FIRST AMENDMENT TO CREDIT AGREEMENT

Exhibit 10.9

FIRST AMENDMENT TO CREDIT AGREEMENT

FIRST AMENDMENT TO CREDIT AGREEMENT (this “ Amendment ”), dated as of March 26, 2009, among Sbarro Holdings, LLC, a Delaware limited liability company (“ Holdings ”), Sbarro, Inc., a New York corporation (the “ Borrower ”), and the Lenders party hereto, amends that certain CREDIT AGREEMENT (as amended, modified or waived prior to the date hereof, the “ Credit Agreement ”), dated as of January 31, 2007, among Sbarro, Inc., as Borrower, Sbarro Holdings, LLC, as Holdings, each Person from time to time party thereto as a Lender, Bank of America, N.A., as Administrative Agent, Collateral Agent, Swing Line Lender and L/C Issuer, Credit Suisse, as Syndication Agent, Banc of America Securities LLC and Credit Suisse Securities (USA) LLC, as Joint Lead Arrangers and Joint Book Managers, and Natixis and Bank of Ireland, as Co-Documentation Agents. Capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Credit Agreement.

W I T N E S S E T H:

WHEREAS, the Credit Parties have requested that the Lenders agree to amend certain provisions of the Credit Agreement as provided for herein; and

WHEREAS, subject to certain conditions, the Required Lenders are willing to agree to the amendments set forth in Section 1 hereof (collectively, the “ Amendments ”) relating to the Credit Agreement;

NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereto agree as follows:

Section 1. Amendments to Credit Agreement.

(a) Amendments to Section 1.01: Defined Terms .

(i) The following definitions shall be added in proper alphabetical sequence:

(A) “ First Amendment ” means the First Amendment to the Credit Agreement, dated as of March 26, 2009, among the Borrower, Holdings and the Lenders party thereto.

(B) “ First Amendment Effective Date ” means March 26, 2009.

(C) “ Intercreditor Agreement ” means the Intercreditor Agreement, substantially in the form of Exhibit M to this Agreement, between the Administrative Agent and the Second Lien Administrative Agent, as amended, modified, replaced, restated or otherwise supplemented from time to time.

(D) “Reinstatement Date” has the meaning specified in Section 7.09(i) .

(E) “ Second Lien Administrative Agent ” means “Administrative Agent” as defined in the Second Lien Credit Agreement.

(F) “ Second Lien Collateral Documents ” means “Collateral Documents” as defined in the Second Lien Credit Agreement.

(G) “ Second Lien Credit Agreement ” means the Second Lien Credit Agreement, dated as of March 26, 2009, among Holdings, the Borrower, each of the lenders from time to time party thereto and Natixis, as administrative agent and collateral agent, as may be amended, restated, modified, increased or otherwise supplemented from time to time.

(H) “ Second Lien Credit Obligations ” means “Second Lien Credit Obligations” as defined in the Second Lien Credit Agreement.

(I) “ Second Lien Lenders ” means “Lenders” as defined in the Second Lien Credit Agreement.

(J) “ Second Lien Loan Documents ” means “Loan Documents” as defined in the Second Lien Credit Agreement.

(K) “ Second Lien Loans ” means “Loans” as defined in the Second Lien Credit Agreement.

(L) “ Second Lien Transaction ” means “Transaction” as defined in the Second Lien Credit Agreement.

(M) “ Second Lien Transaction Documents ” means “Transaction Documents” as defined in the Second Lien Credit Agreement.

(ii) The definition of “Applicable Margin” is hereby amended by deleting such definition in its entirety and replacing it with the following:

“ Applicable Margin ”: (i) prior to the First Amendment Effective Date, shall mean “Applicable Margin” as defined in this Agreement prior to giving effect to the First Amendment and (ii) on and after the First Amendment Effective Date for purposes of calculating (a) the applicable interest rate for any Term B Loan or the applicable interest rate for any day for any Revolving Loan or any Swing Line Loan, means for Eurodollar Loans, 4.50% or for Base Rate Loans, 3.50%; (b) the applicable rate of the Commitment Fee for any day for purposes of Section 2.11(a) means, 0.50%, and (c) the applicable rate of the Letter of Credit Fee for any day for purposes of Section 2.11(b)(i) means, 4.50%.”

