Intercreditor and Subordination Agreement dated November 17, 2006 INTERCREDITOR AND SUBORDINATION AGREEMENT
Exhibit
4.16
Intercreditor
and Subordination Agreement dated November 17, 2006
INTERCREDITOR
AND SUBORDINATION AGREEMENT, dated as of November 17, 2006, (this
“Agreement”), by and among 2118769 Ontario Inc., an Ontario corporation
(“Ontario”), ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, an individual (“Serruya” and
together with Ontario, the “Subordinated Creditors”), JPMORGAN CHASE
BANK, N.A., in its capacity as administrative agent for itself and the other
lenders party to the Integrated Credit Agreement (as defined below) (in such
capacity, the “Integrated Agent”), and JPMORGAN CHASE BANK, N.A., in its
capacity as administrative agent for itself and the other lenders party to
the
Americana Credit Agreement (as defined below) (in such capacity, the
“Americana Agent” and together with the Integrated Agent, the
“Administrative Agent”).
INTRODUCTORY
STATEMENT
A. All
capitalized terms used herein and not otherwise defined above or in this
Introductory Statement are used as defined in Section 1.
B. Integrated
Brands Inc., Eskimo Pie Frozen Distribution, Inc., Eskimo Pie Corporation
and
Coolbrands Dairy, Inc., as Borrowers (the “Integrated Borrowers”), the
Loan Guarantors party thereto (the “Integrated Loan Guarantors” and
together with the Integrated Borrowers, the “Integrated Loan Parties”),
the lenders party thereto (the “Integrated Lenders”) and the Integrated
Agent entered into that certain Credit Agreement, dated as of April 21, 2006
(as
amended, supplemented or otherwise modified from time to time, the
“Integrated Credit Agreement”).
C. Americana
Foods Limited Partnership, as Borrower (the “Americana Borrower” and,
together with the Integrated Borrowers, the “Borrowers” and each a
“Borrower”), the lenders party thereto (the “Americana Lenders”
and together with the Integrated Lenders, the “Senior Lenders”) and the
Americana Agent entered into that certain Credit Agreement, dated as of April
21, 2006 (as amended, supplemented or otherwise modified from time to time,
the
“Americana Credit Agreement” and together with the Integrated Credit
Agreement, the “Senior Credit Agreements”).
D. To
secure all present and future obligations of the Integrated Borrowers under
or
in connection with the Integrated Credit Agreement and the other Integrated
Loan
Documents, pursuant to the Integrated Collateral Documents the Integrated
Loan
Parties have granted and hereafter may grant to the Integrated Agent Liens
in
substantially all of such Integrated Loan Parties’ assets, real and personal,
tangible and intangible, now existing or hereafter arising or acquired and
the
proceeds thereof as more particularly set forth in their respective Integrated
Collateral Documents (the “Collateral”).
E. The
Integrated Loan Parties (the “Americana Guarantors”) have each executed a
Guarantee (collectively, the “Americana Guarantees”) in favor of the
Americana Agent pursuant to which the Americana Guarantors have guaranteed
the
timely payment and performance of the Secured Obligations (as defined in
the
Americana Credit Agreement).
F. To
secure all present and future obligations of the Americana Guarantors under
or
in connection with the Americana Guarantees, the Americana Guarantors have
granted and hereafter may grant to the Americana Agent Liens in the Collateral
owned by them.
G. Each
of the Integrated Loan Parties party thereto, the Integrated Lenders party
thereto and the Integrated Agent, entered into that certain Forbearance,
Waiver
and First Amendment to Credit Agreement, dated as of the date hereof (as
amended, supplemented or otherwise modified from time to time, the
“Forbearance and First Amendment”), pursuant to which, among other
things, the Integrated Agent and the Integrated Lenders have agreed to permit
the Integrated Loan Parties to grant a junior security interest in the
Collateral to the Subordinated Creditors.
H. It
is a condition precedent to the effectiveness of the Forbearance and First
Amendment that the parties hereto shall have executed and delivered this
Agreement in order to set forth the relative rights and priorities of the
Administrative Agent, the Senior Lenders and the Subordinated Creditors under
the Senior Debt Documents and the Subordinated Debt Documents.
Accordingly,
in consideration of the foregoing and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Administrative
Agent on behalf of the Senior Lenders and the Subordinated Creditors hereby
agree as follows:
1. Defined
Terms.
