EXHIBIT 10.1
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SECOND AMENDMENT TO CREDIT AGREEMENT
This Second Amendment to Credit Agreement (the "Second Amendment") is
made as of this 4th day of August, 2005 by and among
XXXXX XXXXX, a New York general partnership, having its principal place of
business at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; and
XXXXX XXXXX INC. a Delaware corporation, having its principal place of
business at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; and
DRI I INC., a Delaware corporation, having its principal place of business
at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; and
XXXXX XXXXX INTERNATIONAL, INC., a Delaware corporation, having a mailing
address at X.X. Xxx 00000, Xxxxxx, Xxx Xxxxxx 00000; and
XXXXX XXXXX REALTY, INC., a Delaware corporation, having its principal
place of business at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; and
XXXXX XXXXX HOLDINGS, INC., a Delaware corporation, having its principal
place of business at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; and
the LENDERS party hereto; and
BANK OF AMERICA, N.A. (f/k/a Fleet National Bank), as Issuing Bank, a
national banking association having a place of business at 000 Xxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000; and
BANK OF AMERICA, N.A. (f/k/a/ Fleet National Bank), as Administrative Agent
for the Lenders, a national banking association having a place of business at
000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000; and
FLEET RETAIL GROUP, LLC (f/k/a Fleet Retail Finance Inc.), as Collateral
Agent for the Lenders, a Delaware corporation, having its principal place of
business at 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000; and
CONGRESS FINANCIAL CORPORATION, as Documentation Agent; and
GENERAL ELECTRIC CAPITAL CORPORATION as Syndication Agent; and
XXXXX FARGO RETAIL FINANCE, LLC, as Syndication Agent and Co-Lead Arranger
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 July 21, 2003, certain of the parties hereto entered into
that certain Credit Agreement (as amended and in effect, the "Credit
Agreement"); and
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WHEREAS, certain of the Loan Parties intend to incur additional
Indebtedness in an amount not to exceed $50,000,000 (the "Additional Notes")
under either the Indenture dated December 20, 2004 with U.S. Bank National
Association as Trustee relating to certain Senior Secured Floating Rate Notes
due 2010 or a substantially similar indenture; and
WHEREAS, the incurrence of Indebtedness under the Additional Notes,
without the consent of the Required Lenders would constitute an Event of Default
under the Credit Agreement; and
WHEREAS, the Loan Parties have requested that the Lenders amend certain
provisions of the Credit Agreement to permit the incurrence of Indebtedness
under the Additional Notes and otherwise as set forth herein.
NOW, THEREFORE, it is hereby agreed as follows:
1. CAPITALIZED TERMS. All capitalized terms used herein and not
otherwise defined shall have the same meaning herein as in the
Credit Agreement.
2. AMENDMENTS TO ARTICLE I. The provisions of Article I of the
Credit Agreement are hereby amended as follows:
(a) By deleting the definition of "Capital Expenditures" in
its entirety and substituting the following in its
stead:
"CAPITAL EXPENDITURES" means, for any period, all
expenditures made or costs incurred (whether made in the
form of cash or other property) for the acquisition,
improvement or repair of fixed or capital assets of the
Parent and its Subsidiaries (including, without
limitation, prescription lists), in each case that are
(or would be) set forth in a Consolidated statement of
cash flows of the Parent and its Subsidiaries for such
period prepared in accordance with GAAP as capital
expenditures, but excluding Capital Lease Obligations
incurred by the Parent and its Subsidiaries during such
period.
(b) By deleting the definition of "CMLTD" in its entirety
and substituting the following in its stead:
"CMLTD" means current maturities of long term
Indebtedness of the Parent and its Subsidiaries
(including, without limitation, on account of Capital
Lease Obligations, but excluding the Obligations), as
determined in accordance with GAAP.