(iii) The definition of “Base Rate” is hereby amended by deleting the “.” at the end of the first sentence thereof and replacing it with “and (iii) the Eurodollar Rate for a one-month Interest Period plus 100 basis points.”

 

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(iv) The definition of “Change of Control” is hereby amended by adding the words “or the Second Lien Credit Agreement” immediately after the words “Senior Notes Indenture” in clause (iv).

(v) The definition of “Collateral Documents” is hereby amended by adding the words “Intercreditor Agreement” immediately after the word “collectively,”.

(vi) The definition of “Consolidated Capital Expenditures” is hereby amended by restating clause (vi) thereof in its entirety as follows:

“(vi) any expenditures made with the proceeds of a Debt Issuance of Holdings or any of its Subsidiaries (other than Second Lien Loans, Revolving Loans, and Indebtedness incurred pursuant to Section 7.01(xx) after the Closing Date) to the extent not required to prepay the Loans or used for any other purpose; and”

(vii) The definition of “Consolidated EBITDA” is hereby amended by:

(A) deleting the words “Synthetic Lease Obligations and” from clause (iii)(B);

(B) restating clause (iii)(I) in its entirety as follows:

“(I) any financial advisory fees, accounting fees, legal fees and other similar advisory and consulting fees and other out-of-pocket costs and expenses of the Borrower incurred as a result of this Amendment and the Second Lien Transaction (whether or not actually consummated) and deducted from net income during the Borrower’s fiscal years ending December 28, 2008 and December 27, 2009,”

(C) replacing clause (iii)(J) with “[Intentionally Omitted]”;

(D) adding the following at the end of clause (iii)(L): “not to exceed an aggregate of $1,000,000”;

(E) restating clause (iii)(M) in its entirety as follows: “non-recurring cash charges resulting from severance, consulting, advisory and other similar transition expenses, stay or sign on bonuses, restructuring, consolidation, transition integration and other adjustments made as a result of Permitted Acquisitions, and other Investments permitted under Section 7.06 ; provided that the amounts referred to in this clause (M)  reported in any fiscal year ending after December 31, 2006 shall not, in the aggregate, exceed $2,000,000 during any fiscal year and $4,000,000 in the aggregate since the First Amendment Effective Date”;

(F) replacing clause (iii)(O) with “[Intentionally Omitted]”;

(G) replacing clause (iii)(P) with “[Intentionally Omitted]”;

 

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(H) adding the following at the end of clause (iii)(Q): “not to exceed an aggregate of $1,000,000 per year beginning with fiscal year 2009”;

(I) replacing clause (iii)(R) with “[Intentionally Omitted]”;

(J) adding the following at the end of clause (iii)(T): “not to exceed an aggregate of $3,000,000 per year beginning with fiscal year 2009”;

(K) deleting the “,” after the word “bonuses” and replacing it with the word “or” in clause (iii)(U);

(L) deleting the words “, consolidation, severance or discontinuance of any portion of operations, employees and/or management” from clause (iii)(U);

(M) replacing the “$2,500,000” in clause (iii)(U) with “$1,500,000”;

(N) deleting clause (iii)(W) and replacing it with “expenses related to consolidation, severance or the discontinuance of any portion of operations, employees and/or management not to exceed an aggregate amount during any four consecutive fiscal quarters greater than (1) as of the fiscal quarter ending on March 29, 2009, $3,500,000, (2) as of the fiscal quarter ending on June 28, 2009, $3,000,000, (3) as of the fiscal quarter ending on September 27, 2009, $2,750,000, (4) as of the fiscal quarter ending on December 27, 2009, $2,500,000 and (5) as of any fiscal quarter ending thereafter, $1,500,000”;

(O) restating clause (iv) in its entirety as follows:

“for purposes of curing any violation of the covenant set forth in Section 7.16 , the Net Cash Proceeds of any Equity Issuance of Qualified Capital Stock to the Investor Group and/or to one or more other Persons who are or become holders of Equity Interests in Holdings, solely to the extent that such Net Cash Proceeds are actually received by the Borrower (including through capital contribution of such Net Cash Proceeds by Holdings to the Borrower) no later than 10 Business Days after the delivery of a Notice of Intent to Cure; provided that Net Cash Proceeds of Equity Issuances of Qualified Capital Stock may be included pursuant to the provisions of this clause (iv)  in Consolidated EBITDA of no more than two fiscal quarters in any period of four consecutive fiscal quarters; and provided further that the aggregate amount of Net Cash Proceeds of Equity Issuances of Qualified Capital Stock which may be included pursuant to this clause (iv)  in Consolidated EBITDA may not exceed, in any case, (A) the aggregate amount necessary to cure an Event of Default arising in respect of the covenant set forth in Section 7.16 for such applicable period for which such Notice of Intent to Cure is delivered or (B) an amount greater than 10% of the Consolidated EBITDA of Holdings as of the last day of the most recent period of four consecutive fiscal quarters of Holdings

 

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for which financial statements are required to be delivered pursuant to Section 6.01(a) or (b) ; provided further ; that the Borrower shall prepay the Term B Loans with 100% of all Net Cash Proceeds of Equity Issuances of Qualified Capital Stock included pursuant to this clause (iv)  in the manner and in accordance with the provisions applicable to voluntary prepayments of Term B Loans with Net Cash Proceeds; provided , however , that the aggregate amount of Net Cash Proceeds of Equity Issuances of Qualified Capital Stock which are included pursuant to this clause (iv)  in Consolidated EBITDA shall not increase any basket or other amount hereunder and shall not be used for any other purpose or action hereunder that is specifically permitted to be taken with the use of proceeds from Equity Issuances; it being understood that this clause (iv)  may not be relied on for purposes of calculating any financial ratios other than for purposes of determining compliance with the financial covenant set forth in Section 7.16 ; minus”

(P) deleting the word “covenants” and replacing it with the word “covenant” in clause (vi);

(Q) deleting the words “the Interest Coverage Ratio or” in the final paragraph of such definition; and

(R) adding immediately after the words “Total Leverage Ratio for all purposes” the words “or any determination of Consolidated EBITDA for purposes of Section 7.16 ” in the final paragraph of such definition.

(viii) The definition of “Consolidated Scheduled Debt Payments” is amended by adding the words “, mandatory prepayments of the Second Lien Loans pursuant to Section 2.09(c) of the Second Lien Credit Agreement (as in effect on the date hereof),” immediately after the words “Term B Loans pursuant to Section 2.09(c) ”.

(ix) The definition of “Excess Cash Flow” is hereby amended by:

(A) deleting the words “or Incremental Revolving Loans” in the second parenthetical clause of clause (v);

(B) adding the words “Second Lien Loans,” immediately after the words “other than intercompany Indebtedness,” in clause (v)(C);

(C) deleting the parenthetical “(excluding any Restricted Payments made as permitted pursuant to clause (z)  of the second proviso thereto from Excess Cash Flow for any period)” in clause (v)(G);

(D) replacing the words “the Transaction,” with “the Second Lien Transaction” in clause (v)(I) and adding the following to the end of such clause “not to exceed an aggregate of $1,000,000”;

 

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(E) replacing clause (v)(J) with “[Intentionally Omitted]”;

(F) deleting the words “early retirement of debt,” from clause (v)(N) and adding to the end of such clause: “ provided that the amounts referred to in this clause (N) reported in any fiscal year ending after December 31, 2006 shall not, in the aggregate, exceed $2,000,000 during any fiscal year and $4,000,000 in the aggregate since the First Amendment Closing Date”;

(G) replacing clause (v)(O) with “[Intentionally Omitted]”;

(H) adding the following at the end of clause (v)(Q): “not to exceed an aggregate of $1,000,000 per year beginning with fiscal year 2009”;

(I) replacing clause (v)(R) with “[Intentionally Omitted]”;

(J) adding the following at the end of clause (v)(T): “not to exceed an aggregate of $3,000,000 per year beginning with fiscal year 2009”;

(K) deleting the words “early extinguishment of Indebtedness,” from clause (v)(U);

