EXHIBIT(b)(3)
SECOND AMENDMENT TO
CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT ("this Amendment") is dated
as of June 20, 2005 (the "Effective Date"), by and among BOOKS-A-MILLION, INC.,
a Delaware corporation ("BAM"), and its wholly-owned subsidiaries AMERICAN
WHOLESALE BOOK COMPANY, INC., an Alabama corporation ("AWBC") and AMERICAN
INTERNET SERVICE, INC., an Alabama corporation ("AIS") and the wholly-owned
subsidiaries of AIS, XXXXXXXXXXXXX.XXX, INC., an Alabama corporation
("XXX.XXX"), NETCENTRAL, INC., a Tennessee corporation ("NI"), and FAITHPOINT,
INC. an Alabama corporation ("FAITHPOINT"); BAM, AWBC, AIS, xxx.xxx, NI and
FaithPoint are sometimes together referred to as the "INITIAL PARTICIPATING
ENTITIES"; the Initial Participating Entities, together with all Persons that
hereafter become Participating Entities, being hereafter sometimes together
referred to as the "BORROWERS"), BANK OF AMERICA, N.A., a national banking
association ("BOFA"), and the various lenders identified on the signature pages
hereto (collectively, the "LENDERS"); and BANK OF AMERICA, N.A., a national
banking association, as agent for the Lenders (the "AGENT").
RECITALS
A. The Borrowers, the Lenders and the Agent have previously
entered into that certain Credit Agreement dated as of July 1, 2002 (together
with any and all amendments thereto, including, but not limited to that certain
First Amendment to Credit Agreement dated as of June 14, 2004, the "Credit
Agreement"). Capitalized terms not otherwise herein defined shall have the
meanings given them in the Credit Agreement.
B. The Borrowers, the Lenders and the Agent now desire to amend
the Minimum Shareholder's Equity covenant set forth in the Credit Agreement and
to make the other changes set forth in this Amendment.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing recitals and in
further consideration of the mutual agreements set forth herein, the Borrowers,
the Lenders and the Agent hereby agree as follows, with such agreements to
become effective as of the Effective Date:
1. RECITALS. The recitals hereinabove are hereby incorporated by
this reference as if fully set forth herein.
2. RULES OF CONSTRUCTION. This Amendment is subject to the rules
of construction set forth in Section 1.2 of the Credit Agreement.
3. REPRESENTATIONS AND WARRANTIES OF BORROWERS. The Borrowers
represent and warrant to the Lenders and the Agent as follows:
(a) REPRESENTATIONS AND WARRANTIES IN CREDIT DOCUMENTS.
All of the representations and warranties set forth in the Credit
Documents are true and correct in all material respects on and as of
the Effective Date, except to the extent that such representations and
warranties expressly relate to an earlier date.
(b) NO DEFAULT. As of the Effective Date, the Borrowers
are in compliance in all material respects with all the terms and
provisions set forth in the Credit Documents on their part to be
observed or performed, and, no Event of Default, nor any event that
upon notice or lapse of time or both would constitute such an Event of
Default, has occurred and is continuing.
(c) ORGANIZATIONAL DOCUMENTS. The articles of
incorporation and bylaws of the Borrowers have not been modified or
amended since July 1, 2002.
4. AMENDMENTS TO CREDIT AGREEMENT. Section 5.8.3 of the Credit
Agreement is hereby deleted in its entirety and the following is substituted
therefor:
5.8.3 Minimum Shareholders' Equity. Shareholders' Equity for
the Consolidated Entities on a consolidated basis shall: (a)
for any date prior to and including September 30, 2005, not be
less than $85,000,000 and (b) for any date after September 30,
2005, not be less than the Reset Minimum SH Equity, plus (i)
50% of Consolidated Net Income (if positive and with no
reduction if negative), for each fiscal quarter (beginning
with the fiscal quarter ending on or about October 30, 2005
and each fiscal quarter thereafter) and (ii) 100% of the Net
Cash Proceeds from any Equity Issuance. For purposes of this
Section 5.8.3, "Reset Minimum SH Equity" shall equal the
greater of (aa) $85,000,000 or (bb) 90% of Shareholders'
Equity for the Consolidated Entities on a consolidated basis
as of the fiscal quarter ending on or about July 30, 2005,
less the actual purchase price (including normal and customary
related transaction fees, commissions and other expenses
incurred in connection with such purchases) paid by BAM in
connection with the re-acquisition of outstanding capital
stock of BAM from the last day of the fiscal quarter ending on
or about July 30, 2005 until September 30, 2005.