(c) By deleting the definition of "Fixed Charge Coverage
Ratio" in its entirety and substituting the following in
its stead:
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"FIXED CHARGE COVERAGE RATIO" means, as to the Parent
and its Subsidiaries, for any period, the ratio of (a)
Consolidated EBITDA to (b) the sum of (i) Consolidated
Interest Expense for such period, PLUS (ii) CMLTD during
such period, PLUS (iii) Restricted Payments made in cash
during such period, PLUS (iv) federal, state and foreign
income Taxes paid in cash during such period, PLUS (v)
Capital Expenditures incurred during such period, all as
determined in accordance with GAAP (other than as
expressly provided in the definition of Capital
Expenditures or in the final sentence of this
definition). The Fixed Charge Ratio shall be calculated
on a trailing twelve fiscal months basis.
Notwithstanding the foregoing, for any period in which
the calculation of the Fixed Charge Coverage Ratio
includes any fiscal month through the fiscal month
ending immediately prior to the consummation of the Xxx
Transaction, the calculation of the Fixed Charge
Coverage Ratio for those fiscal months prior to and
including such month shall include the financial results
for DR Corp. and its Subsidiaries only (as if they were
the "Parent and its Subsidiaries" for those months).
(d) By deleting the last sentence of the definition of
"Total Commitments" in its entirety and substituting the
following in its stead:
As of the date of issuance of the Supplemental Permanent
Securities (the "Issuance Date"), the Total Commitments
aggregate $225,000,000.
(e) By adding the following definitions in appropriate
alphabetical order:
"ADJUSTED EXCESS AVAILABILITY" means, as of any date of
determination, the excess, if any, of (a) the Borrowing
Base over (b) the outstanding Credit Extensions.
"SUPPLEMENTAL PERMANENT SECURITIES" means the issuance
by the Parent, or any of its Subsidiaries, in one or
more tranches, of debt, or equity or convertible
securities of the Borrower, the Parent or DR Corp., for
the purpose (i) of refinancing and repaying $25,000,000
of the Obligations, with a permanent reduction in the
Commitments, and (ii) repaying a portion of the
Obligations, without a permanent reduction in the
Commitments PROVIDED THAT (i) the principal amount of
such securities shall not exceed $50,000,000; (ii) such
securities shall not have a final maturity date earlier
than that contained in the Permanent Securities, (iii)
if such securities are secured by assets of any Loan
Party, the holder of such securities (or its
representative) shall become a party to the
Intercreditor Agreement; and (iv) the pricing,
covenants, defaults, rights and remedies and other terms
of such securities shall be reasonably comparable to
those terms then required or imposed by other lenders
for similar securities issued by similarly situated
issuers (as determined by the Borrower).
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3. AMENDMENT TO ARTICLE II. The provisions of Article II of the
Credit Agreement are hereby amended as follows:
(a) The provisions of Section 2.01(a)(i) of the Credit
Agreement are deleted in their entirety and the
following substituted in their stead:
(i) The aggregate outstanding amount of the Credit
Extensions shall not at any time exceed the lower of (i)
$250,000,000, and after the Issuance Date, $225,000,000
or, in each case, any other amount to which the
Commitments have then been increased or reduced by the
Borrower pursuant to Sections 2.02 or 2.16, and (ii) the
then amount of the Borrowing Base.
(b) The provisions of Section 2.06(b) of the Credit
Agreement are hereby amended by deleting the final
sentence thereof in its entirety and substituting the
following in its stead:
No Swingline Loans shall be made pursuant to this
subsection (b) if the aggregate outstanding amount of
the Credit Extensions and Swingline Loans would exceed
the lower of (i) $250,000,000, and after the Issuance
Date, $225,000,000 or any other amount to which the
Commitments have then been increased or reduced by the
Borrower pursuant to Sections 2.02 and 2.16, and (ii)
(other than with respect to Permitted Overadvances) the
then amount of the Borrowing Base.
