Fourth Amendment to Credit Agreement (3-Year)
Exhibit 99.1
Fourth Amendment to
Credit Agreement (3-Year)
Credit Agreement (3-Year)
This Fourth Amendment to Credit Agreement (3-Year) (this “Amendment”) is dated as of December
21, 2005 by and among Alliance Data Systems Corporation (the “Borrower”), the Guarantor party
hereto, the Banks party hereto, and Xxxxxx X.X., as Administrative Agent and Letter of Credit
Issuer.
w i t n e s s e t h:
Whereas, the Borrower, the Guarantor, the Banks, and the Administrative Agent have
heretofore executed and delivered a Credit Agreement (3-Year) dated as of April 10, 2003 (as
amended by the First Amendment thereto dated as of October 21, 2004, the Second Amendment thereto
dated as of April 7, 2005, and Third Amendment thereto dated as of October 28, 2005, the “Credit
Agreement”); and
Whereas, the Borrower, the Guarantor, the Banks and the Administrative Agent desire
to amend the Credit Agreement to (i) modify certain covenants and (ii) make certain other
amendments to the Credit Agreement as set forth herein;
Now, Therefore, for good and valuable consideration the receipt of which is hereby
acknowledged, the Borrower, the Guarantor, the Banks and the Administrative Agent hereby agree as
follows:
1. The defined term “Senior Leverage Ratio” is hereby amended in its entirety and as so
amended shall read as follows:
“Senior Leverage Ratio” means, at any time, the ratio of (x)
all amounts owing by the Borrower and its Subsidiaries pursuant to
the terms of (i) this Agreement or any other Credit Document, the
Related Credit Agreement or the Canadian Credit Agreement to the
agents and the lenders thereunder and (ii) any credit agreement,
note purchase agreement, indenture or other credit facility relating
to Debt permitted by Section 6.15(viii) to (y) Consolidated
Operating EBITDA of the Borrower and its Subsidiaries for the twelve
months then most recently ended.
2. Section 6.11 of the Credit Agreement is hereby amended in its entirety and as so amended
shall read as follows:
Section 6.11. Maximum Total Capitalization Ratio. The Borrower
will not permit its Total Capitalization Ratio at any time to be
more than 60%.
3. Section 6.12 of the Credit Agreement is hereby amended in its entirety and as so amended
shall read as follows:
Section 6.12. Senior Leverage Ratio. The Borrower shall not
permit its Senior Leverage Ratio at any time to exceed 2.50 to 1.00.
4. Section 6.15 of the Credit Agreement is hereby amended by deleting clauses (vii), (viii)
and (ix) thereof and inserting in their place the following:
(vii) loans and letter of credit reimbursement obligations
outstanding from time to time under this Agreement, the Related
Credit Agreement and the Canadian Credit Agreement in an aggregate
principal amount not to exceed $550,000,000 (including the Dollar
equivalent of Canadian dollar borrowings based on the exchange rate
set forth in the Canadian Credit Agreement), (viii) unsecured Debt
or Debt secured by the Collateral (or any part thereof) on a pari
passu basis with, or on a junior basis to, the obligations
outstanding from time to time under this Agreement, the Related
Credit Agreement and the Canadian Credit Agreement, outstanding from
time to time in an aggregate principal amount not to exceed
$600,000,000, (ix) Debt incurred by the Borrower and its
Subsidiaries in the nature of a purchase price adjustment in
connection with a permitted Restricted Acquisition, and (x) other
unsecured Debt of the Borrower and/or its Subsidiaries not to exceed
$10,000,000 in the aggregate outstanding at any time.
5. Section 6.24(7) of the Credit Agreement is hereby amended in its entirety and as so amended
shall read as follows: “(7) encumbrances and restrictions contained in Permitted Subordinated Debt
and Debt permitted by Section 6.15(viii); and”.
