exv10w13







EXHIBIT
10.13




SP Acquisition Holdings, Inc.

590 Madison Avenue, 32nd Floor

New York, NY 10022




September
8, 2009




Steel Partners II Liquidating Series Trust — Series F

590 Madison Avenue, 32nd Floor

New York, NY 10022




SP Acq LLC

590 Madison Avenue, 32nd Floor

New York, NY 10022


Re: Non-Voting Common Stock




     Gentlemen:



     The purpose of this letter (this “Letter Agreement”) is to set forth the terms of an
understanding between SP Acquisition Holdings, Inc. (“SPAH”), SP Acq LLC and Steel Partners II
Liquidating Series Trust- Series F (“Steel Trust”), a liquidating trust established for the purpose
of effecting the orderly liquidation of certain assets of Steel Partners II, L.P. (“SPII”), in
connection with (a) the conversion of certain voting common stock of SPAH held by Steel Trust and
SP Acq LLC, and (b) the exercise of certain warrants acquired by SPII and SP Acq LLC pursuant to
that certain the Founder’s Securities Purchase Agreement (the “Purchase Agreement”), dated March
22, 2007, by and between SPAH and SP Acq LLC; and/or pursuant to that certain Co-Investment Units
Purchase Agreement and any amendments to such Co-Investment Units Purchase Agreement (the
“Co-Investment Agreement”), dated March 22, 2007 by and among SPAH, SP Acq LLC, and SPII; and/or
that certain Founder’s Units Purchase Agreement (the “SPII Purchase Agreement”), dated March 30,
2007, by and among SPAH, SP Acq LLC and SPII. This Letter Agreement is being delivered in
accordance with Section G of the Purchase Agreement, the SPII Agreement and the Co-Investment
Agreement. Terms not defined in this Letter Agreement shall have the meaning ascribed to them in
the Purchase Agreement. Steel Trust, as the successor interest to SPII, and SP Acq LLC are
collectively referred to herein as the “Steel Affiliates”.



     In order facilitate the merger (the “Merger”) and other related transactions contemplated by
that certain Agreement and Plan of Merger (the “Merger Agreement”), dated as of July 30, 2009, as
amended by Amendment No. 1 to Agreement and Plan of Merger, dated August 10, 2009, by and between
SPAH and Frontier Financial Corporation and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:



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	1.	 	Warrant Exercise. Upon the exercise of the Initial Founder’s Warrants, the
Additional Founder’s Warrants and Co-Investment Warrants (collectively, the “Warrants”) by
the Steel Affiliates following consummation of the Merger, the Steel Affiliates shall
receive non-voting common stock of SPAH in lieu of voting common stock of SPAH in such
amounts, as shall be jointly determined by the Steel Affiliates, as is necessary to maintain
a joint ownership level by the Steel Affiliates of SPAH voting common stock at below 5% of
the total outstanding shares of voting common stock of SPAH. For the avoidance of doubt,
the agreement set forth in this provision only applies to Warrants exercised by the Steel
Affiliates and shall not apply to Warrants distributed to beneficiaries of the Steel
Affiliates.
	 
	2.	 	Stock Conversion. Immediately following consummation of the Merger, the Steel
Affiliates shall convert such number of shares of voting common stock of SPAH owned by the
Steel Affiliates into shares of non-voting common stock of SPAH as is necessary to maintain
a joint ownership level by the Steel Affiliates of SPAH voting common stock at below 5% of
the total outstanding shares of voting common stock of SPAH. The number of shares of
voting common stock of SPAH to be converted to non-voting common stock pursuant to this
Section 2 shall be jointly determined by the Steel Affiliates.
	 
	3.	 	Entire Agreement. This Letter Agreement contains the entire understanding
between the parties as to the subject matter herein contained. There are no oral
understandings, terms or conditions, and no party has relied upon any representation,
express or implied, not contained in this Letter Agreement.
	 
	4.	 	Amendments. Except as otherwise provided herein, this Letter Agreement may not
be terminated, amended, altered, modified or varied in any respect whatsoever except by a
further agreement, in writing, fully executed by each of the parties.
	 
	5.	 	Successors. This Letter Agreement shall be binding upon and inure to the
benefit of the parties and to their respective heirs, personal representatives, permitted
successors and assigns.
	 
	6.	 	Joint Effort. Preparation of this Letter Agreement has been a joint effort of
the parties, and the resulting document shall not be construed more severely against one of
the parties than the other.
	 
	7.	 	Counterparts. This Letter Agreement may be executed in one or more
counterparts, each of which shall be deemed an original.
	 
	8.	 	Governing Law. This Letter Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to the principles of
conflicts of laws thereof.





     Steel Trust and SP Acq LLC each acknowledge and understand that SPAH will rely upon this
Letter Agreement in proceeding with the Merger and related transactions contemplated by the Merger
Agreement.



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     Please sign in the space provided below to acknowledge that the foregoing sets forth an
agreement between us.



	 	 	 	 	 	 	 	 	 
	 	 	 	 	SP ACQUISITION HOLDINGS, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Jack Howard	 	 
	 

	 	 	 	 	 	 

Name: Jack Howard
	 	 
	 

	 	 	 	 	 	Title: Chief Operating Officer and Secretary	 	 
	ACCEPTED AND AGREED TO:	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Steel Partners II Liquidating Series Trust -	 	SP Acq LLC	 	 
	Series F	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	Steel Partners II GP LLC, the	 	 	 	 	 	 
	 

	 	Liquidating Trustee	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ Jack Howard	 	By:	 	/s/ Warren Lichtenstein	 	
	 

	 	 

Name: Jack Howard
	 	 	 	 

Name: Warren Lichtenstein
	 	 
	 

	 	Title: President
	 	 	 	Title: Managing Member	 	 







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