Exhibit 10
AMENDMENT NO. 10
THIS AMENDMENT NO. 10 (the "Amendment") dated as of May 31, 2000, to
the Credit Agreement referenced below, is by and among MACSAVER FINANCIAL
SERVICES, INC., a Delaware corporation, (the "Borrower"), XXXXXX-XXXXXX COMPANY,
a Virginia corporation (the "Company"), the Lenders identified therein, WACHOVIA
BANK, N.A. (formerly, Wachovia Bank of Georgia, N.A.), as Administrative Agent,
BANK OF AMERICA, N.A. (formerly NationsBank, N.A.), as Documentation Agent, and
CRESTAR BANK and FIRST UNION NATIONAL BANK (formerly, First Union National Bank
of Virginia), as Co-Agents. Terms used but not otherwise defined shall have the
meanings provided in the Credit Agreement.
W I T N E S S E T H
WHEREAS, the Lenders established a $400 million credit facility for the
benefit of the Borrower pursuant to the terms of that Credit Agreement dated as
of July 18, 1995 (as amended and modified, the "Credit Agreement") among the
Borrower, the Company, the Lenders identified therein and Wachovia Bank of
Georgia, N.A., as Administrative Agent;
WHEREAS, the commitments under the Credit Agreement have been
permanently reduced to $140 million;
WHEREAS, the Borrower has requested certain modifications to the
Credit Agreement;
WHEREAS, the requested modifications require the consent of the
Required Lenders; and
WHEREAS, the Required Lenders have consented to the requested
modifications on the terms and conditions set forth herein;
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. The Credit Agreement is amended and modified in the following
respects:
1.1 The following definitions are amended or added in Section 1.1
to read as follows:
"Consolidated Funded Debt" means Funded Debt of the Company
and its Subsidiaries on a consolidated basis determined in accordance
with GAAP, but excluding for purposes hereof (i) amounts advanced
hereunder in respect of the Spread Account under Section 6.11(ii) and
(ii) any Funded Debt outstanding under the FUNB Lease Financing (as
defined in the Sharing Agreement) or the Wachovia Lease Financing (as
defined in the Sharing Agreement) to the extent that amounts have been
applied to purchase a participation interest in such Funded Debt, have
been deposited in escrow pending application to repay such Funded Debt
or have otherwise been applied in respect of such Funded Debt in
accordance with the related Senior Secured Financing Documents (as
defined in the Sharing Agreement).
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"Consolidated EBITDA" means, for the Company and its
Subsidiaries for any period, the sum of (i) Consolidated EBIT plus (ii)
to the extent deducted in determining net income, depreciation,
amortization and non-recurring non-cash charges and expenses associated
with a sale of assets (subject to the limitations on such exclusion for
certain losses as provided in the definition of Consolidated Net
Income) or refinancing of Indebtedness or leases permitted hereunder,
in each case on a consolidated basis determined in accordance with
GAAP, provided that (A) in the case of the sale or disposition for
value of all or any portion of Xxxxxxx, Mattress Discounters, Xxxxxx or
any other operating subsidiary, division or assets (other than assets
sold in a Permitted Receivables Financing), Consolidated EBITDA and its
components shall be adjusted to exclude for the applicable period
income statement items directly attributable to the assets, property
and/or operations which were the subject of such sale or disposition
and (B) for purposes of determining compliance with the Consolidated
Leverage Ratio covenant in Section 7.9(b), Consolidated EBITDA and its
components shall be calculated as if the Homemakers Stores had been
sold during the fiscal quarter ending May 31, 2000 (so long as the
Homemakers Stores shall have been sold or shall be under contract for
sale by August 31, 2000).
"Homemakers Stores" means the Homemakers retail store and
corporate offices located at 0000 Xxxxxxxxxxx Xxxx, Xxxxxxx Xxxxx,
Xxxxxxxx, 00000 (HM LOC #5710 and #1154), the Homemakers retail stores
located at 00 Xxxxxx Xxxxxx Xxxxx, Xxxxxx Xxxx, Xxxxxxxx, 00000 (HM LOC
#5610) and 0000 Xxxx Xxxxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx, 00000 (HM
LOC #5510) and the Homemakers distribution center located at 000 Xxxx
Xxx Xxxxx, Xxxxx Xxxxxx, Xxxxxxxx, 00000 (HM LOC #1201).
1.2 In Section 1.1 with respect to the definition of
"Consolidated Net Income", clause (iv) is deleted in its entirety and
a new clause (iv) is added to read as follows:
(iv) for purposes of determining compliance with the
Consolidated Net Worth covenant in Section 7.9(a), the Consolidated
Leverage Ratio covenant in Section 7.9(b) and the Consolidated Adjusted
Fixed Charge Coverage Ratio covenant in Section 7.9(c), there shall be
excluded (A) special non-cash charges of up to $28.5 million
(excluding, for purposes hereof, in any event, the portion of such
charges relating to Xxxxxxx, subject to satisfactory documentation) in
connection with implementation of the requirements of Securities and
Exchange Commission Staff Accounting Bulletin 101 regarding recognition
of revenue in certain retail transactions, (B) special cash
restructuring and severance charges of up to $2 million in the
aggregate taken in the first (ending May 31, 2000) and second (ending
August 31, 2000) fiscal quarters of 2000 and (C) special non-cash
charges of up to $8 million in the aggregate taken in the first (ending
May 31, 2000) and second (ending August 31, 2000) fiscal quarters of
2000 in connection with the sale of the Homemakers Stores.
