AMENDMENT NO. 3 TO AMENDED AND RESTATED LOAN AGREEMENT
AND TO OTHER LOAN DOCUMENTS
AMENDMENT AGREEMENT, dated as of January 11, 2000, to the
Amended and Restated Loan Agreement, dated as of July 31, 1995 (as the same has
been or may be further amended, supplemented, modified or restated in accordance
with its terms, the "Loan Agreement") among XXX RADIO AND TELEVISION, INC., an
Ohio corporation ("Xxx Radio"), XXXXX & XXXXX APPLIANCES, INC., an Ohio
corporation ("Xxxxx"), STEREO TOWN, INC., a Georgia corporation ("Stereo Town"),
XXX KANSAS, INC., a Kansas corporation ("Xxx Kansas"), XXX ALABAMA, INC., an
Ohio corporation ("Xxx Alabama"), XXXXXXXXX.XXX, INC., an Ohio corporation ("Xxx
Internet"), those financial institutions named as lenders on Schedule 2.01
thereto (the "Lenders") and FLEET BANK, N.A. (as successor to NatWest Bank
N.A.), in its capacity as agent (the "Agent") for itself and the Lenders.
Capitalized terms used herein and not otherwise defined shall have the meanings
attributed to them in the Loan Agreement.
SECTION I. AMENDMENTS TO LOAN AGREEMENT
1. Section 1.01 of the Loan Agreement is amended by deleting
the definitions of "Acquisition Standards" and "Expiration Date" set forth
therein and substituting the following therefor:
"'Acquisition Standards' shall mean the following:
(i) In the event that a proposed acquisition is to be
on a "hostile" rather than a "friendly" basis, the Parent or the
Borrower, as the case may be, shall so state in the notice of proposed
acquisition it sends to the Agent in accordance with Section 14(g)(II)
of the Parent Guaranty or the definition of Borrower Acquisition, as
applicable, and the Agent or any Lender may disapprove such proposed
hostile acquisition if the Agent or any Lender, or any Person related
to the Agent or any Lender, or any participant of the Agent or any
Lender in connection with the Obligations, shall object to the proposed
acquisition because the target business is, or is affiliated with, a
customer of the Agent or such Lender, a Person related to the Agent or
such Lender, or any participant of the Lender; and
(ii) The nature of the target business shall not be
illicit or illegal, shall not subject the Agent or any Lender to
embarrassment or adverse publicity and shall not subject the Agent or
any Lender to any litigation, claim or other proceeding."
"'Expiration Date' shall mean July 31, 2005."
2. The definition of "Permitted Capital Expenditure Amount" in
Section 1.01 of the Loan Agreement is hereby amended by (a) deleting
"15,000,000" where it appears in clause (i) and substituting "$30,000,000"
therefor and (b) deleting "25,000,000" where it appears in clause (ii) and
substituting "50,000,000" therefor.
3. Section 1.01 of the Loan Agreement is further amended by
adding the following defined terms in the correct alphabetical order:
"'Availability' shall mean at any time the Borrowing Base
minus the sum at such time of (i) the unpaid principal balance of, and
accrued interest and fees on, the Revolving Credit Loans and (ii) the
Letter of Credit Usage."
"'Borrower Acquisition' shall mean the purchase by a Borrower
of (x) assets of any Person which constitute an operating unit or
business of such Person or (y) the capital stock or other beneficial
ownership interests in another Person; provided that (i) no Default or
Event of Default shall have occurred and be continuing on the date of
any such acquisition or would occur after giving effect thereto, (ii)
at all times during the twelve month period immediately preceding any
such acquisition, and after giving effect thereto, Availability shall
be equal to or greater than $25,000,000, (iii) the Borrower shall have
notified the Agent not less than 10 days prior to the proposed closing
date for any such acquisition, and the Agent shall have confirmed
within 5 days after Agent's receipt of such notice that the proposed
acquisition complies with the Acquisition Standards, and the Agent's
decision thereon shall be final and binding, (iv) the Borrowers shall
take or cause to be taken such actions as the Agent shall reasonably
request in order that the Agent be granted a first priority security
interest in all assets acquired, including, without limitation, all
assets of any target company and the pledge of any stock purchased or
of any Subsidiary formed and (v) any new Subsidiary shall issue a
Guaranty of the Obligations; provided further that the Borrowers and
the Parent may assume, for all Borrower Acquisitions and Permitted
Acquisitions in the aggregate, not more than $10,000,000 in
liabilities, contingent and actual and, in any event, including,
without limitation, lease obligations with respect to real property."
