EXHIBIT 10.44.1
FIRST AMENDMENT TO
AMENDED AND RESTATED LOAN AGREEMENT
FIRST AMENDMENT TO AMENDED AND RESTATED LOAN AGREEMENT, dated as of
April 18, 2005 (this "Amendment"), by and among Source Interlink Companies,
Inc., a Delaware corporation, as successor by merger to Source Interlink
Companies, Inc., a Missouri corporation, as the administrative borrower on
behalf of all Loan Parties (as defined below) (the "Administrative Borrower"),
the other Loan Parties, Xxxxx Fargo Foothill, Inc., a California corporation, as
the arranger, administrative agent and collateral agent for the Lenders (as
defined below) (the "Agent"), and Wachovia Bank, National Association, a
national banking association ("Wachovia"), as the documentation agent (the
"Documentation Agent").
WHEREAS, the Administrative Borrower, each of the Administrative
Borrower's Subsidiaries identified on the signature pages thereto as a
"Borrower" (such Subsidiaries, together with the Administrative Borrower, are
referred to hereinafter each individually as a "Borrower", and individually and
collectively, jointly and severally, as the "Borrowers"), and each of the
Administrative Borrower's Subsidiaries identified on the signature pages thereto
as a "Guarantor" (such Subsidiaries are referred to hereinafter each
individually as a "Guarantor", and individually and collectively, jointly and
severally, as the "Guarantors" and together with the Borrowers, each
individually as a "Loan Party", and individually and collectively, jointly and
severally, as the "Loan Parties"), the lenders that are signatories thereto (the
"Lenders"), and the Agent are parties to an Amended and Restated Loan Agreement
dated as of February 28, 2005 (the "Loan Agreement"); and
WHEREAS, the Borrowers have requested that the Lenders and the Agent
enter into this Amendment to, among other things, (i) increase the Maximum
Revolver Amount from $200,000,000 to $250,000,000, (ii) appoint Wachovia as the
Documentation Agent, and (iii) amend certain other terms and conditions of the
Loan Agreement, in each case subject to the terms and conditions set forth in
this Amendment.
NOW THEREFORE, in consideration of the premises and other good and
valuable consideration, the parties hereto hereby agree as follows:
1. Definitions. Any capitalized term used herein and not defined
herein shall have the meaning assigned to it in the Loan Agreement.
2. Amendments. The Loan Agreement is hereby amended as follows:
2.1. Existing Definitions.
(a) The definition of "Eligible Accounts" in Section 1.1
of the Loan Agreement is hereby amended by deleting the reference to "10%" in
sub-clause (B) of clause (i) of such definition and substituting therefor "15%".
(b) The definition of the term "Maximum Revolver Amount"
in Section 1.1 of the Loan Agreement is hereby amended in its entirety to read
as follows:
"'Maximum Revolver Amount' means $250,000,000."
(c) The definition of the term "WFF Debt" in Section 1.1
of the Loan Agreement is hereby amended in its entirety to read as follows:
"'WFF Debt' means, at any date, the Revolver Usage."
2.2. New Definitions.
(a) The definition of the new term "Documentation Agent"
is hereby inserted in Section 1.1 of the Loan Agreement, in appropriate
alphabetical order, to read in its entirety as follows:
"'Documentation Agent' means Wachovia."
(b) The definition of the new term "Wachovia" is hereby
inserted in Section 1.1 of the Loan Agreement, in appropriate alphabetical
order, to read in its entirety as follows:
"'Wachovia' means Wachovia Bank, National Association, a national
banking association."
2.3. Making of Swing Loans. Section 2.3(d) of the Loan
Agreement is hereby amended by adding a new subsection (iii) at the end of such
Section to read as follows:
"(iii) The aggregate principal amount of Swing Loans outstanding at
any time shall not exceed $25,000,000."
2.4. Agent Advances. Section 2.3(e) of the Loan Agreement is
hereby amended by adding a new subsection (iv) at the end of such Section to
read as follows:
"(iv) After giving effect to the Agent Advances, the outstanding
Revolver Usage (except for and excluding amounts charged to the Loan Account for
interest, fees, or Lender Group Expenses) at any time shall not exceed the
Maximum Revolver Amount."
