EXHIBIT 10
SECOND AMENDMENT TO CREDIT AGREEMENT
This Second Amendment to Credit Agreement (this "Amendment") is entered
into as of August 12 , 1996, between Bank of America National Trust and
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Savings Association ("Bank") and K-Swiss, Inc. ("Borrower"), with reference
to the following:
Recitals
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A. Bank and Borrower are parties to that certain Credit Agreement
dated as of March 25, 1994, as modified by an amendment dated as
of June 29, 1995 (as amended, the "Credit Agreement").
B. Bank and Borrower now desire to further amend the Credit
Agreement on the terms and conditions set forth below.
Agreement
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NOW, THEREFORE, the parties hereto agree as follows:
1. Definitions. Capitalized terms not otherwise
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defined in this Amendment shall have the
meanings ascribed to them in the Credit Agreement.
2. Amendments. The Credit Agreement shall be
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amended as follows:
(a) In the definition of "Availability Period" in
Paragraph 1.1, the date "May 1, 1997" is
amended to read "July 1, 1998."
(b) In the definition of "Credit Limit" in
Paragraph 1.1, the amount "Fifty Million Dollars
($50,000,000)" is amended to read "Thirty Million
Dollars ($30,000,000)".
(c) Subparagraph 2.4(d) is amended in full to read as follows:
"(d) Borrower shall pay Bank negotiation fees of the
greater of one quarter percent(0.25%) of the amount of each
drawing or Ninety Dollars ($90), and other fees at the
times and in the amounts Bank advises Borrower from time to
time as being generally applicable to commercial letters of
credit issued by Bank, including without limitation
amendment, discrepancy, and cancellation fees."
(d) Paragraph 3.1 is amended in full to read as follows:
"3.1 Unused Commitment Fee (Advances).
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Intentionally omitted;"
(e) Paragraph 8.6 is amended in full to read as follows:
"8.6 Effective Tangible Net Worth. Maintain at
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all times on a consolidated basis effective Tangible Net
Worth plus Subordinated Debt of at least Sixty Seven
Million Two Hundred Thirty Four Thousand Dollars
($67,234,000) plus the sum of seventy-five percent (75%) of
net income after income taxes (without subtracting losses)
earned in each fiscal year commencing after December 31,
1995;
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(f) Paragraph 8.9 is amended to add the following sentence:
"For purposes of the foregoing calculation, the total
of all advances outstanding at any one time under the
Revolving Facility shall be a current liability."
(g) Paragraph 8.10 is amended in full to read as follows:
"8.10 Maximum Debt Requirement. Repay any advances in
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full, and not to draw any additional advances on the
Revolving Facility, for a period of at least thirty (30)
consecutive calendar days during the period from the date
of this Agreement through July 1, 1997, and during each
subsequent twelve-month period during the Availability
Period. For purposes of this paragraph, "advances" does not
include undrawn amounts of outstanding letters of credit;"
(h) Except as hereby amended, all of the terms and
conditions of the Credit Agreement shall remain in full
force and effect.
3. Representations and Warranties. Borrower represents and
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warrants to Bank that: (a) no Event of Default has occurred
and is continuing under the Credit Agreement, (b) the
representations and warranties in the Credit Agreement are
true as of the date of this Amendment, (c) this Amendment is
within Borrower's powers, has been duly authorized, and does
not conflict with Borrower's organizational papers,and (d)
this Amendment does not conflict with any law, agreement, or
obligation by which Borrower is bound.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the date first above written.
BANK OF AMERICA NATIONAL TRUST K-SWISS, INC.
AND SAVINGS ASSOCIATION
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxxxx Xxxxxxx
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Xxxxxxx X. Xxxxxx Xxxxxx Xxxxxxx
Vice President Vice President
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