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Exhibit 10.14
THIRD AMENDMENT TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
THIS THIRD AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT
(this "Third Amendment"), dated as of July 31, 1998 is entered into among
PETsMART, INC., a Delaware corporation (the "Company"), the banks listed on the
signature pages hereof (the "Lenders") and NATIONSBANK, N.A., as Administrative
Lender (in said capacity, the "Administrative Lender").
BACKGROUND
A. The Company, the Lenders and the Administrative Lender heretofore
entered into that certain Third Amended and Restated Credit Agreement, dated as
of April 18, 1997, as amended by that certain First Amendment to Third Amended
and Restated Credit Agreement dated as of August 6, 1997, and that certain
Second Amendment to Third Amended and Restated Credit Agreement dated October
29, 1997 (as amended, the "Credit Agreement"). The terms defined in the Credit
Agreement and not otherwise defined herein shall be used herein as defined in
the Credit Agreement.
B. The Company, the Lenders and the Administrative Lender desire to
amend the Credit Agreement.
NOW, THEREFORE, in consideration of the covenants, conditions and
agreements hereafter set forth, and for other good and valuable consideration,
the receipt and adequacy of which are all hereby acknowledged, the Company, the
Lenders and the Administrative Lender covenant and agree as follows:
1. AMENDMENTS.
(a) The definition of "Letter of Credit" in Section 1.1 of the
Credit Agreement is amended by deletion of "$15,000,000" and replacing
that amount with "$25,000,000".
(b) The definition of "EBITDA" set forth in Section 1.1 of the
Credit Agreement is hereby amended to read as follows:
"EBITDA" means, for the Company and its Subsidiaries, calculated on
a consolidated basis in accordance with GAAP, the sum of (a) net profit
before Taxes
THIRD AMENDMENT TO THIRD AMENDED
AND RESTATED CREDIT AGREEMENT - PETsMART
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(but excluding from the calculation thereof (i) the effect of one-time
charges to operating income with respect to the costs related to
Pooling Acquisitions by the Company, provided that such costs shall
not, together with the aggregate Acquisition Consideration (other than
capital stock of the Company) and Capital Expenditures paid or incurred
in connection with Acquisitions during each fiscal year, exceed 15% of
Tangible Net Worth during each fiscal year and (ii) the effect of one
time charges to operating income with respect to costs and expenses
relating to certain litigation in the amount of $4,000,000 and that
certain severance package for Xxxxx Xxxxx in the amount of $1,526,000),
plus (b) depreciation and amortization expense, and other non-cash
items deducted in the calculation of net operating income, plus (c)
interest expense (including interest expense pursuant to Capital
Leases), net of interest and other investment income, plus (d) any net
extraordinary losses included in the calculation of net operating
income, minus (e) any net extraordinary gains included in the
calculation of net operating income.
(c) The following is added as Section 5.13 of the Credit Agreement:
"The Borrower has (i) initiated a review and assessment of all areas
within its and each of its Subsidiaries' business and operations (and
has made appropriate inquiry regarding those affected by suppliers and
vendors) that could be adversely affected by the "Year 2000 Problem"
(that is, the risk that computer applications used by the Borrower or
any of its Subsidiaries (or its suppliers and vendors) may be unable to
recognize and perform properly date-sensitive functions involving
certain dates prior to and any date after December 31, 1999), (ii)
developed a plan for addressing the Year 2000 Problem on a timely
basis, and (iii) to date, operated in accordance with such plan. The
Borrower reasonably believes that all computer applications (including
those of its suppliers and vendors) that are material to its or any of
its Subsidiaries' business and operations on January 1, 2000 will, on a
timely basis, be able to perform properly date-sensitive functions for
all dates before and after January 1, 2000 (that is, be "Year 2000
compliant"), except to the extent that a failure to do so could not
reasonably be expected to cause a Material Adverse Change."
(d) The following is added as Section 6.19 of the Credit Agreement:
"The Borrower will promptly notify the Administrative Lender in the
event the Borrower discovers or determines that any computer
application (including those of its suppliers and vendors) that is
material to its or any of its Subsidiaries' business and operations
will not be Year 2000 compliant on a timely basis, except to the extent
that such failure could not reasonably be expected to cause a Material
Adverse Change."
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AND RESTATED CREDIT AGREEMENT - PETsMART
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(e) The first sentence of Section 6.3 of the Credit Agreement
is amended in its entirety to read as follows: "The Company shall not,
and shall not permit any of its Subsidiaries to, create or suffer to
exist any Lien upon any of their Properties, except (a) Liens shown on
Schedule II attached hereto, (b) Liens securing Indebtedness permitted
under (i) Section 6.2(d) hereof, encumbering only the assets purchased
or financed with such Indebtedness and (ii) Section 6.2(i) hereof,
provided that the value of the collateral secured by such Liens does
not exceed the aggregate principal amount of such Indebtedness, and (c)
Tax, mechanic's, materialmen's, and landlord Liens relating to amounts
that are not yet due and payable, or that are being contested in good
faith by appropriate proceedings, for which adequate reserves have been
established.
