Exhibit 4.7
EXECUTION
VERSION
FIRST AMENDMENT TO FORBEARANCE
AGREEMENT
This First Amendment to Forbearance
Agreement (this “ Agreement ”), dated as of
May 14, 2008, amends that certain Forbearance Agreement dated
as of April 30, 2008 (the “ Existing Forbearance
Agreement ”) and is entered into by and among
Vertis, Inc. (the “ Issuer ”), each of the
undersigned entities listed as guarantors (collectively, the
“ Guarantors ”), each of the undersigned holders
(collectively, the “ Initial Forbearing Holders
”) of the 9.75% Senior Secured Second Lien Notes due 2009
(the “ Notes ”) issued by the Issuer that is a
signatory to the Existing Forbearance Agreement and certain other
holders of the Notes (the “ Additional Holders
,” and together with the Initial Forbearing Holders, the
“ Holders ”). Each capitalized term used
herein and not otherwise defined herein shall have the meaning
attributed to such term in the Existing Forbearance
Agreement.
W I T N E S S E T
H:
WHEREAS, on April 30, 2008, the Issuer, the
Guarantors and the Initial Forbearing Holders entered into the
Existing Forbearance Agreement, pursuant to which such holders
agreed to forbear during the Forbearance Period from exercising
their rights and remedies under the Indenture and from directing
the Trustee to exercise any such rights and remedies on their
behalf resulting from the Existing Default and the Payment Default;
and
WHEREAS, the failure of the Restructuring Agreement
Execution to occur on or before 5:00 p.m. (New York time) on
May 13, 2008 (the “ Restructuring Execution
Deadline ”) resulted in a Forbearance Termination Event
under the Existing Forbearance Agreement; and
WHEREAS, due to the ongoing discussions among the parties
with respect to the Restructuring Agreement, the Issuer and the
Guarantors have requested that the Holders continue their
forbearance with respect to the Payment Default and the Existing
Default by waiving the aforementioned Forbearance Termination Event
and extending the Restructuring Execution Deadline; and
WHEREAS, subject to the terms and conditions set forth
herein, the Additional Holders have agreed to be bound by the terms
of the Existing Forbearance Agreement, as amended hereby and the
Holders have agreed to continue their forbearance and extend the
Restructuring Execution Deadline to 5:00 p.m. (New York time)
on May 20, 2008.
NOW, THEREFORE,
in consideration of the mutual
covenants set forth herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as
follows:
SECTION 1. Waiver of Forbearance
Termination Event.
The Holders hereby waive the Forbearance Termination Event
occurring under the Existing Forbearance Agreement as a result of
the failure of the Restructuring Agreement Execution to occur on or
before 5:00 p.m. (New York time) on May 13,
2008.
SECTION 2. Amendment to Existing
Forbearance Agreement. The following clauses of the definition of
Forbearance Termination Event in Section 1 of the Existing
Forbearance Agreement shall be hereby amended as
follows:
(1) clause (a) is hereby amended to
read: “(a) the failure of the Restructuring Agreement
Execution to occur on or before 5:00 p.m. (New York time) on
May 20, 2008;”;
(2) clause (e) is hereby amended to
read: “(e) the occurrence of a Default or Event of
Default under the Indenture other than the Existing Default, the
Payment Default or an Event of Default under
Section 6.1(d) of the Indenture due to an acceleration of
the Issuer’s 13.5% Senior Subordinated Notes due 2009 arising
from the failure of the Issuer and/or the Guarantors to pay
interest thereon;”; and
(3) clause (f) is hereby amended to
read: “(f) the failure of the Issuer and/or the
Guarantors to comply with any term, condition, representation or
covenant contained in this Agreement, or any amendment
hereto.”
SECTION 3. Amendment Fee.
In consideration for the
agreements reflected herein, the Issuer shall deliver by wire
transfer, on or before 5:00 p.m. on May 14, 2008, the sum
of $75,000 (the “ Amendment Fee ”) to the law
firm of Stroock & Stroock & Lavan LLP (“
Stroock ”) on behalf of the Holders. Stroock
shall then promptly distribute the Amendment Fee to the Holders
pro rata according to their holdings of Notes as a
percentage of the aggregate principal amount of Notes held by all
Holders.
SECTION 4. Conditions to
Effectiveness. The
effectiveness of this Agreement shall be subject to the
satisfaction of each of the following conditions:
(a)
Holders representing in the aggregate more than 75% of the
outstanding principal amount of the Notes shall have executed this
Agreement;
(b)
the Holders shall have received from the Issuer a duly executed
counterpart of this Agreement from each Holder, the Issuer and each
Guarantor listed on the signature pages hereto; provided,
however , that signature pages executed by Holders shall
be delivered to (a) other Holders in a redacted form that
removes such Holder’s holdings of the Notes and (b) the
Issuer, the Guarantors and advisors to the Holders in an unredacted
form; provided further, however , that the advisors to the
Holders shall not disclose the unredacted signature pages to
any Holder.
(c)
(i) all representations and warranties made by the Issuer and
the Guarantors in the Indenture, the Note and the Security
Documents shall be true and correct in all material respects on and
as of the effective date of this Agreement as though made on and as
of such date (unless any such representation or warranty relates
solely to an earlier date, in which case it shall have been true
and correct in all material respects as of such earlier date); and
(ii) no Default or Event of Default (except with respect to
the Existing Default and the Payment Default) has occurred or is
continuing as of the effective date of this Agreement;
and
(d)
the Issuer shall have delivered the Amendment Fee in accordance
with Section 3 hereof.
SECTION 5. Agreement to be
Bound. Subject to
Section 4 hereof, the undersigned Holders hereby severally
agree to be bound by the Existing Forbearance Agreement, as amended
hereby and the undersigned Additional Holders shall also be deemed
to be “Holders” thereunder.
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