Exhibit 10.61
AMENDMENT XX. 0
XXXXXXXXX XX. 0 dated as of February 14, 2002, among STUDENT ADVANTAGE,
INC., a Delaware corporation duly organized and validly existing under the laws
of the State of Delaware (the "BORROWER"); each of the Subsidiaries of the
Borrower identified under the caption "SUBSIDIARY GUARANTORS" on the signature
pages hereto (individually, a "SUBSIDIARY GUARANTOR" and, collectively, the
"SUBSIDIARY GUARANTORS" and, together with the Borrower, the "OBLIGORS"); each
of the lenders that is a signatory hereto (individually, a "LENDER" and,
collectively, the "LENDERS"); and RESERVOIR CAPITAL PARTNERS, L.P., a Delaware
limited partnership, as administrative agent for the Lenders (in such capacity,
together with its successors in such capacity, the "ADMINISTRATIVE AGENT").
The Borrower, the Subsidiary Guarantors, the Lenders and the
Administrative Agent are parties to a Loan Agreement dated as of June 25, 2001
(as modified and supplemented and in effect on the date hereof, the "LOAN
AGREEMENT"), providing, subject to the terms and conditions thereof, for loans
to be made by said Lenders to the Borrower in an aggregate principal amount not
exceeding $15,200,000. Simultaneously herewith Borrower is paying down the
Revolving Loans with a payment of $2,500,000. This prepayment is being funded by
certain borrowings by Subsidiaries (specifically, OCM Direct, Inc. ("OCM"),
Collegiate Carpets, Inc. ("CC"), and CarePackages, Inc. ("CP") from Bank of
America, NA ("BofA"), which borrowing from BofA is being guaranteed by the
Borrower. The Borrower, the Subsidiary Guarantors, the Lenders and the
Administrative Agent wish to amend the Loan Agreement in certain respects, and
accordingly, the parties hereto hereby agree as follows:
Section 1. DEFINITIONS. Except as otherwise defined in this Amendment
No. 3, terms defined in the Loan Agreement are used herein as defined therein.
References in the Loan Agreement (including references to the Loan Agreement as
amended hereby) to "this Agreement" (and indirect references such as
"hereunder", "hereby", "herein" and "hereof") shall be deemed to be references
to the Loan Agreement as amended hereby. The term "Loan Documents" is amended to
include the Intercreditor Agreement referred to in Section 3 hereof.
Section 2. REVOLVING LOAN. On April 15, 2002, the Revolving Loan
Commitment shall be reduced to the principal amount of Revolving Loans
outstanding on the date.
Section 3. PURCHASE FROM BofA. If the Lenders purchase the interests of
Bank of America, N.A. under the Intercreditor Agreement dated as of the date
hereof among it and the parties hereto, the BofA Loan Documents shall be deemed
amended, restated and replaced in their entirety by Basic Documents, and the
purchased interests shall be deemed for all purposes under the Basic Documents
to represent a Revolving Borrowing on that date in the amount of the purchase
price paid under the Purchase Agreement (notwithstanding the fact that the
amount of such deemed Revolving Borrowing may exceed the Revolving Loan
Commitment). Interest shall accrue at the Applicable Rate as at the time the
purchase is consummated. The term "BofA Documents" shall mean that certain
Revolving Line of Credit Loan Agreement and Security
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Agreement dated of even date herewith by and among OCM Direct, Inc. Collegiate
Carpets, Inc. and CarePackages, Inc. as borrower, and Bank of America, N.A., as
lender (the "BofA Loan Agreement"), the Subordination Agreement (as defined in
the BofA Loan Agreement), the Guaranty (as defined in the BofA Loan Agreement)
and the other agreements, documents and instruments executed in connection
therewith, copies of which are attached hereto, in the form in which attached.
Section 4. WAIVERS. The Lenders waive Sections 7.01 (with respect to
the guaranty), 7.05 (with respect to the Borrower's current ownership of shares
of and its current subordinated loan to OCM, CC and CP) and 7.07 (with respect
to its current subordinated loan to OCM, CC and CP) of the Loan Agreement. The
Lenders have no objection to the $37,181 letter of credit issued by BofA for the
account of OCM to back the performance of a trade contract on February 12, 2002.
Section 5. COVENANTS. Anything in the Loan Agreement to the contrary
notwithstanding, no party to the BofA Documents shall be deemed a Subsidiary or
a Subsidiary Guarantor for purposes of the Loan Agreement.
