Document:

a50581549_ex4-1.htm

 

Exhibit 4.1

 

 

AMENDMENT NO. 1 TO RIGHTS AGREEMENT

This Amendment No. 1 to Rights Agreement (this “Amendment”), dated as of March 1, 2013, by and between iParty Corp., a Delaware corporation (the “Company”), and Continental Stock Transfer & Trust Company, a New York corporation (the “Rights Agent”), amends that certain Rights Agreement, dated as of October 7, 2011, by and between the Company and the Rights Agent (the “Rights Agreement”).

The Company and the Rights Agent have heretofore executed and entered into the Rights Agreement.  Pursuant to Section 26 of the Rights Agreement, the Company may from time to time supplement or amend the Rights Agreement in accordance with the provisions of Section 26 thereof, and the Company desires and directs the Rights Agent to so amend the Rights Agreement.  All acts and things necessary to make this Amendment a valid agreement according to its terms have been done and performed, and the execution and delivery of this Amendment by the Company and the Rights Agent have been in all respects authorized by the Company and the Rights Agent.

In consideration of the foregoing premises and mutual agreements set forth in the Rights Agreement and this Amendment, the parties hereto agree as follows:

1.           Section 1(a) of the Rights Agreement is hereby amended by adding as a final sentence thereto the following:

“Notwithstanding any provision in this Rights Agreement to the contrary, none of Party City Holdings, Inc., a Delaware corporation (“Parent”), Confetti Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of Parent (“Merger Sub”), any of their stockholders or any of their respective Affiliates and Associates shall be deemed to be an Acquiring Person as a result of (i) the approval, execution, delivery, performance or announcement of that certain Agreement and Plan of Merger, dated as of March 1, 2013, by and among the Company, the Parent and the Merger Sub (as the same may be amended from time to time, the “Merger Agreement”), the Support Agreements (as such term is defined in the Merger Agreement) or any of the other agreements and instruments contemplated by the Merger Agreement, or (ii) the consummation of the Merger (as such term is defined in the Merger Agreement) or the other transactions contemplated by the Merger Agreement.”

2.           Section 1(t) of the Rights Agreement is hereby amended by adding as a final sentence thereto the following:

“Notwithstanding any provision in this Rights Agreement to the contrary, no Stock Acquisition Date shall be deemed to occur as a result of (i) the approval, execution, delivery, performance or announcement of the Merger Agreement, the Support Agreements (as such term is defined in the Merger Agreement) or any of the other agreements and instruments contemplated by the Merger Agreement, or (ii) the consummation of the Merger (as such term is defined in the Merger Agreement) or the other transactions contemplated by the Merger Agreement.”

 

 

 

 

 

3.           Section 3(b) of the Rights Agreement is hereby amended by adding as a final sentence thereto the following:

“Notwithstanding any provision in this Rights Agreement to the contrary, no Distribution Date shall be deemed to occur as a result of (i) the approval, execution, delivery, performance or announcement of the Merger Agreement, the Support Agreements (as such term is defined in the Merger Agreement) or any of the other agreements and instruments contemplated by the Merger Agreement, or (ii) the consummation of the Merger (as such term is defined in the Merger Agreement) or the other transactions contemplated by the Merger Agreement.”

4.           Section 7(a) of the Rights Agreement is hereby amended and restated in its entirety as follows:

 

“The Rights shall not be exercisable until, and shall become exercisable on, the Distribution Date (unless otherwise provided herein, including, without limitation, the restrictions on exercisability set forth in Sections 7(e) and 23(a) hereof). Except as otherwise provided herein, the Rights may be exercised, in whole or in part, at any time commencing with the Distribution Date upon surrender of the Right Certificate, with the form of election to purchase and certificate on the reverse side thereof duly executed (with signatures duly guaranteed), to the Rights Agent at the principal office of the Rights Agent in New York, New York, together with payment of the Exercise Price for each Right exercised, subject to adjustment as hereinafter provided, at or prior to the Close of Business on the earlier of (i) November 9, 2021 (the “Final Expiration Date”), (ii) the Effective Time (as such term is defined in the Merger Agreement) (but subject to the occurrence of the Effective Time) or (iii) the date on which the Rights are redeemed as provided in Section 23 hereof (such earlier date being herein referred to as the “Expiration Date”).”

5.           A new Section 33 shall be added and shall read as follows:

“Section 33.  Termination.  Immediately prior to the Effective Time (as such term is defined in the Merger Agreement) (but subject to the occurrence of the Effective Time), this Rights Agreement shall be terminated and all outstanding Rights shall expire.  The Company will notify the Rights Agent promptly after the occurrence of the Effective Time of the termination of this Rights Agreement.”

6.           Except as expressly amended hereby, the Rights Agreement remains in full force and effect in accordance with its terms.

