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EXHIBIT 10.12
FOURTH AMENDMENT TO LOAN AGREEMENT
THIS FOURTH AMENDMENT TO LOAN AGREEMENT (this "Fourth Amendment") is
entered into as of April 29, 1999, by and among THE GOOD GUYS - CALIFORNIA,
INC., a California corporation ("Borrower"), each of the financial institutions
from time to time listed on Schedule 1 attached to the Loan Agreement defined
below, as amended from time to time (collectively, the "Lenders"), and XXXXX
FARGO BANK, NATIONAL ASSOCIATION, ("Xxxxx Fargo"), as agent for the Lenders (in
such capacity, the "Agent").
RECITALS
WHEREAS, Borrower is currently indebted to the lenders pursuant to the
terms and conditions of that certain Loan Agreement among Borrower, the Lenders
and the Agent dated as of September 29, 1997, as amended from time to time (the
"Loan Agreement").
WHEREAS, the Lenders, the Agent and Borrower have agreed to certain
changes in the terms and conditions set forth in the Loan Agreement and have
agreed to amend the Loan Agreement to reflect such changes.
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
I. Amendment to Section 1.8. The definition of "Applicable Maximum
Amount" set forth in Section 1.8 of the Loan Agreement is
amended in its entirety to read as follows:
"Applicable Maximum Amount" means (a) from April 29, 1999,
through and including May 29, 1999, Eighty-Two Million Five
Hundred Thousand Dollars ($82,500,000), and (b) at any other
time, Seventy-Five Million Dollars ($75,000,000).
II. Amendment to Section 2.1(c). Section 2.1(c) of the Loan
Agreement is amended in its entirety to read as follows:
(c) Overadvance Subfeature; Non-Compliance with Advance
Limitations.
(i) Each Lender hereby severally agrees, on a pro
rata basis, to make Revolving Advances to
Borrower from time to time for the period from
April 29, 1999, through and including May 29,
1999, in excess of the amounts under the lending
formula (each, an "Overadvance"), but
nonetheless subject to the Applicable Maximum
Amount. The aggregate principal
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amount of such Overadvances shall not exceed, as
of any date of determination during said period,
Seven Million Five Hundred Thousand Dollars
($75,000,000.00).
(ii) The foregoing shall be referred to herein as the
"Overadvance Subfeature." Each Overadvance made
by Lender under the Overadvance Subfeature shall
be deemed a Revolving Advance under the Line of
Credit and shall be repaid by Borrower in
accordance with the terms and conditions of this
Agreement applicable to such Revolvng Advances;
provided, however, that (A) Overadvances under
the Overadvance Subfeature shall not be subject
to the lending formulas set forth in Section
2.1(a), and (B) the aggregate amount of all
outstanding Overadvances under the Overadvance
Subfeature shall be reserved under the Line of
Credit and shall not be available for Revolving
Advances thereunder.
(iii) In the event that the outstanding amount of any
component of the Revolving Advances, or the
aggregate amount of the outstanding Revolving
Advances and Letter of Credit Obligations,
exceed the amounts available under the lending
formulas, the sublimit for Overadvances set
forth in Section 2.1 (c)(i), the sublimits for
Letters of Credit set forth in Section 2.2(b) or
the then Applicable Maximum Amount, as the case
may be, such event shall not limit, waive or
otherwise affect any rights of the Agent in that
circumstances or on any future occasions and
Borrower shall, upon demand by the Agent, which
may be made at any time or from time to time,
immediately repay to Lenders the entire amount
of any such excess(es) for which payment is
demanded.
III. Exhibit B. Exhibit B (the Line of Credit Note) to the Loan
Agreement is amended and restated in its entirety by Exhibit B
attached hereto as Annex I.
