Exhibit 10.1


 


WELLS FARGO RETAIL FINANCE, LLC


One Boston Place, 18th Floor


Boston, Massachusetts 02108


 


August 3, 2009


 


Overstock.com, Inc.


6350 South 3000 East


Salt Lake City, Utah  84121


 


Ladies and Gentlemen:


 


Reference is hereby made to that certain Amended and
Restated Loan and Security Agreement (the “Loan Agreement”)
dated as of January 6, 2009 by and between Wells Fargo Retail Finance, LLC
(the “Lender”), and Overstock.com, Inc.
(the “Borrower”) and the Loan Documents executed
in connection therewith. All capitalized terms used herein and not otherwise
defined shall have the same meaning herein as in the Loan Agreement.


 


The Borrower has notified the Lender that it intends
to repay all outstanding Obligations owing to the Lender under the Loan Agreement
and, concurrently therewith, terminate the Loan Agreement, by no later than August 3,
2009.  In connection therewith, the
Borrower has requested that the Lender agree to waive the Applicable
Prepayment Premium which would become payable upon termination of the Loan
Agreement.  The Lender is willing to
waive the Applicable Prepayment Premium, subject to the terms and conditions
contained herein.


 


Accordingly, the Borrower
and the Lender hereby agree as follows:


 


1.                                       As of August 3, 2009 (the “Payoff Date”), the amount required to pay the outstanding Obligations
(other than the Applicable Prepayment Premium) is $144,497.50 (the “Payout Amount”), consisting of:


 


(a)                                  $42,500 in respect of the unpaid Administration
Fee (as set forth in the Fee Letter);


 


(b)                                 $99,800 in respect of the unpaid Annual
Fee (as set forth in the Fee Letter); and


 


(c)                                  $2,197.50 in respect of outstanding Lender
Expenses.


 


2.                                       This will confirm that, provided that the
conditions in clause (a) and (b) below (collectively, the “Payout Conditions”) have been satisfied by no later than 5:00
pm Boston time on the Payoff Date:


 


(a)                                  receipt by the Lender of the Payout
Amount in accordance with Paragraph 4 below; and


 

















 


(b)                                 receipt by the Lender of a fully-executed
counterpart of this letter agreement signed by the Borrower;


 


then, in such event, the Borrower and the Lender agree
that (i) all outstanding Obligations owing by the Borrower under the Loan Agreement
shall be deemed to be paid and satisfied in full, except for indemnity and
other obligations which survive in accordance with the specific terms of the
Loan Agreement and other Loan Documents, (ii) the Loan Agreement shall be
terminated, except for indemnity and other obligations which survive in
accordance with the specific terms of the Loan Agreement and other Loan
Documents, (iii) all liens and security interests granted to the Lender
under the Loan Documents as security for the Obligations shall be immediately
released and discharged and (iv) the Borrower and its agents or designees
shall be authorized to file Uniform Commercial Code amendment statements which
are necessary to terminate the financing statements evidencing the liens and
security interests granted to the Lender under the Loan Documents as security
for the Obligations.


 


3.                                       The Borrower hereby covenants and agrees
that (i) the Applicable Prepayment Premium in the amount of $250,000 is
unconditionally due and payable upon the termination of the Loan Agreement and (ii) notwithstanding
the Lender’s agreement to waive payment of the Applicable Prepayment Penalty in
accordance with the terms of this letter agreement, in the event that the Payout
Conditions have not been satisfied by 5:00 pm Boston time on the Payoff Date,
then (x) the Payout Amount shall no longer be valid and (y) the
Lender’s agreement to waive payment of the Applicable Prepayment Penalty shall
be null and void ab initio.


 


4.                                       The Payout Amount must be remitted by
wire transfer of immediately available funds, for receipt by no later than the
Payoff Date, as follows:


 


	
  Bank:

  	
   

  	
  Wells Fargo Bank

  
	
  ABA #:

  	
   

  	
   

  
	
  Acct. #:

  	
   

  	
   

  
	
  Acct. Name:

  	
   

  	
  Wells Fargo Retail Finance LLC

  
	
  Ref/Attn:

  	
   

  	
  Overstock.com

  



 


The Lender believes that the Payout Amount reflects all amounts (other
than the Applicable Prepayment Penalty) currently owed by the Borrower to the
Lender.  Notwithstanding the release of
the Lender’s security interests upon the satisfaction of the Payout Conditions
in accordance with Paragraph 2 above, the Borrower will remain liable to the
Lender for any expenses incurred in connection with the release of its security
interests and liens, and for any interest, fees, expenses or other amounts
which may have been omitted in error from the Payout Amount.


 


5.                                       The Borrower hereby unconditionally
releases, waives and forever discharges the Lender and its affiliates and their
respective officers, directors, employees, representatives, agents,
predecessors, counsel and affiliates from any and all claims, demands,
obligations, liabilities, suits and causes of action of any kind whatsoever (if
any), whether now existing or hereafter arising, under, arising out of, or in
connection with (i) the Loan Documents or the transactions contemplated
thereby or (ii) the execution of (or the satisfaction of any condition
precedent or subsequent to) this letter agreement or the transactions
contemplated hereby.


 


2





















 


6.                                       Upon the request of the Borrower, the
Lender agrees to execute and deliver, in form and substance reasonably
acceptable to the Lender, any lien releases and other similar discharge or
release documents as are reasonably necessary to release the liens and security
interests granted to the Lender under the Loan Documents as security for the
Obligations.  Notwithstanding the
foregoing sentence, the Lender shall have no obligation to deliver any such
releases and discharges unless and until Borrower shall have paid all
reasonable costs and expenses incurred by the Lender in connection with the
preparation and delivery of same, including, but not limited to, all attorneys’
fees and expenses.


 


7.                                       The Borrower acknowledges that the
amounts referred to in Paragraph 1 and Paragraph 3 (with respect to the
Applicable Prepayment Premium) above are enforceable obligations of it owed to
the Lender pursuant to the provisions of the Loan Documents and confirm its
agreement to the terms and conditions of this letter agreement by returning to
the Lender a signed counterpart hereof.


 


8.                                       In connection with the foregoing, Wells
Fargo Bank, National Association, hereby agrees to pay $10,000 to the Borrower
as a partial reimbursement of expenses incurred by the Borrower in connection
with the Loan Agreement promptly after the termination of the Loan Agreement.


 


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3

















 


This letter agreement may be executed by each party on
a separate counterpart, each of which when so executed and delivered shall be
an original, but all of which together shall constitute one agreement.


 


	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  WELLS FARGO RETAIL FINANCE, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joseph Burt

  
	
   

  	
  Name:

  	
  Joseph Burt

  
	
   

  	
  Title:

  	
  Vice President

  



 


Accepted and Agreed solely
for the purposes of paragraph 8 above:


 


	
   

  	
  WELLS FARGO BANK NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/Lisbeth Hopper

  
	
   

  	
  Name:

  	
  Lisbeth Hopper

  
	
   

  	
  Title:

  	
  Relationship Manager

  



 


 


	
  Accepted and Agreed:

  	
   

  
	
   

  	
   

  
	
  OVERSTOCK.COM, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Stephen J. Chesnut

  	
   

  	
   

  
	
  Name:

  	
  Stephen J. Chesnut

  	
   

  	
   

  
	
  Title:

  	
  Senior Vice President, Finance