Document:

exv10w29

 

Exhibit 10.29

AMENDMENT AND WAIVER NO. 1 TO CREDIT AGREEMENT

     THIS AMENDMENT AND WAIVER NO. 1 TO AMENDED AND RESTATED CREDIT AGREEMENT, dated as of April
20, 2007 (the “Amendment”), is by and among DEI SALES, INC., a Florida corporation (the
“Borrower”), those Affiliates of the Borrower identified as “Guarantors” on the signature
pages hereto (the “Guarantors”), the financial institutions party hereto (collectively, the
“Lenders”; and individually, a “Lender”), and CANADIAN IMPERIAL BANK OF COMMERCE,
acting through its New York Agency, as administrative agent for the Lenders (in such capacity, the
“Administrative Agent”) and collateral agent for the Secured Parties (in such capacity, the
“Collateral Agent”).

W I
T N E S S E T H

     WHEREAS, the Borrower, the Lenders and the Administrative Agent are parties to that
certain Amended and Restated Credit Agreement dated as of September 22, 2006 (as previously amended
and modified and as amended, modified, supplemented or restated from time to time, the “Credit
Agreement”; capitalized terms used herein shall have the meanings ascribed thereto in the
Credit Agreement unless otherwise defined herein);

     WHEREAS, the Borrower has requested that the Requisite Lenders amend (A) Section 7.1 of the
Credit Agreement to permit indebtedness of up to $5 million in connection with the Omega Litigation
(as defined below), (B) the definition of “Permitted Encumbrances” to permit the lien on the
indebtedness incurred in connection with the Omega Litigation, (C) Section 7.9 of the Credit
Agreement to (i) increase the permitted lease payments to $500,000 in any fiscal year and (ii) to
provide for Borrower’s lease agreement entered into as of December 16, 2002 between Borrower and
Legal and General Assurance Society Limited and (D) Schedule 1.1(a) of the Credit Agreement.

     WHEREAS, the Lenders have agreed to amend certain provisions of the Credit Agreement, in each
case on the terms and conditions set forth herein.

     WHEREAS, the Borrower has requested that the Required Lenders agree to waive certain
provisions of the Credit Agreement as set forth herein.

     WHEREAS, the Lenders have agreed to waive certain provisions of 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:

SECTION 1

AMENDMENTS

     1.1 Amendment to Credit Agreement. Subject to the satisfaction of the closing conditions
set forth in Section 2 below, from and after the Amendment No. 1 Effective Date (defined below),
the Credit Agreement is amended as follows:

 

 

     (a) Section 1.1 is hereby amended by:

     (i) adding the following definition (in alphabetical order):

	 	 	 	“Omega Litigation” shall mean the court judgment in favor of Omega Patents,
L.L.C. (“Omega”) for breach of a certain license agreement and patent
infringement for $1.8 million (plus attorneys fees).”

     (ii) amending the definition of “Permitted Encumbrances” by deleting “and” at
the end of clause (ix), replacing the “.” at the end of clause (viii) with “; and”,
and adding the following new clause (xi): “(xi) Liens arising from Indebtedness
permitted to be incurred pursuant to Section 7.1(ix) arising from the Omega
Litigation in an aggregate principal amount not to exceed $5 million.”

     (b) Section 7.1 of the Credit Agreement is hereby amended by:

     (i) deleting “and” at the end of clause (vii),

     (ii) replacing the “.” at the end of clause (viii) with “; and”, and

     (iii) adding the following new clause (ix): “(ix) The Loan Parties may become
and remain liable with respect to Indebtedness arising from the Omega Litigation in
an aggregate principal amount not to exceed $5 million.”

     (c) Section 7.9 of the Credit Agreement is hereby amended by:

     (i) replacing the “and” appearing at the end of clause (C) with a comma and
inserting, immediately following clause (D), the phrase “and (E) Borrower’s lease of
the Surrey facility pursuant to the lease agreement entered into as of December 16,
2002, as amended from time to time and any successor as replacement lease (the
“UK Lease”),”

     (ii) replacing the “and” appearing in the parenthetical at the end of such
section before “the Maryland Lease” with a comma and adding “and the UK lease”
immediately following such phrase, and

     (iii) deleting “$250,000” contained therein and substituting in its place
“$500,000”.

     (d) Schedule 1.1(a) of the Credit Agreement is hereby amended by adding the following:

     (i) “• Charges related to the Omega Litigation” and

     (ii) “• Non-cash charges related to the purchase accounting treatment of
inventory acquired in the Polk Acquisition.”

