Exhibit 99.3
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CREDIT SUISSE
Eleven Madison Avenue
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JPMORGAN CHASE BANK, N.A.
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J.P. MORGAN SECURITIES
INC.
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CONFIDENTIAL
May 20, 2005
Brand Services,
Inc.
15450 South
Outer Highway 40, #270
Chesterfield,
MO 63017
Brand Services,
Inc.
$150,000,000 Senior Secured Term
C Loan Facility
$35,000,000 Senior Secured Second
Lien Term Loan Facility
Commitment Letter
Ladies and
Gentlemen:
Brand Services, Inc., a Delaware corporation
(the " Borrower " or "
you " ), has advised Credit Suisse
(together with its affiliates, " Credit Suisse "),
JPMorgan Chase Bank, N.A. (" JPM ") and J.P. Morgan
Securities Inc. (" JPMS " and, together with Credit
Suisse and JPM, " we " or " us ")
that you intend to acquire (the " Acquisition ")
substantially all of the assets and to assume certain of the
liabilities of Aluma Enterprises, Inc., a Canadian corporation (the
" Company "), and to consummate the other
Transactions (such term and each other capitalized term used but
not defined herein having the meaning assigned to such term in the
Summary of Principal Terms and Conditions attached hereto as
Exhibit A (the " Term C Facility Term
Sheet ")).
You have further advised us that, in connection
therewith, (a) the Borrower will obtain the senior secured
term C loan facility (the " Term C
Facility ") described in the Term C Facility Term
Sheet, in an aggregate principal amount of up to $150,000,000,
(b) the Borrower will obtain the senior secured second lien
term loan facility (the " Second Lien Term Facility
") described in the Summary of Principal Terms and Conditions
attached hereto as Exhibit B (the " Second Lien Term
Facility Term Sheet " and, together with the Term C
Facility Term Sheet, the " Term Sheets "), in an
aggregate principal amount of up to $35,000,000 and (c) the
Borrower will seek to amend the Existing Credit Agreement (the "
Proposed Amendment ") to, among other things,
(i) allow the consummation of the Acquisition and the
incurrence of the loans under the Term C Facility and the Second
Lien Term Facility (the " Transactions Amendment ")
and (ii) reduce the interest rate margins applicable to the
Term B Loans (as defined in the Existing Credit Agreement). If
the Transactions Amendment is not obtained, the Borrower will
obtain the Replacement Bank Facilities described in the Term C
Facility Term Sheet. The Term C Facility and the Second Lien
Term Facility are collectively referred to herein as the "
New Facilities ". The New Facilities and the
Replacement Bank Facilities are collectively referred to herein as
the " Facilities ". Unless otherwise clearly
stated, all monetary amounts in this Commitment Letter and in the
Fee Letter referred to below are stated in U.S. dollars.
In connection with the foregoing,
(a) Credit Suisse is pleased to advise you of its commitment
to provide 60% of the New Facilities, (b) JPM (together with
Credit Suisse, the " Banks ") is pleased to advise
you of its commitment to provide 40% of the New Facilities and
(c) the Lead Arrangers (as defined below) are pleased to
advise you of their agreement to use commercially reasonable
efforts to arrange the Proposed Amendment, in each case upon the
terms and subject to the conditions set forth or referred to in
this commitment letter (including the Term Sheets and other
attachments hereto, this " Commitment Letter "). In
addition, if the Transactions Amendment is not obtained,
(a) Credit Suisse is pleased to advise you of its commitment
to provide 60% of the Replacement Bank Facilities and (b) JPM
is pleased to advise you of its commitment to provide 40% of the
Replacement Bank Facilities, in each case upon the terms and
subject to the conditions set forth or referred to in this
Commitment Letter. The commitments of the Banks hereunder are
several and not joint and shall be allocated ratably among the
Facilities.
