Document:

exv10w1

 

	 	 	 	 	 

Exhibit 10.1

LIMITED WAIVER WITH RESPECT TO THIRD AMENDED AND

RESTATED CREDIT AGREEMENT

     This LIMITED WAIVER WITH RESPECT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT (this
“Waiver”) is entered into as of this 2nd day of November, 2006, by NAVARRE CORPORATION, a
Minnesota corporation (“Borrower”), the Credit Parties signatory hereto, GENERAL ELECTRIC
CAPITAL CORPORATION, a Delaware corporation, as agent (the “Agent”) for itself and the
Lenders under and as defined in the Credit Agreement (as hereinafter defined), and the Requisite
Lenders. Unless otherwise specified herein, capitalized terms used in this Waiver shall have the
meanings ascribed to them by the Credit Agreement.

RECITALS

     WHEREAS, the Borrower, the Credit Parties, the Agent and the Lenders have entered into that
certain Third Amended and Restated Credit Agreement, dated as of June 1, 2005 (as amended,
supplemented, restated or otherwise modified from time to time, the “Credit Agreement”);
and

     WHEREAS, the Credit Parties contemplate (i) reorganizing their legal structure, (ii) setting
up five new entities (the “New Entities”), each of which will be a direct wholly owned
subsidiary of the Borrower and (iii) contributing cash in an amount not to exceed $5,000 to each
new Subsidiary (the “New Entity Capitalization”).

     WHEREAS, the Borrower, the Credit Parties, the Agent and the Requisite Lenders have agreed to
waive certain provisions of the Credit Agreement as herein set forth.

     NOW THEREFORE, in consideration of the foregoing recital, mutual agreements contained herein
and for good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Borrower, the Credit Parties, the Agent, and the Requisite Lenders hereby agree
as follows:

SECTION 1. Limited Waivers. As long as the Waiver Conditions remain satisfied, the Agent
and the Requisite Lenders hereby waive (i) the provisions of Sections 6.1 and 6.5 of the Credit
Agreement to the extent necessary to permit the Borrower to form and own the New Entities and (ii)
Section 6.2 of the Credit Agreement to the extent necessary to permit the Borrower to consummate
the New Entity Capitalization. As used herein, “Waiver Conditions” means (i) no Credit Party shall
make any investment, loan or other advance to any New Entity other than the New Entity
Capitalization, (ii) no New Entity shall conduct any business and (iii) no New Entity,
individually, shall own assets with a fair market value in the aggregate, in excess of $10,000.

SECTION 2. Conditions The effectiveness of this Waiver is subject to the satisfaction of
each the following conditions precedent:

     (a) this Waiver shall have been duly executed and delivered by the Borrower, the Credit
Parties, the Agent and Requisite Lenders; and

 

 

     (b) the representations and warranties contained herein shall be true and correct in all
respects.

SECTION 3. Representations and Warranties. In order to induce the Agent and each Lender
to enter into this Waiver, each Credit Party hereby represents and warrants to the Agent and each
Lender, which representations and warranties shall survive the execution and delivery of this
Waiver, that:

     (a) all of the representations and warranties contained in the Credit Agreement and in each
Loan Document are true and correct as of the date hereof after giving effect to this Waiver, except
to the extent that any such representations and warranties expressly relate to an earlier date;

     (b) the execution, delivery and performance by such Credit Party of this Waiver has been duly
authorized by all necessary corporate action required on its part and this Waiver, and the Credit
Agreement is the legal, valid and binding obligation of such Credit Party enforceable against such
Credit Party in accordance with its terms, except as its enforceability may be affected by the
effect of bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter
in effect relating to or affecting the rights or remedies of creditors generally;

     (c) neither the execution, delivery and performance of this Waiver by such Credit Party, the
performance by such Credit Party of the Credit Agreement nor the consummation of the transactions
contemplated hereby does or shall contravene, result in a breach of, or violate (i) any provision
of any Credit Party’s certificate or articles of incorporation or bylaws or other similar
documents, or agreements, (ii) any law or regulation, or any order or decree of any court or
government instrumentality, or (iii) any indenture, mortgage, deed of trust, lease, agreement or
other instrument to which any Credit Party or any of its Subsidiaries is a party or by which any
Credit Party or any of its Subsidiaries or any of their property is bound, except in any such case
to the extent such conflict or breach has been waived herein or by a written waiver document, a
copy of which has been delivered to Agent on or before the date hereof; and

     (d) no Default or Event of Default has occurred and is continuing.