(a) As
used in this Agreement, the following terms shall have the following
meanings:
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“Alternate
Forum” has the meaning given to such term in Section 16 hereof.
“Americana
Collateral Documents” means the “Collateral Documents,” as defined in the
Americana Credit Agreement.
“Americana
Loan Documents” means the “Loan Documents,” as defined in the Americana
Credit Agreement.
“Americana
Obligations” means all obligations of the Americana Guarantors arising
under, with respect to or in connection with any Americana
Guarantee.
“Americana
Security Agreement” means that certain Pledge and Security Agreement, dated
as of April 21, 2006, among the Americana Guarantors and the Americana Agent,
for the benefit of the Americana Agent and the Americana Lenders, and any
other
pledge or security agreement entered into, after the date of this Agreement
by
any other Integrated Loan Party (as required by the Americana Credit Agreement
or any other Americana Loan Document), as the same may be amended, restated
or
otherwise modified from time to time.
“Avoidance
Action” has the meaning given to such term in Section 5 hereof.
“Bankruptcy
Code” means The Bankruptcy Reform Act of 1978, as heretofore and hereafter
amended, and codified as 11 U.S.C. Section 101 etseq.
“Business
Day” means any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to remain
closed.
“Holdings”
means CoolBrands International Inc., a Canadian federal
corporation.
“Indebtedness”
means any and all obligations and liabilities, principal, premiums, interest,
fees, reimbursement obligations and indemnities, whether now or hereafter
existing, absolute or contingent, secured or unsecured, due or not due, joint
or
several, and however arising (including interest, costs, fees and expenses
(including professional fees) and any other amounts accruing after maturity
and
interest and any other amounts accruing after the filing of any petition
in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding regardless of whether such interest, costs, fees or expenses,
including professional fees, is allowable, payable or accruable to the holders
of such indebtedness in any such bankruptcy case, proceeding or other
action).
“Integrated
Collateral Documents” means the “Collateral Documents,” as defined in the
Integrated Credit Agreement.
“Integrated
Loan Documents” means the “Loan Documents,” as defined in the Integrated
Credit Agreement.
“Integrated
Obligations” means
the “Secured Obligations,” as defined in the Integrated Credit
Agreement.
“Integrated
Security Agreement” means the “Security Agreement,” as defined in the
Integrated Credit Agreement.
“Indemnification
Agreement” means that certain Indemnification and Waiver Agreement, dated as
of November 17, 2006, by and among the Subordinated Creditors, the
Administrative Agent and the Senior Lenders, as the same may be amended,
restated or otherwise modified from time to time.
“Lien”
means any mortgage, deed of trust, hypothecation, pledge, security interest,
assignment, deposit arrangement, encumbrance, lien (statutory or other),
charge,
preference, priority or other security or preferential arrangement, in each
case, of any kind or nature whatsoever (including any right of setoff, any
conditional sale or other title retention agreement, any agreement to grant
a
security interest at a future date, any lease in the nature of security or
any
agreement having substantially the same economic effect as any of the foregoing,
the filing of, or agreement to give or authorize, any financing statement
under
the Uniform Commercial Code of any jurisdiction, and with respect to any
equity
interest or other security, any purchase option, call or similar right of
a
third party with respect to such equity interest or other
security).
“Loan
Guarantors” has the meaning given to such term in the Integrated Credit
Agreement.
“Obligors”
means, collectively, the Integrated Borrowers, Holdings
and the other Integrated Loan Parties.
“Person”
shall mean any natural person, corporation, division of a corporation,
partnership, limited liability partnership, limited liability company, trust,
joint venture, association, company, estate, unincorporated organization
or
government or any agency or political subdivision thereof.
“Senior
Collateral Documents” means, collectively, the Americana Collateral
Documents and the Integrated Collateral Documents.
“Senior
Credit Termination Date” shall mean the date upon which all of the Senior
Debt has been indefeasibly paid in full in cash, any commitment to lend under
the Senior Credit Agreements shall have been terminated in its entirety,
and all
letters of credit issued under or pursuant to the Senior Credit Agreements
shall
have expired or been terminated, cancelled, surrendered or cash collateralized
in accordance with the terms of the Senior Credit Agreements.
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“Senior
Debt” means, collectively, the Integrated Obligations and the Americana
Obligations.
“Senior
Debt Documents” means, collectively, the Integrated Loan Documents and the
Americana Loan Documents.
