AMENDMENT NO. 4 TO
TRANSACTION DOCUMENTS
THIS
AMENDMENT NO. 4 TO TRANSACTION DOCUMENTS (this “Amendment No.
4”) is entered into by and among MVL Film Finance LLC (the “Borrower”),
MVL Productions LLC (“MPROD”),
Marvel Studios, Inc. (“Marvel
Studios” and together with the Borrower and MPROD, collectively, the
“Marvel
Parties”) and Ambac Assurance Corporation, in its capacity as Control
Party (as defined in the Credit Agreement referred to below) (“Ambac”). All
capitalized terms used herein without definition shall have the meanings
specified in the Credit Agreement referred to below, or, if not defined therein,
in the Master Agreement referred to below.
PRELIMINARY
STATEMENTS:
(1) WHEREAS,
reference is made to (i) the Credit and Security Agreement dated as of August
31, 2005 (the “Credit
Agreement”) among the Borrower, the financial institutions and commercial
paper conduits from time to time party thereto, General Electric Capital
Corporation, as Administrative Agent, and the Collateral Agent, (ii) the Master
Development and Distribution Agreement dated as of August 31, 2005 (the “Master
Agreement”) among the Marvel Parties, (iii) Amendment No. 1 to
Transaction Documents dated as of September 29, 2006 (“Amendment No.
1”), Amendment No. 2 to Transaction Documents dated as of February 21,
2007 (“Amendment No.
2”), and Amendment No. 3 to Transaction Documents dated as of April 13,
2007 (“Amendment No.
3”) each by and between the Marvel Parties, Marvel Characters, Inc., MVL
Rights LLC, Ambac and the Collateral Agent, and (iv) Acknowledgement No. 1 to
Transaction Documents dated as of April 6, 2007 by and among Ambac and the
Marvel Parties (“Acknowledgment
No. 1”);
(2) WHEREAS,
in light of the Marvel Parties’ scheduled release of two Motion Pictures
produced pursuant to the Transaction Documents in the Summer of 2008 and the
current general conditions in the film industry related to its guilds, the
Marvel Parties have asked Ambac to extend the deadline contained in Section
8.01(n)(iii) of the Credit Agreement for the next Initial Funding that is a
Film-Related Advance for a period of twelve (12) months; and
(3) WHEREAS,
Ambac has agreed to grant such an extension provided that if the Marvel Parties
use such extension the Class A Liquidity Reserve will be increased to
$45,000,000 as further described herein;
NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the undersigned hereby agree as
follows:
SECTION
1. Deadline for Third Initial
Funding which is a Film Related Advance.
Section
8.01(n) is hereby amended and restated as follows (with the new text underlined
herein):
“(n) (i)
if the Release Date for the Motion Picture related to the first Initial Funding
which is a Film-Related Advance occurs in 2007, more than eighteen (18) months
has elapsed after an Initial Funding that is a Film-Related Advance before the
occurrence of a subsequent Initial Funding that is a Film-Related Advance, (ii)
if the Borrower breaches the covenant set forth in Section 7.01(j),
(iii) if the Release Date for the Motion Picture related to the first Initial
Funding which is a Film-Related Advance occurs in 2008, the third Initial Funding
which is a Film-Related Advance does not occur on or prior to June 29, 2009 and
thereafter, more than twelve (12) months has elapsed after an Initial
Funding that is a Film-Related Advance before the occurrence of a subsequent
Initial Funding that is a Film-Related Advance, or (iv) if the Release Date for
the Motion Picture related to the first Initial Funding which is a Film-Related
Advance occurs in 2009, the subsequent three Initial Fundings which are
Film-Related Advances do not occur within twenty-four (24) months of the Release
Date for the Motion Picture related to the first Initial Funding which is a
Film-Related Advance, in each case, other than due to an event of Force Majeure
(except that such
deadline shall not be extended for the strike by the Writers Guild of America
which commenced on November 5, 2007);”
SECTION
2. Class A Liquidity
Reserve
(a) The
definition of Class A Liquidity Reserve Deficit set forth in Section 1.01(b) is
hereby amended and restated as follows:
““Class A Liquidity Reserve
Deficit” means, as of any date of determination, the excess, if any, of
Class A Liquidity Reserve Amount over the balance on deposit in the Class A
Liquidity Reserve Account at such time.”
(b)
Section 1.01(b) is hereby amended to add the following definition:
“Class A Liquidity Reserve
Amount” Shall mean: (i) if the third Initial Funding which is a
Film-Related Advance occurs on or prior to June 29, 2008 as such date is
extended by any event of Force Majeure (the length of such extension being the
number of calendar days during which the Force Majeure event existed e.g., in
the case of a union strike, the number of calendar days that the union members
are on strike), $25,000,000; and (ii) if the third Initial Funding which is a
Film-Related Advance occurs thereafter, $45,000,000 provided however, in the event
that the initial Class A Liquidity Reserve Amount funded in accordance with
Section 2.02(d)(ii) on the last Business Day of the Capitalization Period is
$45,000,000 then the Control Party will evaluate, in its good faith discretion,
throughout the term of the Agreement and at least once annually, whether the
Class A Liquidity Reserve Amount may be reduced by up to $20,000,000 or any
partial amount thereof based on the timing and performance of the Pictures and
the Facility as a whole. The Class A Liquidity Reserve Amount shall
be reduced by any amount up to $20,000,000 that Control Party determines is no
longer necessary pursuant to the evaluation set forth in the preceding
sentence. The Control Party shall
provide written notice of any such reduction to the Borrower and
the Administrative Agent.”