SECTION 4. Reference to and Effect Upon the Credit Agreement.

     (a) Except as specifically set forth above, the Credit Agreement and the other Loan Documents
shall remain in full force and effect and are hereby ratified and confirmed; and

     (b) The waivers set forth herein are effective solely for the purposes set forth herein and
shall be limited precisely as written, and shall not be deemed to (i) be a consent to any
amendment, waiver or modification of any other term or condition of the Credit Agreement or any
other Loan Document, (ii) operate as a waiver or otherwise prejudice any right, power or remedy
that the Agent or the Lenders may now have or may have in the future under or in connection with
the Credit Agreement or any other Loan Document or (iii) constitute an
amendment or waiver of any provision of the Credit Agreement or any Loan Document, except as
specifically set forth herein. Upon the effectiveness of this Waiver, each reference in the Credit
Agreement to “this Agreement”, “herein”,
“hereof” and words of like import and each reference in
the Credit Agreement and the Loan Documents to the Credit Agreement shall mean the Credit Agreement
as amended hereby. This Waiver shall be construed in connection with and as part of the Credit
Agreement.

2

 

SECTION 5. GOVERNING LAW. THIS WAIVER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS OF THE STATE OF ILLINOIS.

SECTION 6. Headings. Section headings in this Waiver are included herein for convenience
of reference only and shall not constitute part of this Waiver for any other purposes.

SECTION 7. Counterparts. This Waiver may be executed in any number of counterparts, each
of which when so executed shall be deemed an original, but all such counterparts shall constitute
one and the same instrument.

(signature pages follow)

3

 

     IN WITNESS WHEREOF, the parties hereto have executed and delivered this Waiver as of the date
first written above.

	 	 	 	 	 	 	 
	 	 	BORROWER:	 	 
	 
	 	 	 	 	 	 
	 	 	NAVARRE CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	GENERAL ELECTRIC CAPITAL	 	 
	 	 	CORPORATION, as Agent and Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

[Signature Page to Limited Waiver With Respect To Third Amended

and Restated Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	LENDERS	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 

[Signature Page to Limited Waiver With Respect To Third Amended

and Restated Credit Agreement]

 

 

     IN WITNESS WHEREOF, this Waiver has been duly executed as of the date first written above by
below Persons in their capacity as Credit Parties not as Borrower.

	 	 	 	 	 	 	 
	 	 	ENCORE SOFTWARE, INC., as Credit Party	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	BCI ECLIPSE COMPANY, LLC, as Credit Party	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	FUNIMATION PRODUCTIONS LTD., as Credit Party	 	 
	 
	 	 	 	 	 	 
	 	 	By: Navarre CP, LLC, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	FUNIMATION STORE LTD., as Credit Party	 	 
	 
	 	 	 	 	 	 
	 	 	By: Navarre CS, LLC, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	NAVARRE CP, LLC, as Credit Party	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	NAVARRE CLP, LLC, as Credit Party	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 

[Signature Page to Limited Waiver With Respect To Third Amended

and Restated Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	NAVARRE CS, LLC, as Credit Party	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

[Signature Page to Limited Waiver With Respect To Third Amended

and Restated Credit Agreement]<PAGE>

                                                                 EXHIBIT 10.25.1

(PCTEL(TM) LOGO)
SIMPLIFYING MOBILITY

August 22, 2006

Jeff Miller
118 Durango Drive
Gilberts, Illinois 60136

Subject: Severance Benefits

Dear Jeff:

The offer letter that PCTEL ("Company") and you ("Employee") signed in October,
2003 provides that any changes, additions or modifications to the terms of your
employment can only be made in writing signed by both parties. I am pleased to
extend to you the below updated severance benefits which were approved by PCTEL,
Inc.'s Board of Directors earlier this year, and which will become effective
upon your written acceptance of this letter.