6. The Pricing Schedule set forth in Appendix I to the Credit Agreement is hereby amended by
(i) deleting the pricing grid contained therein in its entirety and inserting in its place the
following:
Status | Level I | Level II | Level III | Level IV | ||||||||||||
Senior Leverage Ratio |
<1.00 | ³1.00<1.50 | ³1.50 <2.00 | ³2.00 | ||||||||||||
Euro-Dollar Margin |
0.50 | % | 0.75 | % | 1.00 | % | 1.25 | |||||||||
Applicable
Commitment Fee
Percentage |
.10 | % | .125 | % | .15 | % | .175 | % |
and (ii) deleting the phrase “Level III” appearing in the definitions “Euro-Dollar Margin” and
“Applicable Commitment Fee Percentage” and inserting in its place “Level IV.”
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7. Each Bank hereby consents to the Debt permitted by Section 6.15(viii) being secured by
security interests in the Collateral and authorizes the Administrative Agent and Collateral Agent
to execute any amendments, supplements, waivers or consents to the Pledge Agreements, Intercreditor
Agreement and any other document executed in connection therewith and to take such other actions as
may be requested by the Borrower and as deemed necessary by the Administrative Agent or Collateral
Agent in order to secure Debt permitted by Section 6.15(viii) of the Credit Agreement by the
Collateral (or any part thereof) on a pari passu basis with, or (if so requested by the Borrower)
on a junior basis to, the obligations outstanding from time to time under the Credit Agreement, the
Related Credit Agreement and the Canadian Credit Agreement.
8. This Amendment shall become effective as of the opening of business on December 21, 2005
(the “Effective Time”) subject to the conditions precedent that on or before such date:
(a) the Administrative Agent shall have received counterparts
hereof executed by the Borrower, the Guarantor and the Required
Banks;
(b) the Administrative Agent shall have received certified
copies of resolutions of the boards of directors of the Borrower and
the Guarantor authorizing the execution and delivery of this
Amendment, indicating the authorized signers of this Amendment and
the specimen signatures of such signers;
(c) the Borrower shall have paid (i) to each Bank which has
executed this Amendment on or prior to December 20, 2005 an
amendment fee equal to 0.10% of each such Bank’s Commitment and (ii)
to the Administrative Agent such other fees as agreed between the
Borrower and Administrative Agent.
9.1. To induce the Administrative Agent and the Banks to enter into this Amendment, the
Borrower represents and warrants to the Administrative Agent and the Banks that: (a) the
representations and warranties contained in the Credit Agreement are true and correct in all
material respects as of the date hereof with the same effect as though made on the date hereof (it
being understood and agreed that any representation or warranty which by its terms is made as of a
specified date shall be required to be true and correct in all material respects only as of such
specified date); (b) no Default or Event of Default exists; (c) this Amendment has been duly
authorized by all necessary corporate proceedings and duly executed and delivered by the Borrower
and the Credit Agreement, as amended by this Amendment, is the legal, valid and binding obligation
of the Borrower, enforceable against the Borrower in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency or other similar laws of general
application affecting the enforcement of creditors’ rights or by general principles of equity; and
(d) no consent, approval, authorization, order, registration or qualification with any governmental
authority is required for, and the absence of which would adversely affect, the
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legal and valid execution and delivery or performance by the Borrower of this Amendment or the
performance by the Borrower of the Credit Agreement, as amended by this Amendment.
9.2. This Amendment may be executed in any number of counterparts and by the different parties
on separate counterparts and each such counterpart shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same Amendment.
9.3. Except as specifically provided above, the Credit Agreement shall remain in full force
and effect and is hereby ratified and confirmed in all respects. The execution, delivery, and
effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver
of any right, power, or remedy of the Administrative Agent or any Bank under the Credit Agreement
or any Note, nor constitute a waiver or modification of any provision of any of the Credit
Agreement or any Note.
9.4. This Amendment and the rights and obligations of the parties hereunder shall be construed
in accordance with and be governed by the law of the State of New York.
[Signature Pages to follow]
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In Witness Whereof, the parties hereto have caused this Amendment to be executed by
their respective officers thereunto duly authorized as of the day and year first above written.