You hereby appoint Credit Suisse and JPMS
(together, in such capacity, the " Lead Arrangers
") to act, and the Lead Arrangers hereby agree to act, as exclusive
joint-bookrunning managers and joint-lead arrangers for the
Facilities and the Proposed Amendment. It is agreed that Credit
Suisse will act as "left lead bookrunner" with respect to the
Facilities and the Proposed Amendment and JPM will act as
syndication agent with respect to the Facilities and the Proposed
Amendment. Each Bank, in its respective capacities, will perform
the duties and exercise the authority customarily performed and
exercised by it in such roles. You agree that no other titles
will be awarded and no compensation (other than that expressly
contemplated by this Commitment Letter and the Fee Letter) will be
paid in connection with the Facilities unless you and we shall so
agree.
The Lead Arrangers on behalf of the Banks
reserve the right, prior to or after the execution of definitive
documentation for the Facilities, to syndicate, in an orderly and
coordinated manner, all or a portion of their commitments hereunder
to a group of banks, financial institutions and other institutional
lenders, other than certain institutions designated by you ("
Disqualified Institutions "), (together with the
Banks, the " Lenders ") identified by us with your
consent (not to be unreasonably withheld or delayed). The Lead
Arrangers intend to commence syndication efforts promptly upon the
execution of this Commitment Letter, and you agree actively to
assist them in completing a satisfactory syndication. Such
assistance shall include (a) your using commercially
reasonable efforts to ensure that any syndication efforts benefit
materially from your existing lending and investment banking
relationships and the existing lending and investment banking
relationships of the Company, (b) direct contact between
senior management, representatives and advisors of you and the
Company and the proposed Lenders, (c) assistance by you and,
to the extent reasonable and practical, the Company in the
preparation of a Confidential Information Memorandum for each of
the Facilities and other customary marketing materials to be used
in connection with the syndications, (d) your using
commercially reasonable efforts to obtain ratings for each of the
Facilities from each of Standard & Poor’s Ratings Service
(" S&P ") and Moody’s Investors Service,
Inc. (" Moody’s ") prior to the fifteenth day
preceding the Closing Date and (e) the hosting, with the Lead
Arrangers, of one or more meetings of prospective Lenders. You
agree, at the request of the Lead Arrangers, to assist in the
preparation of a version of the Confidential Information Memorandum
and other marketing materials and presentations to be used in
connection with the syndication of the Facilities, consisting
exclusively of information and documentation that is either (i)
publicly available or (ii) not material with respect to Parent, the
Borrower, the Company or their respective subsidiaries or any of
their respective securities for purposes of United States Federal
and state securities laws (all such information and documentation
being " Public Information "). Any information and
documentation that is not Public Information is referred to herein
as " Private Information ". You further agree that
each document to be disseminated by the Lead Arrangers to any
Lender in connection with the Facilities will be identified by you
as either (i) containing Private Information or
(ii) containing solely Public Information.
The Lead Arrangers will manage all aspects of
any syndication with respect to the Facilities in consultation with
you, including decisions as to the selection of institutions to be
approached and when they will be approached, when their commitments
will be accepted, which institutions will participate, the
allocation of the commitments among the Lenders and the amount and
distribution of fees among the Lenders. To assist the Lead
Arrangers in their syndication efforts, you agree promptly to
prepare and provide (and to use commercially reasonable efforts to
cause the Company to provide) to the Lead Arrangers all information
reasonably available with respect to Parent, the Borrower, the
Company and their respective subsidiaries, the Transactions and the
other transactions contemplated hereby, including all financial
information and projections (the " Projections "),
as we may reasonably request. You hereby represent and covenant
(and it shall be a condition to our commitment and agreement
hereunder) that (a) all information other than the Projections
(the " Information ") that has been or will be made
available to the Lead Arrangers by you or any of your
representatives is or will be, when furnished, complete and correct
in all material respects and does not or will not, when furnished,
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements contained
therein not materially misleading in light of the circumstances
under which such statements are made and (b) the Projections
that have been or will be made available to the Lead Arrangers by
you or any of your representatives have been or will be prepared in
good faith based upon assumptions that are reasonable at the time
made and at the time the related Projections are made available to
the Lead Arrangers, it being understood that actual results may
vary materially from the Projections. You agree that if at any time
prior to the closing of the Facilities any of the representations
in the preceding sentence would be incorrect if the Information and
Projections were being furnished, and such representations were
being made, at such time, then you will promptly supplement the
Information and the Projections to the extent of Information
available to you so that such representations will be correct under
those circumstances. In arranging and syndicating the Facilities,
we will be entitled to use and rely primarily on the Information
and the Projections without responsibility for independent
verification thereof.