SEVERANCE BENEFITS

(a) Termination by Company Without Cause and Apart From Change of Control. If,
either prior to the occurrence of a Change of Control or after the twelve (12)
month period following a Change of Control, Employee's employment is terminated
(A) involuntarily by the Company for reasons other than Cause, death or
Disability, or (B) by Employee pursuant to a Voluntary Termination for Good
Reason, then Employee shall be entitled to receive the following benefits from
the Company:

     (i) Salary Continuation. Employee shall continue to receive Employee's then
current Base Salary for a period of twelve (12) months following Employee's
termination of employment by the Company for reasons other than Cause. All such
severance payments shall be paid in accordance with the Company's normal payroll
practices. Such continuation of Employee's Base Salary shall be in lieu of any
and all other benefits which Employee is entitled to receive on the date of
Employee's termination of employment pursuant to any Company severance and
benefit plans and practices or pursuant to other agreements with the Company.
Employee shall not be entitled to pro-rated payment of an annual bonus.

     (ii) Benefits. Employee shall receive one hundred percent (100%) of
Company-paid health, dental and vision insurance benefits at the same level of
coverage as was provided to Employee immediately prior to Employee's termination
of employment by the Company for reasons other than Cause ("Company-Paid
Coverage"). If such coverage included Employee's dependents immediately prior to
Employee's termination, such dependents shall also be covered at the Company's
expense. Provided that Employee elects COBRA within the required period,
Company-Paid Coverage shall continue until the earlier of (A) twelve (12) months
following the date of Employee's termination by the Company for reasons other
than Cause (the "Termination Date"), and (B) the date upon which Employee or
Employee's dependents become covered under another employer's group health,
dental and vision insurance benefit plans. If Employee has not become covered
under another employer's group health, dental and vision insurance benefit plans
on or by 18 months following the Termination Date, Employee may, for the period
from and after the Termination Date, independently obtain health, dental and
vision insurance benefits comparable in the aggregate in scope and coverage to
that provided by the Company to Employee immediately prior to the Termination
Date. In such event, the Company shall reimburse Employee for the cost of the
premiums paid for such benefits until the earlier of (i) 6 months following the
termination of Company-Paid Coverage, and (ii) the date upon which Employee or
Employee's dependents become covered under another employer's group health,
dental and vision insurance benefit plans. For purposes of Title X of the
Consolidated Budget

   8725 West Higgins Road Suite 400 Chicago, IL 60631 / Tel: +1-773-243-3000 /
                      Fax: +1-773-243-3050 / www.pctel.com
                               PCTEL Inc. (C) 2006

<PAGE>

(PCTEL(TM) LOGO)
SIMPLIFYING MOBILITY

Reconciliation Act of 1985 ("COBRA"), the date of the qualifying event for
Employee and his or her dependents shall be the Termination Date.

     (iii) Partial Accelerated Vesting. All equity awards from the Company then
held by Employee shall partially accelerate, or if Employee is then holding
unvested shares, Company's right to repurchase the then-unvested shares under
each such equity award shall partially lapse, with respect to the number of
shares under each such award that would have become vested or been released from
such repurchase right under each respective equity award if Employee's
employment with the Company had continued for an additional twelve (12) months
following Employee's effective termination date for reasons other than Cause.

(b) Termination Following a Change of Control. If Employee's employment is
terminated within twelve (12) months following a Change of Control, the
severance and other benefits to which Employee is entitled, if any, shall be
governed by the Management Retention Agreement (which includes the definition of
Change of Control).

(c) Other Termination. If Employee's employment is terminated by the Company for
Cause, or by Employee for any reason, including death or Disability but other
than pursuant to a Voluntary Termination for Good Reason, then Employee shall
not be entitled to receive the severance and other benefits discussed above, but
may be eligible for those benefits (if any) as may then be required by law or
established under the Company's severance and benefit plans and policies
existing at the time of such termination.

Section 409A Compliance. If the Company reasonably determines that Section 409A
of the Internal Revenue Code will result in the imposition of additional tax to
an earlier payment of the severance and other benefits provided in this letter
agreement, this letter agreement will be deemed amended to the extent necessary
to avoid the imposition of any such additional tax or income recognition prior
to actual payment to Employee under Section 409A and any temporary, proposed or
final Treasury Regulations and guidance promulgated thereunder, and the parties
agree to cooperate with each other and to take reasonably necessary steps in
this regard. The remaining severance benefits will be payable as provided above.

