ex10-1.htm


     

    Exhibit
      10.1



    EXECUTION
      COPY

    


    FOURTH
      AMENDMENT TO CREDIT AGREEMENT

    


    THIS
      FOURTH AMENDMENT TO CREDIT
      AGREEMENT (this “Amendment”),
      dated as
      of December 20, 2007, is by and among ENTERTAINMENT DISTRIBUTION
      COMPANY,
      LLC, a Delaware limited liability company (the “Borrower”),
      those
      Domestic Subsidiaries of the Borrower identified as a “Guarantor” on the
      signature pages hereto (individually a “Guarantor” and
      collectively the “Guarantors”), the
      financial institutions party hereto as lenders (the “Lenders”) and WACHOVIA
      BANK, NATIONAL
      ASSOCIATION, as administrative agent under the Credit Agreement (defined
      below) (in such capacity, the “Administrative
      Agent”).

    


    W
      I T N E S S E T H

    


    WHEREAS,
      the Borrower, the
      Guarantors, Glenayre Electronics, Inc., a Colorado corporation, the Lenders
      and
      the Administrative Agent are parties to that certain Credit Agreement dated
      as
      of May 31, 2005 (as previously amended, modified or supplemented and as further
      amended, modified, supplemented, restated or amended and restated from time
      to
      time, the “Credit
      Agreement”; capitalized terms used herein shall have the meanings
      ascribed thereto in the Credit Agreement as amended hereby); and

    


    WHEREAS,
      the Borrower and the
      Lenders have agreed to amend the Credit Agreement on the terms and conditions
      set forth herein;

    


    NOW,
      THEREFORE, in
      consideration of the agreements hereinafter set forth, and for other good and
      valuable consideration, the receipt and adequacy of which are hereby
      acknowledged, the parties hereto agree as follows:

    


    


    ARTICLE
      I

    AMENDMENT
      TO CREDIT AGREEMENT

    


    1.1           
      Amendment
      to Section 1.1.  Section 1.1
      of
      the Credit Agreement is hereby amended as follows:

    


    (a)    The
      definition of “Change of Control” is hereby amended by deleting clause (c) and
      replacing it with the following:

    


    “(c)
      the
      failure of the Parent to own, directly or indirectly, a majority or more of
      the
      then outstanding Voting Stock of the Borrower.”

     

    
      (b)    The
        definition of Security Documents is hereby deleted in its entirety and replaced
        with the following:


    

    
    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Security
      Documents” shall mean (i) the Security Agreement, (ii) the Pledge
      Agreement, (iii) from the Closing Date through the Fourth Amendment Effective
      Date, the Parent Pledge Agreement, (iv) on and after the Fourth Amendment
      Effective Date, the Intermediate Parent Pledge Agreement, (v) the Foreign
      Collateral Documents, (vi) the Mortgage Instruments, (vii) the Cash Collateral
      Account Agreement and such other documents executed and/or delivered in
      connection with the attachment and perfection of the Administrative Agent’s
      security interests and liens arising thereunder, including, without limitation,
      UCC financing statements and any collateral documentation (in addition to the
      Pledge Agreement) with respect to the pledge of 65% of the Capital Stock of
      any
      first-tier Foreign Subsidiary.

     

    
      
        (c)    The
          following definitions are hereby added in appropriate alphabetical order:
          

      

    

     

    
      (i)    “Fourth
        Amendment Effective
        Date” shall mean December 20, 2007.

       

      (ii)    “Intermediate
        Parent”
shall mean GEI EDC Holding Company, a Delaware corporation.

    

    
    

     

    
      (iii)    “Intermediate
        Parent Pledge
        Agreement” shall mean the Intermediate Parent Pledge Agreement dated as
        of the Fourth Amendment Effective Date executed by the Intermediate Parent
        in
        favor of the Administrative Agent, as amended, modified, restated or
        supplemented from time to time.


