EXHIBIT 10.10
EXECUTION COPY
AMENDMENT, dated as of May 7, 1999, to (a) the AMENDED AND RESTATED CREDIT
AGREEMENT, dated as of June 30, 1998, (as amended by the Amendment, dated as of
December 7, 1998, the "Credit Agreement") among METRIS COMPANIES INC., a
Delaware corporation (the "Borrower"), the lenders listed in Schedule 2.01
thereto (the "Lenders"), NATIONSBANK, N.A., as Syndication Agent (in such
capacity, the "Syndication Agent"), DEUTSCHE BANK, as documentation agent, U.S.
BANK NATIONAL ASSOCIATION, as documentation agent (collectively in such
capacity, the "Documentation Agents"), BARCLAYS BANK PLC as co-agent, BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as co-agent (collectively in
such capacity, the "Co-Agents"), and THE CHASE MANHATTAN BANK, as administrative
agent for the Lenders (the "Administrative Agent") and (b) the AMENDED AND
RESTATED PLEDGE AGREEMENT, dated as of June 30, 1998 (the "Pledge Agreement"),
among the Borrower, Metris Direct, Inc., a Delaware corporation, and the
Administrative Agent (this "Amendment").
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have agreed to make,
and have made, certain loans and other extensions of credit to the Borrower; and
WHEREAS, in connection with the acquisition by the Borrower of certain
credit card portfolio assets from General Electric Consumer Card Company (the
"GECC Portfolio"), the Borrower has requested that the Lenders agree to amend
the Credit Agreement as provided herein;
WHEREAS, in connection with certain other amendments to the Credit
Agreement and the Pledge Agreement, the Borrower has requested, and the Lenders
have agreed, that certain provisions of each of the Credit Agreement and the
Pledge Agreement be amended as provided herein;
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and in consideration of the premises contained
herein, the parties hereto hereby agree as follows:
SECTION I. AMENDMENTS
1.1. Defined Terms. Unless otherwise defined herein, capitalized terms
which are defined in the Credit Agreement are used herein as defined therein.
1.2. Amendment to Section 1.1. The definition of "Borrowing Base" set forth
in Section 1.1 of the Credit Agreement is hereby deleted in its entirety and the
following definition is substituted in lieu thereof:
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"'Borrowing Base' shall mean, at any time, an amount equal to the product
of (x) Managed Accounts Receivable (other than Managed Accounts Receivable of
DMCCB or any other Depositary Institution, which Managed Accounts Receivable
have not been sold to the Borrower or any other Subsidiary of the Borrower)
times (y) the Advance Rate. The Borrowing Base at any time shall be determined
by reference to the most recent Borrowing Base Certificate delivered to the
Administrative Agent, absent any error in such Borrowing Base Certificate."
1.3. Amendment to Section 6.01. Paragraph (g) of Section 6.01 of the Credit
Agreement is deleted in its entirety and the following paragraph (g) is
substituted in lieu thereof:
"(g) Borrowing Base. In the case of the Borrower, permit the aggregate
principal amount of Funded Senior Debt (other than Funded Senior Debt incurred
by DMCCB or any other Depositary Institution, including that of the type
described in clause (c) of the definition of Funded Senior Debt) at any time to
exceed the Borrowing Base then in effect."
1.4. Amendment to Section 6.06(d). Each occurrence of the phrase "loans,
advances or investments" contained in paragraph (d) of Section 6.06 of the
Credit Agreement is deleted and the phrase "loans, advances, investments or
Guarantees" is substituted in lieu thereof.
1.5. Amendment to Section 6.06(g). Paragraph (g) of Section 6.06 of the
Credit Agreement is deleted in its entirety and the following paragraph (g) is
substituted in lieu thereof:
"(g) Permitted Business Acquisitions so long as the aggregate consideration
paid by the Borrower and its Subsidiaries in respect of all Permitted Business
Acquisitions (i) of Accounts, consummated or entered into during any period of
four consecutive fiscal quarter periods of the Borrower (an "Acquisition Test
Period") (provided, that for the purposes of this clause (i), the aggregate
consideration paid for Accounts on the date of any determination pursuant to
this clause (g) made after the end of the fiscal quarter during which such
Accounts were acquired shall be deemed to be the lesser of (x) the actual
aggregate consideration paid by the Borrower and its Subsidiaries and (y) the
outstanding amount of such Accounts determined in accordance with GAAP as of the
most recent fiscal quarter ending prior to such date of determination), shall
not exceed 30% of the average Managed Accounts Receivable as of the last day of
each of the four fiscal quarter periods of the Borrower and its Subsidiaries
most recently ended; provided, that (1) the acquisition of the GECC Portfolio by
the Borrower shall in any event be deemed to be a Permitted Business Acquisition
for the Acquisition Test Period ending on June 30, 1999 so long as no other
Permitted Business Acquisition is made during the period from May 7, 1999
through June 30, 1999; (2) in the event that the GECC Portfolio is acquired by
the Borrower, such percentage shall be changed to 35% for the Acquisition Test
Period ending on September 30, 1999, and (3) any acquisition that is a Permitted
Business Acquisition on the date of determination pursuant to this Section
6.06(g) shall remain a Permitted Business Acquisition once such transaction is
consummated, notwithstanding the average Managed Accounts Receivable subsequent
to such date of determination and (ii) otherwise, the cash portion of such
consideration does not exceed $50,000,000; for purposes of the foregoing, the
aggregate consideration shall not include any payment with Capital Stock or
assumption of Indebtedness (which assumption must otherwise not cause an Event
of Default after giving effect to such assumption);".
