Second Amendment to Securities Purchase Agreement by and among Party City Corporation and Purchasers

Summary

Party City Corporation and several investment entities have agreed to amend their existing Securities Purchase Agreement, originally dated August 16, 1999. This amendment, effective April 1, 2001, removes Section 9.21 from the agreement and confirms that all other terms remain unchanged. The amendment is valid once signed by the company and a supermajority of note holders. The parties involved include Party City Corporation and various investment funds and financial institutions.

EX-4.10 2 y49309ex4-10.txt SECOND AMENDMENT TO SECURITIES PURCHASE AGREEMENT 1 EXHIBIT 4.10 SECOND AMENDMENT TO SECURITIES PURCHASE AGREEMENT This SECOND AMENDMENT TO SECURITIES PURCHASE AGREEMENT (this "Amendment") is made and entered into as of April 1, 2001, by and among Party City Corporation, a Delaware corporation (the "Company"), and each of the other parties whose names appear on the signature pages hereto (such other parties, the "Purchasers"). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Purchase Agreement (as defined). RECITAL WHEREAS, on August 16, 1999, the Company entered into a Securities Purchase Agreement with Tennenbaum & Co., LLC, TCO/Party City, LLC, Goldman, Sachs & Co., Goldman Sachs Credit Partners, L.P., Enhanced Retail Funding, LLC and Richmond Associates, L.P., as amended pursuant to the First Amendment to Securities Purchase Agreement dated as of January 14, 2000 (as amended, the "Purchase Agreement"); WHEREAS, a Supermajority in Interest of the holders of the Notes is required to effect an amendment to the Purchase Agreement, and the Purchasers constitute a Supermajority in Interest; and WHEREAS, the Company and the Purchasers now desire to amend the Purchase Agreement in the manner set forth below. AGREEMENT NOW, THEREFORE, in consideration of the mutual covenants contained herein, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Purchasers amend the Purchase Agreement as follows: 1. AMENDMENT TO SECTION 9.21. Section 9.21 of the Purchase Agreement is hereby amended by deleting it in its entirety and inserting the following in lieu thereof: "9.21 [RESERVED]" 2. COUNTERPARTS. This Amendment may be executed in one or more counterparts, and signature pages may be delivered by facsimile, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument, and shall become effective upon its execution by the Company and a Supermajority in Interest of the Notes. 3. FULL FORCE AND EFFECT. Except as expressly modified by this Amendment, all of the terms, covenants, agreements, conditions and other provisions of the Purchase Agreement shall remain in full force and effect in accordance with their respective terms. 2 IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first above written. PARTY CITY CORPORATION By: /s/ Thomas E. Larson ----------------------------------- Name: Thomas E. Larson Title: CFO PURCHASERS: SPECIAL VALUE BOND FUND, LLC By: SVIM/MSM, LLC, its Managing Member By: TENNENBAUM & CO., LLC, its Managing Member By: /s/ Michael E. Tennenbaum ----------------------------------- Name: Michael E. Tennenbaum Title: Managing Member SPECIAL VALUE BOND FUND II, LLC By: SVIM/MSMII, LLC, its Managing Member By: TENNENBAUM & CO., LLC, its Managing Member By: /s/ Michael E. Tennenbaum ----------------------------- Name: Michael E. Tennenbaum Title: Managing Member S-1 3 GOLDMAN, SACHS & CO. By: /s/ David Sabath ----------------------------------- Name: David Sabath Title: Authorized Signatory GOLDMAN SACHS CREDIT PARTNERS, L.P. By: /s/ Mark Denatale ---------------------------------- Name: Mark Denatale Title: Authorized Signatory ENHANCED RETAIL FUNDING, LLC By: /s/ Matthew R. Kahn ----------------------------------- Name: Matthew R. Kahn Title: President CLYDE STREET INVESTMENT, LLC By: /s/ Ralph D. Dillon -------------------------------------- Name: Ralph D. Dillon Title: Managing Member RICHMOND ASSOCIATES, L.P. By: MHM MANAGEMENT, INC., its General Partner By: /s/ John F. Clausen -------------------------------------- Name: John F. Clausen Title: Vive President