2.5. Apportionment and Applications. Section 2.4(b)(i)(K) of
the Loan Agreement is hereby amended in its entirety to read as follows:
"(K) eleventh, if an Event of Default has occurred and is
continuing, first, to pay the amount of any Overadvance, until paid in full, and
second, ratably (i) to pay the principal of all other Advances until paid in
full, (ii) to Agent, to be held by Agent, for the ratable benefit of Issuing
Lender and those Lenders having a Revolver Commitment, as cash collateral in an
amount up to 105% of the then extant Letter of Credit Usage until paid in full,
and (iii) to Agent, to be held by Agent, for the benefit of the Bank Product
Providers, as cash collateral in an amount up to the amount of the Bank Product
Reserve established prior to the occurrence of, and not in contemplation of, the
subject Event of Default until Administrative Borrower's and its Subsidiaries'
obligations in respect of the then extant Bank Products have been paid in full
or the cash collateral amount has been exhausted,"
2.6. Collateral Reporting. Section 6.2 of the Loan Agreement
is hereby amended by inserting immediately following clause (p) of such Section
the words "provided, however, that the report required under this Section 6.2(p)
shall be delivered not later than 30 days after the end of each month (or 45
days in the case of a month that is the end of one of Parent's fiscal
quarters),"
2.7. Conditions Subsequent.
(a) Good Standing Certificates for Borrowers. Section
3.2(h) of the Loan Agreement is hereby amended by deleting the words "Within 15
days of the Closing Date" thereof and substituting the words "Within 60 days of
the Closing Date" in lieu thereof.
(b) Good Standing Certificates for Guarantors. Section
3.2(j) of the Loan Agreement is hereby amended by deleting the words "Within 15
days of the Closing Date" thereof and substituting the words "Within 60 days of
the Closing Date" in lieu thereof.
2.8. Events of Default. Section 8.2(a) of the Loan Agreement
is hereby amended by deleting the reference therein to Section 6.16.
2.9. Amendments; Waivers. Section 15.1 of the Loan Agreement
is hereby amended as follows:
(a) The first paragraph of Section 15.1 of the Loan
Agreement is hereby amended by deleting the text in the first parenthetical
thereof and substituting the following in lieu thereof:
"(or by Agent at the written request of the Required Lenders, or
with respect to any provision of Section 3.2 of this Agreement, by Agent)"
(b) Section 15.1(a) of the Loan Agreement is hereby
amended in its entirety to read as follows:
"(a) increase or extend any Commitment of such Lender or increase
the Maximum Revolver Amount."
2.10. Documentation Agent. A new Section 16.19 is hereby
inserted in the Loan Agreement to read as follows:
"16.19 Documentation Agent. Notwithstanding any other provision
hereof, Wachovia as Documentation Agent shall have no duties or responsibilities
under this Agreement or the other Loan Documents in such capacity, shall incur
no liability under this Agreement or the other Loan Documents in such capacity,
and shall not have any right or power under this Agreement or the other Loan
Document in such capacity."
2.11. Schedules.
(a) Commitments. Schedule C-1 to the Loan Agreement is
hereby amended in its entirety to read as follows:
REVOLVER TOTAL
LENDER COMMITMENT COMMITMENT
------ ---------- ----------
XXXXX FARGO FOOTHILL, INC. $250,000,000 $250,000,000
ALL LENDERS $250,000,000 $250,000,000
On and after the Amendment Effective Date (as defined in Section 4
hereof), all references in any Loan Document to Schedule C-1 to the Loan
Agreement shall mean such Schedule as amended hereby.
(b) Litigation Searches. Schedule L-2 of the Loan
Agreement is hereby amended in its entirety to read as set forth in Annex I
hereto. On and after the Amendment Effective Date, all references in any Loan
Document to Schedule L-2 to the Loan Agreement shall mean such Schedule as
amended hereby.
(c) Deposit Accounts and Securities Accounts. Schedule
5.18 of the Loan Agreement is hereby amended in its entirety to read as set
forth in Annex II hereto. On and after the Amendment Effective Date, all
references in any Loan Document to Schedule 5.18 to the Loan Agreement shall
mean such Schedule as amended hereby.
