AMENDMENT TO LOAN AGREEMENT AND NOTE
EXHIBIT 10.1
AMENDMENT TO LOAN AGREEMENT AND NOTE
This amendment (the “Amendment”), dated as of the date specified below, is by and between the
borrower (the “Borrower”) and the bank (the “Bank”) identified below.
RECITALS
A. The Borrower and the Bank have executed a Loan Agreement (the “Agreement”) dated
SEPTEMBER 21, 2007 and the Borrower has executed a Note (the “Note”), dated SEPTEMBER
21, 2007 , either or both which may have been amended and replaced from time to time, and the
Borrower (and if applicable, certain third parties) have executed the collateral documents which
may or may not be identified in the Agreement and certain other related documents (collectively the
“Loan Documents”), setting forth the terms and conditions upon which the Borrower may obtain loans
from the Bank from time to time in the stated amount of $10,000,000.00, as may be amended
from time to time.
B. The Borrower has requested that the Bank permit certain modifications to the Agreement and
Note as described below.
C. The Bank has agreed to such modifications, but only upon the terms and conditions outlined
in this Amendment.
TERMS OF AGREEMENT
In consideration of the mutual covenants contained herein, and for other good and valuable
consideration, the Borrower and the Bank agree as follows:
þ Change in Maturity Date. If checked here, any references in the Agreement or Note to
the maturity date or date of final payment are hereby deleted and
replaced with “ SEPTEMBER 5, 2010 ”.
o Change in Maximum Loan Amount. If checked here, all references in the Agreement and
in the Note (whether or not numerically) to the maximum loan amount are hereby deleted and replaced
with “$ ”, which evidences an additional $ available to be advanced subject to the terms and
conditions of the Agreement and Note.
o Temporary Increase in Maximum Loan Amount. If checked here, notwithstanding the
maximum principal amount that may be borrowed from time to time under the Agreement and Note, the
maximum principal amount that may be borrowed thereunder shall
increase from $ to $ effective
through annually. On through annually, the maximum principal amount that may be borrowed thereunder
shall revert to $ and any loans outstanding in excess of that amount will be immediately due and
payable without further demand by the Bank.
o Change in Multiple Advance Termination Date. If checked here, all references in the
Agreement and in the Note to the termination date for multiple advances are hereby deleted and
replaced with “ ”.
o Change in Payment Schedule. If checked here, effective upon the date of this
Amendment, any payment terms are amended as follows:
þ Change in Interest Rate. If checked here, effective upon the date of this Amendment,
interest payable under the Note is amended as follows:
The unpaid principal balance will bear interest at an annual rate described in the Interest Rate
Rider attached to this Amendment.
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o Change in Late Payment Fee. If checked here, subject to applicable law, if any
payment is not made on or before its due date, the Bank may collect a delinquency charge of % of
the unpaid amount. Collection of the late payment fee shall not be deemed to be a waiver of the
Bank’s right to declare a default hereunder.
þ Change in Closing Fee. If checked here and subject to applicable law, the Borrower
will pay the Bank a closing fee of $5,000.00 (apart from any prior closing fee)
contemporaneously with the execution of this Amendment. This fee is in addition to all other fees,
expenses and other amounts due hereunder.
o Change in Paid-In-Full Period. If checked here, all revolving loans under the
Agreement and the Note must be paid in full for a period of at
least consecutive days during each
fiscal year. Any previous Paid-in-Full provision is hereby replaced with this provision.
Default Interest Rate. Notwithstanding any provision of this Note to the contrary, upon any
default or at any time during the continuation thereof (including failure to pay upon maturity),
the Bank may, at its option and subject to applicable law, increase the interest rate on this Note
to a rate of 5% per annum plus the interest rate otherwise payable hereunder. Notwithstanding the
foregoing and subject to applicable law, upon the occurrence of a default by the Borrower or any
guarantor involving bankruptcy, insolvency, receivership proceedings or an assignment for the
benefit of creditors, the interest rate on this Note shall automatically increase to a rate of 5%
per annum plus the rate otherwise payable hereunder.
Effectiveness of Prior Documents. Except as specifically amended hereby, the Agreement, the
Note and the other Loan Documents shall remain in full force and effect in accordance with their
respective terms. All warranties and representations contained in the Agreement and the other Loan
Documents are hereby reconfirmed as of the date hereof. All collateral previously provided to
secure the Agreement and/or Note continues as security, and all guaranties guaranteeing obligations
under the Loan Documents remain in full force and effect. This is an amendment, not a novation.