4. AMENDMENTS TO ARTICLE VI. The provisions of Article VI of the
Credit Agreement are hereby amended as follows:
(a) The provisions of Section 6.01 of the Credit Agreement
are hereby amended by deleting the word "and" at the end
of Section 6.01(a)(xi), by renumbering clause (xii) as
clause (xiii) and adding the following new clause (xii)
to Section 6.01(a):
(xii) Indebtedness on account of the Supplemental
Permanent Securities, including Indebtedness consisting
of Guarantees of the Supplemental Permanent Securities
or Permitted Refinancings thereof; PROVIDED that on or
before the Issuance Date, the trustee(s) under the
Supplemental Permanent Securities and the Administrative
Agent shall have entered into a letter agreement
confirming the continued effectiveness of the
Intercreditor Agreement, in such form and containing
such terms as the Administrative Agent and such
trustee(s) may agree; and
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(b) The provisions of Section 6.02(f) are hereby amended by
deleting the words "clause (viii) in the first line
thereof and substituting in its stead the words "clauses
(viii) or (xii)."
(c) The provisions of Section 6.03(b) are hereby amended by
adding the words "any Supplemental Permanent
Securities," after the words "Permanent Securities" in
clause (ii) thereof.
(d) The provisions of Section 6.04(c) are hereby amended by
adding the words "and Supplemental Permanent Securities"
after the words "Permanent Securities" in clause (i)
thereof.
(e) The provisions of Section 6.06(a) are hereby amended by
adding the words "and the Supplemental Permanent
Securities" after the words "Permanent Securities" in
clause (iv)(x) thereof.
(f) The provisions of Section 6.06(b)(i) are hereby amended
by adding the words ", the Supplemental Permanent
Securities" after the words "Permanent Securities" in
clause (B) thereof.
(g) The provisions of Section 6.06(b)(ii) are hereby amended
by adding the words ", any Supplemental Permanent
Securities" after the words "Permanent Securities."
(h) The provisions of Section 6.06(b)(iv) are hereby amended
by adding the words ", any Supplemental Permanent
Securities" after the words "Permanent Securities."
(i) The provisions of Section 6.09(e) are hereby amended by
adding the words "or any Supplemental Permanent
Securities" after the words "Permanent Securities."
(j) Effective on the Issuance Date, the provisions of
Section 6.11(a) of the Credit Agreement are deleted in
their entirety and the following substituted in their
stead:
FIXED CHARGE COVERAGE RATIO; CAPITAL EXPENDITURES. (a)
At any time that Adjusted Excess Availability is less
than ten percent (10%) of the lesser of the then
Borrowing Base and the Total Commitments, the Loan
Parties shall maintain a Fixed Charge Coverage Ratio,
calculated as of the last day of each month, during the
periods set forth below as follows:
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PERIOD MINIMUM RATIO
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Each month end from July 31, 2005 through and 0.60:1.00
including June 30, 2006
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Each month end from July 31, 2006 through and 0.75:1.00
including June 30, 2007
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Each month end from and after July 31, 2007 1.00:1.00
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5. AMENDMENT TO SCHEDULES. As of the Issuance Date, Schedule 1.1 to
the Credit Agreement is hereby deleted in its entirety and a new
Schedule 1.1 in the form annexed hereto substituted in its
stead.
6. RATIFICATION OF LOAN DOCUMENTS. Except as provided herein, all
terms and conditions of the Credit Agreement and of the other
Loan Documents remain in full force and effect. The Loan Parties
each hereby ratify, confirm, and reaffirm all of the
representations and warranties contained therein.
7. CONDITIONS TO EFFECTIVENESS.
This Second Amendment shall not be effective until each of the
following conditions precedent have been fulfilled to the
satisfaction of the Administrative Agent:
(a) This Second Amendment shall have been duly executed and
delivered by the Loan Parties and the Required Lenders.
(b) All corporate and shareholder action on the part of the
Loan Parties necessary for the valid execution, delivery
and performance by the Loan Parties of this Second
Amendment shall have been duly and effectively taken and
evidence thereof satisfactory to the Administrative
Agent shall have been provided to the Administrative
Agent.
