EX-4.X 10 c75265exv4wx.txt 1ST AMENDMENT TO 2ND AMENDED & RESTATED CR. AGMT. EXHIBIT 4-X FIRST AMENDMENT THIS FIRST AMENDMENT dated as of December 30, 2002 (this "Amendment") amends the Second Amended and Restated Credit Agreement dated as of April 11, 2002 (the "Credit Agreement") among TruServ Corporation (the "Company"), various financial institutions from time to time party thereto (the "Lenders") and Bank of America, N.A., as agent for the Lenders (in such capacity, the "Agent"). Capitalized terms used but not otherwise defined herein have the respective meanings given to them in the Credit Agreement. WHEREAS, the Company, the Lenders and the Agent have entered into the Credit Agreement; and WHEREAS, the parties hereto desire to amend the Credit Agreement as more fully set forth herein; NOW, THEREFORE, the parties hereto agree as follows: SECTION 1 Amendments. Effective on (and subject to the occurrence of) the Amendment Effective Date (as defined below), the Credit Agreement shall be amended as set forth below: 1.1 Addition of Definitions. The following new definitions are added to Section 1.1 in appropriate sequence: Designated Sale-Leaseback Transaction means the sale by the Company of the regional distribution centers listed on Schedule 1.1(c) and the concurrent lease, as lessee, of such properties by the Company and/or one or more Subsidiaries pursuant to documentation substantially in the form previously delivered to the Agent. First Amendment means the First Amendment to this Agreement dated as of December 30, 2002. Special Company Account has the meaning specified in the Security Agreement. 1.2 Amendments to Definitions. (a) Clause (a) of the definition of "Adjusted Cash Flow" is amended by (i) redesignating clause "(vi)" as clause "(vii)" and (ii) inserting a comma followed by the following new clause (vi) in appropriate sequence: "(vi) for the period ended December 31, 2002, $7,500,000,". (b) The definition of "Asset Sale" is amended by (i) redesignating clause "(v)" as clause "(vi)" and (ii) inserting a comma followed by the following new clause (v) in appropriate sequence: "(v) any sublease of, or assignment by the Company of its interest as lessee in, properties sold pursuant to the Designated Sale-Leaseback Transaction, provided that any such sublease or assignment, as the case may be, shall be on an arm's length basis, shall have reasonable and normal commercial terms, and shall provide for no less frequent than quarterly payment of rent." (c) The definition of "Business Plan" is amended in its entirety to read as follows: Business Plan means the business plan of the Company which was delivered by the Company to the Agent on December 18, 2002; provided that, with respect to financial reports relating to the periods prior to 2003, "Business Plan" means the Business Plan of the Company dated March 20, 2002 which was delivered by the Company to the Agent. (d) The definition of "Intercreditor Agreement" is amended in its entirety to read as follows: Intercreditor Agreement means the First Amended and Restated Intercreditor Agreement dated as of April 11, 2002, among the Agent, the Collateral Agent and various other parties, substantially in the form of Exhibit N, as amended by the First Amendment thereto dated December 30, 2002. (e) The definition of "Security Agreement" is amended in its entirety to read as follows: Security Agreement means the Security Agreement among the Company, various Subsidiaries and the Collateral Agent dated April 14, 2000, as amended by the First Amendment thereto dated as of April 11, 2002 and the Second Amendment thereto dated as of December 30, 2002. (f) The definition of "Unusable Amount" is amended in its entirety to read as follows: Unusable Amount means the following amounts during the following periods:
Minimum Unusable Period Commitment ------ ---------------- 12/31/02 $70,000,000 1/1/03-6/29/03 $ 0 6/30/03 $25,000,000 7/1/03-7/31/03 $15,000,000 8/1/03-8/31/03 $15,000,000 9/1/03-9/29/03 $ 5,000,000 9/30/03-11/29/03 $ 0 11/30/03-12/30/03 $10,000,000 12/31/03 $45,000,000 1/1/04-6/30/04 $ 0
