SECOND AMENDMENT TO AMENDED AND RESTATED FIRST LIEN LOAN AND SECURITY AGREEMENT
Exhibit 10.3
SECOND AMENDMENT TO AMENDED AND RESTATED
This SECOND AMENDMENT TO AMENDED AND RESTATED FIRST LIEN LOAN AND SECURITY AGREEMENT (this “Amendment”) is dated as of May 2, 2023, and is entered into by and among SELWAY WINE COMPANY, a Delaware corporation (“Intermediate Holdco”), MALLARD BUYER CORP., a Delaware corporation (“Borrower Agent”), each other Subsidiary of Intermediate Holdco party hereto (together with the Borrower Agent, each a “Borrower” and, collectively, “Borrowers”), the Lenders (as defined below) party hereto, and BMO XXXXXX BANK N.A., as successor in interest to BANK OF THE WEST (“BMO”), as administrative agent for the Lenders (in such capacity, “Agent”).
RECITALS
WHEREAS, Intermediate Holdco, Borrowers, the financial institutions party thereto as of the date hereof, as lenders, and the Agent are parties to that certain Amended and Restated First Lien Loan and Security Agreement, dated as of November 4, 2022 (as amended from time to time prior to the date hereof, the “Existing Loan Agreement” and the Existing Loan Agreement, as amended by this Amendment, the “Loan Agreement”);
WHEREAS, the Borrowers have requested that Agent and the Required Lenders agree to amend the Existing Loan Agreement by amending the definition of Fixed Charge Coverage Ratio; and
WHEREAS, Agent and the Required Lenders have agreed to Borrowers’ request, subject to the terms of this Amendment.
NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties agree as follows:
1.DEFINITIONS. All terms which are defined in the Loan Agreement shall have the same definition when used herein unless a different definition is ascribed to such term under this Amendment, in which case, the definition contained herein shall govern.
2.AMENDMENTS. Upon the Second Amendment Effective Date (as defined below), the Existing Loan Agreement is hereby amended as follows:
a.Revise Definition of Fixed Charge Coverage Ratio. The definition of “Fixed Charge Coverage Ratio” in Section 1.1 of the Existing Loan Agreement is hereby amended and restated in its entirety as follows:
Fixed Charge Coverage Ratio: the ratio, determined on a consolidated basis for Intermediate Holdco and its Subsidiaries, of (a) (i) TTM EBITDA minus (ii) Maintenance Capital Expenditure Amount paid during the applicable Test Period (except those financed with (x) Debt, other than revolving credit facilities or (y) proceeds arising from a casualty event covered by insurance, an Asset Disposition not prohibited by Section 10.2.6 or an issuance of any Equity Interests (or receipt of capital contributions) by any Borrower, in each case, to the extent such proceeds are applied to finance such Capital Expenditures within 365 days) minus (iii) all federal, state, and local income taxes paid in cash during such period or Distributions made in accordance with Section 10.2.4 by any Obligor to the direct or indirect parent of Intermediate Holdco for the payment of such taxes during the applicable Test Period, to (b) Fixed Charges.
a.Addition of New Defined Terms. The defined terms “Maintenance Capital Expenditures” and “Maintenance Capital Expenditure Amount” are added to Section 1.1 of the Existing Loan Agreement as follows in the appropriate alphabetical order:
Maintenance Capital Expenditures: all Capital Expenditures necessary to maintain existing output or capacity of operations, including expenditures required by policies (whether regulatory, internal, or other) which govern existing operations.
Maintenance Capital Expenditure Amount: an amount of Maintenance Capital Expenditures equal to, as of any date of determination, the greater of (a) $7.5 million, and (b) the actual amount paid for such Maintenance Capital Expenditures during the applicable Test Period.
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1.CONDITIONS PRECEDENT TO EFFECTIVENESS OF AMENDMENT. This Amendment shall become effective on the date (such date the “Second Amendment Effective Date”) on which Agent shall have received counterparts to this Amendment, duly executed by the Agent, Intermediate Holdco, the Borrowers, and the Required Lenders party hereto.
2.REPRESENTATIONS AND WARRANTIES. Intermediate Holdco and each of the Borrowers hereby affirm to Agent and the Lenders party hereto:
a.All of Borrowers’ representations and warranties set forth in Section 9 of the Loan Agreement are true and correct in all material respects as of the date hereof; provided that to the extent such representations and warranties expressly relate to an earlier date, such representations and warranties shall be true and correct in all material respect as of such earlier date (provided that if a representation or warranty is by its terms already subject to a materiality qualifier, it shall not be further subject to the materiality qualifier in this Section 4.1).
b.No Default or Event of Default exists or would arise after giving effect to this Amendment.
