EXECUTION COPY
AMENDMENT No. 1 AND WAIVER dated as of February
13, 2004 (this "Amendment and Waiver"), to the Credit
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Agreement dated as of January 31, 2003 (as amended,
supplemented or otherwise modified from time to time,
the "Credit Agreement"), among WKI HOLDING COMPANY,
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INC., a Delaware corporation (the "Borrower"), the
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financial institutions party to the Credit Agreement as
Lenders (the "Lenders"), and JPMORGAN CHASE BANK, as
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Administrative Agent and Collateral Agent.
A. The Borrower has requested that the Lenders agree to amend
and/or waive certain provisions of the Credit Agreement as set forth herein.
B. The Borrower has also informed the Lenders that an Event of
Default has occurred as a result of the Borrower's failure to (i) liquidate or
dissolve WKI do Brasil Ltda. by December 31, 2003, and (ii) cause clause (b) of
the definition of Collateral and Guarantee Requirement to be satisfied with
respect to such Subsidiary, as required by Section 5.13(e) of the Credit
Agreement (such Event of Default, the "Specified Event of Default"), and has
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requested that the Lenders grant a limited waiver of the Specified Event of
Default.
C. The Lenders are willing to amend the Credit Agreement and waive
certain provisions of the Credit Agreement, in each case on the terms and
subject to the conditions set forth herein.
D. Capitalized terms used and not otherwise defined herein shall
have the meanings assigned thereto in the Credit Agreement, as amended hereby.
SECTION 1. Amendment to Section 1.01. The definition of the term
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"Consolidated EBITDA" in Section 1.01 of the Credit Agreement is hereby amended
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by deleting such definition in its entirety and substituting the following
therefor:
"Consolidated EBITDA" means, for any period, Consolidated Net Income
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for such period PLUS (a) without duplication and to the extent deducted in
determining such Consolidated Net Income, the sum of (i) consolidated
interest expense for such period, (ii) consolidated income and franchise
tax expense for such period, (iii) all amounts attributable to
depreciation and amortization for such period, including, without
limitation, amortization of intangibles (excluding amortization expense
attributable to a prepaid cash item that was paid in a prior period and
included in Consolidated EBITDA for such prior period), (iv) any noncash
and non-recurring charge for such period, (v) any cash or non-cash charges
for such period properly classified as "extraordinary" under GAAP,
including without limitation, charges relating to impairment of intangible
assets, (vi) fees and expenses incurred in such period in connection with
the Emergence Plan, (vii) charges for such period attributable to the key
employee retention plans and longterm incentive plans listed on Schedule
1.01(b) or any other such plan approved by the Required Lenders, provided
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that the charges associated with this
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clause (vii) shall not exceed $11,800,000 in the aggregate, (viii) cash
and noncash charges for such period that are directly attributable to the
closing of any retail store facilities of the Borrower, including, without
limitation, severance payments relating to the closing of any headquarters
or distribution facilities, (ix) cash and non-cash charges for such period
that are directly related to the 2004 restructuring of the Borrower
currently contemplated by the Board of Directors with the advice of
AlixPartners including, without limitation, severance payments, expenses
associated with inventory reductions and consultants' fees and expenses,
and (x) fees and expenses of financial advisors, accountants and outside
counsel incurred in such period in connection with any asset sale
contemplated by the Board of Directors as of February 6, 2004 and MINUS
(b) without duplication and to the extent included in determining such
Consolidated Net Income, any extraordinary gains for the period, all
determined on a consolidated basis in accordance with GAAP.
SECTION 2. Amendment to Section 5.13. Paragraph (e) of Section 5.13 of
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the Credit Agreement is hereby amended by deleting the text "December 31, 2003"
after the text "dissolved by" and substituting the text "June 30, 2004" in lieu
thereof.