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     (e) Section 7.6(A) of the Credit Agreement is hereby amended by deleting the grid
therein in its entirety and replacing it with the following:

	 	 	 
	 	 	Maximum
	 	 	Consolidated
	 	 	Total Leverage
	Period	 	Ratio
	September 30, 2006 - March 31, 2007
	 	4.85:1.0
	April 1, 2007 - March 31, 2008
	 	4.85:1.0
	April 1, 2008 - March 31, 2009
	 	4.60:1.0
	April 1, 2009 - March 31, 2010
	 	3.95:1.0
	April l, 20l0 - March 31, 2011
	 	3.25:1.0
	April l, 2011 - March 31, 2012
	 	3.00:1.0
	April 1, 2012 - March 31, 2013
	 	3.00:1.0
	April 1, 2013 and thereafter
	 	3.00:1.0

     1.2 Effect of Amendment. Except as modified hereby, all of the terms and provisions of
the Credit Agreement (including the Schedules) and the other Credit Documents remain in full force
and effect.

SECTION 2

LIMITED WAIVERS

     2.1 Waivers. (a) The Required Lenders hereby waive Borrower’s obligation to comply with
Section 8.3 and 8.8 of the Credit Agreement with respect to the Omega Litigation.

     (b) The Required Lenders hereby waive any prior Default that may have existed under
Section 8.3 of the Credit Agreement pursuant to Section 7.9 (Restriction on Leases).

SECTION 3

CLOSING CONDITIONS

     3.1 Conditions Precedent. This Amendment No. 1 shall become effective as of the date
hereof upon the receipt by the Administrative Agent of the following (the “Amendment No. 1
Effective Date”):

     (a) Executed Agreement. Receipt by the Administrative Agent of a duly executed
signature page to this Amendment No. 1 from each of Borrower, the Guarantors, the
Administrative Agent, and the Requisite Lenders.

     (b) Fees and Expenses. The Agents and the Lenders shall have received from the
Borrower the aggregate amount of fees and expenses payable in connection with the
consummation of the transactions contemplated hereby.

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SECTION 4

MISCELLANEOUS

     4.1 Amended Terms. The term “Credit Agreement” as used in each of the Loan Documents
shall hereafter mean the Credit Agreement as amended by this Amendment No. 1. 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.

     4.2 Representations and Warranties of Credit Parties. Each of the Credit Parties hereby
represents and warrants as follows:

     (a) Such Person has taken all necessary action to authorize the execution, delivery and
performance of this Amendment No. 1.

     (b) This Amendment No. 1 has been duly executed and delivered by such Person and
constitutes such Person’s legal, valid and 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 court or governmental authority or third party is required in
connection with the execution, delivery or performance by such Person of this Amendment No.
1.

     (d) After giving effect to this Amendment No. 1, the representations and warranties set
forth in Section 5 of the Credit Agreement are, subject to the limitations set forth
therein, true and correct in all respects as of the date hereof (except for those which
expressly relate to an earlier date).

     (e) After giving effect to this Amendment No. 1, no Default or Event of Default has
occurred and is continuing.

     4.3 Reaffirmation of Obligations. Each of the Loan Parties hereby acknowledges and
reaffirms their respective Obligations under the Loan Documents.

     4.4 Loan Document. This Amendment No. 1 shall constitute a Loan Document under the terms
of the Credit Agreement and shall be subject to the terms and conditions thereof (including,
without limitation, Sections 10.17 and 10.18 of the Credit Agreement).

     4.5 Entirety. This Amendment No. 1 and the other Loan 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.

     4.6 Counterparts. This Amendment No. 1 may be executed in any number of counterparts,
each of which when so executed and delivered shall be an original, but all of which

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shall
constitute one and the same instrument. Delivery of executed counterparts of this Amendment No. 1
by telecopy or electronic mail shall be effective as an original and shall constitute a
representation that an original shall be delivered.

     4.7 Expenses. The Borrower agrees to pay all reasonable costs and expenses of the
Administrative Agent in connection with the preparation, negotiation, execution and delivery of
this Amendment No. 1, including, without limitation, the reasonable fees and expenses of Cahill
Gordon & Reindel LLP, and all previously incurred fees and expenses which remain outstanding on the
date hereof.

     4.8 Further Assurances. The Loan Parties agree to promptly take such action, upon the
request of the Administrative Agent, as is necessary to carry out the intent of this Amendment.

     4.9 GOVERNING LAW . THIS AMENDMENT NO. 1 AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
(INCLUDING SECTION 5-1401 OF TILE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES.