“Senior
Security Documents” means collectively, the Americana Security Agreement and
the Integrated Security Agreement.
“Standby
Letter of Credit” means that certain irrevocable standby letter of credit in
favor of the Administrative Agent, for the ratable benefit of certain of
the
Senior Lenders, in the aggregate face amount of $5,000,000, as the same may
be
amended, restated or otherwise modified from time to time.
“Subordinated
Debt” means all obligations of each Obligor to the Subordinated Creditors
evidenced by or incurred pursuant to the Subordinated Debt Documents;
provided, that the terms of such Subordinate Debt shall not impose on the
Obligors any representations, warranties, covenants, events of default or
remedies that, in the case of each such representation, warranty, covenant,
event of default or remedy, are more restrictive or burdensome to the Obligors
than the terms and provisions of the Senior Credit Agreements in effect at
the
time of the execution of the Subordinated Debt Documents.
“Subordinated
Debt Documents” means the Indemnification Agreement and the Standby Letter
of Credit.
“Subordinated
Security Document” means any pledge or security agreement entered into by
either Subordinated Creditor and any Obligor, and all other agreements,
documents and instruments executed from time to time in connection therewith,
as
the same may be amended, restated or otherwise modified from time to time,
in
each case, as permitted hereunder.
“Uniform
Commercial Code” means the Uniform Commercial Code as in effect from time to
time in the applicable jurisdiction.
Rules
of Construction. All references to “Sections,” “Exhibits,”
“Schedules” and “paragraphs” shall be to Sections, Exhibits, Schedules and
paragraphs, respectively, of this Agreement unless otherwise specifically
provided. Any of the terms specified in this paragraph 1 may, unless
the context otherwise requires, be used in the singular or the plural depending
on the reference. All references to statutes and related regulations
shall include, unless otherwise specifically provided herein, any amendments
of
same and any successor statutes and regulations, as applicable. The
words “include,” “includes” and “including” shall be deemed to be followed by
the words “without limitation.”
2. Subordination.
(a) Payment. (i) The
Subordinated Creditors hereby irrevocably agree that any and all Subordinated
Debt shall be in all respects subordinate, junior and inferior in right of
payment and collection to the prior indefeasible payment in full in cash
of any
and all Senior Debt. In the event of any receivership, insolvency,
bankruptcy, assignment for the benefit of creditors, readjustment of
indebtedness, composition, reorganization (whether or not pursuant to bankruptcy
laws), sale of all or substantially all of the assets, dissolution, winding
up,
liquidation, or any other marshalling of the assets and liabilities of any
of
the Obligors while any of the Senior Debt remains outstanding, any payment
or
distribution of assets of any of the Obligors of any kind or character, whether
in cash, securities or other property, which would otherwise be payable to
or
deliverable to the Subordinated Creditors upon or with respect to any or
all of
the Subordinated Debt or which would constitute the Collateral or the proceeds
of the Collateral shall be paid or delivered directly to the Administrative
Agent for application to the Senior Debt in accordance with this Agreement
until
the Senior Credit Termination Date has occurred. The Senior Lenders
shall have the right to enforce, collect and receive every such payment or
distribution and give acquittance therefor.
(ii) The
Subordinated Creditors hereby irrevocably agree that no payment of or on
account
of the Subordinated Debt shall be made, including by means of setoff, offset,
recoupment or by any other means, whether or not there exists a Default or
an
Event of Default under and as defined in each respective Senior Credit
Agreement, or any guaranty therefor enforced, unless and until the Senior
Credit
Termination Date has occurred. Until the Senior Credit Termination Date,
all
cash, cash equivalents or other property owned, leased or held by or on behalf
of the Obligors shall be subject to this Agreement and the Subordinated
Creditors hereby agree that their right to receive any payment or distribution
therefrom shall be expressly subordinate and junior in right of payment to
the
indefeasible payment in cash in full of the Senior Debt. The
Subordinated Creditors hereby irrevocably further agree not to demand, receive
or accept on account of the Subordinated Debt any payment prior to the Senior
Credit Termination Date.