(L) deleting the words “, severance or discontinuance of any portion of operations, employees and/or management” and the word “million” from clause (v)(U);

(M) replacing the “2,500,000” in clause (v)(U) with “1,500,000”;

(N) deleting clause (v)(W) and replacing it with “expenses related to severance or the discontinuance of any portion of operations, employees and/or management not to exceed an aggregate amount during any four consecutive fiscal quarters greater than (1) as of the fiscal quarter ending on March 29, 2009, $3,500,000, (2) as of the fiscal quarter ending on June 28, 2009, $3,000,000, (3) as of the fiscal quarter ending on September 27, 2009, $2,750,000, (4) as of the fiscal quarter ending on December 27, 2009, $2,500,000 and (5) as of any fiscal quarter ending thereafter, $1,500,000”; and

(O) adding the words “Second Lien Loans,” immediately after the words “to prepay the” in clause (viii).

(x) The following definitions are hereby deleted:

(A) “Applicable ECF Percentage,”

(B) “Incremental Revolving Loan Commitment,”

(C) “Incremental Revolving Loans,”

 

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(D) “Incremental Term Loan Commitment,”

(E) “Incremental Term Loans,”

(F) “Interest Coverage Ratio,”

(G) “Post-Increase Revolving Lenders,” and

(H) “Pre-Increase Revolving Lenders.”

(xi) The definition of “Permitted Acquisition” is hereby amended by:

(A) deleting the words “financial covenants specified in Sections 7.16(a) and (b) ” and replacing them with the words “financial covenant specified in Section 7.16 ”;

(B) adding the words “or the Second Lien Lenders” immediately after the words “the Lenders” in paragraph (c);

(C) deleting the word “franchises” and replacing it with the word “franchisees” in paragraph (c); and

(D) adding the parenthetical “(other than expenditures included in Consolidated Capital Expenditures)” immediately after the words “in the aggregate” in paragraph (c).

(E) adding the following as a new paragraph immediately following such definition:

“Notwithstanding the foregoing, unless otherwise agreed to in writing by the Required Lenders, (x) from and after the First Amendment Effective Date, (1) the aggregate amount of any acquisition (whether individually or together with any related acquisitions) shall not exceed $5,000,000 and (2) the aggregate amount of all Permitted Acquisitions shall not exceed $10,000,000 and (y) no acquisition shall be deemed to be a Permitted Acquisition unless immediately after giving effect to such acquisition the Total Leverage Ratio shall be less than the Total Leverage Ratio immediately prior to such acquisition.”

(xii) The definition of “Pro-Forma Basis” is hereby amended by deleting the words “In connection with any calculation of the financial covenants set forth in Section 7.16 or elsewhere” and replacing them with the words “In connection with any calculation of the Total Leverage Ratio or the financial covenant set forth in Section 7.16 or elsewhere”.

(xiii) The definition of “Pro-Forma Compliance Certificate” is hereby amended by deleting the words “and the Interest Coverage Ratio” and replacing them with the words “and the financial covenant set forth in Section 7.16 ”.

 

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(xiv) The definition of “Revolving Committed Amount” is hereby amended by deleting “$25,000,000” and replacing it with “$21,500,000”.

(xv) The definition of “Total Leverage Ratio” is hereby amended by inserting “for which financial statements have been (or were required to have been) delivered pursuant to Section 6.01(a) or (b) ” immediately before the final”.”.

(b) Amendment to Section 2.06 of the Credit Agreement: Interest .

(i) Clause 2.06(c) is hereby replaced in its entirety with the following:

“(x) immediately upon an Event of Default, all Loans shall bear interest at a fluctuating interest rate per annum equal to the Default Rate and (y) if any Senior Credit Obligation is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, such overdue amount shall thereafter bear interest at a fluctuating interest rate per annum equal to the Default Rate, in each case, until such Default or Event of Default has been cured or waived, to the fullest extent permitted by applicable Laws.”

(c) Amendments to Section 2.09 of the Credit Agreement: Prepayments .

(i) Section 2.09(c)(ii) is hereby amended by:

(A) deleting the words “the Applicable ECF Percentage” and replacing them with “75%”; and

(B) deleting the last sentence of such section.

