Exhibit 10.1
LIMITED WAIVER AND
AMENDMENT NO. 1 AND AGREEMENT dated as of November 15, 2004
(this “ Waiver & Amendment ”), with respect
to the Credit Agreement dated as of January 25, 2002 (the
“ Credit Agreement ”), among Coinmach Laundry
Corporation (“ Holdings ”), Coinmach Corporation
(the “ Borrower ”), the Subsidiary Guarantors
listed on the signature pages thereto or that otherwise became
party to the Credit Agreement by joinder, the lending institutions
from time to time party thereto (each, a “ Bank
” and, collectively, the “ Banks ”),
Deutsche Bank Trust Company Americas (f/k/a Bankers Trust Company),
as Administrative Agent and Collateral Agent, Deutsche Bank
Securities Inc. (f/k/a Deutsche Banc Alex. Brown Inc.), as Lead
Arranger and Book Manager, J.P. Morgan Securities Inc. and Wachovia
Capital Markets, LLC (f/k/a First Union Securities, Inc.), as
Syndication Agents, and Credit Lyonnais New York Branch, as
Documentation Agent.
A. Pursuant
to the Credit Agreement, the Banks have agreed to extend credit to
the Borrower pursuant to the terms and conditions set forth
therein.
B. The Credit
Parties have indicated to the Administrative Agent and the Banks
that a newly formed affiliate of Holdings that will become the
parent of Holdings (“ CSC ”) intends to enter
into a series of transactions, along with certain of the Credit
Parties, whereby the following will occur: (i) CSC will issue
(x) between $250.0 million and $380.0 million in
aggregate gross proceeds of Income Deposit Securities (“
IDS ”) that consist of an aggregate of a number of
shares to be determined of CSC class A common stock (gross proceeds
equal to approximately 55% of the aggregate gross proceeds of the
IDS) and senior secured notes due 2024 in an initial aggregate
principal amount equal to approximately 45% of the aggregate gross
proceeds of the IDS (the “ IDS Debt ”) and
(y) an additional $20.0 million in aggregate principal
amount senior secured notes due 2024 separate and apart from the
IDS (such additional senior secured notes due 2024, the “
Third Party Notes ”); (ii) CSC will use a portion
of the net proceeds from the IDS offering to make an intercompany
loan to the Borrower equal to not less than 60% of the sum of
(x) the aggregate principal amount of the IDS Debt and
(y) the aggregate principal amount of the Third Party Notes
(such intercompany loan amount to be in the aggregate between
$79.5 million and $114.6 million depending on the size of
the IDS offering) (the “ Intercompany Loan ”);
(iii) CSC will use an amount equal to (x) the proceeds, net of
the fees and expenses referred to in clause (viii) below, from
(a) the IDS offering plus (b) the Third Party Notes
offering, minus (y) the sum of (c) the aggregate principal
amount of the Intercompany Loan plus (d) any amount of net
proceeds from the IDS offering received as a result of the
underwriters’ exercise of their overalottment option which
shall be retained by Holdings to redeem a like amount of its
preferred equity interests, to make a capital contribution to
Holdings, and Holdings will, in turn, make a capital contribution
in the same amount to the Borrower (between $ 165.3 million
and $252.4 million depending on the size of the IDS offering)
(the “ Capital Contribution ”); (iv) the
Borrower will use between approximately $133.2 million, plus
up to approximately $5.5 million depending on the redemption
date, and $171.7 million, plus up to approximately
$7.1 million depending on the redemption date, of the proceeds
it receives from the Capital Contribution to redeem between
approximately 27.2% and 35% of the Borrower’s 9% Senior Notes
due 2010 (the “ Senior Notes ”) and to pay
redemption premium and accrued and unpaid interest on the Senior
Notes; (v) the Borrower will use between $14.6 million
and $21.8 million, depending on the timing and size of the IDS
offering, of the proceeds it receives from the Intercompany Loan
and the Capital Contribution to repay the full remaining aggregate
principal amount of Tranche
A Term Loans ($15.5 million
before December 31, 2004 and $14.6 million on and after
December 31, 2004 after giving effect to a scheduled