Section 6. MODIFICATION OF BofA DOCUMENTS. Neither the Borrower nor any
Subsidiary (recognizing that this term now excludes OCM, CC and CP) will consent
to or take any act resulting in any increase above $5,000,000 in the principal
amount guaranteed by the Borrower's guaranty provided under the BofA Documents
or the granting of any collateral security therefor with regard to Borrower's
obligations to BofA without the prior consent of the Required Lenders (which
consent the Required Lenders may withhold in their absolute discretion).
Section 7. EVENT OF DEFAULT. The occurrence of and continuation of an
"Event of Default" or "default" as defined under the BofA Documents after the
expiration of the applicable cure period therefor shall be deemed an Event of
Default.
Section 8. RELEASE. The Administrative Agent hereby assigns, transfers,
releases and delivers to the "Borrower" (as defined in the BofA Loan Agreement)
all its right, title and interest of OCM, CC and CP in the Collateral (as
defined under the Security Agreement, which includes the stock of CC and CP) and
security granted under the patent and trademark security agreements dated as of
June 25, 2001, but without any recourse, warranty or representation whatsoever.
The Administrative Agent shall also execute and deliver to such Borrower such
Uniform Commercial Code termination statements and other documentation as such
Borrower shall reasonably request to effect the termination and release of the
Liens on such Collateral, and will deliver the certificates it holds evidencing
the stock of CC and CP. Such Borrower (OCM, CC and CP) shall no longer be deemed
an Obligor under the Security Agreement or a Subsidiary Guarantor under the Loan
Agreement. OCM, CC and CP are hereby released from any and all guaranties or
other liability for the Borrower's indebtedness to the Lenders.
Section 9. REPRESENTATIONS AND WARRANTIES. The Borrower represents and
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warrants to the Lenders that the representations and warranties set forth in
Article IV of the Loan Agreement and Section 3 of the Warrant Agreement are true
and complete on the date hereof as if made on and as of the date hereof and as
if each reference in said Article IV and Section 3 to "this Agreement" included
reference to this Amendment No. 3, except as to subsequent issuances of warrants
to Lender, stock options to employees and consultants of the Borrower, and the
capital stock (section 4.14 of the Loan Agreement) and acquisition and
disposition transactions assented to previously by the Administrative Agent in
writing.
Section 10. CONDITIONS PRECEDENT. This Amendment No. 3 shall become
effective as of the date hereof once it has been executed and delivered by each
of the parties hereto.
Section 11. DOCUMENTS. Prior to execution, the Administrative Agent has
received the following documents:
(1) CORPORATE DOCUMENTS. Certified copies of the charter and
by-laws (or equivalent documents) of each Obligor (or, in the
alternative, a certification to the effect that none of such documents
has been modified since delivery thereof on the Effective Date pursuant
to the Loan Agreement) and of all corporate authority for each Obligor
(including board of director resolutions and evidence of the incumbency
of officers for each Obligor) with respect to the execution, delivery
and performance of this Amendment No. 3 and the Loan Agreement as
amended hereby and the loans under the Loan Agreement as amended hereby
and each other document to be delivered by each Obligor from time to
time in connection with the Loan Agreement as amended hereby (and the
Administrative Agent and each Lender may conclusively rely on such
certificate until it receives notice in writing from each Obligor to
the contrary).
(2) OPINION OF COUNSEL TO THE OBLIGORS. An opinion of Xxxx and
Xxxx LLP, counsel to the Obligors (each Obligor having instructed such
counsel to deliver such opinion to the Lenders and the Administrative
Agent).
(3) INTERCREDITOR AGREEMENT. The Intercreditor Agreement dated
the date hereof among the parties hereto and Bank of America, N.A. (the
"INTERCREDITOR AGREEMENT").
(4) OTHER DOCUMENTS. Such other documents as the
Administrative Agent or any Lender or special counsel to the Lenders
has reasonably requested.
Section 12. WAIVERS OF CERTAIN FINANCIAL COVENANTS. It is agreed that
the requirement of compliance with Section 7.10 of the Loan Agreement is waived
through March 30, 2002. For purposes of Section 7.10(g), Cash and Cash
Equivalents of the Borrower shall be reduced by the outstanding amount of the
amount of borrowings from BofA in excess of $2,500,000.