3. Waivers. Subject to the conditions set forth in Section 4 below,
the Agent and the Required Lenders under the Loan Agreement as of the date
hereof hereby waive any Event of Default that would otherwise arise under
Section 8.2 of the Loan Agreement by reason of the Loan Parties' failure to
timely deliver to the Agent certificates of status with respect to certain
Borrowers and Guarantors in certain jurisdictions, a certificate of the
Secretary of Parent certifying the existing collective bargaining agreements and
certain Material Contracts, an officer's certificate of an Authorized Officer of
each applicable Loan Party with respect to the Vendor schedule and Vendor
Agreements, and the pro forma consolidated unaudited balance sheet of Parent and
its Subsidiaries as of the Closing Date, in accordance with Sections 3.2(h),
(j), (k), (l) and (n) of the Loan Agreement, respectively, provided that the
Loan Parties shall be in compliance with such Sections as of the applicable
dates set forth in Section 2.6 of this Amendment (it being agreed that the
certificate of the Secretary of Parent certifying the existing collective
bargaining agreements and certain Material Contracts, each officer's certificate
of the applicable Loan Party with respect to the Vendor schedule and Vendor
Agreements, and the pro forma consolidated unaudited balance sheet of Parent and
its Subsidiaries as of the Closing Date shall be delivered to the Agent on a
date prior to the date hereof). This waiver shall be effective only in this
specific instance and for the specific purpose forth herein and does not allow
for any other or further departure from the terms and conditions of the Loan
Agreement or any other Loan Document, which terms and conditions shall continue
in full force and effect.
4. Conditions. This Amendment shall be effective as of the date
hereof (the "Amendment Effective Date"), subject to the fulfillment, in a manner
satisfactory to the Agent, of each of the following conditions precedent:
(a) Representations and Warranties. The representations
and warranties contained herein, in Section 5 of the Loan Agreement (after
giving effect to the amendments to the Loan Agreement set forth herein) and in
each other Loan Document and certificate or other writing delivered to the Agent
or any Lender pursuant hereto on or prior to the Amendment Effective Date shall
be correct in all material respects on and as of the Amendment Effective Date as
though made on and as of such date, except to the extent that such
representations and warranties expressly relate solely to an earlier date (in
which case such representations and warranties shall be true and correct in all
material respects on and as of such date).
(b) No Event of Default. No Default or Event of Default
shall have occurred and be continuing on the Amendment Effective Date, or result
from this Amendment becoming effective in accordance with its terms.
(c) Fees. The Agent shall have received any fee, in
immediately available funds, due and payable to Agent as of the Amendment
Effective Date.
(d) Delivery of Documents. The Agent and the Lenders
shall have received on or before the Amendment Effective Date the following,
each in form and substance satisfactory to the Agent and unless indicated
otherwise, dated the Amendment Effective Date:
(i) counterparts of this Amendment, duly executed
by the Loan Parties, the Agent and the Lenders; and
(ii) a certificate from the Secretary of each Loan
Party attesting to the resolutions of such Loan Party's Board of
Directors authorizing its execution, delivery and performance of
this Amendment and authorizing specific officers of such Loan Party
to execute the same.
(e) Proceedings. All proceedings in connection with the
transactions contemplated by this Amendment, and all documents incidental
thereto, shall be satisfactory to the Agent, and the Agent shall have received
from the Borrowers all such information and such counterpart originals or
certified copies of documents, and such other agreements, instruments,
approvals, opinions and other documents, as the Agent may reasonably request.
(f) Lender Group Expenses. Borrowers shall have paid all
Lender Group Expenses incurred in connection with the transactions evidenced by
this Amendment.
5. Representations and Warranties. Each Loan Party hereby represents
and warrants to the Agent and the Lenders as follows:
(a) The representations and warranties herein, in
Section 5 of the Loan Agreement and in each other Loan Document (after giving
effect to the amendments set
forth herein) and certificate or other writing delivered to the Agent or any
Lender pursuant hereto on or prior to the Amendment Effective Date are correct
in all material respects on and as of the Amendment Effective Date as though
made on and as of such date, except to the extent that such representations and
warranties expressly relate solely to an earlier date (in which case such
representations and warranties are true and correct in all material respects on
and as of such date).
(b) No Default or Event of Default has occurred and is
continuing (after giving effect to the waivers set forth in Section 3 hereof) or
would result from this Amendment becoming effective in accordance with its
terms.