Preconditions to Effectiveness. This Amendment shall only become effective upon execution by
the Borrower and the Bank, and approval by any other third party required by the Bank.
No Waiver of Defaults; Warranties. This Amendment shall not be construed as or be deemed to
be a waiver by the Bank of existing defaults by the Borrower, whether known or undiscovered. All
agreements, representations and warranties made herein shall survive the execution of this
Amendment.
Counterparts. This Amendment may be signed in any number of counterparts, each of which shall
be considered an original, but when take together shall constitute one document.
Authorization. The Borrower represents and warrants that the execution, delivery and
performance of this Amendment and the documents referenced herein are within the authority of the
Borrower and have been duly authorized by all necessary action.
Transferable Record. The agreement and note, as amended, is a “transferable record” as
defined in applicable law relating to electronic transactions. Therefore, the holder of the
agreement and note, as amended, may, on behalf of Borrower, create a microfilm or optical disk or
other electronic image of the agreement and note, as amended, that is an authoritative copy as
defined in such law. The holder of the agreement and note, as amended, may store the authoritative
copy of such agreement and note, as amended, in its electronic form and then destroy the paper
original as part of the holder’s normal business practices. The holder, on its own behalf, may
control and transfer such authoritative copy as permitted by such law.
Attachments. All documents attached hereto, including any appendices, schedules, riders, and
exhibits to this Amendment, are hereby expressly incorporated herein by reference.
[SIGNATURE(S) ON NEXT PAGE]
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| Dated as of: | SEPTEMBER 14, 2009. | Outdoor Channel Holdings, Inc. | ||||
| (Individual Borrower) | Borrower Name (Organization) | |||||
| a Delaware Corporation | ||||||
Borrower Name
|
N/A | By | /s/ Xxxxx X. Xxxxxx, Xx. | |||
| Name and Title Xxxxx X. Xxxxxx, Xx., CEO & President | ||||||
| By | /s/ Xxxx X. Xxxxx | |||||
| Borrower Name | N/A | Name and Title Xxxx X. Xxxxx, CFO | ||||
Agreed to: |
||||||
| U.S. BANK N.A. | ||||||
(Bank) |
||||||
By:
|
/s/ Xxxxxx X. Xxxx | |||
| Name and Title Xxxxxx X. Xxxx, Vice President | ||||
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ADDENDUM TO AMENDMENT TO
LOAN AGREEMENT AND NOTE
LOAN AGREEMENT AND NOTE
By and Between
U.S. Bank N.A. and Outdoor Channel Holdings, Inc.
September 14, 2009
This Addendum to Amendment of Loan Agreement and Note (this “Addendum”) is made part of the
Amendment to Loan Agreement and Note of even date herewith (the “Amendment”) by and between the
undersigned borrower (the “Borrower”) and U.S. Bank N.A. (the “Bank”). This Addendum is an
addendum to the Amendment. The warranties, covenants and other terms of this Addendum hereby
(i) supplement, amend or modify the Agreement (as defined in the Amendment), the Amendment, the
Interest Rate Rider of even date herewith (the “Interest Rate Rider”) by Borrower in favor of Bank,
the Loan Documents, and any and all other existing documents by and between Bank and Borrower with
respect to the subject matter hereof, and (ii) constitute warranties, covenants and terms of all
the extensions of credit made by Bank to Borrower. Capitalized terms not defined herein or by
reference to an existing document shall have the meanings ascribed to them in the Agreement or, if
not defined in the Agreement, in accordance with generally accepted accounting principles. In the
event of any conflict between the provisions of this Addendum, on one hand, and the Agreement, the
Amendment, the Interest Rate Rider, any Loan Document or any other document by and between Bank and
Borrower, on the other, the provisions of this Addendum shall prevail and control.
1. Amendment and Restatement of Fixed Charge Coverage Ratio Covenant. The requirement that
Borrower maintain a Fixed Charge Coverage Ratio of a minimum amount, as contained in that certain
Second Addendum to Revolving Credit Agreement and Note dated as of September 21, 2007 (the
“September 2007 Second Addendum”) by and between Borrower and Bank, is hereby amended and restated
in its entirety, as follows:
“Borrower shall maintain a Fixed Charge Coverage Ratio as of the end of each
fiscal quarter for the four (4) fiscal quarters then ended (i.e., on a “rolling
four (4) quarter basis”) of at least 1.25:1.
