KUSHNER-LOCKE FORM 8-K

EX-10.76 3 v74632ex10-76.txt KUSHNER-LOCKE FORM 8-K 1 EXHIBIT 10.76 AMENDMENT NO. 7 TO LIMITED FORBEARANCE AGREEMENT AMENDMENT NO. 7 dated as of August 3, 2001 (the "Amendment"), to Limited Forbearance Agreement dated as of January 11, 2000, as heretofore amended (the "Forbearance Agreement") among THE KUSHNER-LOCKE COMPANY (the "Borrower"), its subsidiaries (the "Guarantors", and together with the Borrower, the "Credit Parties"), the Lenders party to the Credit Agreement defined below (the "Lenders") and THE CHASE MANHATTAN BANK (formerly known as Chemical Bank), as Agent and as Fronting Bank for the Lenders (the "Agent"). The Borrower, the Guarantors, the Lenders and the Agent are parties to a Credit, Security, Guaranty and Pledge Agreement, dated as of June 16, 1996, as amended (the "Credit Agreement"). As set forth in Section 1 of the Forbearance Agreement, Defaults and Events of Default under the Credit Agreement have occurred and are continuing. In order to allow the Borrower additional time to prepare for the proposed sale of its film library and related accounts receivable and to explore various restructuring options, the Borrower has requested that the Agent and the Lenders amend the Forbearance Agreement to (i) extend the Lenders' agreement to forebear from applying collections in respect of the Credit Parties' receivables to repayment of the Loans, (ii) release an additional portion of such collections to fund operating expenses of the Credit Parties and (iii) make certain other modifications to the Forbearance Agreement. The Agent and the Lenders have agreed to the foregoing requests, all on the terms and subject to the conditions hereinafter set forth. Accordingly, the parties hereby agree as follows: 1. Defined Terms. All capitalized terms not otherwise defined herein are used as defined in the Forbearance Agreement. 2. Amendments to Forbearance Agreement. Subject to the satisfaction of the condition precedent set forth in Section 3 hereof, the Forbearance Agreement is hereby amended effective as of the Effective Date (as hereinafter defined) as follows: (a) The reference to "August 8, 2001" as the Stated Expiration Date set forth in Section 2 of the Forbearance Agreement is hereby amended to be "September 19, 2001." (b) The Disbursement Schedule attached as Exhibit A to the Forbearance Agreement is hereby replaced in its entirety with the Disbursement Schedule attached as Exhibit A to this Amendment. 2 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized officers, all as of the date and year first above written. BORROWER: THE KUSHNER-LOCKE COMPANY By: /s/ Donald Kushner ------------------------------------- Name: Donald Kushner Title: Co-CEO GUARANTORS: KL PRODUCTIONS, INC. POST AND PRODUCTION SERVICES, INC. TWILIGHT ENTERTAINMENT, INC. KLF GUILD CO. KLTV DEVELOPMENT CO. KUSHNER-LOCKE INTERNATIONAL, INC. KL INTERACTIVE MEDIA, INC. DAYTON WAY PICTURES III, INC. By: /s/ Donald Kushner ------------------------------------- Name: Donald Kushner Title: Co-CEO KLC/NEW CITY By its General Partner THE KUSHNER-LOCKE COMPANY By: /s/ Donald Kushner ------------------------------------- Name: Donald Kushner Title: Co-CEO 3 3 LENDERS Executed in THE CHASE MANHATTAN BANK (formerly New York, New York known as Chemical Bank), individually and as Agent By: /s/ MARY ELLEN EGBERT ------------------------------------ Name: Mary Ellen Egbert Title: Managing Director NIB CAPITAL BANK N.V. (formerly known as De Nationale Investeringsbank N.V.) By: ------------------------------------ Name: Title: By: ------------------------------------ Name: Title: COMERICA BANK -- CALIFORNIA By: ------------------------------------ Name: Title: FAR EAST NATIONAL BANK By: ------------------------------------ Name: Title: 4