Exhibit 99.9
Execution Version
LOAN PURCHASE AGREEMENT
THIS
LOAN PURCHASE AGREEMENT (this “ Agreement ”),
dated as of October 1, 2007, is by and between SILVER POINT
FINANCE, LLC as Co-Agent for the Lenders (as defined below) party
hereto, HARBINGER CAPITAL PARTNERS MASTER FUND I, LTD. and
HARBINGER CAPITAL PARTNERS SPECIAL SITUATIONS FUND, L.P.
(individually, each a “ Purchaser ”, or
collectively, the “ Purchasers ”) and SALTON,
INC. (“ Salton ”) and each of Salton’s
Subsidiaries identified as Borrowers and Guarantors on the
signature pages. Capitalized terms used but not defined herein
shall have the meaning ascribed to such term in the Credit
Agreement (as defined hereinafter).
RECITALS:
A.
Salton has entered into that certain Amended and Restated Credit
Agreement, dated as of May 9, 2003 and amended and restated as
of June 15, 2004, as amended and restated and further amended,
by and among Salton, the financial institutions named therein as
lenders (“ Lenders ”), Wells Fargo Foothill,
Inc., in its capacity as administrative agent and collateral agent
for the agents and lenders party thereto, together with its
successors and assigns thereto in such capacities, and Silver Point
Finance LLC, in its capacity as the co-agent, syndication agent,
and documentation agent for the lenders party thereto in such
capacities, as such is amended, modified, supplemented or restated
from time to time in accordance with the terms thereof (the “
Credit Agreement ”).
B.
Under the Credit Agreement, Salton has loans available to it based
on the amounts described in clause (a)(D) of the definition of
“Borrowing Base” contained in the Credit Agreement (the
“ Stretch Loans ”). Salton is obligated to repay
any amounts outstanding of the Stretch Loans on November 10,
2007.
C.
Salton and APN Holding Company, a wholly owned subsidiary of
Purchasers, have entered into an Agreement and Plan of Merger as of
October 1, 2007 (the “ Merger Agreement ”)
and as a condition to entering into the Merger Agreement, Salton
has required Purchasers to enter into this Agreement for the
benefit of the Lenders.
D.
Silver Point Finance LLC, as Co-Agent under the Credit Agreement,
Wells Fargo Foothill, Inc., as Agent under the Credit Agreement,
and The Bank of New York, as Second Lien Agent under the Second
Lien Credit Agreement, and Harbinger Capital Partners Special
Situations Fund, L.P., as Agent under the Reimbursement and Credit
Agreement, have entered into an Amended and Restated Intercreditor
Agreement dated as of the date hereof (the “ Intercreditor
Agreement ”) and acknowledged by Salton and each of
Salton’s Subsidiaries identified as Borrowers and Guarantors
on the signature pages to the Credit Agreement.
NOW
THEREFORE, the parties hereby agree as follows:
1. Sale and
Purchase .
(a) Purchasers
agree to buy, in such allocation as they may determine, upon
receipt, from time to time during the Stretch Put Period (as
defined hereinafter), of a notice (substantially in
the form
attached hereto as Exhibit A , (a “ Stretch
Loan Put Notice ”)), from the Co-Agent on behalf of the
Lenders holding the Stretch Loans , the principal amount of Stretch
Loans specified in such Stretch Loan Put Notice as set forth in
Section 3 below; provided, however, that notwithstanding
anything to the contrary in this Agreement, Purchasers shall not be
obligated to purchase Stretch Loans having an aggregate principal
amount exceeding $68,489,510. The Stretch Loans so purchased by the
Purchasers are referred to herein as the “ Purchased
Stretch Loans ”. The Purchaser shall be entitled to
receive all accrued and unpaid interest on the principal amount of
the Purchased Stretch Loans.
(b) Purchasers
agree to buy, in such allocation as they may determine, upon
receipt during the Breach Put Period (as defined hereinafter), of a
notice (substantially in the form attached hereto as
Exhibit B (a “ Breach Put Notice ”))
from the Co-Agent, on behalf of the Lenders, all, but not less than
all, of the outstanding Obligations (as that term is defined in the
Credit Agreement).