Definition of Terms:

The following terms referred to in this letter agreement shall have the
following meanings:

Base Salary. "Base Salary" shall mean an amount equal to the Employee's Company
annual salaried compensation.

Cause. "Cause" shall mean (i) an act of personal dishonesty taken by the
Employee in connection with his responsibilities as an Employee and intended to
result in substantial personal enrichment of the Employee, (ii) Employee being
convicted of a felony, (iii) a willful act by the Employee which constitutes
gross misconduct and which is injurious to the Company, (iv) following delivery
to the Employee of a written demand for performance from the Company which
describes the basis for the Company's reasonable belief that the Employee has
not substantially performed his duties, continued violations by the Employee of
the Employee's obligations to the Company which are demonstrably willful and
deliberate on the Employee's part.

Change of Control. "Change of Control" is as defined in the Management Retention
Agreement entered into between Company and Employee.

Disability. "Disability" shall mean that the Employee has been unable to perform
his Company duties as the result of his incapacity due to physical or mental
illness, and such inability, at least

   8725 West Higgins Road Suite 400 Chicago, IL 60631 / Tel: +1-773-243-3000 /
                      Fax: +1-773-243-3050 / www.pctel.com
                               PCTEL Inc. (C) 2006

<PAGE>

(PCTEL(TM) LOGO)
SIMPLIFYING MOBILITY

26 weeks after its commencement, is determined to be total and permanent by a
physician selected by the Company or its insurers and acceptable to the Employee
or the Employee's legal representative (such Agreement as to acceptability not
to be unreasonably withheld). Termination resulting from Disability may only be
effected after at least 30 days' written notice by the Company of its intention
to terminate the Employee's employment. In the event that the Employee resumes
the performance of substantially all of his duties hereunder before the
termination of his employment becomes effective, the notice of intent to
terminate shall automatically be deemed to have been revoked.

Voluntary Termination for Good Reason. "Voluntary Termination for Good Reason"
shall mean the Employee voluntarily resigns after the occurrence of any of the
following: (i) a reduction by the Company in the Base Salary of the Employee as
in effect immediately prior to such reduction (other than a reduction that
generally applies to Company officers and/or managers); (ii) a material
reduction by the Company in the aggregate level of Employee benefits, including
bonuses, to which the Employee was entitled immediately prior to such reduction
with the result that the Employee's aggregate benefits package is materially
reduced (other than a reduction that generally applies to Company officers
and/or managers); (iii) the relocation of the Employee to a facility or a
location more than thirty-five (35) miles from the Employee's then present
location, without the Employee's express written consent; or (iv) any act or set
of facts or circumstances which would, under Illinois case law or statute
constitute a constructive termination of the Employee. For the avoidance of
doubt, the voluntary resignation by Employee after the occurrence of either of
the following shall not constitute grounds for a "Voluntary Termination for Good
Reason": (1) a material reduction of the Employee's duties, title, authority or
responsibilities, relative to the Employee's duties, title, authority or
responsibilities as in effect immediately prior to such reduction, in the
instance where, as a result of the Company being acquired and made part of a
larger entity, a Senior Vice-President of a business unit of the Company, for
example, remains as such following a Change of Control, or, with good business
reasons, such as a restructure of the Company and/or its subsidiaries, and/or a
restructure of functions and/or reporting relationships; (2) a material
reduction, without good business reasons, of the facilities and perquisites
(including office space and location) available to the Employee immediately
prior to such reduction (other than a reduction that generally applies to
Company officers and/or managers).

Except as provided above, all remaining provisions of the entire employment
agreement between us shall continue in full force and effect.

Please indicate your acceptance to the above and foregoing by signing and
returning to me the enclosed copy of this letter. Thank you.

Very truly yours,

Marty Singer

Accept and Agree to the above and foregoing
This 22nd of August, 2006.

/s/ Jeff Miller
-------------------------------------
Jeff Miller

   8725 West Higgins Road Suite 400 Chicago, IL 60631 / Tel: +1-773-243-3000 /
                      Fax: +1-773-243-3050 / www.pctel.com
                               PCTEL Inc. (C) 2006

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