AMENDMENT NO. 1 dated as of September 30, 2009 to AMENDED AND RESTATED LOAN AGREEMENT dated as of October 1, 2008
EXHIBIT 10.1
AMENDMENT NO. 1
dated as of September 30, 2009
to
AMENDED AND RESTATED LOAN AGREEMENT
dated as of October 1, 2008
dated as of October 1, 2008
This AMENDMENT NO. 1 (this “Amendment”), dated as of September 30, 2009, to the Amended and
Restated Loan Agreement, dated as of October 1, 2008 (as amended, supplemented, restated or
otherwise modified from time to time, the “Loan Agreement”), is made by and among G&K Receivables
Corp., a Minnesota corporation (“Borrower”), G&K Services, Inc., a Minnesota corporation, in its
capacity as the initial servicer (in such capacity, together with its successors and permitted
assigns in such capacity, “Servicer”), Three Pillars Funding LLC, a Delaware limited liability
company (together with its successors and permitted assigns, “Lender”), and SunTrust Xxxxxxxx
Xxxxxxxx, Inc., a Tennessee corporation, as agent and administrator for Lender (in such capacity,
together with its successor and assigns in such capacity, “Administrator”). Capitalized terms used
but not defined herein shall have the meanings assigned to them in the Loan Agreement.
BACKGROUND
1. The parties hereto are parties to the Loan Agreement.
2. The parties hereto desire to amend the Loan Agreement on the terms and
subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual agreements herein contained,
the parties hereto agree to amend the Loan Agreement as follows:
Section 1. Amendments to the Loan Agreement. The Loan Agreement is hereby amended as
follows:
(a) The defined term “Facility Limit” set forth in Section 1.1 of the Loan Agreement is
hereby deleted in its entirety and replaced with the following:
“Facility Limit” means $50,000,000.
(b) The defined term “Interest Period” set forth in Section 1.1 of the Loan Agreement
is hereby deleted in its entirety and replaced with the following:
“Interest Period” means:
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(a) with respect to any CP Allocation or any Alternative Rate Allocation while
the Base Rate is applicable thereto, (i) initially, the period commencing on the
date of the initial establishment of such Allocation and ending on the last day of
the calendar month in which such Allocation was initially established, and (ii)
thereafter, each period commencing on the first day of a calendar month and ending
on the last day of such calendar month; and
(b) with respect to any Alternative Rate Allocation while the LIBOR Rate is
applicable thereto, (i) initially, the period commencing on the date of the initial
establishment of such Allocation and ending on (but excluding) the next following
Scheduled Interest Payment Date, and (ii) thereafter, each period commencing on (and
including) a Scheduled Interest Payment Date and ending on (but excluding) the next
following Scheduled Interest Payment Date (or, if the LIBOR Rate becomes unavailable
prior to such following Scheduled Interest Payment Date, the first day of an
Interest Period described in clause (a) above with respect to the same allocation);
; provided, however, that if any Interest Period for any Allocation that commences
before the Commitment Termination Date would otherwise end on a date occurring after
such Commitment Termination Date, such Interest Period shall end on such Commitment
Termination Date and the duration of each such Interest Period that commences on or
after the Commitment Termination Date, if any, shall be of such duration as shall be
selected by Administrator.
(c) The defined term “Liquidity Termination Date” set forth in Section 1.1 of the Loan
Agreement is hereby deleted in its entirety and replaced with the following:
“Liquidity Termination Date” means the earlier to occur of (a) September 29,
2010, as such date may be extended from time to time by the Liquidity Banks in
accordance with the Liquidity Agreement, and (b) the occurrence of an Event of
Bankruptcy with respect to Lender.
(d) The defined term “Scheduled Commitment Termination Date” set forth in Section 1.1
of the Loan Agreement is hereby deleted in its entirety and replaced with the following:
“Scheduled Commitment Termination Date” means September 26, 2012, as extended
from time to time by mutual agreement of the parties hereto.
(e) The defined term “Stress Factor” set forth in Section 1.1 of the Loan Agreement is
hereby deleted in its entirety and replaced with the following:
“Stress Factor” means 2.5.
(f) Section 1.2 of the Loan Agreement is hereby amended by adding a new clause (d) at
the end thereof:
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(d) The words “fiscal month,” “fiscal period” and “fiscal year” and similar
terms when used in this Agreement shall refer to the fiscal month, fiscal period and
fiscal year of the Initial Servicer.