(b) Lien. Notwithstanding
anything to the contrary contained in any Senior Debt Document or Subordinated
Debt Document and irrespective of (i) the time, order or method of attachment
or
perfection of the security
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interests
created by any Senior Security Document or Subordinated Security Document;
(ii)
the time or order of filing or recording of financing statements or other
documents filed or recorded to perfect security interests in any Collateral;
(iii) anything contained in any filing or agreement to which the Administrative
Agent, any Senior Lender or the Subordinated Creditors may now or hereafter
be a
party; (iv) the rules for determining priority under the Uniform Commercial
Code
or any other law governing the relative priority of secured creditors; (v)
whether the security interest or lien of the Administrative Agent on behalf
of
the Senior Lenders has been perfected; or (vi) the validity, enforceability
or
avoidability of any security interest or lien of the Administrative Agent
on the
Collateral, any security interest of the Subordinated Creditors in any of
the
Collateral is and shall be subordinate, junior and inferior in priority,
operation and effect to any security interest or lien on such Collateral
of the
Administrative Agent on behalf of the Senior Lenders. Until the
Senior Credit Termination Date, the Subordinated Creditors agree that they
shall
not (i) except as permitted in paragraph 5 of this Agreement, take any action
or
enforce any of their rights under the Subordinated Debt Documents in respect
of
the Subordinated Debt or the Collateral; (ii) take any action or enforce
any of
their rights in respect of the Collateral, including any action of foreclosure;
(iii) contest, protest or object to any foreclosure proceeding or action
brought
by the Administrative Agent or any Senior Lender or any other exercise by
the
Administrative Agent or any Senior Lender of any rights or remedies under
any
Senior Debt Document; (iv) take any action to enforce any of their rights
in
respect of any other property in or on which the Obligors have granted or
may
hereinafter grant a security interest or lien to secure the payment of the
Subordinated Debt; or (v) amend, modify or supplement those provisions of
the
Subordinated Debt Documents relating to the Collateral or which would affect,
impact or alter the right to payment thereunder to the extent that any such
amendment, modification or supplement is adverse to the interests of the
Administrative Agent or any Senior Lender; provided that the Subordinated
Creditors may file any proof of claim or, subject to the restrictions and
limitations placed upon the Subordinated Creditors as set forth in this
Agreement, take any action necessary to perfect, protect and preserve their
interests under the Subordinated Debt Documents.
(c) Exercise
of Rights and Remedies. In exercising rights and remedies with
respect to the Collateral, the Administrative Agent and the Senior Lenders
may
enforce the provisions of the Senior Collateral Documents and exercise remedies
thereunder and under any other Senior Debt Documents, all in such order and
in
such manner as they may determine in the exercise of their sole business
judgment. Such exercise and enforcement shall include the rights to
sell or otherwise dispose of the Collateral, to incur expenses in connection
with such sale or disposition and to exercise all the rights and remedies
of a
secured lender under the Uniform Commercial Code.
(d) Release
of Lien. The Administrative Agent’s and the Senior Lenders’
rights with respect to the Collateral include the right to release any
or all of
the Collateral from the Lien of any Senior Security Document or Subordinated
Security Document during the pendency of any Event of Default and/or the
exercise of any of the Administrative Agent’s or Senior Lenders’ remedies,
including in connection with the sale or other disposition of such Collateral,
notwithstanding that the net proceeds of any such sale may not be used to
permanently prepay any Senior Debt or Subordinated Debt. If the
Administrative Agent or the Senior Lenders shall determine that the release
of
the Lien of any Subordinated Security Document on such Collateral is necessary
or advisable, the Subordinated Creditors, as applicable, shall execute such
release documents and instruments and shall take such further actions as
the
Administrative Agent or the Senior Lenders shall request. Each
Subordinated Creditor hereby irrevocably constitutes and appoints the
Administrative Agent and any officer or agent of the Administrative Agent,
with
full power of substitution, as its true and lawful attorney-in-fact with
full
irrevocable power and authority in the place and stead of such Subordinated
Creditor and in the name of such Subordinated Creditor or in the Administrative
Agent’s own name, from time to time in the Administrative Agent’s discretion,
for the purpose of carrying out the terms of this paragraph, to take any
and all
appropriate action and to execute any and all documents and instruments which
may be necessary or desirable to accomplish the purposes of this paragraph,
including any financing statements, endorsements, assignments or other
instruments of transfer or release. Each Subordinated Creditor hereby
ratifies all that said attorneys shall lawfully do or cause to be done pursuant
to the power of attorney granted in this paragraph.