(ii) Section 2.09(c)(iii) is hereby amended by deleting the number “$5,000,000” and replacing it with the number “$1,000,000”.

(d) Amendment to Section 2.15: Increase in Commitments .

Section 2.15 is hereby amended by deleting such section in its entirety and replacing it with the word “Intentionally Omitted”.

(e) Amendment to Section 5.21 of the Credit Agreement: Ownership .

Section 5.21 is hereby amended by adding the words “Second Lien Collateral Documents,” before the words “Collateral Documents”.

(f) Amendment to Section 6.01: Financial Statements .

(i) Section 6.01 is hereby amended by deleting paragraph (b) in its entirety and replacing it with:

“(b) (x) Within 50 days after the end of the first three fiscal quarters of Holdings, and (y) within 45 days of the first full fiscal month following the First Amendment

 

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Effective Date and each fiscal month thereafter which does not coincide with the end of a fiscal quarter of Holdings, a consolidated balance sheet of Holdings and its Consolidated Subsidiaries as of the end of such period, together with related consolidated statements of operations and a consolidated statement of cash flows for such period and the then elapsed portion of such fiscal year, setting forth for all periods beginning after the first anniversary of the Closing Date in comparative form the consolidated figures for the corresponding periods of the preceding fiscal year, all in reasonable detail, certified by a Responsible Officer of the Borrower as fairly presenting, in all material respects, the financial condition, results of operations and cash flows of Holdings and its Consolidated Subsidiaries in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes, provided that the quarterly (but not monthly) obligations in this paragraph (b) may be satisfied by the Borrower by furnishing its Form 10-Q.”; and

(ii) Section 6.01(c) is hereby amended by deleting “(x) on a quarterly basis for the first such forecast, and (y) for each forecast delivered thereafter,”.

(g) Amendment to Section 6.02 of the Credit Agreement: Certificates; Other Information .

(i) Paragraph (b) is hereby amended by deleting the word “covenants” and replacing it with the word “covenant”; and

(ii) The last sentence of Section 6.02(b) is hereby deleted.

(h) Amendment to Section 6.03 of the Credit Agreement: Notices .

(i) Clause (iii) is hereby amended by deleting “and”;

(ii) Clause (iv) is hereby amended by deleting “.” and replacing it with “;”; and

(iii) Section 6.03 is hereby amended by inserting new clauses (v) and (vi) immediately after clause (iv) as follows:

“(v) of notices delivered by the Borrower under the Second Lien Credit Agreement that would not otherwise give rise to a notice requirement hereunder; and

(vi) of any amendments, restatements, supplements or other modifications to the Second Lien Loan Documents or the Second Lien Transaction Documents.”

(i) Amendment to Section 6.14 of the Credit Agreement: Designation of Unrestricted Subsidiaries .

Section 6.14 is hereby amended by deleting the word “covenants” and replacing it with the word “covenant” in each instance that it appears.

 

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(j) Amendments to Section 7.01 of the Credit Agreement: Limitation on Indebtedness .

(i) Clause (ii) is hereby amended by (A) deleting the words “(including any incremental loans incurred pursuant to Section 2.15)” and (B) deleting the words “plus, so long as no Default or Event of Default exists or would result therefrom, an additional amount of such Senior Notes incurred in any “tack on” offering under the Senior Notes Indenture, not to exceed $25 million in the aggregate”;

(ii) Clause (iii) is hereby amended by deleting the number “$7,500,000” and replacing it with the number “$5,000,000”;

(iii) Clause (v) is hereby amended by restating subclause (w) thereof in its entirety as follows: “(w) such refinancing Indebtedness shall not be secured by any Lien unless the Indebtedness being refinanced was subject a Lien, in which case any Liens on such refinancing indebtedness shall not extend to any additional assets and shall, if the existing Liens were subordinated, be subordinated on no less favorable terms,”;

(iv) Clause (vi) is hereby amended by deleting the word “covenants” and replacing it with the word “covenant”;

(v) Clause (x) is hereby amended by deleting the number “$7,500,000” and replacing it with “$5,000,000”;

