Exhibit 10.1
WAIVER AND FOURTH
AMENDMENT
TO REVOLVING CREDIT
AGREEMENT
This Waiver and Fourth Amendment,
dated as of February 9, 2007 (this “ Waiver and
Amendment ”), is executed and delivered by D 56, INC., a
Minnesota corporation (“ D 56 ”), LENOX RETAIL,
INC., a Minnesota corporation (“ Lenox Retail
”), LENOX, INCORPORATED, a New Jersey corporation (“
Lenox ” and, together with D 56 and Lenox Retail,
“ Borrowers ” and each individually, a “
Borrower ”), the Revolving Lenders party hereto and
UBS AG, Stamford Branch, as administrative agent (in such capacity,
the “ Administrative Agent ”).
RECITALS
WHEREAS , Borrowers, the financial institutions party
thereto as lenders (the “ Revolving Lenders ”)
and the Administrative Agent are parties to that certain Revolving
Credit Agreement, dated as of September 1, 2005, as amended by that
certain First Amendment thereto, dated as of December 29, 2005, by
that certain Second Amendment thereto, dated as of January 23,
2006, and by that certain Third Amendment thereto, dated as of
April 27, 2006 (as such agreement may be further amended, modified
or supplemented from time to time, the “ Credit
Agreement ”);
WHEREAS , Borrowers have informed Administrative Agent
and Revolving Lenders that the following Events of Default (the
“ Specified Events of Default ”) have occurred
and are continuing: (i) failure to achieve the maximum Leverage
Ratio pursuant to Section 6.08(a) of the Credit Agreement for the
Test Period ended December 31, 2006 and (ii) failure to achieve the
minimum Interest Coverage Ratio pursuant to Section 6.08(b) of the
Credit Agreement for the Test Period ended December 31,
2006;
WHEREAS , Administrative Agent and Revolving Lenders are
willing to waive the Specified Events of Default as and to the
extent set forth in this Waiver and Amendment and subject to the
terms and conditions set forth herein;
WHEREAS , this document shall constitute a Loan Document
and these Recitals shall be construed as part of this Waiver and
Amendment;
NOW THEREFORE
, in consideration of the premises
and the mutual covenants hereinafter contained, and for good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as
follows:
1.
Definitions . Except to the extent otherwise specified
herein, capitalized terms used in this Waiver and Amendment shall
have the same meanings ascribed to them in the Credit
Agreement.
2.
Limited Waiver . Administrative Agent and Revolving Lenders
hereby waive the Specified Events of Default solely for the time
period ending on April 30, 2007 (the “ Waiver Termination
Date ”). On the earlier of the Waiver Termination Date or
the occurrence of any other Event of Default under the Credit
Agreement, the foregoing waiver shall automatically
terminate and the Specified Events
of Default shall then be existing and continuing Events of Default
under the Credit Agreement entitling the Administrative Agent and
Revolving Loan Lenders to exercise all rights and remedies with
respect thereto as though such waiver had never been in
effect.
3.1. Section
5.01(h) of the Credit Agreement is amended by deleting the words
“Not later than the first day of each fiscal year” and
inserting in place thereof, the following words at the beginning of
such section: “With respect to the fiscal year 2007, not
later than March 15, 2007, and with respect to each fiscal year
thereafter, not later than 60 days after the first day of each such
fiscal year”.
3.2. The
following is inserted as a new Section 6.08(d) to the Credit
Agreement:
“(d) Minimum Borrowing
Availability . Permit Borrowing Availability to be less than
$5,000,000 at any time.”
3.3. The
following amendments set forth in this Section 3.3 are made as
temporary amendments to the Credit Agreement solely until the
Waiver Termination Date. On the earlier of the Waiver Termination
Date or the occurrence of any Event of Default (other than the
Specified Events of Default), the following amendments shall
automatically terminate and the respective covenant levels so
amended shall revert to the levels in effect under the Credit
Agreement prior to such amendments as though such amendments had
never been in effect:
(a) Section
6.08(a) of the Credit Agreement is amended by resetting the
Leverage Ratio covenant level for the Test Period of four fiscal
quarters ending March 31, 2007 to 5.40 to 1.0.
(b) Section
6.08(b) of the Credit Agreement is amended by resetting the
Interest Coverage Ratio covenant level for the Test Period of four
fiscal quarters ending March 31, 2007 to 1.25 to 1.0.
4.
Borrowing Base Covenant . Beginning with the week
comme