3. Turnover
of Payments. Should any payment, distribution or security or the
proceeds thereof (whether in cash, property or securities) be received by
the
Subordinated Creditors on or after the date of this Agreement and prior to
the
Senior Credit Termination Date on account of or with respect to any Subordinated
Debt, the Subordinated Creditors shall forthwith deliver the same to the
Administrative Agent for distribution to the Senior Lenders, in the form
received (together with any endorsement or assignment by the Subordinated
Creditors where required by the Administrative Agent), for application on
account of the Senior Debt and, until so delivered, the same shall be held
in
trust by the Subordinated Creditors, as trustee for the Administrative Agent,
for the benefit of the Senior Lenders.
4. Moratorium
on Exercise of Rights and Remedies.
(a) The
Subordinated Creditors agree that the Administrative Agent and the Senior
Lenders shall have the sole and exclusive right to enforce rights and exercise
remedies with respect to the Collateral. Accordingly, notwithstanding
any other provisions hereof or of the Subordinated Debt Documents to the
contrary, the Subordinated
4
Creditors
shall not exercise any remedies or rights whatsoever with respect to the
Subordinated Debt or the Collateral under the Subordinated Debt Documents
or
otherwise, including the right to accelerate or demand payment of or ▇▇▇
for
arrearage with respect to the Subordinated Debt or commence or join with
any
other creditor in commencing any proceeding or action for liquidation,
dissolution, receivership, insolvency, reorganization or bankruptcy of any
Obligor, until the Senior Credit Termination Date.
(b) Nothing
in this Agreement shall impose any duty, responsibility or obligation upon
the
Administrative Agent or the Senior Lenders with respect to the Collateral,
the
Obligors, or with respect to amounts owed to the Subordinated
Creditors. All rights and interests of the Administrative Agent and
the Senior Lenders, and all agreements and obligations of the Subordinated
Creditors, under this Agreement shall remain in full force and effect
irrespective of any circumstance which might constitute a defense available
to,
or a discharge of the Subordinated Creditors or the Obligors in respect of
the
Senior Debt or in respect of this Agreement.
(c) The
Subordinated Creditors agree and acknowledge that, until the Senior Credit
Termination Date has occurred, the Subordinated Creditors shall not exercise
any
claims or rights by way of subrogation or otherwise as a result of the payment
of any amounts to the Administrative Agent or the Senior Lenders on account
of
the Senior Debt. This Agreement shall continue to be effective or
shall be reinstated, as the case may be, if at any time any lien or security
interest asserted by the Administrative Agent or the Senior Lenders is avoided
or payment on or in respect of the Senior Debt shall be rescinded or must
otherwise be returned by the Administrative Agent or the Senior Lenders upon
the
insolvency, bankruptcy, reorganization of the Obligors or otherwise, all
as
though such payment had not been made.
5. Agreements
Regarding Insolvency.
(a) The
Subordinated Creditors hereby irrevocably consent and agree to (i) the granting
to the Administrative Agent or the Senior Lenders of any replacement liens
or
other adequate protection to the Administrative Agent or the Senior Lenders
pursuant to 11 U.S.C. §§ 105, 361, 362, 363, 364, 365, 506 or 553; and (ii)
any conditions, restrictions or limitations requested by the Administrative
Agent or the Senior Lenders with respect to the use by the Obligors of the
Administrative Agent’s or the Senior Lenders’ Collateral, including cash
collateral. Until the Senior Credit Termination Date, the
Subordinated Creditors agree that they will not extend credit or grant any
financial accommodation to the Obligors or provide or participate in any
debtor-in-possession financing or any exit financing under a plan of
reorganization for the Obligors except (a) to the extent such financing is
junior to the Senior Debt and secured by Liens junior to the Liens securing
the
Senior Debt or (b) as part of a debtor-in-possession or exit financing arranged
by the Administrative Agent. To the extent that the Subordinated
Creditors have or acquire any rights under 11 U.S.C. §§ 361, 363, 364 or 553
with respect to the Collateral, the Subordinated Creditors hereby agree not
to
assert such rights without the prior written consent of the Administrative
Agent; provided, that if requested by the Administrative Agent, the
Subordinated Creditors shall seek to exercise such rights in the manner
requested by the Administrative Agent. Further, the
Subordinated Creditors agree that notwithstanding anything in 11 U.S.C.