2 1.3 Amendment to Section 2.4.2. Section 2.4.2 is amended in its entirety to read as follows: 2.4.2 Mandatory Reductions of Commitments. (a) The Commitments shall be reduced by an aggregate amount of $5,000,000 on each of June 30, 2003, September 30, 2003 and December 31, 2003. (b) In addition to the reductions described in clause (a) above, upon any required prepayment under Section 2.5.2(b), (c) or (d), the aggregate Commitments shall be reduced by the amount of the required prepayment, even if such reduction is in excess of the outstanding amount of the Loans prior to such required prepayment. Upon the effectiveness of the First Amendment to this Agreement dated as of December 30, 2002 and the repayment related to the Designated Sale-Leaseback Transaction, the Commitments shall be reduced permanently by the amount of such repayment. 1.4 Amendment to Section 5.5. The second parenthetical phrase set forth in Section 5.5 is amended in its entirety to read as follows: "(other than properties and assets disposed of (x) in the ordinary course of business, (y) in connection with the sale of the Brookings regional distribution center or (z) pursuant to the Designated Sale-Leaseback Transaction)". Schedule 5.5 is hereby amended to state as set forth as Schedule 5.5 hereto. 1.5 Addition of Section 6.17. The following new Section 6.17 is added to the Credit Agreement in appropriate sequence to read as follows: 6.17 Amendments to Financial Covenants. If the sale-leaseback of the regional distribution center located at 333 Harvey Road, Manchester, New Hampshire (the "Manchester RDC") does not occur by February 15, 2003, the Company shall cause the financial covenant levels set forth in Article VII to be amended to reflect the exclusion of the Manchester RDC sale-leaseback from the Business Plan in a manner satisfactory to the Required Lenders in their sole discretion, and such financial covenant levels will be established in a manner reasonably satisfactory to the Required Lenders on the basis of the same methodologies used in preparing the covenant levels incorporated in the First Amendment. 1.6 Amendment to Section 7.1. The table set forth in Section 7.1 is amended in its entirety to read as follows: 3
Fiscal quarter ending on or about Minimum Fixed Charge --------------------------------- Coverage Ratio -------------------- December 31, 2002 0.70 to 1 March 31, 2003 0.70 to 1 June 30, 2003 0.65 to 1 September 30, 2003 0.65 to 1 December 31, 2003 0.90 to 1 March 31, 2004 0.90 to 1 June 30, 2004 0.90 to 1
1.7 Amendment to Section 7.2(h). Section 7.2(h)(ii) is amended in its entirety to read as follows: "(ii) a lease entered into as part of a sale and leaseback transaction (other than the Designated Sale-Leaseback Transaction provided that such interest or title attaches only to the property being leased in connection therewith)". 1.8 Amendment to Sections 7.2. Section 7.2 is amended by (a) deleting the word "and" at the end of clause (l), (b) redesignating clause "(m)" as clause "(n)" and (c) inserting the following new clause (m) in appropriate sequence: "(m) Liens in favor of BofA on the Special Company Account with respect to services provided by BofA, and". 1.9 Amendment to Section 7.11. Section 7.11(h) is amended in its entirety to read as follows: (h) (i) maintain the Special Company Account; provided that as of the close of business on any day on which the Total Outstandings are greater than zero or during the existence of an Event of Default after the commencement of an Enforcement (as defined in the Intercreditor Agreement), the amount maintained in the Special Company Account shall not be greater than zero; and (ii) maintain other deposit accounts with financial institutions in the ordinary course of business; provided that the amount maintained in deposit accounts with financial institutions other than the Lenders shall not exceed (x) in the case of any one such account, $200,000 for more than three consecutive Business Days; and (y) in the case of all such accounts in the aggregate, $600,000 for more than two consecutive Business Days. 1.10 Amendment to Section 7.14. The table set forth in Section 7.14 is amended in its entirety to read as follows: 4
Fiscal quarter ending on or about Minimum Interest --------------------------------- Coverage Ratio ---------------- December 31, 2002 1.75 to 1 March 31, 2003 1.75 to 1 June 30, 2003 2.00 to 1 September 30, 2003 2.00 to 1 December 31, 2003 3.00 to 1 March 31, 2004 3.00 to 1 June 30, 2004 3.00 to 1
1.11 Amendment to Section 7.15. The table set forth in Section 7.15 is amended in its entirety to read as follows:
Fiscal period ending on or about Minimum Amount -------------------------------- -------------- December 31, 2002 $1,975,000,000 January 31, 2003 $1,820,000,000 February 28, 2003 $1,780,000,000 March 31, 2003 $1,740,000,000 April 30, 2003 $1,725,000,000 May 31, 2003 $1,740,000,000 June 30, 2003 $1,720,000,000 July 31, 2003 $1,715,000,000 August 31, 2003 $1,710,000,000 September 30, 2003 $1,700,000,000 October 31, 2003 $1,715,000,000 November 30, 2003 $1,695,000,000 December 31, 2003 $1,700,000,000 January 31, 2004 $1,700,000,000 February 29, 2004 $1,695,000,000 March 31, 2004 $1,690,000,000 April 30, 2004 $1,690,000,000 May 31, 2004 $1,680,000,000 June 30, 2004 $1,670,000,000
1.12 Amendment to Section 7.16. Section 7.16 is amended by inserting the following phrase immediately before the sentence set forth below the table therein: "; provided that the aggregate amount of Capital Expenditures made during any fiscal year ending after December 31, 2002 may be increased by an amount equal to the lesser of (a) $2,000,000 and (b) the excess of the maximum amount of Capital Expenditures permitted to be made in the prior fiscal year over the actual amount of Capital Expenditures made during such prior fiscal year. Such increased permitted Capital Expenditures may be made in any fiscal quarter or fiscal quarters of such fiscal year." 5 1.13 Amendment to Section 7.17. The table set forth in Section 7.17 is amended in its entirety to read as follows:
Fiscal period ending on or about Minimum Adjusted -------------------------------- EBITDA ---------------- December 31, 2002 $100,000,000 January 31, 2003 $ 95,000,000 February 28, 2003 $ 95,000,000 March 31, 2003 $ 90,000,000 April 30, 2003 $ 90,000,000 May 31, 2003 $ 85,000,000 June 30, 2003 $ 80,000,000 July 31, 2003 $ 75,000,000 August 31, 2003 $ 70,000,000 September 30, 2003 $ 70,000,000 October 31, 2003 $ 70,000,000 November 30, 2003 $ 70,000,000 December 31, 2003 $ 70,000,000 January 31, 2004 $ 70,000,000 February 29, 2004 $ 70,000,000 March 31, 2004 $ 70,000,000 April 30, 2004 $ 70,000,000 May 31, 2004 $ 70,000,000 June 30, 2004 $ 70,000,000.
1.14 Addition of new Schedule 1.1(c). A new Schedule 1.1(c) is added to the Credit Agreement in the form of Schedule 1.1(c) hereto. SECTION 2 Representations and Warranties. The Company represents and warrants to the Agent and the Lenders that, after giving effect hereto, (a) each representation and warranty set forth in Article V of the Credit Agreement is true and correct as of the date of the execution and delivery of this Amendment by the Company with the same effect as if made on such date (except to the extent such representations and warranties expressly refer to an earlier date, in which case they were true and correct as of such earlier date) subject, in the case of the representations and warranties contained in Sections 5.2 and 5.12 of the Credit Agreement, to the matters disclosed in the waiver letter dated October 3, 2002 executed by the Lenders, and (b) no Event of Default or Unmatured Event of Default exists. SECTION 3 Effectiveness. The amendments set forth in Section 1 above shall become effective on the date (the "Amendment Effective Date") when the Agent shall have received the following: (a) to the extent then billed, all costs and expenses of the Agent in connection with this Amendment (including reasonable attorneys' fees and charges and all costs, expenses and charges for a field examination); 6 (b) counterparts of this Amendment executed by the Company and the Required Lenders; (c) a Confirmation, substantially in the form of Exhibit A, signed by the Company and each Guarantor; (d) an executed amendment to the Security Agreement substantially in the form of Exhibit B; (e) an executed amendment to the Intercreditor Agreement substantially in the form of Exhibit C; (f) evidence that the Designated Sale-Leaseback Transaction has occurred and that the proceeds thereof have been applied in accordance with the terms of the Intercreditor Agreement; and (g) evidence that the Company shall have entered into amendments to the Senior Note Agreements and the Shelf Note Agreement (each as defined in the Intercreditor Agreement) in form and substance reasonably satisfactory to the Agent, including an agreement by the applicable Noteholders (as defined in the Intercreditor Agreement) (i) to waive payment by the Company of the Make-Whole Delta Amount (as defined in the Intercreditor Agreement) in respect to any payment made with the proceeds of the Designated Sale-Leaseback Transaction and (ii) that the remaining Make-Whole Amount (as defined in the Intercreditor Agreement) shall be payable in two equal installments on January 10, 2003 and June 30, 2003. SECTION 4 Miscellaneous. 