     4.10 GENERAL RELEASE. IN CONSIDERATION OF THE LENDERS ENTERING INTO THIS AMENDMENT NO. 1,
THE LOAN PARTIES HEREBY RELEASE THE ADMINISTRATIVE AGENT, THE LENDERS, AND THE ADMINISTRATIVE
AGENT’S, AND THE LENDERS’ RESPECTIVE OFFICERS, EMPLOYEES, REPRESENTATIVES, AGENTS, COUNSEL AND
DIRECTORS FROM ANY AND ALL ACTIONS, CAUSES OF ACTION, CLAIMS, DEMANDS, DAMAGES AND LIABILITIES OF
WHATEVER KIND OR NATURE, IN LAW OR IN EQUITY, NOW KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED TO
TILE EXTENT THAT ANY OF THE FOREGOING ARISES FROM ANY ACTION OR FAILURE TO ACT UNDER THE CREDIT
AGREEMENT OR UNDER THE OTHER CREDIT DOCUMENTS ON OR PRIOR TO THE DATE HEREOF.

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     IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this
Amendment No. I to be duly executed and delivered as of the date first above written.

	 	 	 
	 BORROWER:

	 	DEI SALES, INC.

	 	 	 	 	 
	 	 	 
	 	By:  	/s/
Ronald F. Dutt
 	 
	 	 	Name:  	Ronald F. Dutt 	 
	 	 	Title:  	Chief Financial Officer 	 
	 

	 	 	 
	GUARANTORS:

	 	DIRECTED ELECTRONICS, INC.
	 

	 	DEI HEADQUARTERS, INC.,
	 

	 	DEI INTERNATIONAL, INC.
	 

	 	POLK HOLDING CORP.
	 

	 	POLK AUDIO, INC.
	 

	 	BRITTANIA INVESTMENT CORPORATION

	 	 	 	 	 
	 	 	 
	 	By:  	/s/
Ronald F. Dutt
 	 
	 	 	Name:  	Ronald F. Dutt 	 
	 	 	Title:  	Chief Financial Officer 	 
	 

[DEI Amendment No. 1]

 

 

	 	 	 
	ADMINISTRATIVE AGENT:

	 	CANADIAN IMPERIAL BANK OF
	 

	 	COMMERCE, ACTING THROUGH
	 

	 	ITS NEW YORK AGENCY,
	 

	 	as Administrative Agent on behalf of the Lenders

	 	 	 	 	 
	 	 	 
	 	By:  	                                /s/ David Sommer
 	 
	 	 	Name:  	David Sommer 	 
	 	 	Title:  	Authorized Signatory 	 
	 

[DEI Amendment No. 1]exv10w13

 

Exhibit 10.13

RELEASE

     WHEREAS, Kathleen Flanagan (“Executive”) was an employee of eFunds Corporation, a Delaware
corporation (the “Company”);

     WHEREAS, Executive’s employment with the Company was terminated effective as of December 31,
2006 (the “Separation Date”);

     WHEREAS, Executive and the Company have previously entered into that certain Executive
Transition Assistance Agreement, dated as of December 2, 2002 and amended as of December 2006 (as
amended, the “Transition Agreement”), pursuant to which the Company has agreed to make certain
payments to Executive following the termination of her employment; and

     WHEREAS, it is a condition to the Company’s obligation to make the payments provided for in
the Transition Agreement that Executive execute, deliver and not rescind this Release.

     NOW, THEREFORE, IN CONSIDERATION OF THE FOREGOING, Executive and the Company hereby agree as
follows:

     1. Release.

          (a) As consideration for the promises of the Company contained in the Transition
Agreement, Executive, for herself and her successors and assigns, hereby fully and completely
releases and waives any and all claims, complaints, rights, causes of action or demands of whatever
kind, whether known or unknown or suspected to exist by Executive (collectively, “Claims”) which
she has or may have against the Company and any company controlling, controlled by or under common
control with the Company (collectively with the Company, the “Controlled Group”) and their
respective predecessors, successors and assigns and all officers, directors, shareholders,
employees and agents of those persons and companies (“the Released Parties”) arising out of or
related to any actions, conduct, promises, statements, decisions or events occurring prior to or on
the Separation Date (the “Released Matters”), including, without limitation, any Claims based on or
arising out of Executive’s employment with the Controlled Group and the cessation of that
employment; provided, however, that such release shall not operate to relieve the
members of the Controlled Group of any obligation to indemnify Executive against any Claims brought
against Executive by any third party by reason of Executive’s status as an officer or employee of
the Controlled Group. As an essential inducement to Executive to enter into this Agreement, and as
consideration for the promises of Executive contained herein, the Company, for itself and its
successors, assigns and affiliates hereby fully and completely releases and waives any and all
Claims which it or they have or may have against Executive arising out of or related to the
Released Matters; provided, however, that such release shall not operate to relieve
Executive from any obligation to reimburse the members of the Controlled Group for any
disbursements (such as travel and entertainment expenses) improperly charged by Executive to such
Group. Executive and the Company each further agree that they will not, and will cause their
affiliates not to, institute any legal proceedings against the persons released by them in respect
of any Claim. Executive and the Company agree that, by signing this Release, neither party is
waiving any Claim arising after the Separation Date or under the Transition Agreement.

