Exhibit 10.37
EXECUTION VERSION
AMENDMENT NO. 4 TO TERM LOAN
AGREEMENT
This AMENDMENT NO. 4 TO TERM LOAN
AGREEMENT (this “ Amendment ”) is entered into
as of October 15, 2008 by and among BURLINGTON MORELOS, S.A DE
C.V., a Mexican stock limited liability corporation (the “
Borrower ”), GENERAL ELECTRIC CAPITAL CORPORATION, a
Delaware corporation, for itself and as Agent, and the other
Lenders signatory hereto. Unless otherwise specified herein,
capitalized terms used in this Amendment shall have the meanings
ascribed to them in the Term Loan Agreement (as hereinafter
defined).
R E C I T A L S:
WHEREAS, Borrower, the Agent and the
Lenders entered into the Term Loan Agreement dated as of
December 29, 2006 (as amended, supplemented, restated or
otherwise modified from time to time, the “ Term Loan
Agreement ”);
WHEREAS, the parties to the Term
Loan Agreement have agreed to a limited waiver and amendment to the
Term Loan Agreement as set forth herein;
NOW, THEREFORE, in consideration of
the premises contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1 Amendments to the Term Loan
Agreement .
1.1 Section 1 of the
Term Loan Agreement is hereby amended by adding the following
defined term in alphabetical order and renumbering the provisions
of Section 1 accordingly:
“ Specified Guarantors
” means, collectively, Burlington (Nustart), S.A. de C.V.;
Burlington Yecapixtla, S.A. de C.V.; Burlmex Denim Apparel
Services, S.A. de C.V.; Cone Denim Yecapixtla, S.A. de C.V.; Casa
Burlmex, S.A. de C.V.; Casimires Burlmex, S.A. de C.V.; and
Servicios Burlmex, S.A. de C.V.
1.2 Section 1 of the
Term Loan Agreement is hereby amended by amending and restating the
following defined terms in their entirety as follows:
“ Collateral ”
means, (a) initially (i) the Parras Cone Machinery and
Equipment, (ii) the Parras Cone Land and Buildings,
(iii) insurance policies relating to assets of Parras Cone,
(iv) the Parras Cone Receivables, and (v) contractual
rights of Parras Cone relating to the Parras Cone Land and
Buildings and the Parras Cone Machinery and Equipment;
(b) subsequent to the Closing Date, any and all after
acquired property or assets comprising any of the collateral
categories listed in subclause (a) above owned by Borrower or
Borrower’s Subsidiaries and (c) the Shares (less one
share of the Subsidiary Guarantors (other than the Specified
Guarantors) owned by Cone which shall be pledged in favor of the
Agent under the Pledge Agreement). In no event shall any property
or assets constituting Collateral under this Agreement be
considered as or included in “Collateral” under and as
defined in the Revolving Loan Agreement (provided that any Parras
Cone Receivables that have been sold or otherwise transferred to a
U.S. Affiliate shall be deemed to be “Collateral” under
and as defined in the Revolving Loan Agreement and not Collateral
under this Agreement).
“ Cone ” means
Cone International Holdings II, Inc., a Delaware corporation and
holder of at least one share of the outstanding capital stock of
all of the Subsidiary Guarantors.
“ Consolidated EBITDA
” means EBITDA of the Borrower and the Subsidiary Guarantors,
on a consolidated basis and determined in accordance with
GAAP.
“ Consolidated Interest
Expense ” means, for any period, without duplication, the
aggregate of all gross interest paid or accrued of Borrower and the
Subsidiary Guarantors as determined on a consolidated basis in
accordance with GAAP (including, without limitation, the interest
portion of Capital Lease Obligations of Borrower and the Subsidiary
Guarantors, but specifically excluding capitalized interest and the
interest portion of operating leases of Borrower and the Subsidiary
Guarantors which are treated as Capital Leases for tax purposes),
other than deferred financing costs not paid in cash (in each case,
excluding any intercompany interest expense and after eliminating
all offsetting debits and credits between Borrower and the
Subsidiary Guarantors and all other items required to be eliminated
in the course of the preparation of consolidated financial
statements of Borrower and the Subsidiary Guarantors in accordance
with GAAP).
“ Fixed Charge Coverage
Ratio ” means, the ratio of (a) Consolidated EBITDA
less Capital Expenditures (excluding Capital Expenditures funded
with Indebtedness) of Borrower and the Subsidiary Guarantors, to
(b) Fixed Charges, in each case calculated as of the end of
each Fiscal Quarter for the twelve (12) Fiscal Month period
then ended.
“ Fixed Charges ”
means, with respect to any fiscal period of Borrower and the
Subsidiary Guarantors on a consolidated basis, without duplication,
Consolidated Interest Expense (less all interest income received by
Borrower and the Subsidiary Guarantors on a consolidated basis
during such period), scheduled principal payments of Indebtedness
(including any scheduled principal payments of the Term Loans that
have been prepaid in accordance with Section 2.5 ), and
federal, state, local and foreign cash income taxes, excluding
deferred taxes and taxes which are subject to Contest.
“ Pledge Agreement
” means the pledge agreement to be executed by Cone in favor
of the Agent in form and substance satisfactory to the Agent,
pursuant to which Cone shall pledge its shares of the corporate
capital of the Subsidiary Guarantors (other than the Specified
Guarantors).
“ Shares ” means
the Equity Interests in the Subsidiary Guarantors (other than the
Specified Guarantors) representing all of the economic and voting
rights associated with ownership of one hundred percent
(100%) of the outstanding capital stock of all classes of the
Subsidiary Guarantors (other than the Specified Guarantors) on a
fully diluted basis.
1.3 Section 3.1(a) of
the Term Loan Agreement is hereby amended and restated in its
entirety to read as follows:
(a) As security for performance and
payment of the Term Loans and all other Obligations,
(i) Borrower and Parras Cone, as settlors (
fideicomitentes ) and beneficiaries, shall execute and
deliver the Guaranty Trust pursuant to which Borrower and Parras
Cone shall appoint the Agent, as first beneficiary (
fideicomisario en primer lugar ) and grant the Agent, for
the benefit of the Secured Parties, a valid and perfected security
interest in the Collateral (collectively, the “ Pledged
Assets ”), (ii) Cone shall execute and deliver the
Pledge Agreement in favor of the Agent pursuant to which Cone shall
grant the Agent, for the benefit of the Secured Parties, a valid
and perfected security interest in its shares of the capital of
each of the Subsidiary Guarantors (other than the Specified
Guarantors), (iii) Parras Cone shall execute and deliver the
Security Agreement in favor of the Agent pursuant to which Parras
Cone shall grant the Agent, for the benefit of the Secured Parties,
a valid and perfected security interest in certain Parras Cone
Receivables payable in the United States and Equipment (as defined
in the Security Agreement) and (iv) each of the U.S.
Affiliates shall execute and deliver the Affiliate Guaranty and
Security Agreement in favor of the Agent