"'Borrower Stock Repurchase' shall mean the repurchase from
time to time by a Borrower of its issued and outstanding common stock;
provided that (i) no Default or Event of Default shall have occurred
and be continuing on the date of any such stock repurchase or would
occur after giving effect thereto, (ii) at all times during the twelve
month period immediately preceding any such stock repurchase, and after
giving effect thereto, Availability shall be equal to or greater than
$25,000,000."
"'Third Amendment Date' shall mean January 11, 2000."
4. Section 2.01 of the Loan Agreement is hereby amended by
deleting "$150,000,000" where it appears in paragraph (vi) and substituting
"$130,000,000" therefor.
5. Schedules 2.01, 2.02 and 2.03 to the Loan Agreement are
hereby deleted and the Schedules 2.01, 2.02 and 2.03 attached hereto as Annex A
are substituted therefor.
6. Paragraph (a) of Section 3.03 of the Loan Agreement is
hereby amended by deleting clause (iii) thereof in its entirety and substituting
the following therefor:
"(iii) the Borrowers shall pay to the Agent on behalf
of the Lenders a fee equal to (x) three-quarters of one percent (3/4%)
of the amount of such prepayment if such prepayment is made on or prior
to the first anniversary of the Third Amendment Date, (y) one-half of
one percent (1/2%) of the amount of such prepayment if such prepayment
is made after the first anniversary of the Third Amendment Date and on
or prior to the second anniversary of the Third Amendment Date and (z)
one-quarter of one percent (1/4%) of the amount of such prepayment if
such prepayment is made after the second anniversary of the Third
Amendment Date and on or prior to the third anniversary of the Third
Amendment Date."
7. Section 9.01 of the Loan Agreement is hereby amended by
deleting paragraph (b) thereof in its entirety and substituting the following
therefor:
"(b) Fixed Charge Coverage Ratio. Permit or suffer
the ratio (the "FC Ratio") of (i) EBITDA to (ii) the sum of (w)
scheduled principal payments on Indebtedness, (x) capital expenditures
made or committed (less any such expenditures made with Capex Financing
Proceeds), (y) tax expense and (z) Interest Expense, each for the
Parent and its Subsidiaries on a Consolidated basis, at any time to be
less than 1.00:1.00; provided, however, that the Borrowers shall not be
required to comply with the FC Ratio set forth above in the event that:
(A) Undrawn Availability at all times is greater than $25,000,000;
provided, that if Undrawn Availability at any time shall be $25,000,000
or less, then compliance with the FC Ratio shall be required at all
times thereafter unless Undrawn Availability shall subsequently
increase to more than $25,000,000 and shall remain at more than
$25,000,000 for twelve consecutive months, in which event compliance
with the FC Ratio shall not be required commencing with the end of such
twelve consecutive month period and shall not be required again until
such time, if any, as Undrawn Availability shall decrease to
$25,000,000 or less; or (B) EBITDA of the Parent and its Subsidiaries
on a Consolidated basis is not less than the aggregate amounts
specified below for the four fiscal quarters ending on the dates
indicated:
Period Amount
------ ------
January 31, 2000 21,000,000
April 30, 2000 21,000,000
July 31, 2000 21,000,000
October 31, 2000 21,000,000
January 31, 2001 23,000,000
April 30, 2001 23,000,000
July 31, 2001 23,000,000
October 31, 2001 23,000,000
January 31, 2002 26,000,000
April 30, 2002 26,000,000
July 31, 2002 26,000,000
October 31, 2002 26,000,000
January 31, 2003 29,000,000
April 30, 2003 29,000,000
July 31, 2003 29,000,000
October 31, 2003 29,000,000
January 31, 2004 33,000,000
April 30, 2004 33,000,000
July 31, 2004 33,000,000
October 31, 2004 33,000,000"
8. Section 9.02 of the Loan Agreement is hereby amended by (a)
deleting "$25,000,000" where it appears in clause (iii) thereof and substituting
"$50,000,000" therefor, (b) deleting the word "and" at the end of clause (iv)
thereof, (c) deleting the period at the end of clause (v) and substituting ";
and" therefor and (d) adding a new clause (vi) which reads as follows:
"(vi) Unsecured Indebtedness incurred solely to finance a
Borrower Acquisition or Borrower Stock Repurchase."
