Exhibit 10.2
FIFTH AMENDMENT
OF
SUBORDINATED NOTE AND WARRANT PURCHASE AGREEMENT
This Fifth Amendment, dated effective
as of February 4, 2005, by and among CROWN CRAFTS, INC.
(the “ Company ”), and BANC OF AMERICA
STRATEGIC SOLUTIONS, INC. (assignee of Bank of America, N.A.), THE
PRUDENTIAL INSURANCE COMPANY OF AMERICA , and WACHOVIA BANK,
NATIONAL ASSOCIATION (successor by merger to Wachovia Bank,
N.A.) (collectively, the “ Purchasers
”).
WHEREAS , the parties hereto
have executed and delivered that certain Subordinated Note and
Warrant Purchase Agreement dated as of July 23, 2001, as
amended by First Amendment of Subordinated Note and Warrant
Purchase Agreement dated as of September 28, 2001, Second
Amendment of Subordinated Note and Warrant Purchase Agreement dated
as of February 10, 2003, Global Amendment Agreement dated as
of April 29, 2003 and Fourth Amendment of Subordinated Note
and Warrant Purchase Agreement dated as of August 1, 2003(as
so amended, the “ Purchase Agreement
”);
WHEREAS , the Company has
requested a modification of, among other things, the financial
covenants under the Purchase Agreement;
WHEREAS , the Purchasers are
willing to enter into this Amendment subject to the satisfaction of
conditions and terms set forth herein;
WHEREAS , capitalized terms
used herein and not otherwise defined shall have the meanings set
forth in the Purchase Agreement; and
NOW, THEREFORE, in
consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
| 1. |
Amendments to Purchase Agreement. |
lA. Section 8.
01(a) of the Purchase Agreement
. Section 8.01(a) of the Purchase Agreement is amended
by deleting it in its entirety and substituting the following
therefor:
(a) Minimum EBITDA .
Consolidated EBITDA shall not be less than, at the end of each
Fiscal Quarter, for such Fiscal Quarter and the 3 immediately
preceding Fiscal Quarters, the amount set forth below corresponding
to such Fiscal Quarter:
| |
|
|
|
|
|
| |
| |
Fiscal Quarter Ending |
|
|
Minimum EBITDA |
|
|
|
December 26, 2004
|
|
|
$7,000,000 |
|
| |
|
|
|
|
|
|
|
April 3,
2005 through January 1, 2006
|
|
|
$5,500,000 |
|
| |
|
|
|
|
|
|
|
April 2,
2006
|
|
|
$5,800,000 |
|
| |
|
|
|
|
|
|
|
July 2,
2006 and each Fiscal Quarter thereafter
|
|
|
$6,400,000 |
|
| |
|
|
|
|
|
| |
lB. Section 8.
01(b) of the Purchase Agreement
. Section 8.01(b) of the Purchase Agreement is amended
by deleting it in its entirety and substituting the following
therefor:
(b) Debt/EBITDA
Ratio . The Debt/EBITDA Ratio will not exceed, at the
end of each Fiscal Quarter set forth below, calculated as to Debt
as of such Fiscal Quarter and calculated as to Consolidated EBITDA
for such Fiscal Quarter and the 3 immediately preceding Fiscal
Quarters, the ratio set forth below corresponding to such Fiscal
Quarter :
| |
|
|
|
|
|
| |
| |
Fiscal Quarter Ending |
|
|
Maximum Debt/EBITDA
Ratio |
|
|
|
December 26, 2004
|
|
|
4.00 to 1.00 |
|
| |
|
|
|
|
|
|
|
April 3,
2005 through October 2, 2005
|
|
|
5.00 to 1.0 |
|
| |
|
|
|
|
|
|
|
January 1,
2006 through July 2, 2006
|
|
|
4.75 to 1.00 |
|
| |
|
|
|
|
|
|
|
October 1,
2006 and December 31, 2006
|
|
|
4.50 to 1.00 |
|
| |
|
|
|
|
|
|
|
April 1,
2007 and each Fiscal Quarter thereafter
|
|
|
4.00 to 1.00 |
|
| |
|
|
|
|
|
| |
lC. Section 8.
01(d) of the Purchase Agreement
. Section 8.01(d) of the Purchase Agreement is amended
by deleting it in its entirety and substituting the following
therefor:
2
(d) EBITDA/Cash
Interest Ratio. The EBITDA/Cash Interest Ratio will not be less
than, at the end of each Fiscal Quarter set forth below, for such
Fiscal Quarter and the 3 immediately preceding Fiscal Quarters, the
amount set forth below corresponding to such Fiscal
Quarter:
| |
|
|
|
|
|
| |
| |
|
|
|
Minimum EBITDA/Cash Interest |
|
| |
Fiscal Quarter Ending |
|
|
Ratio |
|
|
|
December 26,
2004
|
|
|
2.50 to 1.0 |
|
| |
|
|
|
|
|
|
|
April 3, 2005
and July 3, 2005
|
|
|
2.00 to 1.0 |
|
| |
|
|
|
|
|
|
|
October 2,
2005 and January 1, 2006
|
|
|
2.25 to 1.0 |
|
| |
|
|
|
|
|
|
|
April 2, 2006
and each Fiscal Quarter thereafter
|
|
|
2.75 to 1.00 |
|
| |
|
|
|
|
|
| |
| 2. |
Conditions of Effectiveness. This Amendment shall
be effective as of the date first set forth above (the “
Effective Date ”), upon the satisfaction of the
following conditions: |
| |
(a) |
the Purchasers shall have received executed originals,
satisfactory to the Required Holders in all respects, of this
Amendment and the Seventh Amendment to the Credit Agreement, dated
as of even date herewith, among the Company, Churchill Weavers,
Inc., Hamco, Inc. and Crown Crafts Infant Products, Inc., as
borrowers, Wachovia Bank, National Association (successor by merger
to Wachovia Bank, N.A.), as agent, and Wachovia Bank, National
Association (successor by merger to Wachovia Bank, N.A.), Banc of
America Strategic Solutions, Inc. (assignee of Bank of America,
N.A.) and The Prudential Insurance Company of America, as lenders,
each agreement being dated the Effective Date, in form and
substance satisfactory to the Purchasers. |
| |
| |
(b) |
The Company shall have paid all costs and expenses (including
attorney’s fees and expenses) incurred by any Purchaser
through the Effective Date, pursuant to statements submitted to the
Company (which statements may include estimates of time and
expenses to be incurred on and after the dates of posting of actual
time and expenses set forth therein, which estimated amounts shall
be subject to subsequent adjustment to reflect actual time and |
|
