the legal validity, enforceability or
collectability thereof, and that you are fully familiar with all of the details
thereof.  You hereby acknowledge 


 


 


 


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that
you have received copies of the Loan Agreement and the Other Documents.  In giving or withholding consents or
approvals, taking, holding, permitting substitutions for or releasing
Collateral, obtaining or releasing the primary or secondary liability of any
party with respect to the Advances, or any Collateral granted as security
therefor, and otherwise in exercising, refraining from exercising, or waiving
any of Agent’s and Lenders’ rights under the Loan Agreement and the Other
Documents (all of which Agent and Lenders may do in their sole and absolute
discretion without notice to or consent by you), Agent and Lenders will
endeavor to use the same care as if the Advances were solely for their own
accounts, but Agent and Lenders shall be under no fiduciary duty to you and
they shall be liable to you only for their own willful misconduct or gross
negligence.  Agent and Lenders may make
such other Advances and enter into such other agreements and transactions with
Borrower as Agent and Lenders may, in their our sole and absolute judgment,
deem advisable, without notice to or consent from you.


 


10.           All attorneys’ fees, court costs,
collection expenses and other legal or extraordinary expenses, if advanced or
paid by Agent and Lenders to or for the account of Borrower or for the care,
preservation or collection of the Collateral shall be recovered by agent and
Lenders from the Collateral.  All sums
collected by Agent and Lenders upon the Collateral shall be applied first to
the payment to Agent and Lenders of the aforesaid expenses, then to interest
and fees and, finally, to the principal indebtedness owing to Agent and
Lenders.  Agent and Lenders shall have
the right to incur such expenses in their sole and absolute discretion as they
deem advisable.  You shall promptly repay
to Agent any sum paid by Agent to you under this Agreement in the event that
Agent or Lenders must repay the same to Borrower or its representatives for any
reason whatsoever, with interest thereon from the date Agent or Lenders repay
the same to Borrower or its representatives until you repay the same to Agent
in full at the rate of interest payable to you under this Agreement.


 


11.           Agent and Lenders shall have the
exclusive right to (i) service and manage the Loan Agreement, the Other
Documents, the Collateral and all transactions contemplated under the Loan
Agreement and Other Documents and (ii) exercise any and all remedies
available to Agent and Lenders therein and at law or in equity, or forbear from
exercising such remedies, all in Agent’s and Lenders’ sole and absolute
discretion.  It is specifically
understood and agreed that Agent and Lenders may from time to time make
Advances to Borrowers under the Loan Agreement and Other Documents without
regard to the Collateral.  Agent and
Lenders may make substantial over-advances to Borrower relying upon your
participation, notwithstanding the fact that in Agent’s and Lenders’ opinion
they may not have sufficient Collateral. 
You hereby agree to Agent’s and Lenders’ making such Advances.  Agent and Lenders do not assume and shall
have no responsibility or liability, express or implied, for the
collectability, enforceability, genuineness or validity of the transactions or
the Collateral, or the financial condition of Borrower or any obligation on
Borrower’s account, or credit or other information furnished by Agent and
Lenders to you.


 


12.           Agent and Lenders may, upon five (5) Business
Days notice, repurchase your Junior Participation, at any time, for a
repurchase price equal to your investment plus all accrued (but unpaid)
earnings thereon.  Upon such repurchase,
each party to this Agreement shall be released of any liability to the other
parties arising out of subsequent transactions with Borrower.  You may not terminate your Junior
Participation since Agent and Lenders are relying on the same in making
Advances to Borrower.


 


 


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13.           Nothing contained in this Agreement
shall confer upon any party to this Agreement any interest in, or subject any
party to this Agreement to any liability for, the business, assets, profits,
losses or obligations of the other parties to this Agreement, except to the
extent set forth in this Agreement.


 


14.           EACH PARTY HERETO DOES HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO TRIAL BY JURY IN
ANY ACTION OR PROCEEDING BASED ON OR WITH RESPECT TO THIS AGREEMENT OR ANY OF
THE TRANSACTIONS CONTEMPLATED HEREBY OR RELATING OR INCIDENTAL HERETO.  EACH PARTY HERETO DOES HEREBY CERTIFY THAT NO
REPRESENTATIVE OR AGENT OF THEIRS HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
IT WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT
TO JURY TRIAL PROVISION.