(c)
Section 2.02(d)(ii)(C) is hereby amended and restated as follows:
“(C) on
the last Business Day of the Capitalization Period, to fund the Class A
Liquidity Reserve Account up to the amount of the Class A Liquidity Reserve
Amount.”
(d)
Section 2.02(e) is hereby amended and restated as follows:
“Class A Liquidity Reserve
Account. On the last Business Day of the Capitalization
Period, the Borrower shall request a Borrowing pursuant to Section 2.02(a) in
the amount of the Class A Liquidity Reserve Amount at such time, and instruct
the Administrative Agent, upon receipt of such funds from the Lenders, to direct
such funds to the Class A Liquidity Reserve Account.”
(e)
Section 5.02(xviii) is hereby amended and restated as follows:
“The sum
of (a) the excess of the aggregate Class A Lender Commitments over the aggregate
outstanding Class A Advances, plus (b) the excess
of the balance on deposit in the Borrower Blocked Account over the Minimum
Interest Reserve, exceeds the sum of (x) the aggregate unfunded Direct Negative
Cost for all Motion Pictures in production, plus (y) the Direct
Negative Cost for the Motion Picture related to the proposed Initial Funding
plus (z) solely
during the Capitalization Period, $45,000,000”
SECTION
3. Representations and
Warranties of the Marvel Parties.
3.1 The
Marvel Parties each hereby represents and warrants to Ambac as
follows:
(a) It is a
corporation or limited liability company, as applicable, duly organized, validly
existing and in good standing under the laws of the State of
Delaware.
(b) The
execution, delivery and performance by it of this Amendment No. 4 and each
Transaction Document to which it is a party, and the transactions contemplated
hereby and thereby, are within its limited liability company or corporate
powers, have been duly authorized by all necessary limited liability company or
corporate action, and do not (i) contravene, or constitute a default under,
its constitutive documents, (ii) violate any Law or applicable writ,
judgment, injunction, decree, determination or award except where such
violations, individually or in the aggregate, could not reasonably be expected
to have a Material Adverse Effect, (iii) conflict with or result in the
breach of, or constitute a default under, any contract, loan agreement,
indenture, mortgage, deed of trust, lease or other instrument binding on it or
any of its properties, in each case which breach or default has not been
permanently waived in accordance therewith or (iv) result in or require the
creation or imposition of any Adverse Claim upon or with respect to any of its
properties, other than Permitted Liens.
(c) No
consent of any other Person and no authorization or approval or other action by,
and no notice to or filing with, any governmental authority or regulatory body
or any other third party that has not been obtained is required for the due
execution, delivery or performance by it of this Amendment No. 4 or any
Transaction Document to which it is or is to be a party.
(d) This
Amendment No. 4 has been, and each Transaction Document to which it is a party
has been, duly executed and delivered by it and is its legal, valid and binding
obligation, enforceable against it in accordance with the terms of such
document, except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or limiting creditors’
rights generally or by equitable principles.
3.2 In
addition, the Marvel Parties each hereby represents and warrants to Ambac as
follows:
No Event
of Default, Potential Event of Default, MSI Default Event, MEI Event of Default
or Acceleration Event has occurred and is continuing or would result from the
execution, delivery and performance by it of this Amendment No. 4 and the
transactions contemplated hereby.
SECTION
4. Reference to and Effect on
the Transaction Documents, Etc.
(a) This
Amendment No. 4 shall pertain only to the matters expressly referred to above
and is effective only for the limited purposes set forth above, and shall not be
deemed to authorize any other action or non-compliance on the Borrower’s,
MPROD’s or Marvel Studio’s part.
(b) The
Transaction Documents, as specifically modified by Amendment No. 1, Amendment
No. 2, Amendment No. 3, Acknowledgment No. 1 and this Amendment No. 4 are and
shall continue to be in full force and effect and are hereby in all respects
ratified and confirmed. This Amendment No. 4 constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof, there
being no other agreements or understandings, oral, written or otherwise,
respecting such subject matter, any such agreement or understanding being
superseded hereby.
SECTION
5. Execution in
Counterparts. This
Amendment No. 4 may be executed in any number of counterparts and by any
combination of the parties hereto in separate counterparts, each of which
counterparts shall be an original and all of which taken together shall
constitute one and the same Amendment No. 4. Delivery of an executed
counterpart of a signature page to this Amendment No. 4 by facsimile shall be
effective as delivery of a manually executed counterpart of this Amendment No.
4.
SECTION
6. Governing
Law. This
Amendment No. 4 shall be governed by, and construed in accordance with, the
internal laws of the State of New York.
[Signature
pages follow]
IN WITNESS WHEREOF, the undersigned
have caused this Amendment No. 4 to be executed by their respective officers
thereunto duly authorized, as of the date first above written.
AMBAC
ASSURANCE CORPORATION
By: /s/ Kevin
Graham
Name:
Kevin Graham
Title: Vice
President
MVL FILM
FINANCE LLC
By: /s/ Tim
Connors
Name: Tim
Connors
Title: Executive
Vice President, Business Affairs and Operations
MVL
PRODUCTIONS LLC
By /s/ Tim
Connors
Name: Tim
Connors
Title: Executive
Vice President, Business Affairs and Operations
MARVEL
STUDIOS, INC.
By /s/ Tim
Connors
Name: Tim
Connors
Title:
Executive Vice President, Business Affairs and Operations