7.           This Amendment shall be governed by and construed in accordance with the laws of the State of Delaware.

8.           This Amendment may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed an original, and all such counterparts shall together constitute one and the same instrument.  A signature to this Amendment transmitted electronically shall have the same authority, effect and enforceability as an original signature.

 

 

 

 

 

9.           Except as expressly set forth herein, this Amendment shall not by implication or otherwise alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Rights Agreement, all of which are ratified and affirmed in all respects and shall continue in full force and effect.

10.         Capitalized terms used herein but not defined shall have the meanings given to them in the Rights Agreement.

[Remainder of Page Intentionally Left Blank]

 

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the day and year first above written.

	  	
iParty Corp.

	  	  
	  	  
	  	
By: /s/ Sal Persiano                          

	  	
    Name: Sal Perisano

	  	
    Title:   Chief Executive Officer

	  	  
	  	  
	  	
Continental Stock Transfer & Trust

	  	
Company

	  	  
	  	  
	  	
By: /s/ Leslie A Deluca                    

	  	
    Name: Leslie A. Deluca

	  	
    Title:   Vice Presidenta50581549_ex10-1.htm

 

Exhibit 10.1

 

Execution Copy

 

SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

 

SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”) dated as of February 28, 2013 between

 

IPARTY RETAIL STORES CORP., a Delaware corporation (the “Lead Borrower”),

 

IPARTY CORP., a Delaware corporation (a “Borrower”, and, together with the Lead Borrower, the “Borrowers”),

 

the Guarantors party hereto (each a “Guarantor”, and, together with the Borrowers, the “Loan Parties”),

 

the Lenders party hereto, and

 

WELLS FARGO BANK, NATIONAL ASSOCIATION, as successor by merger to Wells Fargo Retail Finance, LLC, as assignee to Wells Fargo Retail Finance II, LLC, as administrative agent and as collateral agent (the “Agent”);

 

in consideration of the mutual covenants herein contained and benefits to be derived herefrom.

W I T N E S S E T H:

WHEREAS, the Loan Parties, the Lenders and the Agent entered into a certain Second Amended and Restated Credit Agreement dated as of July 1, 2009 (as amended, restated or otherwise modified from time to time, the “Credit Agreement”); and

WHEREAS, the Loan Parties, the Lenders and the Agent have agreed to amend the Credit Agreement as set forth herein.

NOW THEREFORE, in consideration of the mutual promises and agreements herein contained, the parties hereto hereby agree as follows:

	
1.

	
Defined Terms.   All capitalized terms not otherwise defined herein shall have the same meaning as ascribed thereto in the Credit Agreement, respectively.

 

	
2.

	
Representations and Warranties.  Each Loan Party hereby represents and warrants that (a) no Default or Event of Default has occurred and is continuing, and (b) after giving effect to this Amendment, all representations and warranties contained in the Credit Agreement and each other Loan Document are true and correct in all material respects (except to the extent that such representation or warranty is already qualified by materiality or subject to a “Material Adverse Effect” qualifier) on and as of the date hereof, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties were true and correct as of such earlier date).

 

 

 

 

 

 

	
3.

	
Ratification of Loan Documents.  Each Loan Party hereby acknowledges and agrees, except as expressly amended hereby, that no other amendments, changes or modifications to the Loan Documents are intended or implied and hereby ratifies and confirms that all the terms and conditions of the Loan Documents as amended hereby remain in full force and effect.

 

	
4.

	
Amendments to Credit Agreement.  The Credit Agreement is hereby amended as follows:

 

	
  

	
a.

	
Amendments to Article I.  The provisions of Section 1.01 are hereby amended by adding the following new defined terms (and corresponding definitions) in appropriate alphabetical order therein:

 

	
  

	
i.

	
“Minimum Availability Reduction” has the meaning specified in Section 7.17.

 

	
  

	
ii.

	
“Minimum Availability Reduction Conditions” means (i) no Default or Event of Default exist, and (ii) receipt by the Agent of a Minimum Availability Reduction Notice not less than two Business Days prior to the delivery of the Borrowing Base Certificate pursuant to Section 6.01.

 

	
  

	
iii.

	
“Minimum Availability Reduction Effective Period” means the period beginning on the Second Amendment Effective Date and ending April 30, 2014.

 

	
  

	
iv.

	
“Minimum Availability Reduction Notice” means a notice from the Lead Borrower to the Agent in the form of Exhibit 1 annexed to the Second Amendment requesting a Minimum Availability Reduction for a specified period of not less than fourteen days per each request and not more than sixty (60) days in the aggregate for all such requests.

 

	
  

	
v.