4.1 Continuing Effectiveness, etc. As herein amended, the Credit Agreement shall remain in full force and effect and is hereby ratified and confirmed in all respects. After the Amendment Effective Date, all references in the Credit Agreement and the other Loan Documents to "this Agreement", "the Credit Agreement" or similar terms shall refer to the Credit Agreement as amended hereby. 4.2 Counterparts. This Amendment may be executed in any number of counterparts and by the different parties on separate counterparts, and each such counterpart shall be deemed to be an original but all such counterparts shall together constitute one and the same Amendment. 4.3 Governing Law. This Amendment shall be a contract made under and governed by the laws of the State of Illinois applicable to contracts made and to be performed entirely within such state. 4.4 Successors and Assigns. This Amendment shall be binding upon the Company, the Lenders and the Agent and their respective successors and assigns, and shall inure to the benefit of the Company, the Lenders and the Agent and the respective successors and assigns of the Lenders and the Agent. 7 4.5 Consents. Notwithstanding any provision in the Credit Agreement to the contrary, the Required Lenders consent to (a) the amendments to the Financing Agreements set forth as Exhibits D, E and F hereto (b) the consummation of the Designated Sale-Leaseback Transaction and (c) the release of collateral by the Collateral Agent to the extent subject to the Designated Sale-Leaseback Transaction. 4.6 Further Assurances. Upon the request of the Required Lenders, the Company agrees to provide and cause its Subsidiaries to provide to the Lenders such additional amendments, consents, reaffirmations and ancillary documentation as is necessary or advisable, in the sole reasonable discretion of the Required Lenders, to ensure that the Collateral Documents are in full force and effect in all respects. 8 Delivered at Chicago, Illinois, as of the day and year first above written. TRUSERV CORPORATION By: /s/ DAVE SHADDUCK ----------------------------------------- Title: Senior Vice President & Chief Financial Officer -------------------------------------- BANK OF AMERICA, N.A., as Agent By: /s/ RONALD PRINCE ---------------------------------------- Title: Senior Vice President ------------------------------------- BANK OF AMERICA, N.A., as a Lender By: /s/ RONALD PRINCE ---------------------------------------- Title: Senior Vice President ------------------------------------- 9 BANK OF MONTREAL By: /s/ JACK J. KANE ---------------------------------------- Title: Vice President ------------------------------------- 10 BANK ONE, NA (Main Office Chicago) By: /s/ RICHARD BABCOCK ---------------------------------------- Title: First Vice President ------------------------------------- 11 PNC BANK, NATIONAL ASSOCIATION By: /s/ GARY A. BEST ---------------------------------------- Title: Vice President ------------------------------------- 12 WACHOVIA BANK, N.A. By: /s/ JAMES BARWIS ---------------------------------------- Title: Director ------------------------------------- 13 THE NORTHERN TRUST COMPANY By: /s/ OLGA GEORGIEV ---------------------------------------- Title: Vice President ------------------------------------- 14 ABN AMRO BANK N.V. By: /s/ STEVEN C. WIMPENNY ---------------------------------------- Title: Group Senior Vice President ------------------------------------- By: /s/ WILLIAM J. TERESKY, JR. ---------------------------------------- Title: Group Vice President ------------------------------------- 15 NATIONAL CONSUMER COOPERATIVE BANK By: /s/ MARK W. HILTZ ---------------------------------------- Title: Managing Director ------------------------------------- 16 UMB BANK, N.A. By: /s/ TERRY DIERKS ---------------------------------------- Title: Senior Vice President ------------------------------------- 17 SCHEDULE 1.1(c) REGIONAL DISTRIBUTION CENTERS
PROPERTY ADDRESS -------- ------- Allentown 7058 Snowdrift Road Fogelsville, PA 18087 Atlanta 7600 Jonesboro Road Jonesboro, GA 30236 Corsicana 2601 East Highway 31 Corsicana, TX 75153 Kansas City 14900 US Highway 71 Kansas City, MO 64147 Kingman 4005 Mohave Airport Dr. Kingman, AZ 86401 Springfield 2150 Olympic Avenue Springfield, OR 97477 Woodland 215 N. Pioneer Aven. Woodland, CA 95776