As consideration for the commitments of the
Banks hereunder and agreement of the Lead Arrangers to perform the
services described herein, you agree to pay to the Banks the fees
set forth in this Commitment Letter and in the fee letter dated the
date hereof and delivered herewith with respect to the Facilities
(the " Fee Letter ").
The commitments of the Banks and the Lead
Arrangers hereunder and their agreements to perform the services
described herein are subject to (a) our not having discovered
or otherwise become aware of any information not previously
disclosed to us that we believe to be inconsistent in a material
and adverse manner with our understanding, based on the information
provided to us prior to the date hereof, of the business, assets,
liabilities, operations, financial condition, operating results or
Projections of the Company and its subsidiaries or the Borrower and
its subsidiaries, in each case, taken as a whole, (b) there
not having occurred any change, event, fact, condition,
circumstance or development that, individually or in the aggregate,
has had or would reasonably be expected to have a material adverse
effect or change on the condition (financial or otherwise),
properties, business, results of operations, assets, liabilities or
operations of (i) the Borrower and its subsidiaries, taken as
a whole, or (ii) the Company and its subsidiaries, taken as a
whole, in each case since December 31, 2004, (c) our
satisfaction that, prior to and during the syndication of the
Facilities, there shall be no other issues of debt securities or
commercial bank or other credit facilities of Parent, the Borrower,
the Company or their respective subsidiaries being offered, placed
or arranged that could reasonably be expected to adversely affect
the syndication of the Facilities, (d) the negotiation,
execution and delivery of definitive documentation with respect to
the Facilities reasonably satisfactory to the Lead Arrangers and
their counsel, (e) the Lead Arrangers (on behalf of the Banks)
having been afforded a period of at least 20 consecutive days
following the launch of the general syndication of the Facilities
and immediately prior to the Closing Date to syndicate the
Facilities, (f) your compliance, in all material respects,
with the terms of this Commitment Letter and the Fee Letter, and
(g) the other conditions set forth or referred to in the Term
Sheets and the other exhibits hereto.
You agree (a) to indemnify and hold
harmless each of the Banks and Lead Arrangers and their respective
affiliates and their respective officers, directors, employees,
agents, advisors, controlling persons, members and successors and
assigns (each, an " Indemnified Person ") from and
against any and all losses, claims, damages, liabilities and
expenses, joint or several, to which any such Indemnified Person
may become subject arising out of or in connection with this
Commitment Letter, the Fee Letter, the Transactions, the Facilities
or any related transaction or any claim, litigation, investigation
or proceeding relating to any of the foregoing, regardless of
whether any such Indemnified Person is a party thereto, and to
reimburse each such Indemnified Person upon demand for any
reasonable legal expenses (with, subject to customary exceptions
for actual or potential conflicts of interest, all Indemnified
Persons to use a single counsel in each jurisdiction) or other
expenses incurred in connection with investigating or defending any
of the foregoing, provided that the foregoing indemnity
will not, as to any Indemnified Person, apply to losses, claims,
damages, liabilities or related expenses to the extent they are
found in a final, non-appealable judgment of a court of competent
jurisdiction to have resulted primarily from the willful misconduct
or gross negligence of such Indemnified Person, and (b) to
reimburse each of the Banks and the Lead Arrangers from time to
time, upon presentation of a summary statement, for all reasonable
and documented out-of-pocket expenses (including but not limited to
expenses of the Banks’ due diligence investigation,
consultants’ fees, syndication expenses, travel expenses and
fees, disbursements and other charges of Cravath, Swaine &
Moore LLP plus required local counsel), in each case incurred in
connection with the Facilities and the preparation of this
Commitment Letter, the Fee Letter, the definitive documentation for
the Facilities and any security arrangements in connection
therewith; provided that, in the event that the Closing
Date does not occur, your obligations under this clause (b) shall
be limited to 50% of the fees, disbursements and other charges of
Cravath, Swaine & Moore LLP and required local counsel.