IV. Conditions Precedent. The effectiveness of this Fourth Amendment
and the Agent's and Lenders' agreements set forth herein are
subject to the satisfaction of each of the following conditions
precedent on or before April 29, 1999:
A. Documentation. Borrower shall have delivered or
caused to be delivered to the Agent, at
Borrower's sole cost and expense the following,
each of which shall be in form and substance
satisfactory to the Agent:
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(a) Two (2) executed original counterparts
of this Fourth Amendment;
(b) executed counterparts of the Consent and
Reaffirmation of Guarantor attached
hereto in the form of Annex II;
(c) unanimous written consent of the board
of directors of Borrower authorizing
Borrower to borrow, under the Loan
Agreement, any amount not to exceed
$82,500,000.00;
(d) an Amended and Restated Line of Credit
Note executed by Borrower in favor Xxxxx
Fargo substantially in the form of Annex
I attached hereto; and
(e) such additional agreements,
certificates, reports, approvals,
instruments, documents, consents and/or
reaffirmations as the Agent or any
Lender may reasonably request.
B. Amendment Fee. Borrower shall have paid to the Agent,
for the benefit of the Lenders, an amendment fee of
$75,000; provided that upon extension of the Loan
Agreement for a period of at least one year from the
Line Maturity Date, $25,000 of said amendment fee shall
be refunded to Borrower concurrently with the
effectiveness of such extension of the Loan Agreement.
V. Miscellaneous. Except as specifically provided herein, all terms
and conditions of the Loan Agreement remain in full force and
effect, without waiver or modification. All terms defined in the
Loan Agreement shall have the same meaning when used in this
Fourth Amendment. This Fourth Amendment and the Loan Agreement
shall be read together, as one document.
VI. Representations and Warranties. Borrower hereby remakes all
representations and warranties contained in the Loan Agreement
and reaffirms all covenants set forth therein. Borrower further
certifies that as of the date of this Fourth Amendment there
exits no Default of Event of Default as defined in the Loan
Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Fourth Amendment
to be executed as of the day and year first written above.
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THE GOOD GUYS - CALIFORNIA, INC. XXXXX FARGO BANK,
a California corporation NATIONAL ASSOCIATION,
as Agent and Lender
By: By:
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Xxxx Xxxxxx
Vice President
Title:
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ANNEX I
AMENDED AND RESTATED
LINE OF CREDIT NOTE
$82,500,000 April 29, 1999
FOR VALUE RECEIVED, the undersigned, THE GOOD GUYS - CALIFORNIA,
INC., a California corporation ("Borrower"), hereby promises to pay to the order
of XXXXX FARGO BANK, NATIONAL ASSOCIATION, a national banking association
("Lender"), on the Line Maturity Date the principal sum of Eighty-Two Million
Five Hundred Thousand Dollars ($82,500,000), or such lesser amount as shall
equal the aggregate outstanding principal balance of all Revolving Advances made
by Lender to Borrower pursuant to the Loan Agreement referred to below.
This promissory note is one of the Line of Credit Notes referred to in,
and subject to the terms of, that certain Loan Agreement among Borrower, Lender
and the other financial institutions from time to time parties thereto
(collectively, the "Lenders"), and Xxxxx Fargo Bank, National Association, as
agent for the Lenders, dated as of September 29, 1997 (as amended, modified or
supplemented from time to time, the "Loan Agreement"). Capitalized terms used
herein shall have the respective meanings assigned to them in the Loan
Agreement. This promissory note amends and restates in its entirety that certain
Line of Credit Note dated as of September 29, 1997 executed and delivered by
Borrower to the order of Lender in the original principal amount of up to
$75,000,000 (the "Prior Note"). Amounts outstanding and committed under the
Prior Note shall, upon the effectiveness of this Note be deemed to be
outstanding and committed hereunder and evidenced hereby, subject, however, to
all terms and conditions hereunder and under the Loan Agreement.
Borrower further promises to pay interest on the outstanding principal
balance hereof at the interest rates, and payable on the dates, set forth in the
Loan Agreement. All payments of principal and interest hereunder shall be made
to Agent, at Agent's Office, for the account of Lender, in lawful money of the
United States and in same day or immediately available funds.