(c) The Loan Parties shall have paid all fees due under a
certain Amendment Fee Letter of even date herewith.
(d) No Default or Event of Default shall have occurred and
be continuing.
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(e) The Loan Parties shall have executed such additional
instruments, documents and agreements as the
Administrative Agent may reasonably request, including,
without limitation, Notes in substitution for the
existing Notes.
8. MISCELLANEOUS.
(a) This Second 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 Second 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 Second
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 Second Amendment.
(d) The Loan Parties shall pay all reasonable costs and
expenses of the Agents, including, without limitation,
reasonable attorneys' fees in connection with the
preparation, negotiation, execution and delivery of this
Second Amendment.
(e) The Loan Parties warrant and represent that the Loan
Parties have consulted with independent legal counsel of
their selection in connection with this Second Amendment
and are not relying on any representations or warranties
of the Agents or the Lenders or their counsel in
entering into this Second Amendment.
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IN WITNESS WHEREOF, the parties have hereunto caused this Second Amendment to be
executed and their seals to be hereto affixed as of the date first above
written.
XXXXX XXXXX
as Borrower
By: XXXXX XXXXX INC.,
its General Partner
by: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Chief Financial Officer
by: /s/ Xxxxxxxx X. Xxxxxxx
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Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
By: DRI I INC., its General Partner
by: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Chief Financial Officer
by: /s/ Xxxxxxxx X. Xxxxxxx
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Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
XXXXX XXXXX INC., as Facility Guarantor
by: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Chief Financial Officer
by: /s/ Xxxxxxxx X. Xxxxxxx
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Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
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DRI I INC., as Facility Guarantor
by: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Chief Financial Officer
by: /s/ Xxxxxxxx X. Xxxxxxx
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Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
XXXXX XXXXX INTERNATIONAL, INC.,
as Facility Guarantor
by: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Chief Financial Officer
by: /s/ Xxxxxxxx X. Xxxxxxx
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Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
XXXXX XXXXX REALTY, INC.,
as Facility Guarantor
by: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Chief Financial Officer
by: /s/ Xxxxxxxx X. Xxxxxxx
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Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
XXXXX XXXXX HOLDINGS, INC.,
as Facility Guarantor
by: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Chief Financial Officer
by: /s/ Xxxxxxxx X. Xxxxxxx
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Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
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FLEET RETAIL GROUP, LLC,
As Collateral Agent, as Swingline Lender
and as Lender
By: /s/ Xxxxx Xxxxxxxxxxx
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Name: Xxxxx Xxxxxxxxxxx
Title: Director
Address:
00 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxxx Xxxxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
BANK OF AMERICA, N.A.,
as Administrative Agent and as
Issuing Bank
By: /s/ Xxxxx Xxxxxxxxxxx
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Name: Xxxxx Xxxxxxxxxxx
Title: Director
Address:
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxxx Xxxxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
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CONGRESS FINANCIAL CORPORATION,
as Documentation Agent and Lender
By: /s/ Xxxxx Xxxxxx
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Name: Xxxxx Xxxxxx
Title: Associate
Address:
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
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GENERAL ELECTRIC CAPITAL CORPORATION,
as Syndication Agent and Lender
By: /s/ Xxxxx Xxxxxxx
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Name: Xxxxx Xxxxxxx
Title: Duly Authorized Signatory
Address:
Telephone:
Telecopy:
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THE CIT GROUP/BUSINESS CREDIT, INC.,
as Lender
By: /s/ Xxxxxx Xxxxxx
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Name: Xxxxxx Xxxxxx
Title: Vice President
Address: 0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Telephone: 000-000-0000
Telecopy: 000-000-0000
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XXXXX FARGO RETAIL FINANCE, LLC,
as Syndication Agent, as Co-Lead
Arranger, and as Lender
By: /s/ Xxxx Lofts
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Name: Xxxx Lofts
Title: AVP Account Executive
Address: Xxx Xxxxxx Xxxxx, 00xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Telephone: 000-000-0000
Telecopy: 000-000-0000
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