9. Section 9.03 of the Loan Agreement is hereby amended by
deleting the proviso in clause (ii) thereof in its entirety and substituting the
following therefor:
"provided, however, that no Liens (except in favor of the
Agent) shall be permitted on any stock or assets acquired or on any
asset of any target company acquired in a Permitted Acquisition or in a
Borrower Acquisition;"
10. Section 9.04 of the Loan Agreement is hereby amended by
deleting clause (a) thereof in its entirety and substituting the following
therefor:
"(a) Merge or consolidate with, or permit any of its
Subsidiaries to merge or consolidate with, any other Person, except
that a Subsidiary organized solely for the purpose of consummating a
Borrower Acquisition may merge or consolidate with another Person in
accordance with such Borrower Acquisition,"
11. Section 9.06 of the Loan Agreement is hereby amended by
(a) deleting the word "and" at the end of clause (ix) thereof, (b) deleting the
period at the end of clause (x) and substituting "; and" therefor and (c) adding
a new clause (xi) which reads as follows:
"(xi) Borrower Acquisitions and Borrower Stock Repurchases up
to an aggregate, during the remaining term of the Loan Agreement,
together with all Stock Repurchases and Permitted Acquisitions made on
or after the Third Amendment Date by the Parent in accordance with
Section 14(g) of the Parent Guaranty, of $40,000,000; provided that, to
the extent not used to finance Borrower Acquisitions, Borrower Stock
Repurchases, Stock Repurchases and Permitted Acquisitions included in
such $40,000,000 aggregate, Borrower Acquisitions, Borrower Stock
Repurchases, Stock Repurchases and Permitted Acquisitions may be
financed with proceeds of equity offerings by the Parent made after the
Third Amendment Date in an aggregate amount not to exceed 50% of such
proceeds."
12. Section 10.01 of the Loan Agreement is hereby amended by
(a) adding the word "or" at the end of clause (i) thereof and (b) adding a new
clause (j) which reads as follows:
"(j) if Availability shall be less than $25,000,000 at any
time during the twelve month period immediately subsequent to any Stock
Repurchase, Permitted Acquisition, Borrower Stock Repurchase or
Borrower Acquisition;"
SECTION II. AMENDMENT TO PARENT GUARANTY
Section 14(g) of the Parent Guaranty is hereby amended by (i)
deleting the phrase "except that for the period from and including April 1, 1997
through and including the remaining term of the Loan Agreement the Guarantor
shall be permitted up to an aggregate of $20,000,000 for any combination of the
following" and substituting therefor the phrase "except that for the period from
and including the Third Amendment Date through and including the remaining term
of the Loan Agreement the Guarantor shall be permitted up to an aggregate of
$40,000,000, together with all Borrower Stock Repurchases and Borrower
Acquisitions, for any combination of the following", (ii) adding at the end of
clause (C) in paragraph (II) thereof the phrase "and the Agent's decision
thereon shall be final and binding,", (iii) deleting the phrase "for all
Permitted Acquisitions in the aggregate, not more than $10,000,000" and
substituting therefor the phrase
"for all Permitted Acquisitions and Borrower Acquisitions in the aggregate, not
more than $10,000,000", (iv) deleting the phrase "in all assets purchased
including, without limitation, the pledge of any stock" and substituting
therefor the phrase "in all assets acquired including, without limitation, all
assets of any target company and the pledge of any stock" and (v) by adding a
new paragraph at the end thereof as follows:
"In addition, to the extent not used to finance Borrower
Acquisitions, Borrower Stock Repurchases, Stock Repurchases and
Permitted Acquisitions included in the $40,000,000 aggregate set forth
above, Borrower Acquisitions, Borrower Stock Repurchases, Stock
Repurchases and Permitted Acquisitions may be financed with
proceeds of equity offerings by the Parent made after the Third
Amendment Date in an aggregate amount not to exceed 50% of such
proceeds."