Notwithstanding anything to the contrary set forth herein, if
BAM does not re-acquire any of its outstanding capital stock
between June 20, 2005 and September 30, 2005, the
Shareholders' Equity for the Consolidated Entities on a
consolidated basis shall not on any date be less than
$104,018,000.00, plus (i) 50% of Consolidated Net Income (if
positive and with no reduction if negative), for each fiscal
quarter (beginning with the fiscal quarter ending on or about
April 30, 2002 and each fiscal quarter thereafter) and (ii)
100% of the Net Cash Proceeds from any Equity Issuance.
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5. CREDIT DOCUMENTS TO REMAIN IN EFFECT. Except as expressly
amended herein, the Credit Agreement and the other Credit Documents shall remain
in full force and effect in accordance with their respective terms.
6. NO NOVATION, ETC. Nothing contained in this Amendment shall be
deemed to constitute a novation of the terms of the Credit Documents, nor
release any party from liability for any of the Loans, nor affect any of the
rights, powers or remedies of the Lenders under the Credit Documents, nor
constitute a waiver of any provision thereof, except as specifically set forth
in this Amendment.
7. REFERENCES IN CREDIT DOCUMENTS. Effective as of the Effective
Date, all references in the Credit Documents to the "Credit Agreement" shall
refer to the Credit Agreement as amended by this Amendment, including but not
limited to, the extension of the Maturity Date, and as the Credit Agreement may
be further amended from time to time.
8. GOVERNING LAW, SUCCESSORS AND ASSIGNS, ETC. This Amendment
shall be governed by and construed in accordance with the laws of the State of
Georgia and shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns.
9. HEADINGS. The descriptive headings of the sections of this
Amendment are for convenient reference only and shall not be deemed to affect
the meaning or construction of any of the provisions hereof.
10. ENTIRE AGREEMENT. This Amendment constitutes the entire
understanding to date of the parties hereto regarding the subject matter hereof
and supersedes all prior and contemporaneous oral and written agreements of the
parties thereto with respect to the subject matter hereof.
11. SEVERABILITY. If any provision of this Amendment shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
12. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, each of which so executed shall be deemed an original, but all
such counterparts shall together constitute but one and the same instrument.
13. EFFECT OF THIS AMENDMENT. This Amendment amends and
supplements the Credit Agreement and shall be construed as if it is a part
thereof for all purposes.
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IN WITNESS WHEREOF, the Borrowers, the Lenders and the Agent have
caused this Amendment to be executed and delivered by their duly authorized
representatives on the dates set forth below their signature, to be effective as
of the Effective Date.
BOOKS-A-MILLION, INC.
By: /s/ Xxxxxxx Xxxxxxxxxx
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Its Chief Financial Officer
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Dated: June 20, 2005
---------------------------------
NETCENTRAL, INC.
By: /s/ Xxxxxxx Xxxxxxxxxx
------------------------------------
Its Chief Financial Officer
---------------------------------
Dated: June 20, 2005
---------------------------------
AMERICAN INTERNET SERVICE, INC.
By: /s/ Xxxxxxx Xxxxxxxxxx
------------------------------------
Its Chief Financial Officer
---------------------------------
Dated: June 20, 2005
---------------------------------
AMERICAN WHOLESALE BOOK
COMPANY, INC.
By: /s/ Xxxxxxx Xxxxxxxxxx
------------------------------------
Its Chief Financial Officer
---------------------------------
Dated: June 20, 2005
---------------------------------
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XXXXXXXXXXXXX.XXX, INC.
By: /s/ Xxxxxxx Xxxxxxxxxx
------------------------------------
Its Chief Financial Officer
---------------------------------
Dated: June 20, 2005
---------------------------------
FAITHPOINT, INC.
By: /s/ Xxxxxxx Xxxxxxxxxx
------------------------------------
Its Chief Financial Officer
---------------------------------
Dated: June 20, 2005
---------------------------------
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BANK OF AMERICA, N.A., AS AGENT
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------
Its Senior Vice President
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Dated: June 20, 2005
---------------------------------
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BANK OF AMERICA, N.A., AS A LENDER
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------
Its Senior Vice President
---------------------------------
Dated: June 20, 2005
---------------------------------
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AMSOUTH BANK, AS A LENDER
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------
Its Senior Vice President
---------------------------------
Dated: June 17, 2005
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SUNTRUST BANK, AS A LENDER
By: /s/ Xxxxx Xxxxxx
------------------------------------
Its Vice President
---------------------------------
Dated: June 17, 2005
---------------------------------
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SOUTHTRUST BANK, AS A LENDER
By: /s/ Xxxxx Peace
------------------------------------
Its Assistant Vice President
---------------------------------
Dated: June 20, 2005
---------------------------------
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XXXXX FARGO BANK, N.A., AS A LENDER
By: /s/ Xxxxxx Xxxx
------------------------------------
Its Vice President
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Dated: June 20, 2005
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