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THIRD AMENDMENT TO LOAN AND SECURITY AGREEMENT
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This Third Amendment to Loan and Security Agreement (the "Third
Amendment") is made as of this 10th day of December, 1999 by and between
BankBoston Retail Finance Inc. (in such capacity, herein the
"AGENT"), a Delaware corporation with offices at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, as agent for the ratable benefit of the
"LENDERS", who are party to the Agreement (defined below)
and
Drug Emporium, Inc. (hereinafter, the "BORROWER"), a Delaware
corporation with its principal executive offices at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
in consideration of the mutual covenants herein contained and benefits to be
derived herefrom.
W I T N E S S E T H:
WHEREAS, on October 28, 1998 the Agent, the Lenders and the Borrower
entered in a certain Loan and Security Agreement, as amended by a First
Amendment to Loan and Security Agreement dated May 5, 1999 and a Second
Amendment to Loan and Security Agreement dated September 10, 1999 (the
"Agreement"); and
WHEREAS, the Borrower, the Agent, and the Lender desire to amend
certain of the provisions of the Agreement;
NOW, THEREFORE, it is hereby agreed among the Agent, the Lenders and
the Borrower as follows:
1. Capitalized Terms. All capitalized terms used herein and not
otherwise defined shall have the same meaning herein as in the
Agreement.
2. Amendment to Article 1. The definition of "Base Margin Rate"
set forth in Article 1 of the Agreement is hereby amended to
read as follows:
"BASE MARGIN RATE": Base plus one-quarter percent (.25%).
3. Amendment to Article 1. The definition of "Commitment" set
forth in Article 1 of the Agreement is hereby amended to read
as follows:
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"COMMITMENT": Subject to Section 2-21, as follows:
LENDER DOLLAR COMMITMENT COMMITMENT
PERCENTAGE
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BankBoston Retail $39,500,000.00 35.90%
Finance Inc.
National City $26,000,000.00 23.64%
Commercial Finance,
Inc.
LaSalle Business $25,000,000.00 22.73%
Credit, Inc.
American National Bank $19,500,000.00 17.73%
and Trust Company of
Chicago
4. Amendment to Article 1. The definition of "Loan Ceiling" set
forth in Article 1 of the Agreement is hereby amended to read
as follows:
"LOAN CEILING": $110,000,000.00.
5. Amendment to Article 1. The LIBOR MARGIN PRICING GRID set
forth under the definition of "Libor Margin" in Article 1 of
the Agreement is hereby amended to read as follows:
LIBOR MARGIN PRICING GRID
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TIER FIXED CHARGE RATIO TRAILING/ROLLING 12 MONTH MARGIN (BASIS
AVERAGE EXCESS AVAILABILITY POINTS)
---- ------------------------- --------------------------- -------------
I Equal or Greater than 1.7 Equal or Greater than 150
$20,000,000.00
II Equal or Greater than 1.7 Less than $20,000,000.00 175
III 1.26 to 1.69 N/A 175
IV 1.25 or less N/A 200
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6. Waiver of Compliance with Sections 4-18, 4-19, 4-20 and 4-23.
The Lenders waive compliance by the Borrower with the terms of
Sections 4-18, 4-19, 4-20 and 4-23 of the Agreement in
connection with the investments in
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and/or loans to be made to E-Commerce up to a maximum
aggregate amount of $17,500,00.00. No further amounts shall be
advanced to E-COMMERCE directly or indirectly, including by
way of any additional trade support. The Borrower shall be
required to pledge its stock or other investments in
E-Commerce and all notes or other indebtedness payable by
E-Commerce to the Agent and the Lenders. Provided that no
Event of Default is then occurring, the Agent shall release
such pledge at such time that E-COMMERCE procures initial
financing.
7. Amendment Fee. The Borrower shall pay to the Agent an
amendment fee as set forth in a separate fee letter between
the Agent and the Borrower.
8. Ratification of Loan Documents. Except as provided herein, all
terms and conditions of the Agreement and of the other Loan
Documents remain in full force and effect. Furthermore, except
as provided herein, all warranties and representations made in
the Agreement and in the other Loan Documents remain in full
force and effect.
9. Conditions to Effectiveness. This Third Amendment shall not be
effective until each of the following conditions precedent
have been fulfilled to the satisfaction of the Agent and the
Lenders:
(1) This Third Amendment shall have been duly executed
and delivered by the respective parties hereto.
(2) No Suspension Event shall have occurred and be
continuing.
(3) The Borrower shall have provided such additional
instruments and documents to the Agent as the Agent
and the Agent's counsel may have reasonably
requested.
The Agent shall promptly notify the Borrowers when such
conditions are satisfied.
10. Miscellaneous.
(a) This Third Amendment may be executed in several
counterparts and by each party on a separate counterpart, each
of which when so executed and delivered shall be an original,
and all of which together shall constitute one instrument.
(b) This Third Amendment expresses the entire
understanding of the parties with respect to the transactions
contemplated hereby. No prior negotiations or discussions
shall limit, modify, or otherwise affect the provisions
hereof.
(c) Any determination that any provision of this
Third Amendment or any application hereof is invalid, illegal
or unenforceable in any respect and in any instance shall not
effect the validity, legality, or enforceability of such
provision in any other instance, or the validity, legality or
enforceability of any other provisions of this Third
Amendment.
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(d) The Borrower shall pay on demand all costs and
expenses of the Agent, including, without limitation,
reasonable attorneys' fees, in connection with the
preparation, negotiation, execution and delivery of this Third
Amendment.
(e) The Borrower warrants and represents that the
Borrower has consulted with independent legal counsel of the
Borrower's selection in connection with this Third Amendment
and is not relying on any representations or warranties of any
Lender or the Agent or their respective counsel in entering
into this Third Amendment.
IN WITNESS WHEREOF, the parties have caused this Third Amendment to
Loan and Security Agreement to be executed by their duly authorized officers as
a sealed instrument as of the date first above written.
DRUG EMPORIUM, INC.
("Borrower")
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: Chief Financial Officer
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BANKBOSTON RETAIL FINANCE INC.
("Agent")
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇
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Title: Vice President
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The "LENDERS"
BANKBOSTON RETAIL FINANCE INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
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Print Name: ▇▇▇▇▇ ▇. ▇▇▇▇
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Title: Vice President
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NATIONAL CITY COMMERCIAL FINANCE, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
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Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
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Title: Vice President
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AMERICAN NATIONAL BANK AND
TRUST COMPANY OF CHICAGO
By: /s/ M. ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Print Name: M. ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Title: Vice President
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LASALLE BUSINESS CREDIT, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
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Print Name: ▇▇▇▇▇ ▇. ▇▇▇▇
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Title: Vice President
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