18 SCHEDULE 5.5 REAL ESTATE
PROPERTY TYPE ADDRESS OWNERSHIP -------- ---- ------- --------- Allentown Distribution Center 7058 Snowdrift Road Lease Fogelsville, PA 18087 Allentown Garage Hickory Lane Lease Wescoesville, PA Allentown Storage Facility 6829B & 6829C Ruppsville Road Lease Allentown, PA 18106 Allentown Storage Facility 7072 Snowdrift Road Lease Upper Mac Township, PA Atlanta Distribution Center 7600 Jonesboro Road Lease Jonesboro, GA 30236 Blackhawk Manufacturing Facility 823 W. Blackhawk St. Own Chicago, IL 60622 Butler Administration One TruServ Way Own East Butler, PA 16029 Cary Manufacturing Facility 203 Jandus Rd. Own Cary, IL 60013 Cleveland (Westlake) Distribution Center 26025 First St. Own Westlake, OH 44145 Cleveland (Westlake) Storage Facility 1400 Lowell St. Lease Northern Ohio Industrial Park Elyria, OH 44035 Corsicana Distribution Center 2601 East Highway 31 Lease Corsicana, TX 75153 Denver Distribution Center 11275 E. 40th Avenue Lease Denver, CO 80239 Fort Smith Unoccupied 8503 Highway 45 Lease Fort Smith, AR 72916 Greenville Garage Greenville, SC Lease Hagerstown Distribution Center 16500 Hunters Green Parkway Lease Hagerstown, MD 21740 Harvard Distribution Center 306, 308 & 320 S. Division St. Lease Harvard, IL 60033 Kansas City Distribution Center 14900 US Highway 71 Lease Kansas City, MO 64147 Kansas City Storage Facility 624 NE Jones Industrial Drive Lease Lee Summit, MO
19
PROPERTY TYPE ADDRESS OWNERSHIP -------- ---- ------- --------- Kingman Distribution Center 4005 Mohave Airport Dr. Lease Kingman, AZ 86401 Kingman Storage Facility Farner/Orr LLC Lease 7050 Government Way Kingman, AZ 86401 Manchester Distribution Center 333 Harvey Rd. Own Manchester NH 03103 Mankato Distribution Center 2415 3rd Ave. Own Mankato, MN 56001 Mankato Storage Facility 1329 North Riverfront Drive Lease Mankato, MN 56001 Parkesburg Garage R. D. 2 Hammond Drive Lease Parkesburg, PA 19365 Peachtree City Unoccupied Hwy. 74 South Lease Peachtree City, GA 30269 President's Plaza Administration 8600 West Bryn Mawr Ave. Lease Chicago, IL 60631 Springfield Distribution Center 2150 Olympic Avenue Lease Springfield, OR 97477 Springfield Garage 955 A Street South Lease Springfield, OR 97477 Woodland Distribution Center 215 N. Pioneer Avenue Lease Woodland, CA 95776 Woodland Storage Facility 280 N. Pioneer Ave. Lease Woodland, CA
20 EXHIBIT A CONFIRMATION Dated as of December 30, 2002 To: Bank of America, N.A., individually and as Collateral Agent, and the other "Benefited Parties" as defined in the Intercreditor Agreement referred to below Please refer to: (a) the First Amended and Restated Intercreditor Agreement dated as of April 11, 2002 (the "Intercreditor Agreement"; capitalized terms used but not defined herein have the respective meanings ascribed thereto in the Intercreditor Agreement) among various creditors of TruServ Corporation and Bank of America, N.A., as Collateral Agent; (b) the First Amendment dated as of the date hereof to the Credit Agreement; (c) the First Amendments dated as of the date hereof to the Senior Note Agreements; and (d) the First Amendment dated as of the date hereof to the Shelf Note Agreement. Each of the undersigned hereby confirms to the Collateral Agent and each of the other Benefited Parties that, after giving effect to First Amendments referred to in clauses (b), (c) and (d) of the preceding paragraph and the transactions contemplated thereby, the Guaranty and each Collateral Document to which such undersigned is a party continues in full force and effect and is the legal, valid and binding obligation of such undersigned, enforceable against such undersigned in accordance with its terms. TRUSERV ACCEPTANCE COMPANY TRUSERV LOGISTICS COMPANY GENERAL PAINT & MANUFACTURING COMPANY MARYGREEN, LLC TRUE VALUE.COM CORPORATION COTTER CANADA HARDWARE & VARIETY COMPANY, INC. ADVOCATE SERVICES, INC. SERVISTAR PAINT COMPANY By:___________________________________________ Name Printed:_________________________________ Title:________________________________________ 21 EXHIBIT B FORM OF AMENDMENT TO SECURITY AGREEMENT Please see attached. 22 EXHIBIT C FORM OF AMENDMENT TO INTERCREDITOR AGREEMENT Please see attached. 23 EXHIBITS D-F AMENDMENTS TO FINANCING AGREEMENTS Please see attached. 24