    

    1.2    Amendment
      to Section 6.1.  Section 6.1
      of
      the Credit Agreement is hereby amended by deleting clause (d) in its entirety
      and replacing it with the following:

     

    
      (d)    (i)
        Unsecured
        intercompany Indebtedness among the Credit Parties, (ii) unsecured intercompany
        Indebtedness among Foreign Subsidiaries, (iii) Indebtedness owed by a Foreign
        Subsidiary to a Credit Party and (iv) unsecured Indebtedness owed by the
        Borrower to (A) Entertainment Distribution Holdings GmbH in the original
        principal amount of eight million Euros and (B) EDC UK Holdings Limited in
        the
        original principal amount of two million five hundred thousand British Pounds;
        provided that,
        in the case of the Indebtedness described in clauses (i) and (iv), any such
        Indebtedness shall be (x) fully subordinated to the Credit Party Obligations
        hereunder on terms reasonably satisfactory to the Administrative Agent and
        (y)
        if such Indebtedness is evidenced by promissory notes, such promissory notes
        shall be pledged to the Administrative Agent as Collateral for the Credit
        Party
        Obligations; provided, further,
        that in the
        case of the Indebtedness described in clause (iv), the Company shall not
        repay
        such Indebtedness with the proceeds of any Loan; 

    

     


    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    


    
      1.3     
Amendment
        to Section 6.10.  Section 6.10
        of
        the Credit Agreement is hereby deleted in its entirety and replaced with
        the
        following:



    6.10           
      Restricted
      Payments.

    


    Each
      of the Credit Parties will not,
      nor will it permit any Subsidiary to, directly or indirectly, declare, order,
      make or set apart any sum for or pay any Restricted Payment, except:

    


    (a)           
      to make dividends or other distributions payable to any Credit Party (directly
      or indirectly through Subsidiaries);

    


    (b)           
      to make the regularly scheduled Rebate Payments as set forth in the Supply
      Agreements in effect as of the Closing Date;

    


    (c)           
      to make annual distributions from the Borrower to any member of the Borrower
      in
      accordance with the terms of the Borrower’s operating agreement for the purpose
      of paying income taxes of such member equal to the product of (i) the amount
      of
      income allocated to such member by the Borrower for federal income tax purposes,
      multiplied by (ii) the rate established by the Borrower’s board of directors in
      accordance with the terms of the Borrower’s operating agreement, not to exceed
      45%; and

    


    (d)           
      provided that no Default or Event of Default has occurred and is continuing
      at
      such time or would be directly or indirectly caused as a result thereof after
      giving effect to such payments, the Borrower may make regularly scheduled
      payments of principal and interest owing on the Subordinated Indebtedness in
      accordance with the subordination provisions of the documents and instruments
      evidencing such Subordinated Indebtedness.

    


     

    ARTICLE
      II

    CONDITIONS
      TO EFFECTIVENESS

    


     

    2.1           
      Closing
      Conditions.

     

    


    This
      Amendment shall become effective
      as of the date hereof (the “Fourth Amendment
      Effective
      Date”) upon satisfaction of the following conditions (in form and
      substance reasonably acceptable to the Administrative Agent):

    


    (a)           
      Executed
      Amendment.  The Administrative Agent shall have received a copy
      of this Amendment duly executed by each of the Credit Parties, the Lenders
      and
      the Administrative Agent.

    



    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    


     

    
      (b)           
        Intermediate Parent
        Pledge.  The Administrative Agent shall have received a copy of
        the Intermediate Parent Pledge Agreement, duly executed by the Intermediate
        Parent.

       

    

    (c)           
      Other.  The
      Administrative Agent shall have received such other documents, agreements or
      information which it may reasonably request relating to the Credit Parties
      and
      the transactions contemplated by this Amendment and any other matters relevant
      hereto or thereto, all in form and substance satisfactory to the Administrative
      Agent in its sole good faith discretion.

    


    


    ARTICLE
      III

    MISCELLANEOUS

    


    3.1           Amended
      Terms.  All references to the Credit Agreement in each of the
      Credit Documents shall hereafter mean the Credit Agreement as amended by this
      Amendment.  Except as specifically amended hereby or otherwise agreed,
      the Credit Agreement is hereby ratified and confirmed and shall remain in full
      force and effect according to its terms.

    


    3.2           Representations
      and Warranties of Credit Parties.  Each of the
      Credit
      Parties represents and warrants as follows as of the date hereof:

    


    (a)           
      It has taken all necessary action to authorize the execution, delivery and
      performance of this Amendment.