1.3 Section 1.3 is amended in its entirety to read as follows:
1.3 Accounting Terms and Determinations. Unless otherwise
specified herein, all terms of an accounting character used herein
shall be interpreted, all accounting determinations hereunder shall be
made and all financial statements required to be delivered hereunder
shall be prepared in accordance with GAAP, applied on a basis
consistent (except for changes concurred in by the Company's
independent public accountants or otherwise required by a change in
GAAP) with the most recent audited consolidated financial statements
of the Company and its consolidated Subsidiaries delivered to the
Lenders, provided that (i) for purposes of determining compliance with
the Consolidated Leverage Ratio covenant in Section 7.9(b) and the
Consolidated Adjusted Fixed Charge Coverage Ratio covenant in Section
7.9(c), Consolidated Net Income, Consolidated EBIT, Consolidated
EBITDA and Consolidated EBITR shall be calculated without giving
effect to the implementation of Securities and Exchange Commission
Staff Accounting Bulletin 101 regarding recognition of revenue in
certain retail transactions and (ii) with respect to any change
concurred in by the Company's independent public accountants or
required by GAAP, in determining compliance with any of the provisions
of this Credit Agreement or any of the other Credit Documents, if (A)
the Company shall have objected to determining such compliance on such
basis at the time of delivery of such financial statements or (B) the
Required Lenders shall so object in writing within 30 days after the
delivery of such financial statements, then such calculations shall be
made on a basis consistent with that used in the preparation of the
latest financial statements as to which such objection shall not have
been made.
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1.4 In Section 7.1, a new subsection (c) is added to read as
follows:
(c) Internal Financial Statements. As soon as available and in
any event within 60 days after the end of each fiscal quarter of the
Company, a consolidated income statement of the Company and its
consolidated Subsidiaries for such quarterly period and for the portion
of the fiscal year ending with such period, in each case setting forth
in comparative form consolidated figures for the corresponding period
or periods of the preceding fiscal year (subject to normal recurring
year-end audit adjustments), all in reasonable form and detail
acceptable to the Administrative Agent and the Required Lenders, all
such financial statements to be prepared in accordance with GAAP (but
without giving effect to the implementation of Securities and Exchange
Commission Staff Accounting Bulletin 101 regarding recognition of
revenue in certain retail transactions) applied consistently throughout
the periods reflected therein.
2. The Company and the Borrower hereby affirm that the representations
and warranties set out in Section 6 of the Credit Agreement are true and correct
in all material respects as of the date hereof (except those which expressly
relate to an earlier period or date).
3. This Amendment shall be effective as of May 31, 2000 upon (i)
receipt by the Administrative Agent of the consent of the Required Lenders to
this Amendment and (ii) execution of this Amendment by the Borrower, the Company
and the Administrative Agent.
4. Except as modified hereby, all of the terms and provisions of the
Credit Agreement (including Schedules and Exhibits) shall remain in full force
and effect.
5. The Borrower agrees to pay all reasonable costs and expenses of the
Administrative Agent in connection with the preparation, execution and delivery
of this Amendment, including without limitation the reasonable fees and expenses
of Xxxxx & Xxx Xxxxx, PLLC.
6. This Amendment may be executed in any number of counterparts, each
of which when so executed and delivered shall be deemed an original, and it
shall not be necessary in making proof of this Amendment to produce or account
for more than one such counterpart.
7. This Amendment shall be deemed to be a contract made under, and for
all purposes shall be construed in accordance with, the laws of the State of
North Carolina.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Amendment to be duly executed and delivered as of the date and year
first above written.
BORROWER: MACSAVER FINANCIAL SERVICES, INC.,
a Delaware corporation
By: /s/Dossi X. Xxxxxxxxx
-----------------------------
Name: Dossi X. Xxxxxxxxx
Title: Vice-President
COMPANY: XXXXXX-XXXXXX COMPANY,
a Virginia corporation
By: /s/Xxxxx X. Xxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice-President
Treasurer and Secretary
ADMINISTRATIVE AGENT: WACHOVIA BANK,
N.A., as Administrative Agent for
and on behalf of the Lenders
By: signature illegible
Name:
Title:
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CONSENT TO AMENDMENT NO. 10
Wachovia Bank, N.A., as Administrative Agent
000 Xxxxxxxxx Xxxxxx, X.X.
29th Floor, MC-3490
Xxxxxxx, Xxxxxxx 00000
Attn: Syndication Services
Re: Credit Agreement dated as of July 18, 1995 (as amended and
modified, the "Credit Agreement") among MacSaver Financial
Services, Inc., Xxxxxx-Xxxxxx Company, Inc., the Lenders
identified therein and Wachovia Bank of Georgia, N.A. (now
known as Wachovia Bank, N.A.), as Administrative Agent. Terms
used but not otherwise defined shall have the meanings
provided in the Credit Agreement.
Amendment No. 10 dated May 31, 2000 (the "Subject
Amendment") relating to the Credit Agreement
Ladies and Gentlemen:
This should serve to confirm our receipt of, and consent to, the
Subject Amendment. We hereby authorize and direct you, as Administrative Agent
for the Lenders, to enter into the Subject Amendment on our behalf in accordance
with the terms of the Credit Agreement upon your receipt of such consent and
direction from the Required Lenders, and agree that the Borrower and the Company
may rely on such authorization.
Sincerely,
-----------------------------
[Name of Lender]
By:
--------------------------
Name:
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