AMENDMENT NO. 3 TO LOAN AGREEMENT
Exhibit 10(q)
AMENDMENT NO. 3 TO LOAN AGREEMENT
THIS
AMENDMENT NO. 3 TO LOAN AGREEMENT (this “Amendment”) is
made and entered into as of June 2, 2006, with respect to that certain Loan Agreement dated as of
November 17, 2004 (as heretofore amended, restated, supplemented or otherwise modified from time to
time, the “Loan Agreement”), by and among G&K RECEIVABLES CORP., a Minnesota corporation, as
“Borrower”, G&K SERVICES, INC., a Minnesota corporation, in its capacity as the initial “Servicer”,
THREE PILLARS FUNDING LLC, a Delaware limited liability company (together with its successors and
permitted assigns, the “Lender”), and SUNTRUST CAPITAL MARKETS, INC., a Tennessee corporation, as
agent and administrator for Lender (in such capacity, together with its successor and assigns in
such capacity, the “Administrator”). Capitalized terms used and not otherwise defined herein are
used with the meanings attributed thereto in the Loan Agreement.
BACKGROUND
The parties wish to amend the Loan Agreement on the terms and subject to the
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the mutual agreements herein
contained, the parties hereto agree as follows:
1. Amendments.
1.1. The definition of “Facility Limit” in Section 1.1 of the Loan Agreement is
hereby amended and restated in its entirety to read as follows:
“Facility Limit” means $60,000,000.
1.2. The definition of “Loss Horizon Ratio” in Section 1.1 of the Loan
Agreement is hereby amended and restated in its entirety to read as follows:
“Loss Horizon Ratio” means, on any date of determination, the ratio computed as
of the most recent Calculation Date by dividing (a) Credit Sales for the most recent
four (4) Calculation Periods, by (b) an amount equal to the Aggregate Unpaid Balance
as of such Calculation Date, minus the aggregate Excess Concentration Amount
as of such Calculation Date.
1.3. Section 9.1.5(b)(i) of the Loan Agreement is hereby amended and
restated in its entirety to read as follows:
“(i) [intentionally omitted]”
1.4. Section 9.1,5(e) of the Loan Agreement is hereby amended and
restated in its entirety to read as follows:
(e)
Collateral Review. On or before the Closing Date, and annually
thereafter, a report of Commercial Lending Consultants or another firm
acceptable to Administrator (each such report, a “Collateral Review”) which
satisfies the requirements set forth on Schedule 9.1.5.
2. Representations. In order to induce the Administrator and the Lender to enter
into this Amendment, the Borrower hereby represents and warrants to the Administrator and the
Lender that no Significant Event or Unmatured Significant Event exists and is continuing as of
the date hereof.
3. Effectiveness. This Amendment shall become effective and shall inure to the
benefit of the Borrower, the Servicer, the Lender, the Administrator and their respective
successors and assigns as of the date first above written when the Administrator shall have
received:
(a) one or more counterparts hereof duly executed and delivered by each
of the parties hereto,
(b) an amendment and restatement of the Lender Note, duly executed by
the Borrower, in the face principal amount of $60,000,000,
(c) one or more counterparts of an amendment and restatement of the Fee
Letter, duly executed and delivered by each of the parties thereto, and
(d) a copy of the resolutions of the Borrower’s Boards of Directors
authorizing or ratifying the execution, delivery and performance of the Loan
Agreement, as amended hereby, and of the amended and restated Fee Letter and
Lender Note referenced above in this Section 3.
4. Ratification. Except as expressly amended above, the Loan Agreement
remains unaltered and in full force and effect and is hereby ratified and confirmed,
5. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK
(WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF
(OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW)).
6. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original and all of
which
when taken together shall constitute one and the same agreement. Delivery of an executed
counterpart of a signature page to this Amendment by facsimile shall be effective as delivery
of a
manually executed counterpart of this Amendment.