(g) Section 2.6 of the Loan Agreement is hereby deleted in its entirety and replaced
with the following:
Section 2.6 Voluntary Termination of Lender’s Commitment; Reduction of
Facility Limit. Borrower may, in its sole discretion for any reason upon at
least 10 days’ notice to Administrator (with a copy to Lender), terminate the
Lender’s Commitment in whole, or reduce in part the unused portion of the Facility
Limit; provided, however, that (a) each such partial reduction will be in a minimum
amount of $5,000,000 or a higher integral multiple of $1,000,000 and shall not
reduce the Facility Limit below $40,000,000, and (b) in connection therewith
Borrower shall comply with Section 3.2(b) and Section 4.1(b).
Without regard to the foregoing 10-day notice requirement, but subject to
Section 3.2(b) and Section 4.1(b), in the event Lender or
Administrator is downgraded by any Rating Agency, Borrower may reduce the Facility
Limit to zero and terminate the Lender’s Commitment in whole and thereby terminate
the accrual of further Unused Fees (under and as defined in the Fee Letter).
(h) Section 3.2(a) of the Loan Agreement is hereby deleted in its entirety and replaced
with the following:
(a) on each Scheduled Interest Payment Date prior to the Scheduled Commitment
Termination Date, for the Interest Period (or portion thereof) then most recently
ended;
(i) Section 3.5 of the Loan Agreement is hereby amended by adding the parenthetical
“(or, in case of interest at a rate equal to the Base Rate, 365 or, as appropriate, 366
days)” at the end thereof.
(j) Section 4.1(a) of the Loan Agreement is hereby amended by adding the words “, which
notice shall be substantially in the form of Exhibit F hereto,” immediately
following the words “prior written notice to Administrator” therein.
(k) Clauses second and third of Section 4.2(b) are hereby deleted in their entirety and
replaced with the following:
second, interest accrued on the Loans pursuant to Section 3.1 during the
Interest Period then most recently ended ( plus, if applicable, the amount of
interest on the Loans accrued for any prior Interest Period to the extent such
amount has not been paid, and to the extent permitted by law, interest thereon);
third, to the extent due and owing under any Transaction Document, all Fees
accrued during the prior calendar month ( plus, if applicable, the amount of
Fees accrued for any prior calendar month to the extent such amount has not been
distributed to Lender or Administrator);
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(l) Section 10.2.3 of the Loan Agreement is hereby deleted in its entirety and replaced
with the following:
10.2.3 Default Ratio. The Default Ratio shall equal or exceed 2.00% on
a rolling three-fiscal-month average basis at any time on or after the date hereof.
(m) Section 10.2.5 of the Loan Agreement is hereby deleted in its entirety and replaced
with the following:
10.2.5 Delinquency Ratio. The Delinquency Ratio shall equal or exceed
2.75% on a rolling three-fiscal-month average basis at any time on or after the date
hereof.
(n) Section 10.3(a) of the Loan Agreement is hereby deleted in its entirety and
replaced with the following:
(a) Optional TerminationUpon the occurrence of a Significant Event
(other than an Event of Default described in Section 10.1.4 and other than
an Amortization Event described in Section 10.2.9 arising solely by virtue
of an Event of Bankruptcy with respect to Lender) Administrator may, and at the
request of Lender shall, by notice to Borrower (a copy of which shall be promptly
forwarded by Administrator to each Rating Agency), declare all or any portion of the
outstanding principal amount of the Loans and other Obligations to be due and
payable and/or the Lender’s Commitment (if not theretofore terminated) to be
terminated by declaring the Commitment Termination Date to have occurred, whereupon
the full unpaid amount of such Loans and other Obligations which shall be so
declared due and payable shall be and become immediately due and payable, without
further notice, demand or presentment, and/or, as the case may be, the Lender’s
Commitment shall terminate.
(o) The last paragraph in Section 11.7 of the Loan Agreement is hereby amended by
deleting the first sentence therein in its entirety and replacing such first sentence with
the following:
At any time during the continuance of any Servicer Event of Default (which Servicer
Event of Default (other than an Event of Bankruptcy under Section 11.7.5), if
capable of being remedied, has not been remedied for a period of thirty (30) days
after the occurrence thereof), Administrator may, in its sole discretion, notify
Servicer in writing of the revocation of its appointment as Servicer hereunder.
(p) The defined term “Material Debt” set forth in Section 11.7.7 of the Loan Agreement
is hereby amended by replacing “$10,000,000” therein with “$15,000,000”.