SECTION III. AMENDMENT TO PARENT SECURITY AGREEMENT
Paragraph 1 of the Parent Security Agreement is hereby amended
by (i) deleting the phrase "all Obligations including, without limitation,"
where it appears therein, (ii) inserting the word "Parent" immediately preceding
the word "Guaranty" where it appears therein and (iii) deleting the
parenthetical at the end thereof in its entirety and substituting the following
therefor:
"and all Obligations (as such term is defined in the Loan
Agreement; all of the foregoing are referred to hereinafter
collectively as the "Obligations")."
SECTION IV. CONDITIONS PRECEDENT
This Amendment Agreement shall become effective upon the
execution and delivery of counterparts hereof by the Borrowers, the Parent, the
Agent and the Required Lenders and the fulfillment of the following conditions:
1. No unwaived event has occurred and is continuing which
constitutes a Default or an Event of Default.
2. All representations and warranties made by the Borrowers
and the Parent in this Amendment Agreement shall be true and correct.
3. The Agent shall have received, for the ratable benefit of
the Lenders, an amendment and extension fee in the amount of $225,000.
4. All required corporate actions in connection with the
execution and delivery of this Amendment Agreement shall have been taken, and
each shall be satisfactory in form and substance to the Agent, and the Agent
shall have received all information and copies of
all documents, including, without limitation, records of requisite corporate
action that the Agent may reasonably request, to be certified by the appropriate
corporate person or governmental authorities.
5. All of the conditions subsequent set forth in Amendment
No. 2 to Amended and Restated Loan Agreement and to Other Loan Documents,
dated as of October 19, 1999, shall have been satisfied or waived by the Agent.
6. The Agent shall have received any promissory notes issued
to any Borrower or any Subsidiary of any Borrower in connection with any
Permitted Agreements, duly endorsed to the Agent.
7. The Agent shall have received acknowledgment copies of
financing statements (showing the Agent as assignee) duly filed in all
jurisdictions deemed necessary to perfect the security interests granted under
the Permitted Agreements.
SECTION V. MISCELLANEOUS
1. By its signature below, each of the Borrowers reaffirms and
restates the representations and warranties set forth in Article VII of the Loan
Agreement, and all such representations and warranties are true and correct on
the date hereof with the same force and effect as if made on such date (except
to the extent that they relate expressly to an earlier date). The Parent
reaffirms and restates the representations and warranties set forth in Section
14 of the Parent Guaranty, and all such representations and warranties are true
and correct on the date hereof with the same force and effect as if made on such
date (except to the extent that they relate expressly to an earlier date). In
addition, each of the Borrowers and the Parent represents and warrants (which
representations and warranties shall survive the execution and delivery hereof)
to the Agent and the Lenders that:
(a) it has the power and authority to execute, deliver and
carry out the terms and provisions of this Amendment Agreement and the
transactions contemplated hereby, and has taken or caused to be taken all
necessary actions to authorize the execution, delivery and performance of this
Amendment Agreement and the transactions contemplated hereby;
(b) no consent of any other Person (including, without
limitation, shareholders or creditors of the Borrowers or the Parent) and no
action of, or filing with any governmental or public body or authority is
required to authorize, or is otherwise required in connection with the
execution, delivery and performance of this Amendment Agreement, or consummation
of the transactions contemplated hereby;
(c) this Amendment Agreement has been duly executed and
delivered by or on behalf of the Borrowers and the Parent and constitutes a
legal, valid and binding obligation of
each of the Borrowers and the Parent enforceable in accordance with its terms,
subject as to enforceability to bankruptcy, reorganization, insolvency,
moratorium and other similar laws affecting the enforcement of creditors' rights
generally and the exercise of judicial discretion in accordance with general
principles of equity;
(d) the execution, delivery and performance of this Amendment
Agreement will not violate any law, statute or regulation, or any order or
decree of any court or governmental instrumentality, or conflict with, or result
in the breach of, or constitute a default under any contractual obligation of
any Borrower or the Parent; and
(e) as of the date hereof (after giving effect to the
consummation of the transactions contemplated under this Amendment Agreement)
there exists no Default or Event of Default.