amortization payment) and to repay up to approximately $6.3 million
aggregate principal amount of Tranche B Term Loans (collectively,
the “ Optional Prepayment ”); (vi) the
Borrower will use between approximately $89.7 million and
approximately $167.3 million, depending on the size and timing
of the IDS offering, of the proceeds it receives from the
Intercompany Note and the Capital Contribution plus up to
approximately $9.5 million of cash on hand to pay a dividend
to Holdings to enable Holdings to redeem a like amount of its
outstanding preferred equity interests, (vii) the common stock
of Appliance Warehouse of America, Inc. will become owned by CSC,
(viii) CSC will pay fees and expenses related to the foregoing
of between $25.2 million and $33.0 million, depending on
the size of the IDS offering and (ix) Borrower may, at its option
use approximately $0.9 (as of September 30, 2004) million to
terminate existing interest rate swap agreements (the transactions
described in clauses (i) through (ix), collectively, the
“ IDS Financing ”). The actual specific amounts
within the ranges described above will be based upon the actual
size of the IDS offering and determined in accordance with
Section 25 of this Waiver & Amendment.
C. The Credit
Parties have requested that the Supermajority Banks of each Tranche
agree to waive the application of Sections 4.02(e) and
(j) as they relate to the IDS Financing and amend certain
provisions of Section 4.02 of the Credit Agreement. The Credit
Parties have requested that the Supermajority Banks and/or Required
Banks agree to amend certain other provisions of the Credit
Agreement, in connection with and conditioned upon the closing of
the IDS Financing, in each case as set forth herein.
D. The Credit
Parties have additionally requested that the Required Banks agree
to amend certain other provisions of the Credit Agreement, which
amendments would not be conditioned on the closing of the IDS
Financing.
E. The
Supermajority Banks and Required Banks, as the case may be, are
willing to so agree and to waive and/or amend, as the case may be,
the Credit Agreement pursuant to the terms and subject to the
conditions set forth herein.
F. Capitalized
terms used and not otherwise defined herein shall have the meanings
ascribed to them in the Credit Agreement, as amended by this Waiver
& Amendment.
In
consideration of the premises and the agreements, provisions and
covenants contained herein, the parties hereto hereby agree, on the
terms and subject to the conditions set forth herein, as
follows:
SECTION 1.
Limited Waiver . (i) The Supermajority Banks holding
Tranche B Term Loans hereby waive the Borrower’s obligation
to make the Optional Prepayment on a pro rata basis
among the Term Loans and hereby agree that the Optional Prepayment
shall first be applied to repay in full the currently outstanding
amount of all Tranche A Term Loans and any remainder of the
Optional Prepayment shall be applied to the Tranche B Term Loans as
otherwise provided in Section 4.01(a); (ii) the
Supermajority Banks of each Tranche hereby waive the
Borrower’s obligation, pursuant to Section 4.02(e), to
apply any proceeds from the incurrence by the Borrower of the
Intercompany Loan as a mandatory repayment of principal
of
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outstanding Term Loans;
(iii) the Supermajority Banks of each Tranche hereby waive the
Borrower’s obligation, pursuant to Section 4.02(j), to
apply any net proceeds from the Capital Contribution as a mandatory
repayment of principal of outstanding Term Loans; and (iv) the
Supermajority Banks of each Tranche hereby waive any Default or
Event of Default arising from the failure of the Borrower to comply
with the requirements of Sections 4.01, 4.02(e) and 4.02(j) in
respect of the aspects of the IDS Financing described in clauses
(i) through (iii) of this Section 1.
SECTION 2.
Amendments to Section 2.01(a) of the Credit Agreement .
Section 2.01(a) of the Credit Agreement is hereby amended by
deleting, in the sixth line thereof, the phrase “(other than
the Spinoff Guarantor).”