	
“Second Amendment” means that certain Second Amendment to Second Amended and Restated Credit Agreement entered into by and among the Borrowers,  Agent and Lenders dated as of February 28, 2013.

 

	
  

	
vi.

	
“Second Amendment Effective Date” means February 28, 2013.

 

	
  

	
b.

	

Amendments to Article VII.  The provisions of Section 7.17 are hereby deleted in their entirety and the following is substituted in their stead:

 

“7.17           Minimum Availability.  Permit Excess Availability (without giving effect to clause (d) of the definition of the Borrowing Base) at any time to be less than an amount equal to 7.5% of the then applicable Aggregate Commitments (the “Minimum Availability Block”); provided, however, that if the Minimum Availability Reduction Conditions have been satisfied, as determined by the Agent, the Minimum Availability Block be equal to zero (0) (the “Minimum Availability Reduction”) during the Minimum Availability Reduction Effective Period; provided further that a Minimum Availability Reduction can occur no more than two times and shall not exceed sixty (60) days in the aggregate during the Minimum Availability Reduction Effective Period.”

 

 

 

 

 

 

	
5.

	
Amendment Fee.  In addition to any other fees payable under the Credit Agreement, in consideration of the amendments provided for hereunder, Borrowers shall pay to Agent in immediately available funds an amendment fee in the amount of $50,000 (the “Amendment Fee”).  The Amendment Fee shall be fully earned and payable as of the Second Amendment Effective Date and shall be non-refundable in all circumstances, and shall not be subject to any rebate or reduction by way of setoff or counterclaim. The Amendment Fee may be charged by Agent to any account of Borrowers maintained by Agent.

 

	
6.

	
Conditions to Effectiveness.  This Amendment shall not be effective until each of the following conditions precedent have been fulfilled to the reasonable satisfaction of the Agent:

 

	
  

	
a.

	
This Amendment shall have been duly executed and delivered by the Loan Parties, Agent, and the Lenders.  The Agent shall have received a fully executed copy hereof.

 

	
  

	
b.

	
All action on the part of the Loan Parties necessary for the valid execution, delivery and performance by the Loan Parties of this Amendment shall have been duly and effectively taken.

 

	
  

	
c.

	
The Loan Parties shall have paid to the Amendment Fee.

 

	
  

	
d.

	
After giving effect to this Amendment, no Default or Event of Default shall have occurred and be continuing.

 

	
  

	
e.

	
The Loan Parties shall have paid to the Agent, to the extent invoiced prior to the Second Amendment Effective Date, all fees, costs and expenses, including the attorneys’ fees, incurred by the Agent in connection with this Amendment.

 

	
7.

	
Miscellaneous.

 

	
  

	
a.

	
The terms and provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their successors and assigns.

 

	
  

	
b.

	
This Amendment may be executed in multiple counterparts, each of which shall constitute an original and together which shall constitute but one and the same instrument.  Delivery of an executed counterpart of a signature page of this Amendment by facsimile or other electronic transmission shall be effective as delivery of a manually executed counterpart of this Amendment. This Amendment shall constitute a Loan Document.

 

 

 

 

 

 

	
  

	
c.

	
The Loan Parties agree to do such further acts and things, and to execute and deliver, or cause to be executed and delivered, such additional instruments, documents, and assignments and agreements as the Agent and its counsel may reasonably request in connection with the administration and enforcement of this Amendment or in order to better assure and confirm unto the Agent its rights and remedies hereunder or under any of the other Loan Documents.

 

	
  

	
d.

	
This Amendment shall be governed by, and construed and interpreted in accordance with, the law of the Commonwealth of Massachusetts.

 

 

[Signature Pages Follow]

 

 

 

 

 

 

IN WITNESS WHEREOF, this Amendment has been duly executed and delivered by each of the parties hereto as a sealed instrument as of the date first above written.

	  	
IPARTY RETAIL STORES CORP.,

	  	
as Lead Borrower

 

	  	
By:

	
/s/ Sal Perisano               

	  	
Name:

	
Sal Perisano

	  	
Title:

	
Chief Executive Officer

	  	  	  
	  	  	  
	  	
IPARTY CORP.,

	  	
as a Borrower

 

	  	  	  
	  	
By:

	
/s/ Sal Perisano               

	  	
Name:

	
Sal Perisano

	  	
Title:

	
Chief Executive Officer

 

 

 

Signature Page to Second Amendment

 

 

 

	  	
WELLS FARGO BANK, NATIONAL ASSOCIATION,

as successor by merger to Wells Fargo Retail Finance, LLC,

as Agent and Lender

	  	  	  
	  	
By:

	
/s/ Brent Shay                        

	  	
Name:

	
Brent E. Shay

	  	
Title:

	
Director

 

 

 

 

Signature Page to Second Amendment

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