§ 506 to the contrary, the Subordinated Creditors’ rights or entitlement to
receive any payments in respect of the Subordinated Debt Documents in connection
with the Subordinated Debt and the Collateral shall in all respects be junior
and subordinate to the Administrative Agent’s and the Senior Lenders’ right to
receive interest, costs, fees or expenses, including professional fees, even
to
the extent the Administrative Agent or the Senior Lenders are deemed
unsecured. In addition, the Subordinated Creditors each irrevocably
agrees that it shall not vote in favor of any plan of reorganization or support
or promote any such plan proposed under 11 U.S.C. § 1129 by, for or on
behalf of the Obligors unless the Administrative Agent and the Senior Lenders
vote in favor of such plan; provided, however, that in any
bankruptcy case filed by or against the Obligors, the Subordinated Creditors
may
appear as a party-in-interest pursuant to 11 U.S.C. § 1109 for all purposes
subject to the restrictions and limitations contained herein.
(b) If
at any time any liens, security interests, guaranty, undertaking or promise
given by any of the Obligors to the Subordinated Creditors is challenged,
avoided, voided, disallowed, recharacterized or subordinated in whole or
in part
(collectively, an “Avoidance Action”), the Subordinated Creditors and the
Obligors each hereby acknowledge and agree that such Avoidance Action or
its
outcome shall not impair, affect, avoid, or limit the Senior Debt, the
Administrative Agent’s or the Senior Lenders’ liens, security interests or
rights in and to the Collateral, or their respective rights or interests
in, to
or under this Agreement, the Senior Credit Agreements or the other Senior
Debt
Documents.
(c) The
provisions of this Agreement shall continue in full force and effect
notwithstanding any commencement of a proceeding under the Bankruptcy Code,
receivership, insolvency, assignment for the benefit of creditors, readjustment
of indebtedness, composition, reorganization (whether or not pursuant to
bankruptcy laws), sale of all or substantially all of the assets, dissolution,
winding up, liquidation, or any other marshalling of the assets and liabilities
of any of the Obligors.
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6.. Assignment
of Subordinated Debt, etc. Each Subordinated Creditor is
prohibited from assigning or otherwise transferring the Subordinated Debt,
the
Subordinated Debt Documents or their rights and claims under the Subordinated
Debt Documents, except to an assignee or other transferee that has expressly
acknowledged and assumed in writing all of the obligations of the Subordinated
Creditors under this Agreement.
7. Continuing
Agreement; Modification of Terms of Senior Debt.
(a) This
Agreement shall constitute a continuing agreement of subordination, and the
Senior Lenders may, without notice to the Subordinated Creditors, lend
additional monies, extend further credit and make other financial accommodations
to or for the account of the Obligors in reliance hereon or sell, assign
or
convey all or a portion of the Senior Debt and/or interest in the Collateral
securing such Senior Debt. The Subordinated Creditors, in advance,
hereby irrevocably waive, release and disclaim any rights to direct, compel,
request or assert claims against the Administrative Agent or the Senior Lenders
to ▇▇▇▇▇▇▇▇, assemble, arrange, sell, use or dispose of the Collateral or
any
other property of the Obligors in any order, manner or fashion.
(b) The
Administrative Agent and the Senior Lenders, at any time and from time to
time,
may enter into such agreement or agreements with the Obligors, as the
Administrative Agent and the Senior Lenders may deem proper, granting additional
collateral to the Administrative Agent, extending the time of payment or
renewing or otherwise altering in any manner the terms of all or any of the
Senior Debt or affecting in any manner any security underlying any or all
of the
Senior Debt, or may exchange, sell or surrender or otherwise deal with any
of
the Collateral therefor, or may release any balance of funds of the Obligors
with the Administrative Agent or the Senior Lenders without notice to the
Subordinated Creditors and without in any way impairing or affecting this
Agreement.
(c) Any
amendment, supplement, modification, consent or waiver in respect of the
observance or performance of the covenants set forth in any Senior Debt Document
or any Event of Default (as defined in each respective Senior Credit Agreement)
thereunder shall be deemed to be an amendment, supplement, modification,
consent
or waiver in respect of the observance or performance of the covenants set
forth
in the Subordinated Debt Documents or any breach or default thereunder arising
from the same facts and shall be deemed to be binding on the Subordinated
Creditors.
(d) No
right of any present or future holders of any Senior Debt to enforce any
of the
provisions of this Agreement shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Administrative Agent
or
the Senior Lenders or any act or failure to act, in good faith, by any such
holder, or by any noncompliance by the Obligors with the terms of the Senior
Debt Documents or the Subordinated Debt Documents, regardless of any knowledge
thereof which any such holder may have or be otherwise charged
with. The holders of the Senior Debt may extend, renew, modify, or
amend the terms of the Senior Debt or any security therefor and release,
sell or
exchange such security or otherwise deal freely with the Obligors, all without
affecting the liabilities and obligations of the Subordinated Creditors to
the
holders of the Senior Debt.
