EXHIBIT 2.7
[RAC Letterhead]
March 10, 2003
VIA FACSIMILE (814) 461-5401
Rent-Way, Inc.
Rent-Way of Michigan, Inc.
Rent-Way of TTIG, L.P.
Attn: Chief Executive Officer
One Rent Way Place
Erie, Pennsylvania 16505
Dear Sir:
Reference is made to that certain Asset Purchase Agreement, dated as of
December 17, 2002, by and among Rent-A-Center East, Inc., a Delaware corporation
(formerly known as Rent-A-Center, Inc.) ("ACQUIROR"), and Rent-Way, Inc. (the
"COMPANY"), Rent-Way of Michigan, Inc. ("RENT-WAY MICHIGAN") and Rent-Way of
TTIG, L.P. ("TTIG" and, together with Rent-Way Michigan, the "OPERATING
SUBSIDIARIES"), as amended by that certain letter agreement dated December 31,
2002, that certain letter agreement dated January 7, 2003, that certain letter
agreement dated February 7, 2003 and that certain Letter Agreement dated
February 10, 2003 (together, the "ASSET PURCHASE AGREEMENT"). Capitalized terms
not otherwise defined herein shall have the meaning ascribed to such terms in
the Asset Purchase Agreement.
WHEREAS, the Closing of the transactions contemplated under the Asset
Purchase Agreement occurred as of February 8, 2003; and
WHEREAS, Acquiror now wishes to exercise its option to assume an
additional real estate lease from an Acquired Store, and
WHEREAS, the Company desires to grant the Acquiror an option to amend
the list of Acquired Stores and Account Stores as provided herein.
NOW, THEREFORE, this letter agreement, in accordance with Section 7.4
of the Asset Purchase Agreement, memorializes the understanding of the parties
to the Asset Purchase Agreement regarding certain post-closing changes thereto
and hereby amends, modifies and supplements the Asset Purchase Agreement as
follows:
1. Wolcott Store Lease Option.
(a) The Company hereby grants to the Acquiror the option (the
"OPTION") to sell, transfer, assign, convey and deliver to the
Company, without representation or
warranty and free and clear of all Encumbrances (except for
those Encumbrances under Acquiror's senior credit facility, if
any, which may have attached on February 8, 2003 and which
Acquiror covenants it will obtain applicable releases if
required), all of Acquiror's right, title and interest in and
to all of the real estate leases and fixtures (together, the
"RETURNED ASSETS") located at or associated with the Acquired
Store located at 12042 East Main Street, Wolcott, NY 14590
(the "WOLCOTT STORE"). Acquiror hereby acknowledges that (i)
the Option will expire at the close of business on August 31,
2004, and (ii) it will be responsible for rent on the Wolcott
Store until such time as Acquiror exercises the Option.
(b) The Company hereby agrees that, should the Acquiror exercise
the Option, then as of the date of exercise of the Option, the
Company shall assume and agree to pay, perform, discharge, and
satisfy any and all of those Assumed Liabilities related to
the Returned Assets previously assumed by Acquiror on the
Closing Date, effective as of the date of the exercise of the
Option.
2. Exercise of Account Store Acquisition Option.
(a) Acquiror hereby exercises its rights under Section 6.3 of the
Asset Purchase Agreement to assume from the Company the real
estate lease (and the fixtures related thereto) with respect
to the Account Store located at 1121 NW 23rd Street, Oklahoma
City, OK 73106 (the "ADDITIONAL LEASE"). The parties hereby
acknowledge that this letter agreement shall constitute the
written notice required under Section 6.3 of the Asset
Purchase Agreement and that they will enter into the
assignment and assumption agreement, in the form attached as
Exhibit "A" hereto, with respect to the Additional Lease in
accordance with Section 6.3 of the Asset Purchase Agreement.
(b) The Representations and Warranties of the Company set forth in
Section 3.8 of the Asset Purchase Agreement are hereby
incorporated herein by reference and are deemed made by the
Company as of the date hereof with respect to the matters
related to the Additional Lease on or prior to the date
hereof.
(c) As of the date hereof, Acquiror shall assume only those
liabilities or obligations of a kind or nature, whether
absolute, contingent, accrued, known or unknown, that are
attributable to the periods, events or circumstances on or
after the date hereof, and which arise under, relate to or are
in connection with the Additional Lease on or after the date
hereof. Except as specifically set forth in the previous
sentence, Acquiror shall assume no other liabilities or
obligations relating to the Additional Lease.
(d) Acquiror and the Company acknowledge and agree that all of the
Indemnification provisions set forth in Article VIII of the
Asset Purchase Agreement shall be deemed to apply with equal
force to any Indemnity Claims arising or resulting from and to
the extent they are attributable to the Additional Lease as if
originally contemplated by the Asset Purchase Agreement.
3. Entire Agreement. Notwithstanding the provisions of Section 9.5 of the
Asset Purchase Agreement and consistent with Section 7.4 of the Asset
Purchase Agreement, this letter agreement, together with the Asset
Purchase Agreement and all other documents and instruments referred to
therein, including, but not limited to, the letter agreement from
Acquiror to the Company and the Operating Subsidiaries, dated December
31, 2002, relating to the extension of the Due Diligence Period, the
letter agreement from Acquiror to the Company and the Operating
Subsidiaries, dated January 7, 2003, relating to the Acquiror's
internal reorganization, the letter agreement from Acquiror to the
Company and the Operating Subsidiaries, dated February 7, 2003,
relating to various transitional and other matters, and the letter
agreement from Acquiror to the Company and the Operating Subsidiaries,
dated February 10, 2003, relating to certain post-closing matters
constitutes the entire agreement and supersedes all other prior
agreements and undertakings, both written and oral, among the parties
with respect to the transactions contemplated by the Asset Purchase
Agreement.
4. No Further Amendments. Other than as specifically provided for herein,
all other terms and conditions of the Asset Purchase Agreement shall
remain in full force and effect in accordance with its terms.
5. Governing Law. The provisions of Section 9.9 of the Asset Purchase
Agreement shall apply to this letter agreement.
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RENT-A-CENTER EAST, INC.,
formerly known as Rent-A-Center, Inc.
By: /s/ Mitchell E. Fadel
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Name: Mitchell E. Fadel
-------------------------------------
Title: President and Chief Operating Officer
-------------------------------------
AGREED AND ACCEPTED:
RENT-WAY, INC.
By: /s/ William A. McDonnell
-----------------------------------
Name: William A. McDonnell
----------------------------
Title: Vice President
----------------------------
RENT-WAY OF MICHIGAN, INC.
By: /s/ William A. McDonnell
-----------------------------------
Name: William A. McDonnell
----------------------------
Title: Vice President
----------------------------
RENT-WAY OF TTIG, L.P.
By: Rent-Way Development, Inc.,
its general partner
By: /s/ William A. McDonnell
-------------------------------
Name: William A. McDonnell
------------------------
Title: Vice President
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cc: Hodgson Russ, LLP
One M&T Plaza, Suite 2000
Buffalo, New York 14203-2391
Attention: John J. Zak, Esq.
Telecopy: 716-849-0349