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Exhibit
10.2
THIRD AMENDMENT AND
WAIVER , dated as of June 4, 2008 (this “Amendment
and Waiver”), to the Credit Agreement, dated of
August 15 , 2007 (as amended, restated, modified or
otherwise supplemented, from time to time, the “Credit
Agreement”), among ALLOY, INC. , a Delaware
corporation (“Borrower”), the Lenders party thereto and
BANK OF AMERICA, N.A., as Administrative Agent and L/C
Issuer.
RECITALS
WHEREAS, the Borrower
has requested and the Administrative Agent and the Lenders have
agreed, subject to the terms and conditions of this Amendment and
Waiver, to amend and waive certain provisions of the Credit
Agreement as set forth herein;
NOW, THEREFORE, in
consideration of the premises and of the mutual agreements herein
contained, the parties hereto agree as follows:
1.
Amendments.
(a) Section 6.12(a) of
the Credit Agreement is hereby amended and restated in its entirety
to provide as follows:
“Maintain on a
consolidated basis a ratio of Quick Assets to current liabilities
(including all principal due on Committed Loans and LC Obligations)
of at least 1.00:1.00, commencing the Closing Date through and
including January 31, 2008; and for periods thereafter as
follows (i) 1.10:1.00, for each quarterly period ending
April 30 th and
July 31 st during the term of this Agreement and (ii) 1.35:1.00, for
each quarterly period ending October 31 th and January 31 st during the term of this
Agreement..”
(b) Section 7.06(d) of
the Credit Agreement is hereby amended and restated in its entirety
to provide as follows:
“Borrower may issue
(i) Equity Interests to pay consideration in connection with
Permitted Acquisitions and (ii) up to 2,000,000 shares of its
common stock as awards granted under its 2007 Employee, Director
and Consultant Stock Incentive Plan on the terms and conditions
described therein, subject to adjustment to give effect to any
stock split, stock dividend or similar
transaction.”
2.
Waivers.
(a) The Administrative Agent
and the Lenders hereby waive compliance with Section 6.12(a)
of the Credit Agreement in order to the ratio of Quick Assets to
current liabilities (including all principal due on Committed Loans
and LC Obligations) to be less than 1.35:1.00 for the fiscal
quarter ended April 30, 2008, provided that such ratio was not
less than 1:00:1.00 at the end of such fiscal quarter.
(b) The Administrative Agent
and the Lenders hereby waive compliance with Section 7.06(d)
of the Credit Agreement regarding the issuance of Equity Interests
to its employees, directors and consultants as expressly permitted
pursuant to its 2007 Employee, Director and Consultant Stock
Incentive Plan which have occurred prior to the date
hereof.
3. Conditions of
Effectiveness . This Amendment and Waiver shall become
effective as of the date hereof, upon receipt by the Administrative
Agent of this Amendment and Waiver, duly executed by the Borrower,
the Guarantors and the Lenders.
4. Conforming
Amendments . The Credit Agreement, the Loan Documents and
all agreements, instruments and documents executed and delivered in
connection with any of the foregoing, shall each be deemed to be
amended and supplemented hereby to the extent necessary, if any, to
give effect to the provisions of this Amendment and Waiver. Except
as so amended and waived hereby, the Credit Agreement and the other
Loan Documents shall remain in full force and effect in accordance
with their respective terms.
5. Representations and
Warranties . The Borrower hereby represents and warrants to
the Lenders and the Administrative Agent as follows:
(a) After giving effect to
this Amendment and Waiver, (i) each of the representations and
warranties set forth in Article V of the Credit Agreement is true
and correct in all material respects on and as of the date hereof
as if made on and as of the date of this Amendment and Waiver
except to the extent such representations or warranties relate to
an earlier date in which case they shall be true and correct in all
material respects as of such earlier date, and (ii) no Default
or Event of Default has occurred and is continuing as of the date
hereof or shall result from after giving effect to this Amendment
and Waiver.
(b) The Borrower has the
power to execute, deliver and perform this Amendment and Waiver and
each of the other agreements, instruments and documents to be
executed by it in connection with this Amendment and Waiver. No
registration with or consent or approval of, or other action by,
any Governmental Authority is required in connection with the
execution, delivery and performance of this Amendment and Waiver
and the other agreements, instruments and documents executed in
connection with this Amendment and Waiver by the Borrower, other
than registration, consents and approvals received prior to the
date hereof and disclosed to the Lenders and which are in full
force and effect.
(c) The execution, delivery
and performance by the Borrower of this Amendment and Waiver and
each of the other agreements, instruments, and documents to be
executed by it in connection with this Amendment and Waiver, and
the execution and delivery by each of the Guarantors of the Consent
to this Amendment and Waiver, (i) have been duly authorized by
all requisite corporate and limited liability company action,
(ii) will not violate (A) any provision of law applicable
to the Borrower or any Guarantor, any rule or regulation of any
Governmental Authority applicable to the Borrower or
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