    


    (b)           
      This Amendment has been duly executed and delivered by such Person and
      constitutes such Person’s valid and legally binding obligations, enforceable in
      accordance with its terms, except as such enforceability may be subject to
      (i) bankruptcy, insolvency, reorganization, fraudulent conveyance or
      transfer, moratorium or similar laws affecting creditors’ rights generally and
      (ii) general principles of equity (regardless of whether such
      enforceability is considered in a proceeding at law or in equity).

    


    (c)           
      No consent, approval, authorization or order of, or filing, registration or
      qualification with, any Governmental Authority or third party is required in
      connection with the execution, delivery or performance by such Person of this
      Amendment.

    


    (d)           
      The representations and warranties set forth in Article III of the Credit
      Agreement are true and correct in all material respects as of the date hereof
      (except for those which expressly relate to an earlier date).

    


    3.3           Acknowledgment
      of Guarantors.  The Guarantors acknowledge and consent to all
      of the terms and conditions of this Amendment and agree that this Amendment
      and
      all documents executed in connection herewith do not operate to reduce or
      discharge the Guarantors’ obligations under the Credit Documents.

    


     


    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    3.4           
      Credit
      Document.  This Amendment
      shall constitute a Credit Document under the terms of the Credit
      Agreement.

     

    3.5           
      Entirety.  This
      Amendment and the other Credit Documents embody the entire agreement between
      the
      parties hereto and supersede all prior agreements and understandings, oral
      or
      written, if any, relating to the subject matter hereof.

    


    3.6           
      Counterparts;
      Telecopy.  This Amendment may be executed in any number of
      counterparts, each of which when so executed and delivered shall be an original,
      but all of which shall constitute one and the same
      instrument.  Delivery of an executed counterpart to this Amendment by
      telecopy shall be effective as an original and shall constitute a representation
      that an original will be delivered.

    


    3.7           
      GOVERNING
      LAW.  THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
      PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
      IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

    


    3.8           
      Consent
      to Jurisdiction; Service of Process; Waiver of Jury Trial.  The jurisdiction,
      services of process and waiver of jury trial provisions set forth in Sections
      9.14 and 9.17 of the Credit Agreement are hereby incorporated by reference,
      mutatis
      mutandis.

    


    3.9           
      Fees.  The
      Borrower
      agrees to pay all fees and expenses of the Administrative Agent in connection
      with the preparation, execution and delivery of this Amendment, including,
      without limitation, the fees and expenses of Moore & Van Allen
      PLLC.

    


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      of page intentionally left blank]

    



    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    


    IN
      WITNESS WHEREOF the Borrower, the
      Guarantors, the Lenders, and the Administrative Agent have caused this Amendment
      to be duly executed on the date first above written.

     

     

    
      
        	
                BORROWER:

              	
                ENTERTAINMENT
                  DISTRIBUTION COMPANY, 
LLC, a
                  Delaware limited liability company

              	 
	 	 	 
	 	 	 
	
                 

              	
                By:

              	/s/
                Jordan M. Copland	 
	 	
                Name:

              	Jordan
                M. Copland	 
	 	
                Title:

              	Chief
                Executive Officer	 


      


      	
              GUARANTORS
:

            	
              ENTERTAINMENT
                DISTRIBUTION COMPANY
(USA), LLC, a
                Delaware limited liability company

            	 
	 	 	 
	 	 	 
	
               

            	
              By:

            	/s/
              Jordan M. Copland	 
	 	
              Name:

            	Jordan
              M. Copland	 
	 	
              Title:

            	Chief
              Executive Officer	 


                                                      
      


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	ADMINISTRATIVE
              AGENT
AND LENDERS:	
              WACHOVIA
                BANK,
NATIONAL
                ASSOCIATION,
as Administrative
                Agent and as a Lender 

            	 
	 	 	 
	 	 	 
	
               

            	
              By:

            	/s/
              Elaine Eaton	 
	 	
              Name:

            	Elaine
              Eaton	 
	 	
              Title:

            	Senior
              Vice President


    

     

     

    
      	 	
              ING
                CAPITAL LLC, as a
                Lender

            	 
	 	 	 
	 	 	 
	
               

            	
              By:

            	/s/
              Andrew Layton	 
	 	
              Name:

            	Andrew
              Layton	 
	 	
              Title:

            	Vice
              President