“Fixed Charge Coverage Ratio” shall mean (a) net income, plus interest expense,
plus rent expense, plus income tax expense, plus depreciation, plus amortization,
plus charges related to non-cash stock-based compensation per the SFAS 123R
requirement, minus cash taxes, cash dividends and Maintenance Capital Expenditures
divided by (b) the sum of all required principal payments (on short and
long term debt and capital leases), interest expense and rental or lease expense.
“Maintenance Capital Expenditures” shall mean the dollar amount of Capital
Expenditures that are necessary to maintain the current level of revenues. For
the purposes of this covenant calculation, at no time shall the amount of the
Capital Expenditures used be less than 50% of the annualized depreciation expense
of Borrower, prorated evenly for each applicable measurement period.
“Capital Expenditures” shall mean the aggregate amount of all purchases or
acquisitions of fixed assets, including real estate, motor vehicles, equipment,
fixtures, leases and any other items that would be capitalized on the books of the
Borrower under generally accepted accounting principles. The term “Capital
Expenditures” will not include expenditures or charges for the usual and customary
maintenance, repair and retooling of any fixed asset or the acquisition of new
tooling in the ordinary course of business.”
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2. Addition of Liquidity Covenant. The following covenants and definitions are hereby added to the
Amendment and the Agreement:
“Liquidity. Borrower shall maintain at all times liquid assets that have a market
value of no less than 150% of the maximum dollar amount of extensions of credit
that may be made by Bank to Borrower under the Agreement and the Loan Documents.
For purposes of this covenant, “liquid assets” shall consist only of the following
that are 100%-owned by Borrower and are not subject to any direct or indirect
restrictions or encumbrances: unencumbered cash and cash equivalents, including
readily liquidated money market funds and mutual funds, and government issued
securities with original maturities of less than 90 days.
Bank and Investment Account Statements. Borrower shall provide to Bank, no later
than 30 days after the end of each month, bank and/or brokerage statements as
necessary to demonstrate the amount of Borrower’s unencumbered liquid assets as of
the end of such quarter.”
3. Deletion of Minimum Quarterly Profit Covenant. The requirement that Borrower maintain a minimum
net profit for each of its fiscal quarters, including, without limitation, such requirement as
contained in Section 2 of the September 2007 Second Addendum, is hereby deleted in its entirety
from the September 2007 Second Addendum and the Loan Documents.
4. Continuing Validity. Except as expressly modified above or in the other agreements between
Borrower and Bank, the terms of the Agreement, the Amendment, the September 2007 Second Addendum,
the other Loan Documents and the other documents by and between Bank and Borrower in connection
with extensions of credit by Bank to Borrower, shall remain unchanged and in full force and effect.
[signature page follows]
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Dated as of September 14, 2009
Borrower:
Outdoor Channel Holdings, Inc.,
A Delaware corporation
A Delaware corporation
| By: | /s/ Xxxxx X. Xxxxxx, Xx. | |||||
| Name and Title: | Xxxxx X. Xxxxxx, Xx., | |||||
| Chief Executive Officer | ||||||
| and President | ||||||
| By: | /s/ Xxxx X. Xxxxx | |||||
| Name and Title: | Xxxx X. Xxxxx, | |||||
| Chief Financial Officer | ||||||
Agreed to:
Bank:
U.S. Bank N.A.
| By: | /s/ Xxxxxx X. Xxxx | |||||
| Name and Title: | Xxxxxx X. Xxxx, | |||||
| Vice President | ||||||
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INTEREST RATE RIDER
This Rider is made part of the Amendment to Loan Agreement and Note
(the “Amendment”) dated SEPTEMBER 14, 2009 by the undersigned borrower (the
“Borrower”) in favor of U.S. BANK N.A. (the “Bank”) as of the date identified below.