By its signature below, each of the Borrowers and the Parent agree that
it shall constitute an Event of Default if any representation or warranty made
above should be false or misleading in any material respect.
2. Each of the Loan Agreement, the Parent Guaranty and the
Parent Security Agreement is hereby ratified and confirmed in all respects and,
except as expressly amended or waived hereby, all of the representations,
warranties, terms, covenants and conditions of the Loan Agreement, the Parent
Guaranty and the Parent Security Agreement shall remain unamended, unwaived and
in effect in accordance with their respective terms. The amendments and waivers
set forth herein shall be limited precisely as provided for herein and shall not
be deemed to be amendments or consents to, or waivers of modifications of, any
term or provision of the Loan Documents or any other document or instrument
referred to herein or therein or of any transaction or further or future action
on the part of any Borrower or the Parent requiring the consent of the Agent or
any Lender, except to the extent specifically provided for herein.
3. Each Borrower and the Parent confirms in favor of the Agent
and each Lender that it agrees that it has no defense, offset, claim,
counterclaim or recoupment with respect to any of its obligations or liabilities
under the Loan Agreement, the Borrowers Guaranty, the Parent Guaranty, the
Borrowers Security Agreement, the Parent Security Agreement, the Borrowers
Pledge Agreement, the Parent Pledge Agreement, the Security Agreement-Patents
and Trademarks or any other Loan Document and that, except as herein provided,
all terms of the Loan Agreement, the Borrowers Guaranty, the Parent Guaranty,
the Borrowers Security Agreement, the Parent Security Agreement, the Borrowers
Pledge Agreement, the Parent Pledge Agreement, the Security Agreement-Patents
and Trademarks and the other Loan Documents shall continue in full force and
effect.
4. This Amendment Agreement may be executed by the parties
hereto individually or in combination, in one or more counterparts, each of
which shall be an original
and all of which shall constitute one and the same agreement.
5. Delivery of an executed counterpart of a signature page by
telecopier shall be effective as delivery of a manually executed counterpart.
6. THIS AMENDMENT AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE (WITHOUT GIVING EFFECT TO THE
CONFLICTS OF LAWS PRINCIPLES THEREOF).
"BORROWERS"
XXX RADIO AND TELEVISION, INC.
By: XXXXXX X. XXXXX
--------------------------
Name: Xxxxxx X. Xxxxx
Title: Secretary
XXXXX & XXXXX APPLIANCES, INC.
By: XXXXXX X. XXXXX
--------------------------
Name: Xxxxxx X. Xxxxx
Title: Secretary
STEREO TOWN, INC.
By: XXXXXX X. XXXXX
--------------------------
Name: Xxxxxx X. Xxxxx
Title: Secretary
XXX KANSAS, INC.
By: XXXXXX X. XXXXX
--------------------------
Name: Xxxxxx X. Xxxxx
Title: Secretary
XXX ALABAMA, INC.
By: XXXXXX X. XXXXX
-------------------------
Name: Xxxxxx X. Xxxxx
Title: Secretary
XXXXXXXXX.XXX, INC.