SECTION 3.
Amendments to Section 4.02 of the Credit Agreement
.
(i) Section 4.02(e)
of the Credit Agreement is hereby amended by deleting, in each of
the second and third/fourth lines thereof, the phrase “the
Spinoff Guarantor,”.
(ii) Section 4.02(f)
of the Credit Agreement is hereby amended (for the sole purpose of
removing references to the “Release Payments,”
“Spinoff Guarantor,” “Spinoff Guarantor Release
Event” and directly related provisions) by deleting it in its
entirety and replacing it with:
“In addition
to any other mandatory repayments or commitment reductions pursuant
to this Section 4.02, on each date after the Effective Date
upon which the Borrower or any of its Subsidiaries receives
proceeds from any sale of assets (including capital stock and
securities held thereby, but excluding (i) sales or transfers
of inventory or equipment in the ordinary course of business
(including, without limitation, sales or transfers of inventory or
equipment to Subsidiaries), (ii) the sale or other disposition
of obsolete equipment or inventory, (iii) the sale of overdue
receivables or liquidation or sale of Cash Equivalents in the
ordinary course of business, (iv) sales of assets between the
Borrower and Subsidiary Guarantors and/or sales of assets between
Subsidiary Guarantors and (v) sales or transfers of assets up
to an aggregate amount of $1,000,000 in any fiscal year, in each
case to the extent permitted by Section 9.02) an amount equal
to 100% of the Net Sale Proceeds therefrom shall be applied as a
mandatory repayment of principal of outstanding Term Loans in
accordance with the requirements of Sections 4.02(k), (l) and
(m); provided that, in addition to the exceptions set forth
above, so long as no Default or Event of Default then exists, up to
an aggregate of $15,000,000 of Net Sale Proceeds in any fiscal year
shall not be required to be so applied on the date of receipt
thereof to the extent that the Borrower has delivered a certificate
to the Administrative Agent within 15 days following such date
stating that such Net Sale Proceeds shall be reinvested or shall be
committed to be reinvested in the Business within 180 days
following such date (and to the extent the asset sold constituted
Collateral, the assets in which such Net Sales Proceeds are
reinvested shall be pledged as Collateral pursuant to the
appropriate Security Documents); and provided ,
further , that if all or any portion of such Net Sale
Proceeds not required to be applied to the repayment of Term Loans
pursuant to the preceding proviso are either (a) not so used
or committed to be so used within 180 days after the date of
receipt of such Net Sale Proceeds or (b) if committed to be so used
within 180 days after the date of receipt of such Net Sale
Proceeds and not so used
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within 270 days after the
date of receipt of such Net Sale Proceeds, then, in either such
case, such remaining portion not used or committed to be used in
the case of the preceding clause (a) and not used in the case
of the preceding clause (b) shall be applied on the date which
is 180 days after the date of receipt of such Net Sale Proceeds in
the case of clause (a) above or the date occurring
270 days after the date of receipt of such Net Sale Proceeds
in the case of clause (b) above as a mandatory repayment of
principal of outstanding Term Loans in accordance with the
requirements of Sections 4.02(k), (l) and
(m).”.
(iii) Section 4.02(g)
of the Credit Agreement is hereby amended by deleting, in the
second line thereof, the phrase “the Spinoff
Guarantor,”.
(iv) Section 4.02(j)
of the Credit Agreement is hereby amended by (A) deleting, in
the third line thereof, the phrase “(other than any Release
Payments)” and (B) deleting clause (x) in the
second parenthetical thereof and replacing it in its entirety with
“(x) Holdings to the extent such proceeds are from a capital
contribution from the sale or issuance of equity by any direct or
indirect parent of the Borrower to GTCR or”.
SECTION 4.
Amendments to Section 7.09 of the Credit Agreement .