The following interest rate description is hereby added to the Amendment:
Interest Rate Options. Interest on each advance hereunder shall accrue at one of the following per
annum rates selected by the Borrower (“n/a” indicates rate option is not available, but Prime Rate
Loan option must always be selected) (i) upon notice to the Bank, 0.250 % plus the
prime rate announced by the Bank from time to time, as and when such rate changes (a “Prime Rate
Loan”); (ii) upon a minimum of two New York Banking Days prior notice, 2.250 % plus the
1, 2, 3, 6 or 12 month LIBOR rate quoted by the Bank from Reuters Screen LIBOR01 Page or any
successor thereto (which shall be the LIBOR rate in effect two New York Banking Days prior to
commencement of the advance), adjusted for any reserve requirement and any subsequent costs arising
from a change in government regulation (a “LIBOR Rate Loan”); or (iii) upon notice to the Bank,
n/a % plus the rate, determined solely by the Bank, at which the Bank would be able to
borrow funds of comparable amounts in the Money Markets for a 1, 2, 3, 6 or 12 month period,
adjusted for any reserve requirement and any subsequent costs arising from a change in government
regulation (a “Money Market Rate Loan”). The term “New York Banking Day” means any day (other than
a Saturday or Sunday) on which commercial banks are open for business in New York, New York. The
term “Money Markets” refers to one or more wholesale funding markets available to the Bank,
including negotiable certificates of deposit, commercial paper, eurodollar deposits, bank notes,
federal funds, interest rate swaps or others. No LIBOR Rate Loan or Money Market Rate Loan may
extend beyond the maturity of this Note. In any event, if the Loan Period for a LIBOR Rate Loan or
Money Market Rate Loan should happen to extend beyond the Maturity of this Note, such loan must be
prepaid at the time this Note matures. If a LIBOR Rate Loan or Money Market Rate Loan is prepaid
prior to the end of the Loan Period for such loan, whether voluntarily or because prepayment is
required due to the Note maturing or due to acceleration of this Note upon default or otherwise,
the Borrower agrees to pay all of the Bank’s costs, expenses and Interest Differential (as
determined by the Bank) incurred as a result of such prepayment. The term “Loan Period” means the
period commencing on the advance date of the applicable LIBOR Rate Loan or Money Market Rate Loan
and ending on the numerically corresponding day 1, 2, 3, 6 or 12 months thereafter matching the
interest rate term selected by the Borrow; provided, however, (a) if any Loan Period would
otherwise end on a day which is not a New York Banking Day, then the Loan Period shall end on the
next succeeding New York Banking Day unless the next succeeding New York Banking Day falls in
another calendar month, in which case the Loan Period shall end on the immediately preceding New
York Banking Day; or (b) if any Loan Period begins on the last New York Banking Day of a calendar
month (or on a day for which there is no numerically corresponding day in the calendar month at the
end of the Loan Period), then the Loan Period shall end on the last New York Banking Day of the
calendar month at the end of such Loan Period. The term “Interest Differential” shall mean that
sum equal to the greater of zero or the financial loss incurred by the Bank resulting from
prepayment, calculated as the difference between the amount of interest the Bank would have earned
(from like investments in the Xxxxx Markets as of the first day of the LIBOR Rate Loan or Money
Market Rate Loan) had prepayment not occurred and the interest the Bank will actually earn (from
like investments in the Money Markets as of the date of prepayment) as a result of the redeployment
of funds from the prepayment. Because of the short-term nature of this facility, the Borrower
agrees that the Interest Differential shall not be discounted to its present value. Any prepayment
of a LIBOR Rate Loan or Money Market Rate Loan shall be in an amount equal to the remaining entire
principal balance of such loan.
In the event the Borrower does not timely select another interest rate option at least two New York
Banking Days before the end of the Loan Period for a LIBOR Rate Loan or Money Market Rate Loan, the
Bank may at any time after the end of the Loan Period convert the LIBOR Rate Loan or Money Market
Rate Loan to a Prime Rate Loan, but until such conversion, the funds advanced under the LIBOR Rate
Loan or Money Market Rate Loan shall continue to accrue interest at the same rate as the interest
rate in effect for such LIBOR Rate Loan or Money Market Rate Loan prior to the end of the Loan
Period.
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The Bank’s internal records of applicable interest rates shall be determinative in the absence of
manifest error. Each LIBOR Rate Loan and each Money Market Rate Loan shall be in a minimum
principal amount of $100,000.
Dated as of: SEPTEMBER 14, 2009 .
| (Individual Borrower) | Outdoor Channel Holdings, Inc. | |||||
| Borrower Name (Organization) | ||||||
| a Delaware Corporation | ||||||
Borrower Name
|
N/A | By | /s/ Xxxxx X. Xxxxxx, Xx. | |||
| Name and Title Xxxxx X. Xxxxxx, Xx., CEO & President | ||||||
| By | /s/ Xxxx X. Xxxxx | |||||
| Borrower Name | N/A | Name and Title Xxxx X. Xxxxx, CFO | ||||
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