(c) Each Loan Party (i) is duly organized and existing
and in good standing under the laws of the jurisdiction of its organization,
(ii) has all requisite power and authority to execute, deliver and perform this
Amendment and to perform the Loan Documents, as amended hereby, and (iii) is
duly qualified to do business in each jurisdiction in which the character of the
properties owned or leased by it or in which the transaction of its business
makes such qualification necessary except where the failure to be so qualified
could not be expected to have a Material Adverse Change.
(d) The execution, delivery and performance by the Loan
Parties of this Amendment and the performance by the Loan Parties of the Loan
Documents, as amended by this Amendment, (i) have been duly authorized by all
necessary action, and (ii) do not and will not contravene the Loan Parties'
Governing Documents.
(e) The execution, delivery, and performance by the Loan
Parties of this Amendment and the performance of the Loan Documents, as amended
by this Amendment, do not and will not (i) violate any provision of federal,
state, or local law or regulation applicable to any Loan Party, or any order,
judgment, or decree of any court or other Governmental Authority binding on any
Loan Party, (ii) conflict with, result in a breach of, or constitute (with due
notice or lapse of time or both) a default under any material contractual
obligation of any Loan Party, (iii) result in or require the creation or
imposition of any Lien of any nature whatsoever upon any properties or assets of
any Loan Party, other than Permitted Liens, or (iv) require any approval of any
Loan Party's interestholders or any approval or consent of any Person under any
material contractual obligation of any Loan Party, other than consents or
approvals that have been obtained and that are still in force and effect.
(f) Except for Loan Parties' reporting obligations under
the Exchange Act, the execution, delivery, and performance by the Loan Parties
of this Amendment and the performance of the Loan Documents, as amended by this
Amendment, do not and will not require any registration with, consent, or
approval of, or notice to, or other action with or by, any Governmental
Authority or other Person.
(g) This Amendment, when executed and delivered by the
Loan Parties, and the Loan Documents, as amended hereby, are and will be the
legally valid and binding obligations of the Loan Parties, enforceable against
the Loan Parties in accordance with their respective terms.
6. Appointment of Documentation Agent. Each Lender hereby designates
and appoints Wachovia as the Documentation Agent under the Loan Agreement and
Wachovia hereby accepts such designation and appointment, effective as of the
Amendment Effective Date.
7. Indemnification. The Loan Parties, jointly and severally, hereby
agree to pay, indemnify, defend, and hold the Agent and the Lenders and their
respective officers, directors, employees, members, attorneys, consultants,
agents, and affiliates harmless (to the fullest extent permitted by law) from
and against any and all claims, losses and liabilities growing out of or
resulting from this Amendment, except claims, losses or liabilities resulting
solely and directly from any such indemnified person's gross negligence or
willful misconduct as determined by a final judgment of a court of competent
jurisdiction.
8. Miscellaneous.
(a) Continued Effectiveness of the Loan Documents.
Except as otherwise expressly provided herein, the Loan Agreement and the other
Loan Documents are, and shall continue to be, in full force and effect and are
hereby ratified and confirmed in all respects, except that on and after the
Amendment Effective Date (i) all references in the Loan Agreement to "this
Agreement", "hereto", "hereof", "hereunder" or words of like import referring to
the Loan Agreement shall mean the Loan Agreement as amended by this Amendment,
and (ii) all references in the other Loan Documents to the "Loan Agreement",
"thereto", "thereof", "thereunder" or words of like import referring to the Loan
Agreement shall mean the Loan Agreement as amended by this Amendment. Except as
expressly provided herein, the execution, delivery and effectiveness of this
Amendment shall not operate as an amendment of any right, power or remedy of the
Agent or the Lenders under the Loan Agreement or any other Loan Document, nor
constitute an amendment of any provision of the Loan Agreement or any other Loan
Document.
(b) Counterparts; Telefacsimile Execution. This
Amendment may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which shall be deemed to be an
original, but all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of this Amendment by
telefacsimile shall be equally as effective as delivery of an original executed
counterpart of this Amendment. Any party delivering an executed counterpart of
this Amendment by telefacsimile also shall deliver an original executed
counterpart of this Amendment but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Amendment.
(c) Headings. Section headings herein are included for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
(d) Governing Law. This Amendment shall be governed by,
and construed in accordance with, the laws of the State of New York.
(e) Costs and Expenses. Each Loan Party agrees to pay on
demand all fees, costs and expenses of the Agent in connection with the
preparation, execution and delivery of this Amendment and any other related
agreements, instruments and documents.