          (b) Executive’s release of Claims is intended to extend to and include Claims of any kind
arising Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. §§ 2000e et
seq.,
the Age Discrimination in Employment Act, 29 U.S.C. §§ 621 et seq., the Americans
with Disabilities Act, 42 U.S.C. §§ 12101 et seq., the Delaware Discrimination in
Employment Act, Del. Code Ann. Tit. 19, §§ 710-718, the Delaware Handicapped Persons Employment
Protections Act, Del. Code Ann. Tit. 19, §§ 720-728 and any other federal, state or local statute,
Executive Order or ordinance prohibiting employment discrimination or otherwise relating to
employment, as well as any claim for breach of contract, wrongful discharge, breach of any express
or implied promise, misrepresentation, fraud, retaliation, violation of public policy, infliction
of emotional distress, defamation, promissory estoppel, equitable estoppel, invasion of privacy or
any other theory, whether legal or equitable.

 

 

          (c) Executive has been informed of Executive’s right to revoke this Release insofar as it
extends to potential claims under the Age Discrimination in Employment Act by informing the Company
of Executive’s intent to revoke this Agreement within seven (7) calendar days following the
execution of this Release by Executive. Executive has further been informed and understands that
any such rescission must be in writing and hand-delivered to the Company or, if sent by mail,
postmarked within the applicable time period, sent by certified mail, return receipt requested, and
addressed as follows:

eFunds Corporation

Gainey Ranch Center II

8501 N. Scottsdale Road

Suite 300

Scottsdale, AZ 85253

Attention: General Counsel

The Company and Executive agree that if Executive exercises Executive’s right of
rescission, under this Section (c), the Company’s obligations under Section 1 of the
Transition Agreement shall be null and void.

     2. Miscellaneous.

          (a) Executive may not assign or delegate any of Executive’s rights or obligations in respect
of this agreement and any attempted assignment or delegation shall be void and of no effect. This
agreement is binding upon and enforceable by the Company and the other members of the Controlled
Group and their respective successors and assigns and inures to the benefit of Executive and
Executive’s, heirs and executors. This agreement is governed by the substantive laws of the State
of Delaware, without regard to its conflicts of law rules.

          (b) The failure of a party to insist upon strict compliance with any of the terms, conditions
or covenants expressed in this Agreement shall not be deemed a waiver of such term, condition or
covenant, or any other term, condition or covenant, nor shall any waiver or relinquishment of any
right or power under this Agreement on one or more times be deemed a waiver or relinquishment of
such right or power or any other right or power at any other time or times.

          (c) Whenever possible, each provision of this Agreement will be interpreted in
such manner as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be prohibited by or invalid under applicable law, such provision will be
ineffective only to the extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this Agreement.

          (d) This Agreement may be executed in one or more counterparts, any one of which need
not contain the signatures of more than one party, but all such counterparts taken together will
constitute one and the same instrument.

 

 

IN WITNESS WHEREOF, the Company and Executive have hereunto set their hands to this Release as
of the dates set forth below.

	 	 	 	 	 	 	 
	 	 	 	 	eFUNDS CORPORATION
	 
	 	 	 	 	 	 
	Dated:

	 	 	 	By:
	 	/s/ Paul F. Walsh
	 

	 	 	 	Its	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Dated:	 	 	 	/s/ Kathleen Flanagan
	 	 	 	 	Kathleen Flanagan
	 
	 	 	 	 	 	 
	STATE OF Arizona)
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	County of Maricopa)
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Subscribed and sworn before me

this 3rd day of January, 2007.
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	/s/ Sandra A. Freeman	 	 	 	seal
	Notary Public, State of Arizona
	 	 	 	 	 	 
	My Commission expires: 8/17/09

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