Section 7.09 of the Credit Agreement is hereby amended by
deleting it in its entirety and replacing it with:
“Parent,
Holdings, the Borrower and each of their respective Subsidiaries
are members of an affiliated group of corporations filing
consolidated returns for federal income tax purposes, of which
Parent is the “common parent” (within the meaning of
Section 1504 of the Code) of such group. Each of Parent,
Holdings, the Borrower and each of their respective Subsidiaries
have timely filed or caused to be timely filed, on the due dates
thereof or within applicable grace periods, with the appropriate
taxing authority, all federal Tax Returns and all material state or
other Tax Returns required to be filed by Parent, Holdings, the
Borrower and/or any of their respective Subsidiaries and each such
Tax Return is complete and correct in all material respects. Each
of Parent, Holdings, the Borrower and each of their respective
Subsidiaries have paid all material Taxes due and payable by them
other than those which are not delinquent or which are contested in
good faith and for which adequate reserves have been established in
accordance with GAAP. Except as disclosed in the financial
statements referred to in Section 7.05(a), there is no
material action, suit, proceeding, investigation, audit, or claim
now pending or, to the best knowledge of the Borrower, threatened
by any authority regarding any Taxes relating to Parent, Holdings,
the Borrower or any of their respective Subsidiaries. The charges,
accruals and reserves on the books of Parent and its Subsidiaries
in respect of Taxes and other governmental charges are, in the
opinion of the Borrower, in material conformity with GAAP. As of
the Effective Date, none of Parent, Holdings, the Borrower or any
of their respective Subsidiaries has entered into an agreement or
waiver or been requested to enter into an agreement or waiver
extending any statute of limitations relating to the payment or
collection of Taxes of Parent, Holdings, the Borrower or any of
their respective Subsidiaries, and the Borrower is not aware of any
circumstances that would cause the taxable years or other taxable
periods of Parent, Holdings, the Borrower or any of their
respective Subsidiaries not to be subject to the normally
applicable statute of limitations.”
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SECTION 5.
Amendments to Section 7.11(b) of the Credit Agreement .
Section 7.11(b) of the Credit Agreement is hereby amended by
adding to the end of the first sentence thereof, the phrase
“other than the Second Priority Lien of the IDS Collateral
Agent in respect of the common stock of the
Borrower.”.
SECTION 6.
Amendments to Section 9.01 of the Credit Agreement
.
(i) Section 9.01(t)
of the Credit Agreement is hereby amended by deleting the word
“and” at the end thereof.
(ii) Section 9.01(u)
shall become Section 9.01(v) and is otherwise hereby amended
by deleting the phrase “(t)” therein and replacing it
with the phrase “(u)”.
(iii) Section 9.01
is hereby amended by adding a new clause (u) that shall read
in its entirety:
“(u) Liens
in favor of the IDS Collateral Agent representing a Second Priority
Lien on the common stock of the Borrower;”.
(iv) The
proviso at the end of Section 9.01 is hereby amended by
deleting the phrase “(u)” and replacing it with the
phrase “(v)” in the first line thereof and by deleting
the phrase “(other than the Liens described in clauses
(e) and (l) of this Section 9.01)” and
replacing it with “(other than the Liens described in clauses
(e), (l) and (u) of this
Section 9.01)”.
SECTION 7.
Amendments to Section 9.02 of the Credit Agreement
.
(i) Section 9.02(g)
of the Credit Agreement is hereby amended by deleting it in its
entirety and replacing it with:
“the
Borrower or any Subsidiary of the Borrower may transfer assets to
(i) the Borrower or any other Subsidiary Guarantor so long as
(x) the transferee is a Credit Party and (y) the security
interests granted to the Collateral Agent for the benefit of the
Secured Creditors pursuant to the Security Documents in the assets
so transferred shall remain in full force and effect and perfected
(to at least the same extent as in effect immediately prior to such
transfer) and (ii) the Foreign Subsidiaries in an amount,
together with the amount permitted in accordance with Section
9.05(g)(iii), not to exceed $2,500,000 in the
aggregate;”
(ii) Section 9.02(h)
of the Credit Agreement is hereby amended by deleting it in its
entirety and replacing it with
“[Reserved].”.