[signature pages begin on next page]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be executed by their
respective officers thereunto duly authorized as of the day and year first above written.
| G&K RECEIVABLES CORP., As Borrower | ||||
By:
|
Xxxxxxx X. Xxxxxx | |||
Name:
|
Xxxxxxx X. Xxxxxx | |||
Title:
|
Chief Financial Officer | |||
| G&K SERVICES, INC., As Initial Servicer | ||||
By:
|
Xxxxxxx X. Xxxxxx | |||
Name:
|
Xxxxxxx X. Xxxxxx | |||
Title:
|
Chief Financial Officer | |||
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| THREE PILLARS FUNDING LLC, As Lender | ||||
By:
|
Xxxxx X. Xxxxx | |||
Name:
|
Xxxxx X. Xxxxx | |||
Title:
|
Vice President | |||
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| SUNTRUST CAPITAL MARKETS, INC., As Administrator | ||||
By:
|
Xxxxxxx X. Xxxx | |||
Name:
|
Xxxxxxx X. Xxxx | |||
Title:
|
Managing Director | |||
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EXHIBIT A
AMENDED AND RESTATED LENDER NOTE
| $60,000,000.00 | June 2, 2006 |
FOR VALUE RECEIVED, G&K RECEIVABLES CORP., A MINNESOTA CORPORATION (the “Borrower”), promises
to pay to the order of THREE PILLARS FUNDING LLC, a Delaware limited liability company (the
“Lender”) on or before the Scheduled Commitment Termination Date, the principal sum of Sixty
Million and no/100 Dollars ($60,000,000.00) or, if less, the aggregate unpaid principal amount of
all Loans shown on the schedule attached hereto (and/or any continuation thereof and/or in the
records of the Lender) made by the Lender pursuant to that certain Loan Agreement, dated as of
November 17, 2004 (together with all amendments and other modifications, if any, from time to time
thereafter made thereto, the “Loan Agreement”), among Borrower, G&K Services, Inc., as servicer,
the Lender and SunTrust Capital Markets, Inc., as Administrator (the “Administrator”). This note
amends and restates in its entirety that certain Lender Note dated November 17, 2004.
Borrower also promises to pay interest on the unpaid principal amount hereof from time to time
outstanding from the date hereof until maturity (whether by acceleration or otherwise) and, after
maturity, until paid, at the rates per annum and on the dates specified in the Loan Agreement.
Payments of both principal and interest are to be made in lawful money of the United States of
America in immediately available funds to the account designated by Administrator pursuant to the
Loan Agreement.
This promissory note is the “Lender Note” referred to in, and evidences indebtedness incurred
under, the Loan Agreement, and the holder hereof is entitled to the benefits of the Loan Agreement,
to which reference is made for a description of the security for this Lender Note and for a
statement of the terms and conditions on which Borrower is permitted and required to make
prepayments and repayments of principal of the indebtedness evidenced hereby and on which such
indebtedness may be declared to be immediately due and payable. Unless otherwise defined,
capitalized terms used herein have the meanings provided in the Loan Agreement.
All parties hereto, whether as makers, endorsers, or otherwise, severally waive presentment
for payment, demand, protest and notice of dishonor.
THIS LENDER NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO ANY OTHERWISE APPLICABLE PRINCIPLES OF CONFLICTS OF
LAWS (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW).
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| G&K RECEIVABLES CORP. | |||||
| By | Xxxxxxx X. Xxxxxx | ||||
| Name: | Xxxxxxx X. Xxxxxx, CFO | ||||
| Title: | Chief Financial Officer | ||||
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Schedule attached to
Amended and Restated Lender Note dated June 2, 2006 of
G&K Receivables Corp.
PAYABLE TO THE ORDER OF Three Pillars Funding LLC
Amended and Restated Lender Note dated June 2, 2006 of
G&K Receivables Corp.
PAYABLE TO THE ORDER OF Three Pillars Funding LLC
| Date of | Amount of | Amount of | ||||
| Loan | Loan | repayment | ||||
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