8. No
Modification of Subordinated Debt Documents. No rights, remedies,
claims or privileges created by or in favor of the Subordinated Creditors
arising under, with respect to or in connection with the Subordinated Debt
Documents or any documents executed in connection therewith may be expanded
or
enlarged in any respect unless they are not adverse to or detrimental to
interests of the Administrative Agent and the Senior Lenders and the
Subordinated Debt Documents shall not be amended, modified or changed in
any
respect, in each case, without the express prior written consent of the
Administrative Agent if such amendment, modification or change is adverse
to or
detrimental to the interests of the Administrative Agent and the Senior
Lenders.
9. Waiver
and Amendment. The Administrative Agent’s or the Senior Lenders’
delay in or failure to exercise any right or remedy shall not be deemed
to
modify, alter, waive or amend any obligation of the Subordinated Creditors
under
this Agreement. The terms of this agreement may be waived, amended,
supplemented or modified only by a written instrument executed by the Integrated
Borrowers, the other Obligors, the Administrative Agent and the Subordinated
Creditors.
10. Successors
and Assigns. This Agreement shall inure to the benefit of the
Administrative Agent’s or the Senior Lenders’ successors and assigns and shall
bind the successors and assigns of the Subordinated Creditors.
11. Application
of Payments and Proceeds of Collateral. Until the occurrence of
the Senior Credit Termination Date, all payments received by the Administrative
Agent and the Senior Lenders, or any of them, from the Obligors shall be
applied
as provided in the Senior Credit Agreements. All proceeds of the
Collateral received by the Administrative Agent on behalf of the Senior Lenders
shall be applied as provided in the Senior Credit Agreements. Upon
the indefeasible payment in full in cash of all of the Senior Debt and the
occurrence of the Senior Credit Termination Date,
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the
Administrative Agent and the Senior Lenders shall turn over to the Subordinated
Creditors all Collateral remaining in their possession.
12. Conditions
Precedent. It shall be a condition precedent to the effectiveness
of this Agreement that the Obligors execute and deliver the Forbearance and
First Amendment and consent to this Agreement.
13. Governing
Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of New York.
14. Notices. Notices
and other communications provided for herein shall be in writing and shall
be
delivered by hand, facsimile or mailed by overnight delivery as
follows:
(a) if
to the Administrative Agent or Senior Lenders:
Chase
Business Credit
▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇▇
Fax: (▇▇▇)
▇▇▇-▇▇▇▇
(b) if
to the Subordinated Creditors:
[______________________]
All
notices and other communications given to any party hereto in accordance
with
the provisions of this Agreement shall be deemed to have been given (x) on
the
third Business Day after the date when sent, postage prepaid, return receipt
requested, if by certified or registered mail, (y) when delivered, if delivered
by hand or overnight courier service, or (z) when receipt is acknowledged,
if by
facsimile. The names to be used for notices to any party may be
changed at any time by such party by giving written notice of any change
thereto
to each other party entitled to receive notices hereunder.
15. Further
Assurances. The Subordinated Creditors agree to execute,
acknowledge and deliver to the Administrative Agent, upon its request, any
further instruments as may be reasonably requested by the Administrative
Agent
to carry out the intention of or facilitate the performance of this
Agreement. In addition, whenever in this Agreement a provision refers
to the Subordinated Creditors receiving no payment or taking no remedial
action
with respect to the Subordinated Debt or from the Collateral or proceeds
of the
Collateral prior to Senior Credit Termination Date, the parties intend that
upon
the Senior Credit Termination Date, the Subordinated Creditors may receive
payments or take remedial action in respect of the Subordinated Debt or from
the
Collateral or proceeds of the Collateral, subject to the requirement that
if any
payment received in respect of the Senior Debt must subsequently be disgorged,
any payments received in respect of the Subordinated Debt or from the Collateral
or proceeds of the Collateral will remain subject to the requirements of
this
Agreement that they be paid over to the Senior Debt to the extent of the
payments disgorged and any remedial action taken in respect of the Subordinated
Debt or from the Collateral or proceeds of the Collateral shall be discontinued
and, to the extent possible, shall be rescinded until the Senior Debt shall
again have been paid in full.