(vi) Clause (xii) is hereby deleted in its entirety and replaced with “[ Intentionally Omitted ]”;

(vii) Clause (xiv) is hereby deleted in its entirety and replaced with “[ Intentionally Omitted ]”;

(viii) Clause (xvi) is hereby deleted in its entirety and replaced with “[ Intentionally Omitted ]”;

(ix) Clause (xviii) is hereby deleted in its entirety and replaced with “[ Intentionally Omitted ]”;

(x) Clause (xix) is hereby deleted in its entirety and replaced with “[ Intentionally Omitted ]”;

(xi) Clause (xx) is hereby amended by (A) replacing the number “$10,000,000” with “$15,000,000” and (B) deleting the “.” at the end thereof and replacing it with the word “; and”; and

(xii) Section 7.01 is hereby amended by adding the following clause (xxi) immediately after clause (xx) as follows: “(xxi) Indebtedness evidenced by the Second Lien Credit Agreement in an

 

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aggregate principal amount not to exceed $25,500,000 plus the amount of any interest added to the principal thereof in accordance with the terms of the Second Lien Credit Agreement.”

(k) Amendments to Section 7.02 of the Credit Agreement: Restriction on Liens .

(i) Clause (xxvi) is hereby amended by deleting the word “; and” at the end thereof;

(ii) Clause (xxx) is hereby amended by deleting the word “and” at the end thereof;

(iii) Clause (xxxi) is hereby amended by (A) deleting the number “$7,500,000” and replacing it with the number “$5,000,000” and (B) deleting the “.”at the end thereof and replacing it with the word “; and”; and

(iv) Section 7.02 is hereby amended by adding the following clause (xxxii) immediately after clause (xxxi) as follows:

“(xxxii) Liens granted on the Collateral to secure the Second Lien Credit Obligations provided that such Liens are subject to the terms of the Intercreditor Agreement.”

(l) Amendments to Section 7.04: Consolidation, Merger and Dissolution .

(i) Clauses (ii), (iii) and (iv) are hereby amended by adding the words “and are subject to the terms of the Intercreditor Agreement”, in each case, after the words “dissolution or liquidation” in the respective parentheticals therein; and

(ii) Clause (v) is hereby amended by deleting the word “covenants” and replacing it with the word “covenant”.

(m) Amendments to Section 7.05: Asset Disposition .

(i) Clause (xix) is hereby deleted in its entirety and replaced with “[ Intentionally Omitted ]”;

(ii) Clause (xx) is hereby deleted in its entirety and replaced with “[ Intentionally Omitted ]”;

(iii) Clause (xxiii) is hereby deleted in its entirety and replaced with “[ Intentionally Omitted ]”;

(iv) Clause (xxv) is hereby deleted in its entirety and replaced with “[ Intentionally Omitted ]”;

(v) Clause (xxvi) is hereby amended by deleting the number “$15,000,000” and replacing it with the number “$10,000,000”.

 

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(n) Amendments to Section 7.06: Investments .

(i) Clause (vi)(x)(ii) is hereby amended by deleting the number “$2,500,000” and replacing it with the number “$1,000,000”.

(o) Amendments to Section 7.07: Restricted Payments, Etc .

(i) Clause (iii) is hereby amended by deleting the proviso at the end of such clause;

(ii) Clause (iv) is hereby amended by deleting clauses (C) and (D) thereof and replacing the “(E)” therein with “(C)”; and

(iii) Clause (viii) is hereby amended by adding the word “and” at the end thereof;

(iv) Clause (ix) is hereby amended by deleting “; and” at the end thereof and replacing it with a “.”; and

(v) Clause (x) is hereby deleted in its entirety.

(p) Amendments to Section 7.08 of the Credit Agreement: Prepayment of Indebtedness, Etc .

(i) Section 7.08(c) of the Credit Agreement is hereby amended by deleting the proviso “; provided , however , that amounts available under this Section 7.08(c) shall be reduced by any amounts applied pursuant to Section 7.07(x) hereof”.