Notwithstanding any other provision of this Commitment Letter, no
Indemnified Person shall be liable for any damages arising from the
unauthorized use by others of information or other materials
obtained through electronic, telecommunications or other
information transmission systems or for any indirect, special,
punitive or consequential damages in connection with its activities
related to the Facilities.
You acknowledge that the Banks, the Lead
Arrangers and their affiliates may be providing debt financing,
equity capital or other services (including financial advisory
services) to other companies in respect of which you may have
conflicting interests regarding the transactions described herein
and otherwise. In particular, an affiliate of Credit Suisse is
acting as financial advisor to the Company in connection with the
proposed Acquisition. Neither we nor any of our affiliates will use
confidential information obtained from you by virtue of the
transactions contemplated by this Commitment Letter or our other
relationships with you in connection with the performance by us of
services for other companies, and we will not furnish any such
information to other companies. You also acknowledge that neither
we nor any of our affiliates has any obligation to use in
connection with the transactions contemplated by this Commitment
Letter, or to furnish to you, confidential information obtained by
us from other companies, and that we shall not be imputed to have
knowledge of confidential information provided to or obtained by
Credit Suisse’s affiliate in its capacity as financial
advisor to the Company.
This Commitment Letter shall not be assignable
by you without the prior written consent of the Lead Arrangers (and
any attempted assignment without such consent shall be null and
void), is intended to be solely for the benefit of the parties
hereto (and Indemnified Persons), is not intended to confer any
benefits upon, or create any rights in favor of, any person other
than the parties hereto (and Indemnified Persons) and is not
intended to create a fiduciary relationship between the parties
hereto. Any and all obligations of, and services to be provided by,
the Banks and the Lead Arrangers hereunder (including, without
limitation, each Bank’s commitment) may be performed and any
and all rights of the Banks and the Lead Arrangers hereunder may be
exercised by or through any of their respective affiliates or
branches. This Commitment Letter may not be amended or any
provision hereof waived or modified except by an instrument in
writing signed by the Banks, the Lead Arrangers and you. This
Commitment Letter may be executed in any number of counterparts,
each of which shall be an original and all of which, when taken
together, shall constitute one agreement. Delivery of an executed
counterpart of a signature page of this Commitment Letter by
facsimile transmission shall be effective as delivery of a manually
executed counterpart hereof. This Commitment Letter and the Fee
Letter supersede all prior understandings, whether written or oral,
between us with respect to the Facilities.
THIS COMMITMENT LETTER SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK.
Each of the parties hereto hereby irrevocably
and unconditionally (a) submits, for itself and its property, to
the non-exclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in
New York City, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this
Commitment Letter or the transactions contemplated hereby, or for
recognition or enforcement of any judgment, and agrees that all
claims in respect of any such action or proceeding may be heard and
determined in such New York State court or, to the extent
permitted by law, in such Federal court, (b) waives, to the fullest
extent it may legally and effectively do so, any objection which it
may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Commitment
Letter or the transactions contemplated hereby in any New York
State court or in any such Federal court and (c) waives, to the
fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such
court.
This Commitment Letter is delivered to you on
the understanding that neither this Commitment Letter nor the Fee
Letter nor any of their terms or substance shall be disclosed,
directly or indirectly, to any other person except (a) to your
officers, directors, employees, attorneys, accountants and advisors
on a confidential and need-to-know basis or (b) as required by
applicable law or compulsory legal process (in which case you agree
to inform us promptly thereof); provided that you may
disclose this Commitment Letter and the contents hereof (but
not the Fee Letter or the contents thereof) to the Company and its
controlling stockholders and their respective officers, directors,
employees, attorneys, accountants and advisors, on a confidential
and need-to-know basis.
Notwithstanding anything herein to the contrary,
any party to this Commitment Letter (and any employee,
representative or other agent of such
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