(iii) Section 9.02(k)
of the Credit Agreement is hereby amended by deleting it in its
entirety and replacing it with:
“the
Borrower or any of its Wholly Owned Subsidiaries may consummate a
Permitted Acquisition;”.
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(iv) Section 9.02(m)
of the Credit Agreement is hereby amended by deleting, in clause
(i) of the second proviso thereto, the phrase “(other
than the Spinoff Guarantor)”.
(v) Section 9.02(p)
of the Credit Agreement is hereby amended by deleting it in its
entirety and replacing it with “[Reserved].”
SECTION 8.
Amendments to Section 9.03 of the Credit Agreement
.
(i) Section 9.03(b)
of the Credit Agreement is hereby amended by adding at the end
thereof: “ provided , further , the amount of
Dividends declared and paid in any four consecutive quarter period
pursuant to this clause (b) shall not exceed
$10.0 million;”.
(ii) Section 9.03(c)
of the Credit Agreement is hereby amended (for the sole purposes of
deleting all references to the Spinoff Guarantor and to allow
Parent to make tax payments) by deleting it in its entirety and
replacing it with:
“the
Borrower or any Subsidiary of the Borrower may make payments to
Holdings so that Holdings may make payments to Parent in an amount
not in excess of the federal and state (in such states that permit
consolidated or combined tax returns) income tax liability that the
Borrower or the Borrower’s Subsidiaries would have been
liable for if Parent, Holdings, the Borrower and its Subsidiaries
had filed their taxes on a stand-alone basis; provided that
such payments shall be made to Holdings no earlier than five days
prior to the date on which Parent is required to make its payments
to the Internal Revenue Service or the applicable taxing authority,
as applicable;”.
(iii) Section 9.03(d)
of the Credit Agreement is hereby amended by deleting it in its
entirety and replacing it with:
“if no
Default or Event of Default shall have occurred and be continuing,
the Borrower may declare and pay Dividends to Holdings so that
Holdings may declare and pay dividends or make distributions to
Parent so that Parent may repurchase Parent Common Stock (or rights
to acquire Parent Common Stock) from members of Holdings’,
Parent’s or the Borrower’s management in connection
with certain executive employment agreements in an aggregate amount
not to exceed $1,000,000 in any fiscal year; provided that
any amounts not used in any fiscal year can be carried forward and
used in the immediately succeeding fiscal year;”.
(iv) Section 9.03(e)
of the Credit Agreement is hereby amended by deleting it in its
entirety and replacing it with:
“if no
Default or Event of Default shall have occurred and be continuing,
the Borrower may declare and pay Dividends to Holdings so that
Holdings may declare and pay dividends or make distributions to
Parent so that Parent may pay reasonable tax, legal and accounting
fees and other support services provided to or for the benefit of
the Borrower and/or any of its Subsidiaries and to pay
Holdings’ and Parent’s operating and administrative
expenses, in an aggregate amount not to exceed $2,000,000 in any
fiscal year;”.
6
(v) Section 9.03(f)
of the Credit Agreement is hereby amended by deleting it in its
entirety and replacing it with:
“the
Borrower may declare and pay Dividends to Holdings so that Holdings
may declare and pay dividends and distributions to Parent
(i) in connection with any payment obligations (including
administration costs and expenses) under Parent’s stock or
other equity participation purchase program or similar equity based
benefits plans offered to employees of Parent and/or Subsidiaries
of Parent, including, without limitation, any employee stock option
plan or options to purchase Parent Common Stock, in an aggregate
amount not to exceed $1,000,000 in any fiscal year or (ii) so
that Parent may make loans and advances to employees of Parent and
its Subsidiaries in the ordinary course of business and consistent
with past practice, in an aggregate principal amount which, when
taken together with the aggregate principal amount of loans and
advances (exclusive of loans and advances for moving and travel
expenses or relocation expenses incurred in connection with a
permitted acquisition) made by the Borrower and its Subsidiaries
after the Effective Date in accordance with Section 9.05(e) do
not exceed $1,500,000 at any one time
outstanding;”.