3.LIMITED EFFECT. Except for the specific amendments contained in this Amendment, the Loan Agreement and the other Loan Documents shall remain unchanged and in full force and effect.
4.GOVERNING LAW; CONSENT TO FORUM. Sections 14.13 and 14.14 of the Loan Agreement are incorporated herein by reference, mutatis mutandis.
5.COUNTERPARTS. This Amendment may be executed in counterparts, each of which when shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of a signature page of this Amendment by telecopy or other electronic means shall be effective as delivery of a manually executed counterpart of this Amendment.
[Signatures are on following pages]
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IN WITNESS WHEREOF, this Amendment has been executed and delivered as of the date set forth above.
INTERMEDIATE HOLDCO:
SELWAY WINE COMPANY
By: /s/ Xxxx Xxxx
Name: Xxxx Xxxx
Title: President and Chief Executive Officer
BORROWERS:
MALLARD BUYER CORP.
HERITAGE WINE, LLC
CANVASBACK WINE, LLC
WATERFOWL WINE, LLC
HERITAGE VINEYARD, LLC
DUCKHORN WINE COMPANY
KB WINES CORPORATION
DOMAINE, M.B., LLC
XXXXXXXXX GRAGAM LLC
By: /s/ Xxxx Xxxx
Name: Xxxx Xxxx
Title: President and Chief Executive Officer
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AGENT AND LENDERS:
BANK OF THE WEST,
as Agent
By: /s/ Xxxx Xxxxxxxx
Name: Xxxx Xxxxxxxx
Title: Vice President
BANK OF THE WEST,
as Lender
By: /s/ Xxxxxxx Xxxxxxx
Name: Xxxxxxx Xxxxxxx
Title: Vice President
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AGCountry Farm Credit Services, PCA,
as Lender
By: /s/ Xxxx Xxxxxxxx
Name:Xxxx Xxxxxxxx
Title:Vice President Capital Markets
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Capital Farm Credit PCA,
as Lender
By: /s/ Xxxxxxx Xxxxxx
Name:Xxxxxxx Xxxxxx
Title:Director Capital Markets
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Capital Farm Credit, FLCA,
as Lender
By: /s/ Xxxxxxx Xxxxxx
Name:Xxxxxxx Xxxxxx
Title:Director Capital Markets
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Compeer Financial, PCA,
as Lender
By: /s/ Xxxxxx X. Xxxx
Name:Xxxxxx X. Xxxx
Title:Director, Capital Markets
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Farm Credit Services of America, PCA,
as Lender
By: /s/ Xxxxxx Xxxxxx
Name: Xxxxxx Xxxxxx
Title:Vice President - Capital Markets
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Greenstone Farm Credit Services, FLCA,
as Lender
By: /s/ Xxxxxx Xxxxxxxx
Name:Xxxxxx Xxxxxxxx
Title: VP of Capital Markets Lending
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Greenstone Farm Credit Services, ACA,
as Lender
By: /s/ Xxxxxx Xxxxxxxx
Name:Xxxxxx Xxxxxxxx
Title: VP of Capital Markets Lending
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ING Capital LLC,
as Lender
By /s/ Xxxxxxx Xxxx
Name:Xxxxxxx Xxxx
Title:Director
By: /s/ Xxxxxxxx Xxx
Name:Xxxxxxx Xxx
Title:Director
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XX Xxxxxx Xxxxx Bank N.A.,
as Lender
By /s/ Xxxxxx Xxxxxx
Name:Xxxxxx Xxxxxx
Title:Authorized Signer
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MUFG Union Bank N.A.,
as Lender
By: /s/ Xxxxx Xxxxxxxx
Name:Xxxxx Xxxxxxxx
Title:Vice President
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AGWest Farm Credit, PCA (fka, Northwest Farm Credit Services, PCA),
as Lender
By: /s/ Xxxx Xxxxxx
Name:Xxxx Xxxxxx
Title:Vice President
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HTLF Bank,
as Lender
By: /s/ Xxxxxx Xxxxxxx
Name:Xxxxxx Xxxxxxx
Title:SVP/SRM
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