(f) Amendment as Loan Document. Each Loan Party hereby
acknowledges and agrees that this Amendment constitutes a "Loan Document" under
the Loan Agreement. Accordingly, it shall be an Event of Default under the Loan
Agreement if any representation or warranty made by any Loan Party under or in
connection with this Amendment shall have been untrue, false or misleading in
any material respect when made or any Loan Party shall fail to perform any
covenant or agreement set forth herein.
(g) No Waiver. This Amendment is not a waiver of, or
consent to, any Default or Event of Default now existing or hereafter arising
under the Loan Agreement or any other Loan Document and the Agent and the
Lenders expressly reserve all of their rights and remedies under the Loan
Agreement and the other Loan Documents, under applicable law or otherwise.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed and delivered as of the date first above written.
BORROWERS:
SOURCE INTERLINK COMPANIES, INC.,
a Delaware corporation,
as successor by merger to
SOURCE INTERLINK COMPANIES, INC.,
a Missouri corporation,
as Administrative Borrower
SOURCE U.S. MARKETING SERVICES, INC.
a Delaware corporation
BRAND MANUFACTURING CORP.
a New York corporation
SOURCE - MYCO, INC.
a Delaware corporation
SOURCE - XXXXXX INDUSTRIES, INC.
a Delaware corporation
SOURCE - HUCK STORE FIXTURE COMPANY
a Delaware corporation
HUCK STORE FIXTURE COMPANY OF NORTH CAROLINA
a North Carolina corporation
INTERNATIONAL PERIODICAL DISTRIBUTORS, INC.
a Nevada corporation
SOURCE INTERLINK INTERNATIONAL INC.
a Delaware corporation
PRIMARY SOURCE, INC.
a Delaware corporation
SOURCE HOME ENTERTAINMENT, INC.
a Delaware corporation
By: /s/ Xxxx Xxxxxxx
-------------------------------
Name: Xxxx Xxxxxxx
Title: Chief Financial Officer
ALLIGATOR ACQUISITION LLC
as successor by merger to
ALLIANCE ENTERTAINMENT CORP.,
a Delaware corporation
By: SOURCE INTERLINK COMPANIES, INC.
its sole member
By: /s/ Xxxx Xxxxxxx
-------------------------------
Name: Xxxx Xxxxxxx
Title: Chief Financial Officer
AEC ONE STOP GROUP, INC.
a Delaware corporation
By: /s/ Xxxx Xxxxxxx
-------------------------------
Name: Xxxx Xxxxxxx
Title: Chief Financial Officer
AEC SUPERMARKET SERVICES GROUP, LLC
a Delaware limited liability company
By: AEC ONE STOP GROUP, INC.
its sole member
By: /s/ Xxxx Xxxxxxx
-------------------------------
Name: Xxxx Xxxxxxx
Title: Chief Financial Officer
GUARANTORS:
THE SOURCE-CANADA CORP.
an Ontario corporation
SOURCE INTERLINK CANADA INC.
a British Columbia corporation
SOURCE - CHESTNUT DISPLAY SYSTEMS, INC.
a Delaware corporation
T.C.E. CORPORATION
a Delaware corporation
VAIL COMPANIES, INC.
a Delaware corporation
THE INTERLINK COMPANIES, INC.
a Delaware corporation
XXXXX X. XXXXX, INC.
a New York corporation
By: /s/ Xxxx Xxxxxxx
-------------------------------
Name: Xxxx Xxxxxxx
Title: Chief Financial Officer
DISTRIBUTION & FULFILLMENT SERVICES
GROUP, INC.
a Delaware corporation
A.E. LAND CORP.
a Delaware corporation
AEC DIRECT, INC.
a Delaware corporation
By: /s/ Xxxx Xxxxxxx
-------------------------------
Name: Xxxx Xxxxxxx
Title: Chief Financial Officer
AGENT, COLLATERAL AGENT AND LENDER:
XXXXX FARGO FOOTHILL, INC.,
a California corporation, as Agent and
Collateral Agent and as a Lender
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------
Name: Xxxxxx X. Xxxxxx
Title: V.P.
DOCUMENTATION AGENT:
WACHOVIA BANK, NATIONAL ASSOCIATION,
a national banking association, as
Documentation Agent
By: /s/ Roqnne Disalvaldre
-------------------------------
Name: Roqnne Disalvaldre
Title: Vice President
