EXHIBIT 4(a)(1)(B)
[On Letterhead of WACHOVIA BANK, NATIONAL ASSOCIATION,
f/k/a First Union National Bank]
September 23, 2002
Dryclean USA, Inc.
000 XX 00xx Xxxxxx
Xxxxx, Xxxxxxx 00000
Attention: Xxxxxxx Xxxxxxx
Dear Xx. Xxxxxxx:
Reference is made to that certain Loan and Security Agreement, dated
as of December 19, 2001 (the "Loan Agreement"), between Dryclean USA, Inc. (the
"Borrower"), and First Union National Bank, n/k/a Wachovia Bank, National
Association (the "Bank"). The Loan Agreement and all other documents executed in
connection therewith are collectively referred to herein as the "Loan
Documents." Capitalized terms used herein and not otherwise defined shall have
the respective meanings ascribed to them in the Loan Agreement.
Section 5.25(a) of Loan Agreement provides:
(a) Debt Service Coverage Ratio. As of the last day of the each fiscal
year of Borrower, Borrower shall not permit the ratio of (i) the sum of
consolidated net income after tax for the fiscal year then ended plus
consolidated depreciation and amortization for the fiscal year then ended less
dividends declared or paid by Borrower for the fiscal year then ended to (ii)
current maturities of long-term debt (including capitalized leases and excluding
Revolving Loans) to be less than 1.25 to 1.0; provided, however, that such ratio
shall not be less than 1.00 to 1.0 for the fiscal year 2002 of the Borrower;
The Bank and the Borrower hereby agree that solely for the Borrower's
fiscal year ended June 30, 2002, such Debt Service Coverage Ratio shall be based
upon the ratio of (i) earnings from continuing operations plus depreciation of
amortization for the fiscal year ended June 30, 2002 less dividends declared or
paid by Borrower for the fiscal year then ended to (ii) current maturities of
long-term debt (including capitalized leases and and excluding Revolving Loans).
This calculation does not include the loss from discontinued operations from the
sale by the Borrower of its Metro-Tel Division. The Bank and the Borrower
further agree that for the Borrower's fiscal year ended June 30, 2003, and
thereafter, the definition of Debt Service Coverage Ration shall be as set forth
in Section 5.25(a) of the Loan Agreement.
Dryclean USA, Inc.
September 23, 2002
Page 2
The Borrower, by its signature below, represents and warrants that
there exist no defaults or Events of Defaults under the Loan Documents, that the
Loan Documents are in full force and effect and that the Borrower does not have
any defenses to its obligations under the Loan Documents nor any claims against
Bank.
Please evidence your acceptance of the terms of this letter by signing
and returning to the Bank a copy of this letter bearing original authorized
signatures of each of the parties indicated.
Very truly yours,
WACHOVIA BANK, NATIONAL
ASSOCIATION, f/k/a First Union National
Bank
By: /s/ Xxxxxxxxx X. Xxxxxxx
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Xxxxxxxxx X. Xxxxxxx
Senior Vice President
Acknowledged and agreed to the foregoing:
DRYCLEAN USA, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
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Title: President
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Date: 9/23/02
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