By: XXXXXX X. XXXXX
--------------------------
Name: Xxxxxx X. Xxxxx
Title: Secretary
"PARENT"
XXX STORES CORPORATION
By: XXXXXX X. XXXXX
--------------------------
Name: Xxxxxx X. Xxxxx
Title: Secretary
"LENDERS"
FLEET BANK, N.A.,
Individually
By: XXXXXX XXXXXX
--------------------------
Name: Xxxxxx Xxxxxx
Title: Vice President
BANK ONE, N.A. (successor to Bank One,
Dayton, N.A.)
By: XXXXXXX X. XXXXXXXXX
-------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President
KEY BANK NATIONAL ASSOCIATION
By: R. XXXXXXX XXXXXXXX
-------------------------------
Name: R. Xxxxxxx Xxxxxxxx
Title: Vice President
NATIONAL CITY BANK (as successor by
merger to National City Bank, Dayton)
By: XXXXXX X. XXXXXXXXX
------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Vice President
THE PROVIDENT BANK
By: XXXXXX BRUNSWICK
------------------------------
Name: Xxxxxx Brunswick
Title: Vice President
THE FIFTH THIRD BANK
By:______________________________
Name:
Title:
FIRSTAR BANK, N.A. (as successor to
Star Bank, N.A.)
By: XXXXXX X. XXXXXXX
------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
"AGENT"
FLEET BANK, N.A.,
As Agent
By: XXXXXX XXXXXX
-------------------------------
Name: Xxxxxx Xxxxxx
Title: Vice President
ANNEX A
SCHEDULE 2.01
Revolving Credit Commitments
Approximate
Revolving Percentage of
Credit Total Revolving
Lender Commitment Credit Commitment
----------------- ----------------- --------------------
Fleet Bank N.A. $45,000,000 34.6154%
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Bank One, N.A. $20,000,000 15.3846%
000 Xxxx Xxxxx Xxxxxx
0xx Xxxxx
Xxxxxxxx, Xxxx 00000
Fax: (000) 000-0000
Key Bank National Association $15,000,000 11.5385%
00 Xxxxx Xxxx Xxxxxx
Xxxxxx, Xxxx 00000
Fax: (000) 000-0000
National City Bank $25,000,000 19.2308%
0 Xxxxx Xxxx Xxxxxx
Xxxxxx, Xxxx 00000-0000
Fax: (000) 000-0000
The Provident Bank $15,000,000 11.5385%
Courthouse Plaza Northeast
00 Xxxx 0xx Xxxxxx
Xxxxxx, Xxxx 00000
Fax: (000) 000-0000
Firstar Bank, N.A. $10,000,000 7.6923%
000 Xxxxxx Xxxxxx
X.X. Xxx 0000
Xxxxxxxxxx, Xxxx 00000-0000
Fax: (000) 000-0000
SCHEDULE 2.02
Domestic Lending Office
Lender Domestic Lending Office
------ -----------------------
Fleet Bank N.A. 00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Bank One, N.A. Kettering Tower
00 Xxxxx Xxxx Xxxxxx
Xxxxxx, XX 00000
Key Bank National Association 00 Xxxxx Xxxx Xxxxxx
Xxxxxx, XX 00000
National City Bank 0 Xxxxx Xxxx Xxxxxx
Xxxxxx, XX 00000
The Provident Bank Courthouse Plaza Northeast
00 Xxxx 0xx Xxxxxx
Xxxxxx, XX 00000
Firstar Bank, N.A. 000 Xxxxxx Xxxxxx
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000-0000
SCHEDULE 2.03
Eurodollar Lending Office
Lender Eurodollar Lending Office
------ -------------------------
Fleet Bank N.A. 00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Bank One, N.A. Kettering Tower
00 Xxxxx Xxxx Xxxxxx
Xxxxxx, XX 00000
Key Bank National Association 00 Xxxxx Xxxx Xxxxxx
Xxxxxx, XX 00000
National City Bank 0 Xxxxx Xxxx Xxxxxx
Xxxxxx, XX 00000
The Provident Bank Courthouse Plaza Northeast
00 Xxxx 0xx Xxxxxx
Xxxxxx, XX 00000
Firstar Bank, N.A. 000 Xxxxxx Xxxxxx
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000