16. EACH
OF THE SUBORDINATED CREDITORS, THE ADMINISTRATIVE AGENT AND THE SENIOR LENDERS
HEREBY IRREVOCABLY SUBMITS ITSELF TO THE EXCLUSIVE JURISDICTION OF THE SUPREME
COURT OF THE STATE OF NEW YORK, NEW YORK COUNTY, AND THE UNITED STATES DISTRICT
COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, SITTING IN NEW YORK COUNTY,
FOR THE
PURPOSE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY, AND HEREBY WAIVES, AND AGREES NOT TO ASSERT,
BY
WAY OF MOTION, AS A DEFENSE OR OTHERWISE, IN ANY SUIT, ACTION OR PROCEEDING,
ANY
CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF THE ABOVE-NAMED
COURTS FOR ANY REASON WHATSOEVER, OR THAT SUCH SUIT, ACTION OR PROCEEDING
IS
BROUGHT IN AN INCONVENIENT FORUM; PROVIDED, HOWEVER, THAT IN THE
EVENT THE OBLIGORS FILE A CASE UNDER THE BANKRUPTCY CODE IN A JURISDICTION
OTHER
THAN IN NEW YORK STATE (THE “ALTERNATE FORUM”), THE PARTIES HERETO HEREBY
AGREE THAT A SUIT OR ACTION IN CONNECTION WITH ANY DISPUTE UNDER THIS AGREEMENT
MAY ALSO BE BROUGHT IN THE UNITED STATES DISTRICT COURT LOCATED IN THAT
ALTERNATE FORUM. EACH OF THE SUBORDINATED CREDITORS, THE
ADMINISTRATIVE AGENT AND THE SENIOR LENDERS HEREBY WAIVES THE RIGHT TO TRIAL
BY
JURY AND SHALL NOT SEEK A JURY TRIAL IN ANY PROCEEDING ARISING OUT OF THIS
AGREEMENT OR ANY RELATED INSTRUMENT OR DOCUMENT. EACH OF THE
SUBORDINATED CREDITORS, THE ADMINISTRATIVE AGENT AND THE
7
SENIOR
LENDERS WILL NOT SEEK TO CONSOLIDATE SUCH PROCEEDING INTO ANY ACTION IN WHICH
A
JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED.
17. Miscellaneous. In
the event of an inconsistency between the provisions of this Agreement and
any
similar or related provision in the Subordinated Debt Documents, including
provisions with respect to governing law and jurisdiction, the provisions
of
this Agreement shall govern. This Agreement shall be an Senior Debt
Document pursuant to the Senior Credit Agreements and shall (unless expressly
indicated herein or therein) be construed, administered, and applied, in
accordance with all of the terms and provisions of the Senior Credit
Agreements.
[SIGNATURES
ON FOLLOWING PAGE]
8
IN
WITNESS WHEREOF, the parties have executed this Agreement as of this 17th day of
November,
2006.
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Subordinated
Creditors:
2118769
ONTARIO INC.
By: ___________________________________
Name:
Title:
______________________________________
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
Integrated
Administrative Agent:
JPMORGAN
CHASE BANK, N.A., as Administrative Agent under the Integrated
Credit
Agreement
By: ___________________________________
Name:
Title:
Americana
Administrative Agent:
JPMORGAN
CHASE BANK, N.A., as Administrative Agent under Americana Credit
Agreement
By: ___________________________________
Name:
Title:
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Each
of the undersigned acknowledges by its signature receipt of a copy
of this
Agreement and hereby consents to and agrees to honor the
Agreement:
By:
___________________________________
Name:
Title:
INTEGRATED
BRANDS INC.
By: ___________________________________
Name:
Title:
ESKIMO
PIE FROZEN DISTRIBUTION, INC.
By: ___________________________________
Name:
Title:
ESKIMO
PIE CORPORATION
By: ___________________________________
Name:
Title:
COOLBRANDS
DAIRY, INC.
By: ___________________________________
Name:
Title:
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SUGAR
CREEK FOODS, INC.
By: ___________________________________
Name:
Title:
INTEGRATED
BRANDS FRANCHISE CORP.
By: ___________________________________
Name:
Title:
COOLBRANDS
SMOOTHIES FRANCHISE LLC
By: INTEGRATED
BRANDS FRANCHISE CORP., its sole member
By: ___________________________________
Name:
Title:
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