(c) Any
Obligation, including the Stretch Loans, purchased by the
Purchasers are referred to herein as the “ Purchased
Loans ”. The Purchasers shall be entitled to receive all
accrued and unpaid interest on the principal amount of the
Purchased Loans.
2. Purchase Price
.
The
purchase price (“ Purchase Price ”) for
(i) the Purchased Stretch Loans shall be an amount equal to
100% of the outstanding principal amount thereof, plus all accrued
and unpaid interest thereon through and including the date of
purchase and (ii) the Obligations (other than the Purchased
Stretch Loans) shall be 100% of the outstanding amount
thereof.
3. Put Period and
Purchase Procedures .
(a) The
Co-Agent shall have the right to deliver a Stretch Loan Put Notice
(i) from and after the date any party to the Merger Agreement
has, or asserts, the right to terminate the Merger Agreement or the
Merger Agreement is terminated, and/or (ii) on or after
November 10, 2007 and prior to January 30, 2008:
provided, in the case of (i) and/or (ii), no Insolvency
Proceeding with respect to Salton or any of its Subsidiaries is
then pending (the “ Stretch Put Period ”).
(b) The
Co-Agent shall have the right to deliver a Breach Put Notice any
time during the period commencing on the date that is the earlier
of the date the Co-Agent obtains actual knowledge that (i) a
Purchaser or any of its affiliates has breached any of the terms of
the Intercreditor Agreement, (ii) after the commencement of an
Insolvency Proceeding (as defined in the Intercreditor Agreement)
with respect to Salton or any of its Subsidiaries, if all of the
Stretch Loans have not been purchased pursuant to Section 1(a)
above and (iii) following the initial funding under a DIP
Financing (as defined in the Intercreditor Agreement) provided by
any of the Purchasers or any of their affiliates, any of the
conditions set forth in Section 5.d(1) of the Intercreditor
Agreement have not been continuously satisfied and ending of the
date that is 60 days thereafter(the “ Breach Put
Period ”).
(c) On
the third Business Day following receipt of a Stretch Loan Put
Notice or a Breach Put Notice, the Purchasers shall wire transfer,
in immediately available funds, the full amount of the Purchase
Price against delivery to Purchasers of an executed Assignment
Agreement in the form attached hereto as Exhibit C to
the account or accounts specified in such Stretch Loan
2
Put
Notice or Breach Put Notice and upon receipt of such Purchase
Price, Lenders holding a principal amount of Obligations to be paid
shall deliver to Purchasers such executed Assignment Agreement
evidencing the transfer of such Purchased Loans.
(d) Each
of Salton and Purchasers agree that immediately upon transfer of
any Purchased Stretch Loans to the Purchasers, the Purchased
Stretch Loans will be deemed discharged under the Credit Agreement
and automatically converted to loans under the New Second Lien
Credit Agreement. Each of Salton and the Purchasers expressly
acknowledge and agree that immediately upon consummation of the
purchase thereof: (i) the Purchased Stretch Loans and all
rights with respect thereto and security therefore will no longer
be governed by, or entitled to, the benefits of the Credit
Agreement or any other Loan Document, (ii) no Purchaser shall
be a “Lender” under the Credit Agreement or any of the
other Loan Documents, (iii) neither the Agent nor the Co-Agent
shall be an agent of any of Purchaser and (iv) neither shall
the Agent nor the Co-Agent shall have any duties of any kind or
nature whatsoever to any of the Purchasers.
(e) Upon
the consummation of the purchase of Obligations pursuant to a
Breach Put Notice, the Agent and the Co-Agent, notwithstanding
anything to the contrary set forth in the Credit Agreement, shall
be deemed to have resigned as Agent and Co-Agent and Harbinger
Capital Partners Special Situations Fund, L.P. shall be the Agent
and the Co-Agent.
(f) Each
of the Purchasers expressly acknowledge and agree that the purchase
of any Stretch Loans under a Stretch Loan Put Notice entitles the
Purchasers to the payment of only the principal thereof and accrued
and unpaid interest thereon and does not give Purchasers any rights
to any other Obligation under the Credit Agreement, including
without limitation, the Make-Whole Amount, all of whi
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