Alliance Data Systems Corporation, as Borrower |
||||
By | /s/ Xxxxxx X. Armink | |||
Name Xxxxxx X. Armink | ||||
Title SVP & Treasurer | ||||
ADS Alliance Data Systems, Inc., as a Guarantor |
||||
By | /s/ Xxxxxx X. Armink | |||
Name Xxxxxx X. Armink | ||||
Title SVP & Treasurer | ||||
S-1 | [Fourth Amendment 3-Year] |
Xxxxxx X.X. (successor by merger with Xxxxxx Trust and Savings Bank), individually, as Letter of Credit Issuer and as Administrative Agent | ||||
By | /s/ Xxxx X. Xxxxxx | |||
Name Xxxx X. Xxxxxx | ||||
Title Managing Director | ||||
S-2 | [Fourth Amendement 3-Year] |
SunTrust Bank |
||||
By | /s/ Xxxxxxx X. X’xxxxx | |||
Name Xxxxxxx X. X’xxxxx | ||||
Title Director | ||||
S-3 | [Fourth Amendement 3-Year] |
Wachovia Bank, N.A. |
||||
By | /s/ Xxxxx X. Xxxxxx | |||
Name Xxxxx X. Xxxxxx | ||||
Title Vice President | ||||
S-4 | [Fourth Amendement 3-Year] |
JPMorgan Chase Bank |
||||
By | /s/ Xxxxxxx X. Xxxxxx | |||
Name Xxxxxxx X. Xxxxxx | ||||
Title Senior Vice President JPMorgan Chase Bank, N.A. | ||||
S-5 | [Fourth Amendement 3-Year] |
Huntington National Bank |
||||
By | /s/ Xxxxxx X. Xxxxxxx | |||
Name Xxxxxx X. Xxxxxxx | ||||
Title Vice President | ||||
S-6 | [Fourth Amendement 3-Year] |
Bear Xxxxxxx Corporate Lending, Inc. |
||||
By | /s/ Xxxxxx Bulzacchellt | |||
Name Xxxxxx Bulzacchellt | ||||
Title Vice President | ||||
S-7 | [Fourth Amendement 3-Year] |
Credit Suisse, Cayman Islands Branch (f/k/a Credit Suisse First Boston, acting through its Cayman Islands Branch) |
||||
By | /s/ Alain Drouct | |||
Name Alain Drouct | ||||
Title Director | ||||
By | /s/ Xxxxxx X. Xxxxxxx | |||
Name Xxxxxx X. Xxxxxxx | ||||
Title Associate | ||||
S-8 | [Fourth Amendement 3-Year] |
US Bank National Association |
||||
By | /s/ Xxxxx X. XxXxxxxx | |||
Name Xxxxx X. XxXxxxxx | ||||
Title Vice President | ||||
S-9 | [Fourth Amendement 3-Year] |
Union Bank of California, N.A. |
||||
By | /s/ Xxxxxxxx X. Xxx | |||
Name Xxxxxxxx X. Xxx | ||||
Title Vice President | ||||
S-10 | [Fourth Amendement 3-Year] |
Fifth Third Bank (Central Ohio) |
||||
By | /s/ Xxxxxxxxxxx X. Xxxxx | |||
Name Xxxxxxxxxxx X. Xxxxx | ||||
Title Vice President | ||||
S-11 | [Fourth Amendement 3-Year] |
Barclays Bank PLC |
||||
By | /s/ Xxxxxx XxXxxxxx | |||
Name Xxxxxx XxXxxxxx | ||||
Title Associate Director | ||||
S-12 | [Fourth Amendement 3-Year] |
The Bank of New York |
||||
By | /s/ Xxxxxxx X. XxXxxxxxx | |||
Name Xxxxxxx X. XxXxxxxxx | ||||
Title Vice President | ||||
S-13 | [Fourth Amendement 3-Year] |
Bank of America, N.A. |
||||
By | /s/ Xxxxxx X. Xxxxxxxxx | |||
Name Xxxxxx X. Xxxxxxxxx | ||||
Title Senior Vice President | ||||
S-14 | [Fourth Amendement 3-Year] |