(vi) Section 9.03(g)
of the Credit Agreement is hereby amended by deleting it in its
entirety and replacing with:
“(x) if no
Event of Default shall have occurred and be continuing, any IDS
Distribution and (y) if no Default or Event of Default shall
have occurred and be continuing, Dividends to Holdings in respect
of Section 9.06(g), shall be permitted;”.
(vii) Section 9.03(h)
of the Credit Agreement is hereby amended by deleting it in its
entirety and replacing it with:
“(h) the
Permitted IDS Dividend shall be permitted;”.
SECTION 9.
Amendments to Section 9.04 of the Credit Agreement .
Section 9.04 of the Credit Agreement is hereby amended by
deleting the word “and” at the end of clause
(l) thereof, deleting the period at the end of clause
(m) thereof and replacing it with the phrase “;
and” and adding a new clause (n) which shall read in its
entirety:
“(n)
Indebtedness incurred pursuant to the IDS Intercompany
Note.”
SECTION 10.
Amendments to Section 9.05 of the Credit Agreement
.
(i) Section 9.05
(e) of the Credit Agreement is hereby amended deleting the
words “Holdings” and “Borrower” in each
instance where they appear therein and replacing such words, in
each case, with the word “Parent”.
(ii) Section 9.05(g)
of the Credit Agreement is hereby amended by deleting clauses
(iv) and (v) thereof in their entirety.
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(iii) Section 9.05(j)
of the Credit Agreement is hereby amended by deleting the phrase
“(other than the Spinoff Guarantor)” at the end
thereof.
(iv) Sections 9.05(k)
and (l) of the Credit Agreement are hereby amended by deleting
each of them in their entirety and replacing each of them with
“[Reserved];”.
(v) Section 9.05(m)
of the Credit Agreement is hereby amended by deleting, in the first
line thereof, the phrase “(other than the Spinoff
Guarantor)”.
(vi) Section 9.05
(n) of the Credit Agreement is hereby amended by deleting it
in its entirety and replacing it with: “the Borrower may
invest in or redeem up to (x) $157.5 million aggregate
principal amount of the Senior Notes upon consummation of and in
connection with the IDS Transactions and (y) $30,000,000 plus that
portion of the Retained Amount since the date hereof not paid as a
Dividend pursuant to Section 9.03(b) and otherwise permitted
pursuant to Section 9.11 of Senior Notes from time to
time.”
SECTION 11.
Amendments to Section 9.06 of the Credit Agreement
.
(i) Section 9.06(c)
of the Credit Agreement is hereby amended by inserting the phrase
“and Parent” at the end thereof.
(ii) Section 9.06(d)
of the Credit Agreement is hereby amended by deleting the word
“Holdings” and inserting the word “Parent”
in its place.
(iii) Section 9.06(f)
of the Credit Agreement is hereby amended by deleting the word
“Holdings” and inserting the word “Parent”
in its place and by deleting the word “and” at the end
thereof.
(iv) Section 9.06(g)
of the Credit Agreement is hereby amended by deleting the word
“Holdings” and inserting the word “Parent”
in its place and by deleting the period at the end thereof and
replacing it with the phrase “; and”.
(v) Section 9.06
of the Credit Agreement is hereby amended by adding thereto a new
clause (h) which shall read in its entirety:
“(h)
Holdings and its Subsidiaries may enter into the IDS
Transactions.”.
(vi) Section 9.06
of the Credit Agreement is hereby amended by deleting the last two
words thereof and replacing them with
“GTCR”.
SECTION 12.
Amendments to Section 9.07(c) of the Credit Agreement .
Section 9.07(c) of the Credit Agreement is hereby amended by
deleting it in its entirety and replacing it with
“[Reserved].”
SECTION 13.
Amendments to Section 9.09 of the Credit Agreement .
