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EXHIBIT 10.20
FORM OF UNSECURED
TERM PROMISSORY NOTE - EXTENSION AGREEMENT
WHITEHALL
JEWELLERS INC.
June 5, 2007
Subject:
Unsecured Term Promissory Note -Extension
Agreement
_____________________ (“Noteholder”)
and Whitehall Jewellers, Inc. (“Whitehall”) are parties
to an Unsecured Term Promissory Note dated June ____, 2007 issued
by Whitehall to Noteholder (the “Term Note”) in the
principal amount of $______________,
(_______________________________________ DOLLARS), together with
accrued interest from January 17, 2006 as provided in the Term
Note. Whitehall has requested that Noteholder extend the Maturity
Date under the Term Note from September 30, 2007 to March 31, 2009
(the “New Maturity Date”). Noteholder has agreed, based
on the following terms, that the Term Note is hereby amended to
reflect the New Maturity Date and that any references in the Term
Note to the Maturity Date shall hereinafter refer to the New
Maturity Date:
I.
Whitehall agrees and
acknowledges (a) that the indebtedness in the Term Note is due and
owing without offset, defense, discount, allowance, or counterclaim
of any nature whatsoever, and Noteholder agrees and acknowledges
that the indebtedness in the Term Note represents the entire
indebtedness due and owing to the Noteholder pursuant to the ATVEA
(as defined below) for Trade Debt due and owing as of September 23,
2005; and (b) that Noteholder has fully complied to date with its
obligations under the Amended Trade Vendor Extension Agreement
dated as of November 15, 2006 (“ATVEA”). Whitehall and
Noteholder hereby agree that (A) notwithstanding Section 13 of the
ATVEA, their respective obligations to each other under ATVEA shall
extend until the earliest to occur of (i) receipt by the
Participating Suppliers of the Settlement Payments and (ii) March
31, 2009 and (B) the Term Note may only be assigned in accordance
with Section 14(b) of the ATVEA. The Noteholder shall attach this
letter agreement to the Term Note and shall inform any assignee of
the Term Note of this letter agreement.
II.
Section 3 of the Term
Note is hereby amended to add the following provisions:
“(e) Prior to the New
Maturity Date, Whitehall:
(A) fails either: (i) to pay, in the aggregate,
the amount of $2,500,000 ("Mandatory Payment") on account of the
Term Notes to Participating Suppliers under the ATVEA that have not
agreed to the New Maturity Date by executing this letter agreement;
or (ii) to the extent that the Mandatory Payment is not fully
utilized under subsection 3(e)(A)(i), to pay the unused balance,
pro rata, to those Participating Suppliers under the ATVEA that
have executed this letter agreement (the
___________________
Attn: _______________
June ___, 2007
Page 2
“Eligible Participating
Suppliers”); any payments made under this clause (ii) shall
be applied first to accrued but unpaid interest on the Term Notes
held by the Eligible Participating Suppliers and second to the
outstanding principal on the Term Notes held by the Eligible
Participating Suppliers; or
(B) pays, in the aggregate, an amount greater
than the Mandatory Payment on account of the Term
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