(q) Exhibit C to the Loan Agreement is hereby deleted in its entirety and replaced with
Exhibit C set forth in Annex 1 hereto.
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(r) New Exhibit F set forth in Annex 2 hereto is hereby added as Exhibit F to the Loan
Agreement.
Section 2. Conditions Precedent. This Amendment shall become effective and be deemed
effective as of the date first written above (the “Amendment Effective Date”) upon the satisfaction
of the following conditions precedent:
(a) Administrator shall have received counterparts of this Amendment duly executed by
each party hereto;
(b) Administrator shall have received counterparts of the Fifth Amended and Restated
Fee Letter duly executed by the Borrower;
(c) Administrator shall have received, in immediately available funds, the Extension
Fee of $75,000 pursuant to the Fifth Amended and Restated Fee Letter.
Section 3. Reference to and Effect on the Loan Agreement. Upon the effectiveness of
this Amendment, (i) Borrower and Servicer each hereby reaffirms all covenants, representations and
warranties made by it in Loan Agreement to the extent the same are not amended hereby and agrees
that all such covenants, representations and warranties shall be deemed to have been remade as of
the Amendment Effective Date (except for those representations and warranties that are expressly
made only as of a different date, which representations and warranties shall be correct as of the
date made) and (ii) each reference in the Loan Agreement to “this Agreement”, “hereunder”,
“hereof”, “herein” or words of like import shall mean and be, and any references to the Loan
Agreement in any other document, instrument or agreement executed and/or delivered in connection
therewith shall mean and be, a reference to the Loan Agreement as amended hereby.
Section 4. Scheduled Commitment Termination Date. Each of the parties hereto hereby
agrees that the Scheduled Commitment Termination Date shall be as provided herein notwithstanding
any prior noncompliance with the timing provisions with respect to extensions set forth in Section
2.5 of the Loan Agreement.
Section 5. Expenses. Borrower hereby reaffirms its obligations under Section 15.4 of
the Loan Agreement to pay all costs and expenses (including, without limitation, the reasonable
fees and expenses of counsel) incurred by Administrator, Lender, each Liquidity Bank, each Credit
Bank and Servicer in connection with the preparation, execution and delivery of this Amendment and
the agreements and instruments related hereto.
Section 6. Effect. Except as otherwise amended by this Amendment, the Loan Agreement
shall continue in full force and effect and is hereby ratified and confirmed.
Section 7. Severability. Any provision of this Amendment which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions of this
Amendment or affecting the validity or enforceability of such provision in any other jurisdiction.
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Section 8. Governing Law. THIS AMENDMENT SHALL BE A CONTRACT MADE UNDER AND GOVERNED
BY THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES
THEREOF (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW) EXCEPT TO THE EXTENT
THAT THE LAWS OF ANOTHER JURISDICTION GOVERN THE PERFECTION, OR THE EFFECT OF PERFECTION OR
NONPERFECTION, OF THE SECURITY INTERESTS OF ADMINISTRATOR, FOR THE BENEFIT OF THE SECURED PARTIES.
Section 9. Counterparts. This Amendment may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an original but all of which shall
constitute together but one and the same agreement.
[Signatures follow]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be executed by their respective
officers thereunto duly authorized as of the day and year first above written.
G&K RECEIVABLES CORP., as Borrower
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President and Chief Financial Officer
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President and Chief Financial Officer
G&K SERVICES, INC., as initial Servicer
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President and Chief Financial Officer
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President and Chief Financial Officer
Signature Page
to
Amendment No. 1 to Loan Agreement
to
Amendment No. 1 to Loan Agreement
THREE PILLARS FUNDING LLC, as Lender
By: /s/ Xxxxx X. Xxxxx, Vice President
Name: Xxxxx X. Xxxxx, Vice President
Title: Vice President
Name: Xxxxx X. Xxxxx, Vice President
Title: Vice President
Signature Page
to
Amendment No. 1 to Loan Agreement
to
Amendment No. 1 to Loan Agreement
SUNTRUST XXXXXXXX XXXXXXXX, INC., as Administrator
By: /s/ Xxxxxxx X. Xxxx
Name: Xxxxxxx X. Xxxx, Managing Director
Title: Managing Director
Name: Xxxxxxx X. Xxxx, Managing Director
Title: Managing Director
Signature Page
to
Amendment No. 1 to Loan Agreement
to
Amendment No. 1 to Loan Agreement