Lender is authorized, but not required, to record the date and amount of
each Revolving Advance evidenced hereby, each conversion to a different interest
rate and the length of each Fixed Rate Term, the date and amount of each payment
of principal and interest hereunder, and the resulting unpaid principal balance
hereof, in Lender's internal records, and any such recordation shall be prima
facie evidence of the accuracy of the information so recorded; provided however,
that Lender's failure to so record shall not limit or otherwise affect the
obligations of Borrower hereunder and under the Loan Agreement to repay the
principal hereof and interest hereon.
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The Loan Agreement provides, among other things, for acceleration (which
in certain cases shall be automatic) of the maturity hereof upon the occurrence
of certain stated events, in each case without presentment, demand, protest of
further notice of any kind, all of which are hereby expressly waived by
Borrower.
This promissory note is secured by certain collateral more specifically
described in the Loan Agreement and the other Loan Documents.
This promissory note shall be governed by and construed in accordance
with the laws of the State of California.
THE GOOD GUYS - CALIFORNIA, INC.
a California corporation
By:
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Title:
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ANNEX II
CONSENT AND REAFFIRMATION OF GUARANTOR
Reference is hereby made to the foregoing Fourth Amendment to
Loan Agreement ("Fourth Amendment") dated as of April 29, 1999, by and among The
Good Guys - California, Inc., a California corporation ("Borrower"), each of the
financial institutions from time to time listed on Schedule I attached to the
Loan Agreement described therein, as amended from time to time (collectively,
the "Lenders"), and Xxxxx Fargo Bank, National Association ("Xxxxx Fargo"), as
agent for the Lenders (in such capacity, the "Agent").
In order to induce the Agent and the Lenders to enter into the
Fourth Amendment, the undersigned hereby consents to the execution, delivery and
performance by Borrower, the Agent and the Lenders of the Fourth Amendment and
all other documents, instruments and agreements now or hereafter executed in
connection therewith (collectively, together with the Fourth Amendment, the
"Fourth Amendment Documents"). In connection therewith, the undersigned (a)
expressly and knowingly reaffirms its liability under the Continuing Guaranty
dated as of September 29, 1997 (the "Guaranty") and any and all security
agreements, pledge agreements, deeds of trust, mortgages and other collateral
documents (collectively, together with the Guaranty, the "Third Party
Documents"), heretofore executed and delivered by the undersigned from time to
time in favor of the Agent, for the benefit of the Lenders, (b) expressly agrees
to be and remain liable under the terms of such Third Party Documents for the
obligations of Borrower to the Agent and the Lenders and (c) acknowledges that
it has no defense, offset or counterclaim whatsoever against the Agent or the
Lenders with respect to the Third Party Documents to which it is a party.
The undersigned further agrees that the Third Party Documents to
which it is a party shall remain in full force and effect and are hereby
ratified and confirmed and shall guarantee payment and performance of, or
continue to constitute collateral security for, as the case may be, of all of
Borrower's obligations under the Loan Agreement and related Loan Documents, as
any one or more of the same may be amended by the Fourth Amendment Documents.
The undersigned acknowledges that (a) none of the Agent or the Lenders has any
obligation to inform it of the particulars of any modification or amendment to
the Loan Agreement or any other Loan Document executed in connection therewith,
and (b) it has established satisfactory means by which Borrower keeps it
informed with respect to any modification of or amendment to the Loan Agreement
and related Loan Documents.
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The undersigned further agrees that the execution of this
Consent and Reaffirmation is not necessary for the continued validity and
enforceability of the Third Party Documents to which it is a party, but is
executed to induce the Agent and the Lenders to enter into the Fourth Amendment
Documents. The undersigned further agrees that none of the Agent or the Lenders
shall have any obligation to notify it of any actions or omissions to act with
respect to its dealings with Borrower.
IN WITNESS WHEREOF, the undersigned, intending to be legally
bound hereby, has caused this Consent and Reaffirmation to be executed as of
April 29, 1999.
THE GOOD GUYS, INC.,
a Delaware corporation
By:
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Title:
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