SECTION 3. Amendment to Section 6.12. Section 6.12 is hereby amended
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by inserting the following text after the text "any new store":
, it being understood that changing the location of any existing
retail store shall not constitute the opening of a new retail store
for the purposes of this Section 6.12
SECTION 4. Amendment to Section 6.14. The table set forth in Section
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6.14 of the Credit Agreement is hereby amended and restated in its entirety as
follows:
Period Ratio
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January 1, 2004 to March 31, 2004 7.2 : 1.0
April 1, 2004 to June 30, 2004 7.2 : 1.0
July 1, 2004 to September 30, 2004 8.1 : 1.0
October 1, 2004 to December 31, 2004 7.0 : 1.0
January 1, 2005 to March 31, 2005 6.8 : 1.0
April 1, 2005 to June 30, 2005 6.4 : 1.0
July 1, 2005 to September 30, 2005 6.4 : 1.0
October 1, 2005 to December 31, 2005 6.4 : 1.0
January 1, 2006 to March 31, 2006 6.4 : 1.0
April 1, 2006 to June 30, 2006 6.0 : 1.0
July 1, 2006 to September 30, 2006 6.0 : 1.0
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Period Ratio
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October 1, 2006 to December 31, 2006 6.0 : 1.0
January 1, 2007 to March 31, 2007 6.0 : 1.0
April 1, 2007 to June 30, 2007 5.6 : 1.0
July 1, 2007 to September 30, 2007 5.6 : 1.0
October 1, 2007 to December 31, 2007 5.6 : 1.0
January 1, 2008 to March 31, 2008 5.6 : 1.0
SECTION 5. Amendment to Section 6.16. The table set forth in Section
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6.16 of the Credit Agreement is hereby amended and restated in its entirety as
follows:
Date Amount
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March 31, 2004 $58,000,000
June 30, 2004 $58,000,000
September 30, 2004 $54,000,000
December 31, 2004 $57,000,000
March 31, 2005 $72,700,000
June 30, 2005 $73,100,000
September 30, 2005 $74,700,000
December 31, 2005 $76,900,000
March 31, 2006 $77,300,000
June 30, 2006 $77,800,000
September 30, 2006 $79,100,000
December 31, 2006 $81,100,000
March 31, 2007 $81,500,000
June 30, 2007 $82,000,000
September 30, 2007 $83,300,000
December 31, 2007 $85,300,000
SECTION 6. Limited Waiver. The Lenders hereby waive (i) the Specified
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Event of Default and (ii) the notice requirement in Section 5.02(a) of the
Credit Agreement with respect to such Specified Event of Default.
SECTION 7. Limited Waiver. For the avoidance of doubt, to the extent
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that any change in location of a retail store prior to the date hereof would
constitute a Default under Section 6.12 of the Credit Agreement, the Lenders
hereby waive (i) compliance with Section 6.12 of the Credit Agreement with
respect to such Default and
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(ii) the notice requirement in Section 5.02(a) of the Credit Agreement with
respect to
such Default.
SECTION 8. Representations and Warranties. The Borrower represents and
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warrants to the Administrative Agent and to each of the Lenders that:
(a) This Amendment and Waiver has been duly authorized, executed and
delivered by it and constitutes a legal, valid and binding obligation of such
party hereto, enforceable against it in accordance with its terms.
(b) After giving effect to this Amendment and Waiver, the representations
and warranties set forth in Article III of the Credit Agreement are true and
correct in all material respects on and as of the date hereof with the same
effect as if made on and as of the date hereof, except to the extent such
representations and warranties expressly relate to an earlier date.
(c) After giving effect to this Amendment and Waiver, no Event of Default
or
Default has occurred and is continuing.
SECTION 9. Amendment and Waiver Fee. In consideration of the
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agreements of the Lenders contained in this Amendment and Waiver, the Borrower
agrees to pay the Administrative Agent (payable to the Lenders upon receipt by
the Agent of the signatures of the Borrower and the Required Lenders) for the
account of each Lender that delivers an executed counterpart of this Amendment
and Waiver prior to 12:00 (noon), New York City time, on February 13, 2004, an
amendment and waiver fee (the "Amendment and Waiver Fee") equal to 0.25% of the
aggregate amount of the Exposure of such Lender.
SECTION 10. Conditions to Effectiveness. This Amendment and Waiver
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shall become effective as of the date first above written when (a) the
Administrative Agent shall have received (i) counterparts of this Amendment and
Waiver that, when taken together, bear the signatures of the Borrower and the
Required Lenders and (ii) the aggregate amount of the Amendment and Waiver Fee,
(b) the representations and warranties set forth in Section 8 hereof are true
and correct and (c) all fees and expenses required to be paid or reimbursed by
the Borrower pursuant hereto, the Credit Agreement or otherwise, including all
invoiced fees and expenses of counsel to the Administrative Agent, shall have
been paid or reimbursed, as applicable.
SECTION 11. Credit Agreement. Except as specifically amended hereby,
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the Credit Agreement shall continue in full force and effect in accordance with
the provisions thereof as in existence on the date hereof. After the date
hereof, any reference to the Credit Agreement shall mean the Credit Agreement as
amended hereby. This Amendment and Waiver shall be a Loan Document for all
purposes.