2. REPRESENTATIONS AND WARRANTIES TRUE; NO EVENT OF DEFAULT. By its
execution and delivery hereof, Company represents and warrants that, as of the
date hereof and after giving effect to the amendments contemplated by the
foregoing Section 1:
(a) the representations and warranties contained in the Credit
Agreement are true and correct on and as of the date hereof as made on
and as of such date;
(b) no event has occurred and is continuing which constitutes a
Default or an Event of Default;
(c) The Company has full power and authority to execute and deliver
this Third Amendment, and this Third Amendment and the Credit
Agreement, as amended hereby, constitute the legal, valid and binding
obligations of the Company, enforceable in accordance with their
respective terms, except as enforceability may be limited by applicable
debtor relief laws and by general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law) and
except as rights to indemnity may be limited by federal or state
securities laws; and
(d) no authorization, approval, consent, or other action by, notice
to, or filing with, any governmental authority or other Person (other
than the Board of Directors of the Company) is required for the
execution, delivery or performance by Company of this Third Amendment.
3. CONDITIONS OF EFFECTIVENESS. This Third Amendment shall be effective
as of the date first above written, subject to the following:
(a) The Administrative Lender shall have received counterparts of
this Third Amendment executed by the Lenders comprising the Majority
Lenders;
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AND RESTATED CREDIT AGREEMENT - PETsMART
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(b) The Administrative Lender shall have received counterparts of
this Third Amendment executed by the Company and acknowledged by each
Guarantor (as hereinafter defined);
(c) The Administrative Lender shall have received a certified
corporate resolution of the Board of Directors of the Company
authorizing the execution, delivery and performance of this Third
Amendment;
(d) The Administrative Lender shall have received, in form and
substance satisfactory to the Administrative Lender and its counsel,
such other documents, certificates and instruments as the
Administrative Lender shall require; and
(e) The Administrative Lender shall have received for the account of
each Lender a consent fee in an amount equal to the product of (i) 0.05
multiplied by (ii) such Lender's portion of the commitment.
4. REFERENCE TO THE CREDIT AGREEMENT.
(a) Upon the effectiveness of this Third Amendment, each reference
in the Credit Agreement to "this Agreement", "hereunder", or words of
like import shall mean and be a reference to the Credit Agreement, as
affected and amended hereby.
(b) The Credit Agreement, as amended by the amendments referred to
above, shall remain in full force and effect and is hereby ratified and
confirmed.
5. COSTS, EXPENSES AND TAXES. The Company agrees to pay on demand all
costs and expenses of the Administrative Lender in connection with the
preparation, reproduction, execution and delivery of this Third Amendment and
the other instruments and documents to be delivered hereunder (including the
reasonable fees and out-of-pocket expenses of counsel for the Administrative
Lender with respect thereto).
6. GUARANTOR'S ACKNOWLEDGMENT. By signing below, each Subsidiary
executing a Subsidiary Guaranty (a "Guarantor") (a) acknowledges, consents and
agrees to the execution, delivery and performance by Borrowers of this Third
Amendment, (b) acknowledges and agrees that its obligations in respect of its
Guaranty are not released, diminished, waived, modified, impaired or affected in
any manner by this Third Amendment or any of the provisions contemplated
THIRD AMENDMENT TO THIRD AMENDED
AND RESTATED CREDIT AGREEMENT - PETsMART
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herein, (c) ratifies and confirms its obligations under its Guaranty, and (d)
acknowledges and agrees that it has no claims or offsets against, or defenses or
counterclaims to, its Guaranty.
7. EXECUTION IN COUNTERPARTS. This Third Amendment may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which when taken together shall constitute but one and
the same instrument.
8. GOVERNING LAW; BINDING EFFECT. This Third Amendment shall be
governed by and construed in accordance with the laws of the State of Texas and
shall be binding upon the Company and each Lender and their respective
successors and assigns.
9. HEADINGS. Section headings in this Third Amendment are included
herein for convenience of reference only and shall not constitute a part of this
Third Amendment for any other purpose.
10. ENTIRE AGREEMENT. THE CREDIT AGREEMENT, AS AMENDED BY THIS THIRD
AMENDMENT, AND THE OTHER LOAN PAPERS REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
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AND RESTATED CREDIT AGREEMENT - PETsMART
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IN WITNESS WHEREOF, this Third Amendment is executed as of the date
first set forth above.