(ii) Section 7.08(d) of the Credit Agreement is hereby amended by deleting the words “[ Intentionally Omitted ].” and by adding the following:

“(d) Prohibition Against Certain Payments on Second Lien Credit Obligations/Amendments of the Second Lien Loan Documents . None of the Group Companies will directly or indirectly redeem, purchase, prepay, retire, defease or otherwise acquire for value (other than exchanges solely for Equity Interests not constituting Debt Equivalents), prior to scheduled maturity, scheduled repayment or scheduled sinking fund payment, any Indebtedness incurred pursuant to the Second Lien Loan Documents, or set aside any funds for such purpose, whether such redemption, purchase, prepayment, retirement or acquisition is made at the option of the maker or at the option of the holder thereof, and whether or not any such redemption, purchase, prepayment, retirement or acquisition is required under the terms and conditions applicable to such Indebtedness, except that Indebtedness under the Second Lien Loan Documents may be redeemed, purchased, retired, defeased, acquired for value or prepaid at any time following repayment in full of all Term B Loans and all accrued interest thereon by utilizing the Net Cash Proceeds of one or more Asset Dispositions, Casualties, Condemnations and/or Debt Issuances. None of the Group Companies will, or will permit any of their

 

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respective Subsidiaries to, after the issuance thereof, amend, waive or modify (or permit the amendment, waiver or modification of) any of the terms, agreements, covenants or conditions of or applicable to the Second Lien Loan Documents unless such amendment, waiver or modification is in accordance with the terms of the Intercreditor Agreement.”

(q) Amendments to Section 7.09: Transactions with Affiliates .

(i) Clause (i) is hereby amended by adding the following to the end thereof “; provided , however , that (a) from and after the First Amendment Effective Date until such time as the Consolidated EBITDA of Holdings is at least $55,000,000 as of the last day of the most recent period of four consecutive fiscal quarters of Holdings for which financial statements are required to be delivered pursuant to Section 6.01(a) or (b)  (the “ Reinstatement Date ”), any Management Fees payable pursuant to clause (i) of the definition thereof shall be not be paid in cash (but shall continue to accrue) and (b) on and after the Reinstatement Date, no greater than $2,000,000 of such fees shall be paid in cash per fiscal year”;

(ii) Clause (xi) is hereby amended by deleting the word “and” at the end thereof;

(iii) Clause (xii) is hereby amended by inserting the word “and” at the end thereof; and

(iv) Section 7.09 is hereby amended by adding the following clause (xiii) “entering into the Second Lien Transaction Documents and the transactions related thereto, including, without limitation, the issuance of warrants and any amendments or modifications thereto (to the extent permitted by the Intercreditor Agreement).”

(r) Amendments to Section 7.11: Restrictions with Respect to Intercorporate Transfers .

(i) The first paragraph of Section 7.11 is hereby amended by inserting the words “(subject to the terms of the Intercreditor Agreement)” immediately after the words “pursuant to the Loan Documents” in clause (E); and

(ii) The second clause (i) therein is hereby amended by (A) deleting the word “or” and inserting a “,” in its place and (B) adding the words “or Second Lien Loan Documents” immediately after the words “Senior Notes Documents”.

(s) Amendments to Section 7.15: Additional Negative Pledges .

(i) Clause (xi) is hereby amended by deleting the word “and”;

(ii) Clause (xii) is hereby amended by inserting the word “and” at the end thereof; and

 

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(iii) Section 7.15 is hereby amended by adding the following clause (xiii) “pursuant to the Second Lien Credit Agreement and the other Second Lien Loan Document”.

(t) Amendments to Section 7.16: Financial Covenants .

Section 7.16 is hereby amended by deleting such section in its entirety and replacing it with the following:

“Section 7.16 Financial Covenant . Consolidated EBITDA of Holdings shall be at least the amount set forth below for any four fiscal quarter period ending on the last day of each fiscal quarter set forth below.

 

 

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(u) Amendments to Section 7.17: Capital Expenditures .

A new Section 7.17 is added following Section 7.16 to read as follows:

“Section 7.17 Capital Expenditures . Consolidated Capital Expenditures shall be no greater than the amount set forth below for any four fiscal quarter period ending on the last day of each fiscal quarter set forth below.