SECTION 12. APPLICABLE LAW. THIS AMENDMENT SHALL BE
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CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
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SECTION 13. Counterparts. This Amendment and Waiver may be executed in
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two or more counterparts, each of which shall constitute an original but all of
which when taken together shall constitute but one agreement. Delivery of an
executed signature page to this Amendment and Waiver by facsimile transmission
shall be effective as delivery of a manually signed counterpart of this
Amendment and Waiver.
SECTION 14. Expenses. The Borrower agrees to reimburse the
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Administrative Agent for its out-of-pocket expenses in connection with this
Amendment and Waiver, including the reasonable fees, charges and disbursements
of Cravath, Swaine & Xxxxx LLP, counsel for the Administrative Agent.
SECTION 15. Headings. The headings of this Amendment and Waiver
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are for purposes of reference only and shall not limit or otherwise affect the
meaning hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment and
Waiver to be duty executed by their respective authorized officers as of the day
and year first written above.
WKI HOLDING COMPANY, INC.,
by: /s/ Xxxx Xxxxxxxx
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Name: Xxxx Xxxxxxxx
Title: VP and Treasurer
JPMORGAN CHASE BANK, individually
and as Administrative Agent, Collateral
Agent and Issuing Bank,
by:
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Name:
Title:
IN WITNESS WHEREOF, the parties hereto have caused this Amendment and
Waiver to be duty executed by their respective authorized officers as of the day
and year first written above.
WKI HOLDING COMPANY, INC.,
by:
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Name:
Title:
JPMORGAN CHASE BANK, individually
and as Administrative Agent, Collateral
Agent and Issuing Bank,
by: /s/ Xxxxxxxx Xxxx
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Name: Xxxxxxxx Xxxx
Title: Vice President
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
Name of Institution ABN AMRO BANK N.V.
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by /s/ Xxxxxx X. Xxxxxxxx /s/ Xxxxxxxx X. Xxxxxxxx
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Name: Xxxxxx X. Xxxxxxxx Name: Xxxxxxxx X. Xxxxxxxx
Title: Group Senior Vice President Title: Group Vice President
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
Name of Institution CREDIT SUISSE FIRST BOSTON INTERNATIONAL
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by /s/ (ILLEGIBLE)
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Name:
Title:
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
Name of Institution DEBTCO LLC
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by /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Asst. Secretary
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
Name of Institution First Dominion Funding I
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by /s/ (ILLEGIBLE)
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Name:
Title:
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
Name of Institution GENERAL ELECTRIC CAPITAL CORPORATION
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by /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
Title: Duly Authorized Signatory
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
Name of Institution Hour LLC (Clarion Capital Partners)
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by /s/ Xxxx X. Xxxx
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Name: Xxxx X. Xxxx
Title: Managing Partner
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
KZH CYPRESSTREE-1 LLC
by /s/ Xxxxxx Xxxxxxx
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Name: Xxxxxx Xxxxxxx
Title: AUTHORIZED AGENT
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
Name of Institution Xxxxxx Xxxxxxx Prime Income Trust
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by /s/ Xxxxxxxxx Xxxxxxx
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Name: Xxxxxxxxx Xxxxxxx
Title: Authorized Signatory
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
Name of Institution NATEXIS BANQUES POPULAIRES
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by /s/ Xxxx X. Xxxxxx
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Name: XXXX X. XXXXXX
Title: VICE PRESIDENT
/s/ Xxxxx Xxxxxxx
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XXXXX XXXXXXX
VICE PRESIDENT
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
Oaktree Capital Management, LLC, as general partner
and/or investment manager of certain funds and
Name of Institution accounts it manages
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by /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
Title: Managing Director
by /s/ Xxxxx Xxx
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Name: Xxxxx Xxx
Title: Senior Vice President
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
Name of Institution Xxxxx Fargo Bank, N.A.
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by /s/ Xxxxx Xxxxxx
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Name: Xxxxx Xxxxxx
Title: VICE PRESIDENT
SIGNATURE PAGE TO
AMENDMENT TO REVOLVING
CREDIT AGREEMENT
To Approve the Amendment and Waiver:
Name of Institution Xxxxx Fargo Foothill
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by /s/ Xxxxxx Xxx
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Name: Xxxxxx XXx
Title: AVP
