Termination Agreement And Release

Exhibit 10.12


Termination Agreement and Release


This Termination Agreement and Release (this "Agreement") is made this 8th day of April, 2002, by and between, on the one hand, the lenders identified on the signature pages hereof (the "Lenders") and FOOTHILL CAPITAL CORPORATION, a California corporation, as the arranger and administrative agent for the Lenders (in such capacity, "Agent"; and together with the Lenders, the "Lender Group"), and, on the other hand, THE 3DO COMPANY, a California corporation ("Borrower"), THE 3DO COMPANY, a Delaware corporation ("Parent"), and 3DO EUROPE, LTD., a company incorporated under the laws of England ("UK Sub") (Parent and UK Sub are hereinafter collectively referred to as the "Guarantors").


This Agreement is entered into with reference to the following:


A. On or about April 6, 2000, the Lender Group, on the one hand, and Borrower and the Guarantors, on the other hand, entered into that certain Loan and Security Agreement (the "Loan Agreement") and other related Loan Documents (as that term is defined in the Loan Agreement, and all other capitalized terms not defined in this Agreement shall have the meanings ascribed to such terms in the Loan Agreement), pursuant to which the Lender Group extended certain financial accommodations to Borrower, and Borrower granted in favor of Agent, for the benefit of the Lender Group, a security interest in and liens on substantially all of Borrower's assets.


B. On or about April 6, 2000, each of the Guarantors executed in favor of and delivered to Agent, for the benefit of the Lender Group, certain guaranties, guarantor security agreements, and other pledges of collateral in connection with the financial accommodations to Borrower under the Loan Documents.


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C. The Loan Agreement matures on April 6, 2002.


NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each of the parties hereto acknowledges and agrees as follows.


1. Lender Group Expenses. On or before 11:00 a.m., Los Angeles time, on April 5, 2002 (the "Payoff Date"), Borrower shall pay to Agent, for the benefit of the Lender Group, in cash the aggregate amount of $37,880.69 (the "Payoff Amount"), subject to adjustment as set forth in this Paragraph 1, consisting of: (a) $50.69 in respect of accrued and unpaid interest through and including April 5, 2002, (b) $1,250.00 in respect of the amount payable for the unused line fee that was due on April 1, 2002, (c) $1,500.00 in respect of the amount payable for the loan servicing fee that was due on April 1, 2002, (d) $80.00 in respect of the amount payable for wire fees, and (e) the amount of $35,000 in respect of reasonably anticipated Lender Group Expenses to be incurred by the Lender Group from and after the Payoff Date (the "Payoff Reserve"). In the event that the Payoff Amount is not received by Agent on or before the Payoff Date, the Payoff Amount shall increase by $312.50 for each twenty-four hour period thereafter. As of the date hereof, the Agent's Account contains approximately $33,658 of Borrower's cash Collections. Borrower and the Lender Group agree that the Payoff Amount may be satisfied by (i) Agent's retention of an amount equal to $33,658 from Borrower's cash Collections, plus (ii) a cash payment from Borrower in an amount equal to $4,222.69. Within 90 days of the date of this Agreement, Agent shall transfer to Borrower the unused portion, if any, of the Payoff Reserve.


2. Termination of Obligations Other Than Indemnity. The Lender Group, Borrower, and each of the Guarantors acknowledge and agree that upon Agent's receipt of (a) a


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fully executed counterpart of this Agreement signed by the Lender Group, Borrower, and each of the Guarantors, and (b) the Payoff Reserve, all of the Obligations under the Loan Documents shall be terminated and satisfied in full; provided, however, that (A) all Obligations to indemnify each Indemnified Person under Section 11.3 of the Loan Agreement and to reimburse the Lender Group for Lender Group Expenses shall remain in full force and effect, and (B) to the extent that any payments or proceeds (or any portion thereof) received by Agent or any Lender shall be subsequently invalidated, declared to be fraudulent or a fraudulent conveyance or preferential, set aside or required to be repaid to a trustee, receiver, debtor-in-possession or any other party under any bankruptcy law, state or federal law, common law or equitable cause, then to the extent that the payment or proceeds is rescinded or must otherwise be restored by Agent or such Lender, as applicable, whether as a result of any proceedings in bankruptcy or reorganization or otherwise, the Obligations or part thereof which were intended to be satisfied shall be revived and continue to be in full force and effect, as if the payment or proceeds had never been received by Agent or such Lender, as applicable, and this Agreement shall in no way impair the claims of the Lender Group with respect to the revived Obligations.


3. Termination of Loan Documents. Borrower and each of the Guarantors hereby confirm that the commitment of the Lender Group to extend credit under the Loan Agreement and the other Loan Documents is terminated as of the Payoff Date, and, as of the Payoff Date, the Lender Group has no further obligation to extend credit to Borrower.


4. Release of Collateral. Agent, on behalf of the Lender Group, will, as promptly as practicable:


a. Execute and deliver any Uniform Commercial Code termination
statements that (i) Borrower and Guarantors reasonably may request to
release, as


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