 


15.           THIS AGREEMENT SHALL BE GOVERNED,
CONSTRUED AND INTERPRETED AS TO VALIDITY, ENFORCEMENT AND IN ALL OTHER RESPECTS
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.  EACH PARTY HERETO EXPRESSLY CONSENTS TO THE
JURISDICTION AND VENUE OF ANY COURT OF THE STATE OF NEW YORK, COUNTY OF NEW
YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK FOR ALL PURPOSES IN CONNECTION HEREWITH. 
ANY JUDICIAL PROCEEDING BY A PARTY HERETO AGAINST THE OTHER INVOLVING,
DIRECTLY OR INDIRECTLY ANY MATTER OR CLAIM IN ANY WAY ARISING OUT OF, RELATED
TO OR CONNECTED HEREWITH SHALL BE BROUGHT ONLY IN THE SUPREME COURT OF THE
STATE OF NEW YORK, COUNTY OF NEW YORK OR THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK.  EACH
PARTY HERETO FURTHER CONSENTS THAT ANY SUMMONS, SUBPOENA OR OTHER PROCESS OR
PAPERS (INCLUDING, WITHOUT LIMITATION, ANY NOTICE OR MOTION OR OTHER
APPLICATION TO EITHER OF THE AFOREMENTIONED COURTS OR A JUDGE THEREOF) OR ANY
NOTICE IN CONNECTION WITH ANY PROCEEDINGS HEREUNDER, MAY BE SERVED INSIDE
OR OUTSIDE OF THE STATE OF NEW YORK OR THE SOUTHERN DISTRICT OF NEW YORK BY
REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, OR BY PERSONAL SERVICE
PROVIDED A REASONABLE TIME FOR APPEARANCE IS PERMITTED, OR IN SUCH OTHER MANNER
AS MAY BE PERMISSIBLE UNDER THE RULES OF SAID COURTS.  EACH PARTY HERETO WAIVES ANY OBJECTION TO
JURISDICTION AND VENUE OF ANY ACTION INSTITUTED HEREON AND SHALL NOT ASSERT ANY
DEFENSE BASED ON LACK OF JURISDICTION OR VENUE OR BASED UPON FORUM NON
CONVENIENS.


 


16.           To the extent permitted by applicable
law, any provision of this Agreement which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be 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.


 


17.           No amendment or waiver of any
provision of this Agreement, nor consent to any departure by you therefrom
shall in any event be effective unless the same shall be in writing executed by
all parties hereto.


 


 


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18.           This Agreement may be executed by the
parties hereto in one or more counterparts, each of which taken together shall
be deemed to constitute one and the same instrument.  Any signature delivered by telecopy or by
electronic transmission in a “pdf” format shall be deemed to be an original
signature hereto.


 


19.           This Agreement contains the entire
understanding between the parties hereto and shall bind our respective
representatives, successors and assigns. 
The parties hereto agree to endeavor to maintain the confidentiality of
the terms of the Junior Participation.


 


20.           All notices, requests and demands to
or upon the respective parties shall be in writing or by telecopy and shall be
deemed to have been duly given or made (a) when delivered, if by hand, (b) three
(3) days after being deposited in the mail, postage prepaid, if by mail,
or (c) when confirmed, if by telecopy or, (d) one (1) Business
Day after being sent by a recognized overnight delivery service.


 


IN
WITNESS WHEREOF, this Agreement has been duly executed as of the day and year
first written above.


 


 


	
   

  	
  THE
  CHRISTOPHER JOHN KLIEFOTH REVOCABLE TRUST UA 07-10-2007

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  

  	
   /s/ Christopher John Kliefoth, Trustee

  
	
   

  	
  Christopher
  John Kliefoth, Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Richard Horowitz

  
	
   

  	
  Richard
  Horowitz

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PNC
  BANK, NATIONAL ASSOCIATION, as Agent and Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
   /s/ Bryan Shia

  
	
   

  	
   

  	
  Name:
  Bryan Shia

  
	
   

  	
   

  	
  Title:
  Vice President

  
				



 


 


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