Section 9.09 of the Credit Agreement is hereby amended by
deleting the second proviso thereof in its entirety.
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SECTION 14.
Amendments to Section 9.11 of the Credit Agreement
.
(i) Section 9.11(a)
of the Credit Agreement is hereby amended by deleting it in its
entirety and replacing it with the following:
“make (or
give any notice in respect of) any voluntary or optional payment or
prepayment on or redemption or acquisition for value of (including,
without limitation, by way of depositing with the trustee with
respect thereto or any other Person money or securities before due
for the purpose of paying when due) Senior Notes other than
(x) an amount up to $171.7 million (including redemption
premium) plus up to $7.1 million of accrued and unpaid
interest thereon upon consummation of and in connection with the
IDS Transactions and (y) as long as no Default or Event of
Default exists, an amount up to $30,000,000 plus that portion of
the Retained Amount from the date hereof not paid as a Dividend
pursuant to Section 9.03(b);”
(ii) Section 9.11(b)
of the Credit Agreement is hereby amended by inserting the words
“or the IDS Intercompany Note” before the phrase
“; and” therein.
SECTION 15.
Amendment to Section 9.16 of the Credit Agreement .
Section 9.16 of the Credit Agreement is hereby amended by
inserting the phrase “Parent,” between the words
“than” and “Holdings” on the third line
thereof.
SECTION 16.
Amendment to Section 10.04 of the Credit Agreement .
Section 10.04 of the Credit Agreement is hereby amended by
deleting it in its entirety and replacing it with:
“(i) Parent
or any of its Subsidiaries shall default in any payment of any
Indebtedness (other than the Obligations) beyond the period of
grace, if any, provided in the instrument or agreement under which
such Indebtedness was created or (ii) Parent or any of its
Subsidiaries shall default in the observance or performance of any
covenant relating to any Indebtedness (other than the Obligations)
or contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event shall occur or condition
exist, the effect of which default or other event or condition is
to cause, or in the case of the Borrower and its Subsidiaries
permit the holder or holders of such Indebtedness (or a trustee or
agent on behalf of such holder or holders) to cause (determined
without regard to whether any notice is required), any such
Indebtedness to become due prior to its stated maturity, or
(iii) any Indebtedness (other than the Obligations) of
Holdings or its Subsidiaries shall be declared to be due and
payable, or required to be prepaid other than by regularly
scheduled required payments, prior to the stated maturity thereof,
provided that (x) it shall not be a Default or Event of
Default under this Section 10.04 unless the aggregate
principal amount of all Indebtedness as described in the preceding
clauses (i) through (iii), inclusive, is at least $2,500,000;
or”
SECTION 17.
Amendments to Section 11 of the Credit Agreement
.
(i) Section 11
of the Credit Agreement is hereby amended by deleting the following
terms in their entirety: “Additional Spinoff Guarantor
Note,” “Appliance Warehouse Assets,”
“Appliance Warehouse Investment,” “Appliance
Warehouse Note,” “Initial Appliance
Warehouse
9
Investment,”
“Permitted Distribution,” “Permitted Tax
Distribution,” “Release Payment,” “Spinoff
Guarantor,” “Spinoff Guarantor Note” and
“Spinoff Guarantor Release Event.”
(ii) The
definition of “Applicable Base Rate Margin” is hereby
amended by adding to the end thereof, the following:
“
provided further , that in the case of clauses (i)
(before giving effect to the first proviso hereof when the Pro
Forma Leverage Ratio is less than 4.0:1.0) and (ii) hereof,
the Applicable Base Rate Margin will be adjusted to 2.00% on each
day where the Loans are not rated at least B1 or better by
Moody’s Investors Service, Inc. and B+ or better by Standard
& Poor’s Rating Services.”
(iii) The
definition of “Applicable Eurodollar Margin” is hereby
amended by adding to the end thereof, the following:
“
provided further , that in the case of clauses (i)
(before giving effect to