Section 13. CONSIDERATION. On April 15, 2002, whether the Loan
Agreement
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remains in effect and whether the Commitments have been terminated, the
Borrower shall pay to each Lender its proportional share of a fee of
$200,000 (in proportion to their respective Commitments). However, if on that
date (other than by reason of the purchase of BofA's interests under Section
1(a) of the Intercreditor Agreement) either (i) OCM, CC and CP have again become
Subsidiary Guarantors under the Loan Agreement, or (ii) the Borrower ceases to
guarantee their obligations to BofA, this fee will be reduced to $100,000. In
addition, if at any time between now and April 15, 2002 the outstanding amount
of Revolving Loans exceeds $2,500,000, the Borrower will pay an additional fee
in accordance with the following table:
Highest excess of Revolving Loans over
$2,500.000 Additional Fees
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up to $1,000,000 $50,000
from $1,000,000 to $2,000,000 $75,000
$2,000,000 and above $100,000
In addition, if on April 15, 2002 the total amounts owing with respect to all
Loans shall exceed $10,000,000, the Borrower will pay an additional fee of
$100,000. At the option of the Administrative Agent, any such fee may be paid in
immediately exercisable Term Warrants, at the rate of one warrant per dollar of
fee.
Section 14. MISCELLANEOUS. Except as herein provided, the Loan
Agreement shall remain unchanged and in full force and effect. This Amendment
No. 3 may be executed in any number of counterparts, all of which taken together
shall constitute one and the same amendatory instrument and any of the parties
hereto may execute this Amendment No. 3 by signing any such counterpart. This
Amendment No. 3 shall be governed by, and construed in accordance with, the law
of the State of New York. To the extent that any of the Loan Documents, the
Warrant Agreement or any of the Warrants refers to the Loan Agreement, such
reference shall mean the Loan Agreement as amended hereby.
[Signature pages follow.]
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment No. 3 to be duly executed by their respective authorized officers as
of the day and year first above written.
STUDENT ADVANTAGE, INC.
By: /s/ Xxxxxxx X. Xxxxx, Xx.
-------------------------
Name: Xxxxxxx X. Xxxxx, Xx.
Title: President
SUBSIDIARY GUARANTORS
XXXXXXX000.XXX, INC.
By: /s/ Xxxxxxx X. Xxxxx, Xx.
-------------------------
Name: Xxxxxxx X. Xxxxx, Xx.
Title: President
STUDENT ADVANTAGE SECURITIES CORPORATION
By /s/ Xxxxxxx X. Xxxxx, Xx.
-------------------------
Name: Xxxxxxx X. Xxxxx, Xx.
Title: President
XXXXXXXXXX.XXX, INC.
By: /s/ Xxxxxxx X. Xxxxx, Xx.
-------------------------
Name: Xxxxxxx X. Xxxxx, Xx.
Title: President
OCM DIRECT, INC.
By: /s/ Xxxxxxx X. Xxxxx, Xx.
-------------------------
Name: Xxxxxxx X. Xxxxx, Xx.
Title: President
CAREPACKAGES, INC.
By: /s/ Xxxxxxx X. Xxxxx, Xx.
-------------------------
Name: Xxxxxxx X. Xxxxx, Xx.
Title: President
COLLEGIATE CARPETS, INC.
By: /s/ Xxxxxxx X. Xxxxx, Xx.
-------------------------
Name: Xxxxxxx X. Xxxxx, Xx.
Title: President
LENDERS
RESERVOIR CAPITAL PARTNERS, L.P.,
individually and as Administrative
Agent
By: Reservoir Capital Group, L.L.C.,
General Partner
By: /s/ Xxxxx Xxxxxxx
-------------------------
Name: Xxxxx Xxxxxxx
Title: Managing Partner
Address for Notices: 000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxx
Telecopier No.: 212-610-9020
RESERVOIR CAPITAL ASSOCIATES L.P.
By: Reservoir Capital Group, L.L.C.,
General Partner
By: /s/ Xxxxx Xxxxxxx
-------------------------
Name: Xxxxx Xxxxxxx
Title: Managing Partner
Address for Notices: 000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxx
Telecopier No.: 212-610-9020
RESERVOIR CAPITAL MASTER FUND L.P.
By: Reservoir Capital Group, L.L.C.,
General Partner
By: /s/ Xxxxx Xxxxxxx
-------------------------
Name: Xxxxx Xxxxxxx
Title: Managing Partner
Address for Notices: 000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxx
Telecopier No.: 212-610-9020