COMPANY:
PETsMART, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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ADMINISTRATIVE LENDER: NATIONSBANK, N.A., as
Administrative Lender
By:/s/ Xxxxxxxxx X. Xxxx
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Name: Xxxxxxxxx X. Xxxx
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Title: Vice President
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ISSUING BANK: NATIONSBANK,
N.A., as Issuing Bank
By:/s/ Xxxxxxxxx X. Xxxx
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Name: Xxxxxxxxx X. Xxxx
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Title: Vice President
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LENDERS:
NATIONSBANK, N.A.,
Individually
By:/s/ Xxxxxxxxx X. Xxxx
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Name: Xxxxxxxxx X. Xxxx
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Title: Vice President
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AND RESTATED CREDIT AGREEMENT - PETsMART
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XXXXX FARGO BANK, N.A.
By:/s/ Xxxxxxx X. XxXxxxxx
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Name: Xxxxxxx X. XxXxxxxx
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Title: Vice President
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By:/s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
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Title: Assistant Vice President
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NORWEST BANK COLORADO, N.A.
By: /s/ Xxxxx X. Xxxxx
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Name: Xxxxx X. Xxxxx
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Title: Vice President
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COOPERATIEVE CENTRALE
RAIFFEISEN-BOERENLEENBANK
B.A., "RABOBANK NEDERLAND", NEW YORK
BRANCH
By: /s/ W. Xxxxxxx Xxxxxxx
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Name: W. Xxxxxxx Xxxxxxx
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Title: Senior Credit Officer
Senior Vice President
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By:/s/ Xxxxx X. Xxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxx
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Title: Vice President
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AND RESTATED CREDIT AGREEMENT - PETsMART
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ABN AMRO BANK N.V., LOS ANGELES
INTERNATIONAL BRANCH
By:
------------------------
Name:
----------------------
Title:
----------------------
By:
----------------------------
Name:
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Title:
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THE INDUSTRIAL BANK OF JAPAN, LIMITED,
LOS ANGELES AGENCY
By:/s/ Xxxxxxx X. Xxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxx
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Title: SVP & SDGM
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THE LONG-TERM CREDIT BANK OF JAPAN, LTD.
By: /s/ Koh Xxxxxxxx
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Name: Koh Xxxxxxxx
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Title: General Manager
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By: /s/ Xxxxx Read
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Name: Xxxxx Read
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Title: Vice President
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AND RESTATED CREDIT AGREEMENT - PETsMART
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U.S. BANK NATIONAL ASSOCIATION
By:/s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
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Title: Vice President
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CORESTATES BANK, N.A.
By:
----------------------------
Name:
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Title:
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FLEET NATIONAL BANK
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
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Title: Vice President
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THE SUMITOMO BANK OF CALIFORNIA
By: /s/ Xxx X. Xxxxxxx
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Name: Xxx X. Xxxxxxx
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Title: Vice President
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AND RESTATED CREDIT AGREEMENT - PETsMART
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XXX XXXX XX XXXX XXXXXX
By: /s/ Xxxx X. Quick
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Name: Xxxx X. Quick
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Title: Senior Relationship Manager
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THE SAKURA BANK, LIMITED
By: /s/ Xxxxxxxx Xxxxxxxxx
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Name: Xxxxxxxx Xxxxxxxxx
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Title: Joint General Manager
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CREDIT LYONNAIS LOS ANGELES BRANCH
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
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Title:First Vice President
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and Manager
THE DAI-ICHI KANGYO BANK, LTD.,
LOS ANGELES AGENCY
By: /s/ Xxxxxxxxx Xxxxxxxxx
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Name: Xxxxxxxxx Xxxxxxxxx
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Title: Sr. Vice President &
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Joint General Manager
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AND RESTATED CREDIT AGREEMENT - PETsMART
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BANK OF MONTREAL
By:
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Name:
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Title:
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ACKNOWLEDGED AND AGREED TO:
THE WEISHEIMER COMPANIES, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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PETSTUFF, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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SPORTING DOG SPECIALTIES, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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AND RESTATED CREDIT AGREEMENT - PETsMART
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THE PET FOOD GIANT, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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PETSTUFF CANADA (USA) HOLDINGS, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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PETSTUFF NOVA SCOTIA, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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STATE LINE TACK, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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AND RESTATED CREDIT AGREEMENT - PETsMART
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PETSMART VETERINARY SERVICES INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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PACIFIC COAST DISTRIBUTING, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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STATE LINE TACK OF TEXAS, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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NATIONAL BRIDLE SHOP, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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AND RESTATED CREDIT AGREEMENT - PETsMART
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SPAT PRODUCTIONS, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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3003300 NOVA SCOTIA COMPANY
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: CFO
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AND RESTATED CREDIT AGREEMENT - PETsMART
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LENDERS (continued): FIRST UNION NATIONAL BANK
By: /s/ Xxxx X. Xxxxxx
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Name: Xxxx X. Xxxxxx
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Title: Assistant Vice President
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AND RESTATED CREDIT AGREEMENT - PETsMART
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