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1.6. Amendment to Section 6.06(i). Paragraph (i) of Section 6.06 of the
Credit Agreement is deleted in its entirety and the following paragraph (i) is
substituted in lieu thereof:
"(i) other loans, advances, investments or Guarantees by the Borrower or
any of its Subsidiaries that do not exceed $10,000,000 in the aggregate at any
one time outstanding (measured as of the date made and without giving effect to
subsequent changes in value)."
1.7. Amendments to Pledge Agreement. (a) Section 2 of the Pledge Agreement
is hereby amended by adding the following sentence to the end thereof:
"Notwithstanding anything to the contrary contained herein, no capital
stock of any Subsidiary that is not organized in the United States shall be
required to be pledged hereunder."
(b) Section 3(a) of the Pledge Agreement is deleted in its entirety and the
following paragraph (a) is substituted in lieu thereof:
"(a) the Pledged Stock set forth in Schedule I attached hereto (and revised
from time to time with the pledge of any additional stock) pledged by such
Pledgor represents all the outstanding capital stock of each of its Subsidiaries
(other than as to any Subsidiary that is not organized in the United States or
as to the pledge of whose Capital Stock is prohibited by law);".
SECTION II. MISCELLANEOUS
2.1. Conditions to Effectiveness of Amendment. This Amendment shall become
effective (the "Amendment Effective Date") as of the date first set forth above
upon (a) the Administrative Agent having received counterparts of this Amendment
duly executed and delivered by the Borrower and the Required Lenders and (b)
payment to the Administrative Agent and the Lenders by the Borrower of such fees
in respect of this Amendment as have been previously agreed upon by the Borrower
and the Administrative Agent.
2.2. Representations and Warranties. The Borrower represents and warrants
to each Lender that as of the effective date of this Amendment: (a) the
representations and warranties made by the Loan Parties in the Loan Documents
are true and correct in all material respects on and as of the date hereof
(except to the extent that such representations and warranties are expressly
stated to relate to an earlier date, in which case such representations and
warranties shall have been true and correct in all material respects on and as
of such earlier date); and (b) no Default or Event of Default shall have
occurred and be continuing as of the date hereof
2.3. Counterparts. This Amendment may be executed by one or more of the
parties to this Amendment on any number of separate counterparts (including by
facsimile transmission), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. A set of the copies of this
Amendment signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.
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2.4. Continuing Effect; No Other Amendments. Except to the extent expressly
stated herein, all of the terms and provisions of the Credit Agreement and the
other Loan Documents are and shall remain in full force and effect and are not
waived in any respect. This Amendment shall constitute a Loan Document.
2.5. Payment of Expenses. The Borrower agrees to pay and reimburse the
Administrative Agent for all of its reasonable out-of-pocket costs and
reasonable expenses incurred to date in connection with this Amendment and the
other Loan Documents, including, without limitation, the reasonable fees and
disbursements of legal counsel to the Administrative Agent.
2.6. GOVERNING LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their respective proper and duly authorized
officers as of the day and year first above written.
METRIS COMPANIES INC., as Borrower and
as a Pledgor
By:
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Name:
Title:
By:
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Name:
Title:
METRIS DIRECT, INC., as a Pledgor
By:
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Name:
Title:
By:
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Name:
Title:
THE CHASE MANHATTAN BANK, as
Administrative Agent, Lender and
Issuing Bank
By:
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Name:
Title:
NATIONSBANK, N.A.
By:
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Name:
Title:
DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By:
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Name:
Title:
By:
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Name:
Title:
U.S. BANK NATIONAL ASSOCIATION
By:
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Name:
Title:
BARCLAYS BANK PLC,
NEW YORK BRANCH
By:
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Name:
Title:
THE SUMITOMO BANK, LTD.
By:
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Name:
Title:
THE BANK OF NEW YORK
By:
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Name:
Title:
THE BANK OF NOVA SCOTIA
By:
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Name:
Title:
BANQUE NATIONALE DE PARIS
By:
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Name:
Title:
THE LONG-TERM CREDIT BANK OF JAPAN, LTD.
By:
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Name:
Title:
THE FUJI BANK, LIMITED
By:
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Name:
Title:
KZH IV LLC
By:
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Name:
Title:
XXX XXXXXX PRIME RATE INCOME TRUST
By:
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Name:
Title:
KZH SHOSHONE LLC
By:
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Name:
Title:
AMARA-1 FINANCE LTD
By:
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Name:
Title:
AMARA-2 FINANCE LTD
By:
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Name:
Title:
CERES FINANCE LTD.
By:
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Name:
Title:
BANK OF AMERICA NATIONAL TRUST &
SAVINGS ASSOCIATION
By:
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Name:
Title:
STRATA FUNDING LTD.
By:
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Name:
Title:
SPS TRADES
By:
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Name:
Title:
OASIS COLLATERALIZED HIGH INCOME
PORTFOLIOS-I, LTD.
By:
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Name:
Title:
FIRST DOMINION FUNDING II
By:
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Name:
Title:
