FIRST AMENDMENT
TO
CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (the
"FIRST AMENDMENT") dated as of March 31, 2002 relates to
that certain Credit Agreement dated as of January 25, 2001
(the "CREDIT AGREEMENT"), among 7-Eleven, Inc., a Texas
corporation (the "COMPANY"), the financial institutions
party thereto as "Senior Lenders" or "Issuing Banks",
Citibank, N.A., as administrative agent for the Senior
Lenders and Issuing Banks (in such capacity, together with
any successor administrative agent appointed pursuant to
SECTION 11.07 of the Credit Agreement, the "ADMINISTRATIVE
AGENT"), The Sumitomo Mitsui Banking Corporation, New York
Branch (successor in interest to The Sakura Bank, Limited,
New York Branch), as Co-Agent, and Xxxxxxx Xxxxx Xxxxxx,
Inc., as Sole Lead Arranger and Sole Book Manager.
1. DEFINITIONS. Capitalized terms defined in the
Credit Agreement and not otherwise defined or redefined
herein have the meanings assigned to them in the Credit
Agreement.
2. FIRST AMENDMENT EFFECTIVE DATE AMENDMENTS TO
CREDIT AGREEMENT. Upon the "First Amendment Effective
Date" (as defined in Section 7 below), the Credit Agreement
is hereby amended as follows:
2.1 AMENDMENTS TO SECTION 1.01. Section
1.01 of the Credit Agreement is hereby amended as follows:
(a) by amending and restating the
definitions of "APPLICABLE EURODOLLAR RATE MARGIN",
"APPLICABLE FACILITY FEE RATE" and "APPLICABLE UTILIZATION
FEE RATE" in their entirety to read as follows:
"APPLICABLE EURODOLLAR RATE MARGIN", "APPLICABLE FACILITY
FEE RATE" and "APPLICABLE UTILIZATION FEE RATE" shall mean,
the applicable per annum rate set forth below under the
caption "Applicable Eurodollar Rate Margin," "Applicable
Facility Fee Rate" and "Applicable Utilization Fee Rate",
as the case may be, based upon the ratings established by
S&P and Xxxxx'x for the Index Debt as of the most recent
determination date:
Tab 1
Applicable Applicable Applicable
Eurodollar Rate Facility Fee Utilization Fee
Pricing Level Margin Rate Rate
------------------------------------------------------------------------------------
LEVEL 1: If the Index
Debt is rated A- or
Better by S&P or A3 or
Better by Xxxxx'x 0.33% 0.12% 0.30%
LEVEL II: If Level I
Does not apply and the
Index Debt is rated
BBB+ or better by S&P or
Baa1 or better by
Xxxxx'x 0.575% 0.125% 0.30%
LEVEL III: If Level II
Does not apply and the
Index Debt is rated
BBB or better by S&P
Or Baa2 or better by
Xxxxx'x 0.725% 0.15% 0.375%
LEVEL IV: If Level III
Does not apply and the
Index Debt is rated
BBB- or better by S&P
Or Baa3 or better by
Xxxxx'x 0.80% 0.20% 0.375%
LEVEL V: If Level IV
Does not apply and the
Index Debt is rated
BB+ or below by S&P
And Ba1 or below by
Xxxxx'x 1.125% 0.25% 0.375%
For purposes of the foregoing, the applicable Pricing
Level shall change on the date of any relevant change in the
rating of the Index Debt by S&P or Xxxxx'x (or, if neither
S&P nor Xxxxx'x shall then be rating the Index Debt, any
other Applicable Rating Agency or Agencies). In the case of
split ratings from the Applicable Rating Agencies, (x) if the
ratings are two levels apart, the applicable Pricing Level
will be based on the average of the two ratings (e.g.,
BBB/Ba1 results in Pricing Level IV) and (y) if the ratings
are one level apart, the applicable Pricing Level will be
based on the higher of the two ratings (e.g., BBB-/Ba1
results in Pricing Level IV). If no Applicable Rating Agency
shall have established ratings for the Index Debt, or if an
Event of Default shall have occurred and be continuing, the
ratings shall be deemed to be in Level V. If the rating
system of Xxxxx'x or S&P (or any other Applicable Rating
Agency) shall change, or if either of them shall cease rating
the Index Debt (other than by reason of any action or
nonaction by the Company following or in anticipation of a
ratings downgrade), the parties hereto shall negotiate in
good faith to amend the references to specific ratings in
this definition to reflect such changed rating system, the
nonavailability of ratings from such rating agency and/or the
replacement of such rating agency with another Applicable
Rating Agency, and pending agreement on such amendment, the
rating in effect immediately prior to such change or
cessation will apply. If any Applicable Rating Agency shall
not have a rating in effect by reason of any action or
nonaction by the Company following or in anticipation of a
ratings downgrade, then such Applicable Rating Agency shall
be deemed to have established a rating in Level V.
(b) by adding the following definition
of "APPLICABLE RATING AGENCY" in proper alphabetical order:
"APPLICABLE RATING AGENCY" shall mean S&P, Xxxxx'x or any
other nationally recognized rating service(s) acceptable to
the Administrative Agent which is (are) used, as of any date
of determination, for purposes of determining whether a
Downgrade Event has occurred and determining the applicable
"Pricing Level" under the definitions of "APPLICABLE
EURODOLLAR RATE MARGIN", "APPLICABLE FACILITY FEE RATE" and
"APPLICABLE UTILIZATION FEE RATE".
(c) by amending the definition of
"CONSOLIDATED TOTAL INDEBTEDNESS" to delete the period (".")
at the end thereof and to substitute in lieu thereof ", MINUS
(v) Unencumbered VCOM Cash at such time, in an amount not to
exceed $500,000,000.";
(d) by adding the following definition of
"CONSOLIDATED SENIOR INDEBTEDNESS" in proper alphabetical
order:
"CONSOLIDATED SENIOR INDEBTEDNESS" shall mean, at any time,
the sum of the amounts (without duplication) at such time of
(i) consolidated total Indebtedness of the Company and its
Subsidiaries, to the extent required, in conformity with
GAAP, to be reflected on a balance sheet of the Company and
its Subsidiaries at that time, PLUS (ii) the maximum amount
available to be drawn under outstanding letters of credit at
that time, PLUS (iii) the aggregate amount of all
obligations of the Company under the Master Lease Documents,
including, without limitation and without duplication, the
maximum amount of all Accommodation Obligations of the
Company incurred in connection therewith, MINUS (iv) the
aggregate GAAP balance of Subordinated Indebtedness
outstanding at that time.
(e) by adding the following definition
of "DOWNGRADE EVENT" in proper alphabetical order:
"DOWNGRADE EVENT" shall mean the occurrence of any of the
following: (i) S&P issues a rating of BBB- with respect to
the Index Debt and places the Index Debt on "CreditWatch
with negative implications"; (ii) S&P issues a rating of BB+
or below with respect to the Index Debt; (iii) Xxxxx'x
issues a rating of Baa3 with respect to the Index Debt and
places the Index Debt on "Watchlist for Possible Downgrade";
(iv) Xxxxx'x issues a rating of Ba1 or below with respect to
the Index Debt; (v) no Applicable Rating Agency shall have
established ratings for the Index Debt; (vi) any Applicable
Rating Agency shall not have a rating in effect by reason of
any action or nonaction by the Company following or in
anticipation of a ratings downgrade; or (vii) an Event of
Default shall have occurred and be continuing. If the rating
system of Xxxxx'x or S&P (or any other Applicable Rating
Agency) shall change, or if either of them shall cease rating
the Index Debt (other than by reason of any action or
nonaction by the Company following or in anticipation of a
ratings downgrade), the parties hereto shall negotiate in
good faith to amend the references to specific ratings in
this definition to reflect such changed rating system, the
nonavailability of ratings from such rating agency and/or the
replacement of such rating agency with another Applicable
Rating Agency, and pending agreement on such amendment, the
rating in effect immediately prior to such change or
cessation will apply.
(f) by adding the following definition of
"EBITDAR" in proper alphabetical order:
"EBITDAR" shall mean, for any period, the sum of the amounts
for such period of (i) EBITDA for such period, PLUS (ii) the
amount of the interest component of total rent expense of the
Company and its Subsidiaries on the Master Lease Facilities,
including contingent rent, MINUS (iii) the interest component
of sublease rent income of the Company and its Subsidiaries
from property subject to the Master Lease Facilities, all
such income and expense accounted for on a consolidated basis
pursuant to GAAP.
(g) by amending the definition of "FEE
LETTERS" to delete the period (".") at the end thereof and to
substitute in lieu thereof "and (iii) the Fee Letter dated
the First Amendment Effective Date among the Administrative
Agent, CBL Capital Corporation and the Company.";
(h) by adding the following definition of
"FIRST AMENDMENT" in proper alphabetical order:
"FIRST AMENDMENT" shall mean the First Amendment to Credit
Agreement dated as of March 31, 2002 among the Company, the
Requisite Senior Lenders and the Administrative Agent.
(i) by adding the following definition of
"FIRST AMENDMENT EFFECTIVE DATE" in proper alphabetical
order:
"FIRST AMENDMENT EFFECTIVE DATE" shall have the meaning
assigned to it in the First Amendment.
(j) by adding the following definition of
"FOREIGN AFFILIATE in proper alphabetical order:
"FOREIGN AFFILIATE" shall mean any Affiliate of the Company
(i) which is not organized under the laws of the United
States of America, any state thereof or the District of
Columbia or (ii) with respect to which a majority of such
Affiliate's property is not located within any State of the
United States of America or the District of Columbia.
(k) by amending and restating the
definition of "INDEX DEBT" in its entirety to read as
follows:
"INDEX DEBT" shall mean the Company's senior long-term
Indebtedness.
(l) by adding the following definition of
"JOINT VENTURE" in proper alphabetical order:
"JOINT VENTURE" shall mean a Person which is an Affiliate of
the Company solely by reason of ownership of an interest in
such Person by the Company or a Subsidiary of the Company.
(m) by amending and restating the
definition of "MASTER LEASE FACILITIES" in its entirety to
read as follows:
"MASTER LEASE FACILITIES" shall mean (i) the Existing Master
Lease Facilities, (ii) the Operating Lease facility dated the
date hereof among the Company, as Lessee, Convenience
Statutory Trust 2001, as Lessor, the financial institutions
party thereto, as Note Holders and Certificate Holders, CBL
Capital Corporation, as Administrative Agent, and Xxxxxxx
Xxxxx Xxxxxx, Inc. as Lead Arranger, (iii) Capitalized Lease
Obligations relating to real property and VCOM electronic
kiosks provided by one or more financial institutions (and
not landlords) which, but for the amount thereof, would be
permitted by SECTION 8.01(v) but which do not result in an
Event of Default or a Potential Event of Default and (iv) any
similar facility entered into by the Company which does not
result in an Event of Default or a Potential Event of
Default, in each case, as amended, restated, supplemented or
otherwise modified from time to time; PROVIDED, HOWEVER, that
each Master Lease Facility shall provide that the financial
covenants applicable to such Master Lease Facility and the
defined terms relating thereto shall be substantively
identical to the financial covenants set forth in ARTICLE IX
of this Agreement and the defined terms used therein, in each
case as this Agreement may be amended, restated,
supplemented, modified, replaced or refinanced from time to
time.
(n) by adding the following definition of
"PERMITTED ACCOMMODATION OBLIGATIONS" in proper alphabetical
order:
"PERMITTED ACCOMMODATION OBLIGATIONS" shall mean the
following Accommodation Obligations of the Company and its
Subsidiaries: (i) guaranties resulting from endorsement of
negotiable instruments for collection in the ordinary course
of business; (ii) any guaranty of the Obligations by any
Subsidiary of the Company; (iii) reasonable obligations,
warranties and indemnities made under any contracts
effectuating any sale, assignment, transfer, lease,
conveyance or other disposition permitted under SECTION 8.02;
(iv) obligations, warranties and indemnities, not relating to
Indebtedness of any Person, which have been or are undertaken
or made in the ordinary course of business (including
reasonable and customary indemnities in engagement letters
for professionals with respect to transactions permitted by
this Agreement) and not for the benefit or in favor of an
Affiliate of the Company; (v) Accommodation Obligations of
the Company with respect to any Indebtedness of any of its
Subsidiaries permitted by SECTION 8.01 or any other
obligation or liability of any of its Subsidiaries, except to
the extent that such other obligation or liability otherwise
constitutes a breach of this Agreement; (vi) Accommodation
Obligations for Subsidiaries or Foreign Affiliates
(including, for purposes of this CLAUSE (vi), all Joint
Ventures) in lieu of Investments permitted under SECTION
8.04; (vii) Accommodation Obligations constituting Permitted
Existing Indebtedness and extensions and renewals thereof,
and substitutions therefor in the same or a lesser amount and
in respect of the same transaction; (viii) Accommodation
Obligations for the benefit of the Company's franchisees
arising in the ordinary course of business; (ix)
Accommodation Obligations arising in connection with the Loan
Documents; (x) indemnities made in the Yen Royalty Financing
Agreement; (xi) Accommodation Obligations in an amount not to
exceed $50,000,000 in the aggregate at any one time
outstanding with respect to any obligation or liability of
any Joint Venture or Foreign Affiliate; (xii) reasonable and
customary indemnification obligations (not directly or
indirectly supporting payment of any other Indebtedness) in
favor of any dealer, placement agent or issuing and paying
agent engaged to provide services related to the Commercial
Paper in respect of claims arising out of or resulting from
such services; and (xiii) other Accommodation Obligations in
an aggregate amount not to exceed $5,000,000 at any time
outstanding.
(o) by adding the following definition of
"PERMITTED EXISTING INDEBTEDNESS" in proper alphabetical
order:
"PERMITTED EXISTING INDEBTEDNESS" shall mean the Indebtedness
of the Company and its Subsidiaries reflected in the most
recent financial statements delivered prior to the First
Amendment Effective Date to the Administrative Agent and the
Lenders pursuant to SECTION 6.01(a) or (b), as applicable.
(p) by adding the following definition of
"SOLVENT" in proper alphabetical order:
"SOLVENT" shall mean, with respect to any Person on any date
of determination, that on such date (a) the fair value of the
property of such Person is greater than the total amount of
liabilities, including contingent liabilities, of such
Person; (b) the present fair salable value of the assets of
such Person is not less than the amount that will be required
to pay the probable liability of such Person on its
Indebtedness as they become absolute and matured; (c) such
Person does not intend to, and does not believe that it will,
incur Indebtedness or liabilities beyond such Person's
ability to pay as such Indebtedness and liabilities mature;
(d) such Person is not engaged in a business or transaction,
and is not about to engage in a business or transaction, for
which such Person's property would constitute an unreasonably
small capital; and (e) such Person generally is not paying
its Indebtedness or liabilities as such Indebtedness or
liabilities become due. The amount of contingent liabilities
(such as litigation, Accommodation Obligations and pension
plan liabilities) at any time shall be computed as the amount
that, in light of all the facts and circumstances existing at
the time, represents the amount that can reasonably be
expected to become an actual or matured liability.
(q) by amending and restating in its
entirety the definition of "SUBORDINATED INDEBTEDNESS" to
read as follows:
"SUBORDINATED INDEBTEDNESS" shall mean the Indebtedness
evidenced by, or in respect of, (i) the Senior Subordinated
Debentures, (ii) the QUIDS Subordinated Notes and (iii) any
additional Indebtedness (A) (I) subordinated in right of
payment on terms no less favorable to the Senior Lenders than
the subordination provisions set forth in the Senior
Subordinated Debenture Indentures, and (II) subject to
covenants and events of default (however denominated) in any
respect more burdensome to the Company than the covenants and
events of default applicable to any other Subordinated
Indebtedness then outstanding or (B) incurred on other terms
approved in writing by the Requisite Senior Lenders.
(r) by adding the following definition of
"UNENCUMBERED VCOM CASH" in proper alphabetical order:
"UNENCUMBERED VCOM CASH" shall mean, at any time, an amount
equal to (i) the aggregate amount of cash at such time in, or
designated for, VCOM kiosks maintained by the Company or the
VCOM Subsidiary, LESS (ii) all such cash which is the subject
of any Lien or right of setoff (whether directly, as proceeds
of other property subject to a Lien or right of setoff, or
otherwise), LESS (iii) all such cash which is held in any
deposit account which is subject to any Lien.
(s) by deleting in its entirety the
definition of "VCOM" and replacing it with the following
definition of "VCOM SUBSIDIARY":
"VCOM SUBSIDIARY" shall mean a Subsidiary of the Company, the
primary business of which is to operate the Company's VCOM
kiosk business segment.
(t) by amending and restating in its
entirety the definition of "YEN ROYALTY FINANCING AGREEMENT"
to read as follows:
"YEN ROYALTY FINANCING AGREEMENT" shall mean, collectively,
(a) the Credit Agreement dated as of March 21, 1988 among the
Company, the Yen Royalty Lender and Citicorp International
Limited, (b) the Credit Agreement dated as of April 21, 1998
among the Company, the Yen Royalty Lender and Citibank, N.A.,
as Administrative Agent, and (c) the Yen Loan Agreement dated
as of December 21, 2001 among the Company and the Yen Royalty
Lender, in each case as any Yen Royalty Financing Agreement
may be amended, supplemented or otherwise modified from time
to time, PROVIDED that no amendment, supplement or other
modification to any Yen Royalty Financing Agreement
pertaining to the Yen Royalty Financing Collateral or the
recourse of the Yen Royalty Lender (or any other creditor
under a Yen Royalty Financing Agreement) thereto shall
adversely affect the Administrative Agent, the Senior Lenders
or the Issuing Banks without the prior written consent of the
Requisite Senior Lenders.
(u) by amending and restating in its
entirety the definition of "YEN ROYALTY FINANCING COLLATERAL"
to read as follows:
"YEN ROYALTY FINANCING COLLATERAL" shall mean, as applicable,
the "Collateral" as defined in (a) the Assignment and
Security Agreement dated as of March 21, 1988 between the
Company and the Yen Royalty Lender entered into in connection
the credit agreement described in CLAUSE (a) of the
definition of "Yen Royalty Financing Agreement", (b) the
Assignment and Security Agreement dated as of April 21, 1998
between the Company and the Yen Royalty Lender entered into
in connection with the credit agreement described in CLAUSE
(b) of the definition of "Yen Royalty Financing Agreement"
and (c) the [Assignment and Security Agreement] dated as of
December 21, 2001 between the Company and the Yen Royalty
Lender entered into in connection with the loan agreement
described in CLAUSE (c) of the definition of "Yen Royalty
Financing Agreement".
(v) by amending and restating in its
entirety the definition of "YEN ROYALTY LENDER" to read as
follows:
"YEN ROYALTY LENDER" shall mean, as applicable, (i) with
respect to CLAUSE (a) of the definition of "Yen Royalty
Financing Agreement", Citibank (Channel Islands) Limited,
(ii) with respect to CLAUSE (b) of the definition of "Yen
Royalty Financing Agreement", the financial institutions from
time to time party to the Credit Agreement described in such
CLAUSE (b) and (iii) with respect to CLAUSE (c) of the
definition of "Yen Royalty Financing Agreement", CS Funding
Company.
2.2 AMENDMENT TO SECTION 5.01. Section 5.01
of the Credit Agreement is hereby amended by adding the
following as new subsection (z) at the end thereof:
(z) SOLVENCY. The Company is Solvent, and the Company and
the Subsidiary Guarantors, taken as a whole, are Solvent.
2.3 AMENDMENT TO SECTION 6.01(K). Section
6.01(k) of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:
(k) DOWNGRADE EVENT; CHANGE IN INDEBTEDNESS RATINGS. As
soon as obtaining knowledge thereof, written notice of the
occurrence of any Downgrade Event and of any change in the
ratings of the Company's senior long-term Indebtedness by
S&P, Xxxxx'x or any other Applicable Rating Agency
2.4 AMENDMENT TO SECTION 7.06. Section 7.06
of the Credit Agreement is hereby amended and restated in its
entirety to read as follows:
7.06 Subsidiary Guaranty. The Company shall cause each
of its Material Subsidiaries (other than CCEC, 7-Eleven
Canada, and upon the sale of 10% or more of the Equity
Interests in the VCOM Subsidiary in accordance with SECTION
8.02(a), the VCOM Subsidiary), whether existing on the
Effective Date or thereafter formed, acquired or qualifying
as a Material Subsidiary, to execute and deliver the
Subsidiary Guaranty or a joinder thereto, as applicable, on
the Effective Date (in the case of such Material Subsidiaries
existing on the Effective Date) or promptly following such
formation, acquisition or qualification (in the case of all
other such Material Subsidiaries), together with, in the case
of Subsidiaries becoming party to the Subsidiary Guaranty
after the Effective Date, such documents and legal opinions
as would have been required under Section 4.01 if such
Subsidiary had executed and delivered the Subsidiary Guaranty
on the Effective Date. The Subsidiary Guaranty shall provide
for the termination of the VCOM Subsidiary's obligations
under the Subsidiary Guaranty upon the sale of 10% or more of
the Equity Interests in the VCOM Subsidiary in accordance
with Section 8.02(a) of this First Amendment.
2.5 AMENDMENT TO SECTION 8.01. Section 8.01
of the Credit Agreement is hereby amended and restated in its
entirety to read as follows:
8.01 INDEBTEDNESS. The Company shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly
create, incur, assume or otherwise become or remain directly
or indirectly liable with respect to, any Indebtedness,
except:
(i) the Obligations and the obligations arising under
the Master Lease Facilities;
(ii) Permitted Existing Indebtedness and extensions,
renewals, replacements and refinancings of Permitted Existing
Indebtedness (other than Subordinated Indebtedness), not
exceeding the principal amount outstanding on the Effective
Date (together with, in the case of a refinancing, interest
accrued thereon and reasonable costs incurred in connection
with the refinancing);
(iii) Subordinated Indebtedness (other than QUIDS
Subordinated Notes) and extensions, renewals, replacements
and refinancings thereof which satisfy the criteria set forth
in the definition of "Subordinated Indebtedness", the
aggregate principal amount of which shall not exceed
$1,000,000,000 (together with, in the case of a refinancing,
interest accrued thereon and reasonable costs incurred in
connection with the refinancing);
(iv) Present or future Indebtedness of any Subsidiary of
the Company to the Company in an amount not exceeding
$100,000,000; and present and future Indebtedness of the
Company to any of its Subsidiaries or of any such Subsidiary
to any other such Subsidiary; provided, however, that any
Indebtedness of the Company to any such Subsidiary shall be
unsecured and subordinated in right of payment to the
Obligations;
(v) (A) Capitalized Lease Obligations (other than such
obligations included in Permitted Existing Indebtedness and
the Master Lease Facilities) and Indebtedness incurred in
connection with capital expenditures (and within a reasonable
period of time thereafter) if (1) such Capitalized Lease
Obligation and Indebtedness are incurred in connection with
the acquisition of assets at fair value after the Effective
Date, (2) such Capitalized Lease Obligation and Indebtedness
are unsecured or secured only by the assets acquired or
leased in connection with the transaction pursuant to which
the Indebtedness was originally incurred and (3) any Liens
securing such Capitalized Lease Obligations or Indebtedness
do not exceed the purchase price of the assets and the costs
incurred in connection with the acquisition of such assets;
(B) sale and leaseback transactions (other than the Master
Lease Facilities) and Accommodation Obligations with respect
to financing incurred by lessors solely for the purpose of
acquiring and constructing stores, store sites and related
fixtures and equipment which are to be leased by the Company,
if the obligations and Indebtedness incurred in connection
with such transactions are either unsecured or secured only
by the assets subject to such transactions; and (C)
extensions, renewals, replacements or refinancings thereof,
not exceeding the principal amount outstanding before giving
effect to the extension, renewal, replacement or refinancing
(together with, in the case of a refinancing, interest
accrued thereon and reasonable costs incurred in connection
with the refinancing); PROVIDED, that the aggregate principal
amount outstanding at any time pursuant to SECTION 8.01(v)(B)
(other than obligations or Indebtedness included in Permitted
Existing Indebtedness) and extensions, renewals, replacements
or refinancings thereof pursuant to SECTION 8.01(v)(C) do not
exceed $300,000,000;
(vi) Transaction Costs, not included in the Obligations,
incurred in connection with the Master Lease Facilities and
the transactions contemplated thereby;
(vii) Indebtedness in respect of Letters of Credit
(other than Facility Letters of Credit) reasonably incident
to the Company's business;
(viii) Indebtedness in respect of foreign currency
exchange agreements reasonably incident to the Company's
business and Interest Hedging Obligations with respect to
which the aggregate notional amount of Indebtedness subject
thereto does not exceed the then aggregate outstanding
principal amount of obligations of the Company;
(ix) Permitted Accommodation Obligations;
(x) surety bonds and appeal bonds required in the
ordinary course of business or in connection with the
enforcement of rights or claims of the Company or its
Subsidiaries or in connection with judgments which do not
result in an Event of Default hereunder or other breach
hereof;
(xi) Indebtedness of 7-Eleven Canada to obligees other
than the Company or its other Subsidiaries in an amount not
exceeding $30,000,000 (or the Canadian dollar equivalent
thereof) in the aggregate at any one time outstanding, plus
Permitted Existing Indebtedness owing by 7-Eleven Canada and
any refinancings thereof, provided, however, that at no time
shall the aggregate of all of such Indebtedness exceed
$90,000,000 (or the Canadian dollar equivalent);
(xii) the Yen Royalty Financing Indebtedness;
(xiii) Capital Lease obligations of the Company under
the Lease Agreement dated as of February 15, 1987, as amended
and restated as of December 21, 1990, between the Company and
CCEC;
(xiv) subject to the last sentence of SECTION 8.09(b),
unsecured Indebtedness which is either (A) Commercial Paper
or (B) owing to Ito-Yokado in connection with payments by
Ito-Yokado of the principal of or interest on (or other
amounts owing with respect to) Commercial Paper; PROVIDED,
that the aggregate principal amount outstanding pursuant to
SUBCLAUSES (A) and (B) shall not exceed $700,000,000;
(xv) Indebtedness with respect to QUIDS Subordinated
Notes and extensions, renewals, replacements and refinancings
thereof which satisfy the criteria set forth in the
definition of "Subordinated Indebtedness", the aggregate
principal amount of which shall not exceed $380,000,000
(together with, in the case of a refinancing, the interest
accrued thereon and reasonable costs incurred in connection
with such refinancing); and
(xvi) other present or future Indebtedness not in excess
of $40,000,000 at any time outstanding;
PROVIDED, that no Indebtedness for borrowed money permitted
hereunder, except for Permitted Existing Indebtedness to the
extent provided therein or in extensions or renewals thereof,
shall contain any provisions making a default under or in
respect of some other Indebtedness for money borrowed, a
default thereunder, unless such cross-default provisions are
applicable only with respect to defaults which have resulted
in the acceleration of payment obligations for money borrowed
in an amount not less than, in any particular case,
$15,000,000.
2.6 AMENDMENT TO SECTION 8.02(a). Section
8.02(a) of the Credit Agreement is hereby amended as follows:
(a) by deleting in its entirety the
reference in subsection (iv) thereof to "VCOM" and
substituting in lieu thereof "the VCOM Subsidiary"; and
(b) by deleting in its entirety the
reference in subsection (ix) thereof to "SUBSECTIONS (i)
through (ix) above" and substituting in lieu thereof
"SUBSECTIONS (i) through (viii) above".
2.7 AMENDMENT TO SECTION 9.01. Section 9.01
of the Credit Agreement is hereby amended and restated in its
entirety to read as follows:
9.01 CONSOLIDATED TOTAL INDEBTEDNESS RATIO. (a) From the
Effective Date through December 31, 2001, the Company shall
not on any Quarterly Determination Date occurring during any
period set out below permit the ratio of (a) Consolidated
Total Indebtedness as of such Quarterly Determination Date to
(b) EBITDA as determined as of such Quarterly Determination
Date for the four (4) calendar quarters ending on such date,
to be greater than the ratio set out below opposite such
period:
Period Maximum Ratio
-------- ---------------
Effective date through
March 31, 2001 4.25x
April 1, 2001 through
December 31, 2001 4.00x
(b) From and after January 1, 2002, the
Company shall not on any Quarterly Determination Date
occurring during any period set out below permit the ratio of
(a) Consolidated Total Indebtedness as of such Quarterly
Determination Date to (b) EBITDAR as determined as of such
Quarterly Determination Date for the four (4) calendar
quarters ending on such date, to be greater than the ratio
set out below opposite such period:
Period Maximum Ratio
-------- ---------------
January 1, 2002 through
September 30, 2002 4.25x
October 1, 2002 through
March 31, 2003 4.65x
April 1, 2003 through
March 31, 2004 4.50x
April 1, 2004 through
March 31, 2005 4.00x
April 1, 2005 through
January 25, 2006 3.50x
2.8 AMENDMENT TO SECTION 9.02. Section 9.02 of
the Credit Agreement is hereby amended and restated in its
entirety to read as follows:
9.02. MINIMUM INTEREST AND RENT COVERAGE RATIO. The
Company shall not on any Quarterly Determination Date
occurring during any period set out below permit the ratio of
(i) the sum of (A) EBITDA, PLUS (B) Rent Expense on Operating
Leases to (ii) the sum of (A) Consolidated Cash Interest
Expense, PLUS (B) Rent Expense on Operating Leases, in each
case as determined as of such Quarterly Determination Date
for the four (4) calendar quarters ending on such date, to be
less than the ratio set out below opposite such period:
Period Minimum Ratio
-------- ---------------
Effective date through
December 31, 2001 2.00x
January 1, 2002 through
March 31, 2004 1.95x
April 1, 2004 and thereafter 2.00x
2.9 ADDITION OF SECTION 9.03. The following new
Section 9.03 of the Credit Agreement is hereby added to
Article IX of the Credit Agreement:
9.03. CONSOLIDATED SENIOR INDEBTEDNESS TO EBITDAR. The
Company shall not on any Quarterly Determination Date
occurring during any period set out below permit the ratio of
(i) Consolidated Senior Indebtedness as of such Quarterly
Determination Date to (ii) EBITDAR as determined as of such
Quarterly Determination Date for the four (4) calendar
quarters ending on such date, to be greater than the ratio
set out below opposite such period:
Period Maximum Ratio
-------- ---------------
First Amendment Effective
Date through March 31, 2003 3.65x
April 1, 2003 through
March 31, 2004 3.50x
April 1, 2004 through
March 31, 2005 3.00x
April 1, 2005 and thereafter 2.75x
2.10 AMENDMENT TO SECTION 10.01(J). Section
10.01(j) of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:
(j) LOSS OF PAYMENT PRIORITY; FAILURE OF SUBORDINATION;
ITO-YOKADO CP LETTER AGREEMENT . For any reason any of the
subordination provisions of the documents and instruments
evidencing any Subordinated Indebtedness shall, at any time,
be invalidated or otherwise cease to be in full force and
effect, or the Obligations shall be subordinated or shall not
have the priority contemplated by this Agreement or such
subordination provisions, for any reason; and the Requisite
Senior Lenders shall have determined that any event described
in this SECTION 10.01(j) has or is likely to have Material
Adverse Effect. For any reason any provision of the Ito-
Yokado CP Letter Agreement ceases to be in full force and
effect on Ito-Yokado or ceases to be binding on Ito-Yokado or
Ito-Yokado shall so state any of the foregoing in writing.
3. DOWNGRADE EVENT AMENDMENTS TO CREDIT AGREEMENT.
Upon the occurrence of any "Downgrade Event" (as defined in
Section 2.1(e) above), whether occurring before or after any
"Upgrade Event" (as defined in Section 4 below), the Credit
Agreement is hereby automatically amended as follows (without
further action of the Company, the Administrative Agent or
any Lender):
3.1 AMENDMENT TO SECTION 8.04(a). Section
8.04(a) of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:
(a) GENERALLY. The provisions of Section 1007 of the
First Priority Subordinated Debenture Indenture as in effect
on the First Amendment Effective Date, together with any
definitions of terms used therein, are incorporated word for
word in this SECTION 8.04(a) by this reference as if fully
set forth herein; PROVIDED, if any or all of such provisions
and definitions are not in effect at the time of the then
most recent Downgrade Event, such provisions and definitions
not then in effect shall become effective only for dates and
periods on and after the occurrence of such Downgrade Event,
and, to the extent that the Company and its Subsidiaries
have, prior to the occurrence of such Downgrade Event,
exceeded any limitation set forth in such Section 1007, such
excess in existence at the time of such Downgrade Event shall
not constitute an Event of Default or a Potential Event of
Default until such time as the Company and its Subsidiaries
further exceed any limitation set forth in such Section 1007.
For the avoidance of doubt, the provisions of Section 1007 of
the First Priority Subordinated Debenture Indenture as in
effect on the First Amendment Effective Date, together with
any definitions of terms used therein, shall be effective for
purposes of this SECTION 8.04(a) until the payment in full of
all of the Obligations, notwithstanding the amendment, waiver
or other modification of such Section 1007 or such
definitions or the defeasance, refinancing, replacement or
termination at any time of the First Priority Subordinated
Debenture Indenture or any portion thereof and regardless of
whether such amendment, waiver, modification, defeasance,
refinancing, replacement or termination occurs before, on or
after the occurrence of a Downgrade Event; PROVIDED, HOWEVER,
that any payment, redemption, purchase, retirement,
defeasance, sinking fund or similar payment with respect to
Subordinated Indebtedness shall be subject to SECTION
8.10(a).
3.2 AMENDMENT TO SECTION 8.05. Section 8.05
of the Credit Agreement is hereby amended and restated in
its entirety to read as follows:
8.05 LIMITATIONS ON DIVIDENDS AND OTHER PAYMENT
RESTRICTIONS AFFECTING SUBSIDIARIES. The provisions of
Section 1008 of the First Priority Subordinated Debenture
Indenture as in effect on the First Amendment Effective
Date, together with any definitions of terms used therein,
are incorporated word for word in this SECTION 8.05 by this
reference as if fully set forth herein; PROVIDED, if any or
all of such provisions and definitions are not in effect at
the time of the then most recent Downgrade Event, such
provisions and definitions not then in effect shall become
effective only for dates and periods on and after the
occurrence of such Downgrade Event, and any event or
condition that shall have existed upon the occurrence of
such Downgrade Event and otherwise would have resulted in
an Event of Default or a Potential Event of Default under
this subsection if such provisions and definitions were in
effect, shall not constitute an Event of Default or
Potential Event of Default. For the avoidance of doubt, the
provisions of Section 1008 of the First Priority
Subordinated Debenture Indenture as in effect on the First
Amendment Effective Date, together with the definitions of
terms used therein, shall be effective for purposes of this
SECTION 8.05 until the payment in full of all of the
Obligations, notwithstanding the amendment, waiver or other
modification of such Section 1008 or such definitions or
the defeasance, refinancing, replacement or termination of
the First Priority Subordinated Debenture Indenture or any
portion thereof and regardless of whether such amendment,
waiver, modification, defeasance, refinancing, replacement
or termination occurs before, on or after the occurrence of
a Downgrade Event.
3.3 AMENDMENT TO SECTION 8.06. Section 8.06
of the Credit Agreement is hereby amended and restated in its
entirety to read as follows:
8.06 LIMITATIONS ON SUBSIDIARIES. The provisions of
Section 1020 of the First Priority Subordinated Debenture
Indenture as in effect on the First Amendment Effective Date,
together with any definitions of terms used therein, are
incorporated word for word in this SECTION 8.06 by this
reference as if fully set forth herein; PROVIDED, if any or
all of such provisions and definitions are not in effect at
the time of the then most recent Downgrade Event, such
provisions and definitions not then in effect shall become
effective only for dates and periods on and after the
occurrence of such Downgrade Event, and any event or
condition that shall have existed upon the occurrence of such
Downgrade Event and otherwise would have resulted in an Event
of Default or a Potential Event of Default under this
subsection if such provisions and definitions were in effect,
shall not constitute an Event of Default or Potential Event
of Default. For the avoidance of doubt, the provisions of
Section 1020 of the First Priority Subordinated Debenture
Indenture as in effect on the First Amendment Effective Date,
together with the definitions of terms used therein, shall be
effective for purposes of this SECTION 8.06 until the payment
in full of all of the Obligations, notwithstanding the
amendment, waiver or other modification of such Section 1020
or such definitions or the defeasance, refinancing,
replacement or termination of the First Priority Subordinated
Debenture Indenture or any portion thereof and regardless of
whether such amendment, waiver, modification, defeasance,
refinancing, replacement or termination occurs before, on or
after the occurrence of a Downgrade Event.
3.4 AMENDMENT TO SECTION 8.07. Section 8.07
of the Credit Agreement is hereby amended and restated in its
entirety to read as follows:
8.07 TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES. The
provisions of Section 1013 of the First Priority Subordinated
Debenture Indenture as in effect on the First Amendment
Effective Date, together with any definitions of terms used
therein, are incorporated word for word in this SECTION 8.07
by this reference as if fully set forth herein; PROVIDED, if
any or all of such provisions and definitions are not in
effect at the time of the then most recent Downgrade Event,
such provisions and definitions not then in effect shall
become effective only for dates and periods on and after the
occurrence of such Downgrade Event, and any event or
condition that shall have existed upon the occurrence of such
Downgrade Event and otherwise would have resulted in an Event
of Default or a Potential Event of Default under this
subsection if such provisions and definitions were in effect,
shall not constitute an Event of Default or Potential Event
of Default. For the avoidance of doubt, the provisions of
Section 1013 of the First Priority Subordinated Debenture
Indenture as in effect on the First Amendment Effective Date,
together with the definitions of terms used therein, shall be
effective for purposes of this SECTION 8.07 until the payment
in full of all of the Obligations, notwithstanding the
amendment, waiver or other modification of such Section 1013
or such definitions or the defeasance, refinancing,
replacement or termination of the First Priority Subordinated
Debenture Indenture or any portion thereof and regardless of
whether such amendment, waiver, modification, defeasance,
refinancing, replacement or termination occurs before, on or
after the occurrence of a Downgrade Event.
3.5 AMENDMENT TO SECTION 8.10. Section 8.10
of the Credit Agreement is hereby amended and restated in its
entirety to read as follows:
8.10 SUBORDINATED INDEBTEDNESS.
(a) PAYMENTS. On and after the occurrence of the
then most recent Downgrade Event, the Company shall not, and
shall not permit any of its Subsidiaries to, declare or make
any payment, redemption, purchase, retirement, defeasance,
sinking fund or similar payment with respect to Subordinated
Indebtedness, except (i) payments due on Subordinated
Indebtedness and permitted to be made pursuant to the terms
of such Subordinated Indebtedness, and repayments of
Subordinated Indebtedness from the proceeds of new
Subordinated Indebtedness; and (ii) so long as there does not
exist an Event of Default or a Potential Event of Default or
an Event of Default or a Potential Event of Default would
result therefrom, the Company may repurchase or redeem its
Senior Subordinated Debentures, PROVIDED that such
repurchases and redemptions shall be made with the proceeds
of Subordinated Indebtedness, Common Stock, or convertible or
preferred Capital Stock, in each case issued after the First
Amendment Effective Date, PROVIDED, FURTHER, that such
convertible or preferred Capital Stock does not contain any
mandatory redemption rights prior to the time the Obligations
are paid in full.
(b) AMENDMENTS. On and after the occurrence of
the then most recent Downgrade Event, the Company shall not,
and shall not permit any of its Subsidiaries to amend or
otherwise change the terms applicable to any Subordinated
Indebtedness. This SECTION 8.10(b) shall in no way limit
redemptions and repurchases of Subordinated Indebtedness
permitted by SECTION 8.10(a).
(c) NOTICES. The Company shall deliver to the
Administrative Agent (i) a copy of each notice or other
communication delivered by or on behalf of the Company to any
trustee under any Subordinated Indebtedness indenture or to
any holder (in its capacity as such) of any Subordinated
Indebtedness not issued pursuant to an indenture (including,
without limitation, notice of the election of any Extension
Period (as defined therein) under a QUIDS Subordinated Note),
such delivery to be made at the same time and by the same
means as such notice or other communication is delivered to
such trustee or such holder, and (ii) a copy of each notice
or other communication received by the Company from any
trustee under any Subordinated Indebtedness indenture or from
any holder (in its capacity as such) of any Subordinated
Indebtedness not issued pursuant to an indenture, such
delivery to be made promptly after such notice or other
communication is received by the Company.
4. UPGRADE EVENT AMENDMENTS TO CREDIT AGREEMENT. In
the event that, after the occurrence of the most recent
Downgrade Event, (a) the Index Debt is rated BBB- or better
by S&P and Baa3 or better by Xxxxx'x, (b) the Index Debt has
been so rated for a period not less than 90 days and (c) no
Downgrade Event is continuing as of the end of such 90-day
period (the occurrence of the events described in clauses
(a), (b) and (c) above are collectively referred to as an
"UPGRADE EVENT"), SECTIONS 8.04(a), 8.05, 8.06, 8.07 and 8.10
of the Credit Agreement are hereby automatically amended and
restated in their entirety (without further action of the
Company, the Administrative Agent or any Lender) with the
provisions of SECTIONS 8.04(a), 8.05, 8.06, 8.07 and 8.10,
respectively, of the Credit Agreement, in each case as in
effect immediately prior to occurrence of such Downgrade
Event.
5. FEES. In addition to any other fees payable under
the Loan Documents, the Company shall pay to the
Administrative Agent for the account of the Administrative
Agent or the Senior Lenders, as the case may be, the fees
agreed to between the Administrative Agent and the Company in
the Fee Letter dated the First Amendment Effective Date.
6. REPRESENTATIONS AND WARRANTIES. The Company hereby
represents and warrants to each Senior Lender, each Issuing
Bank, the Administrative Agent and the Co-Agent that (a) each
of the statements set forth in Section 5.01 of the Credit
Agreement are true, correct and complete on and as of the
First Amendment Effective Date as though made to each Senior
Lender, each Issuing Bank, the Administrative Agent and the
Co-Agent on and as of such date and (b) as of the First
Amendment Effective Date, no Event of Default or Potential
Event of Default has occurred and is continuing.
7. FIRST AMENDMENT EFFECTIVE DATE. This First
Amendment shall become effective as of the date first above
written (the "First Amendment Effective Date") upon the
satisfaction of the following conditions:
7.1 The Administrative Agent shall have
received counterparts hereof (with sufficient copies for
each Senior Lender), executed by the Company, the
Administrative Agent and the Requisite Senior Lenders;
7.2 Each of the Master Lease Facilities shall
have been amended to give effect to the amendments set forth
in Sections 2.7, 2.8 and 2.9 above; and
7.3 The Administrative Agent shall have
received payment of the fees described in the Fee Letter
dated the First Amendment Effective Date.
8. MISCELLANEOUS. This First Amendment is a Loan
Document. The headings herein are for convenience of
reference only and shall not alter or otherwise affect the
meaning hereof. Except to the extent specifically amended or
modified hereby, the provisions of the Credit Agreement shall
not, except as expressly provided herein, operate as a waiver
of any right, power or remedy of any Senior Lender or Issuing
Bank under any of the Loan Documents, nor constitute a waiver
of any provision of any of the Loan Documents.
9. COUNTERPARTS. This First Amendment may be
executed in any number of counterparts which together shall
constitute one instrument.
10. GOVERNING LAW. THIS FIRST AMENDMENT, AND ALL
ISSUES RELATING TO THIS FIRST AMENDMENT, INCLUDING THE
VALIDITY, ENFORCEABILITY, INTERPRETATION OR CONSTRUCTION OF
THIS FIRST AMENDMENT OR ANY PROVISION HEREOF, SHALL BE
GOVERNED BY, AND SHALL BE DETERMINED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK.
[signature pages follow]
IN WITNESS WHEREOF, the Administrative Agent, the
Requisite Senior Lenders and the Company have caused this
First Amendment to be executed by their respective officers
thereunto duly authorized as of the date first above written.
BORROWER: 7-ELEVEN, INC.
By: ---------------------------------
Title: Treasurer
ADMINISTRATIVE AGENT: CITIBANK, N.A., as the Administrative Agent
By: ---------------------------------
Title:
SENIOR LENDERS: CITIBANK, N.A.
By: ----------------------------------
Title:
THE SUMITOMO MITSUI BANKING CORPORATION,
NEW YORK BRANCH (successor in interest to
The Sakura Bank, Limited,
New York Branch)
By: -----------------------------------
Title:
THE ASAHI BANK, LTD.,
NEW YORK BRANCH
By: -------------------------------------
Title:
BANK OF TOKYO - MITSUBISHI, LTD.,
NEW YORK
BRANCH
By: -------------------------------------
Title:
THE FUJI BANK, LIMITED
By: ------------------------------------
Title:
THE INDUSTRIAL BANK OF JAPAN, LIMITED,
NEW YORK BRANCH
By: -------------------------------------
Title:
DEUTSCHE BANK AG
NEW YORK BRANCH and/or
CAYMAN ISLANDS BRANCH
By: -------------------------------------
Title:
By: -------------------------------------
Title:
CIBC, INC.
By: -------------------------------------
Title:
7-Eleven First Amendment
5
7-Eleven First Amendment
