EXHIBIT 10.22
FIRST AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT AND SECURITY
AGREEMENTS
This First Amendment to Amended and Restated Credit Agreement and Security
Agreements (the "First Amendment") is made as of the 30th day of June, 2006 by
and among
PETSMART, INC., a Delaware corporation, having a principal place of
business at ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, as Lead
Borrower for the Borrowers, being
said PETSMART, INC., and
PETSMART STORE SUPPORT GROUP, INC., a Delaware corporation, having a
principal place of business at ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇;
the LENDERS party hereto; and
BANK OF AMERICA, N.A. (f/k/a Fleet National Bank), as Issuing Bank, a
national banking association having a place of business at ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇; and
FLEET RETAIL GROUP, LLC (f/k/a Fleet Retail Group, Inc.), as Administrative
Agent and Collateral Agent for the Lenders, a Delaware limited liability
company, having an office at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇;
and
WACHOVIA CAPITAL FINANCE CORPORATION (WESTERN), as successor to Congress
Financial Corporation (Western), as Co-Agent
in consideration of the mutual covenants herein contained and benefits to be
derived herefrom.
WITNESSETH
WHEREAS, the Lead Borrower, the other Borrowers, the Administrative Agent,
the Collateral Agent, the Lenders, the Issuing Bank, and the Co-Agent have
entered into an Amended and Restated Credit Agreement dated as of November 21,
2003 (as amended and in effect, the "Credit Agreement"); and
WHEREAS, the Lead Borrower, the other Borrowers, and the Collateral Agent,
have entered into a Security Agreement dated as of April 30, 2001 (as amended
and in effect, the "Borrower Security Agreement"); and
WHEREAS, the Facility Guarantors and the Collateral Agent, have entered
into a Security Agreement dated as of April 30, 2001 (as amended and in effect,
the "Subsidiary
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Security Agreement" and together with the Borrower Security Agreement, the
"Security Agreements"); and
WHEREAS, the Lead Borrower, the other Borrowers, the Administrative Agent,
the Collateral Agent, the Lenders, the Issuing Bank, and the Co-Agent have
agreed to amend certain provisions of the Credit Agreement and the Security
Agreements as set forth herein.
NOW THEREFORE, it is hereby agreed as follows:
1. Definitions: All capitalized terms used herein and not otherwise defined
shall have the same meaning herein as in the Credit Agreement.
2. Amendments to Article I. The provisions of Article I of the Credit
Agreement are hereby amended as follows:
a. The definition of "Facility Guarantors" in Section 1.01 of the Credit
Agreement is hereby deleted in its entirety and the following
substituted in its stead:
"Facility Guarantors" means the Persons listed on Schedule 1.2 hereto
and all other Subsidiaries of each Borrower now existing or hereafter
created other than Foreign Subsidiaries; provided that PET WISE INC.
shall cease to be a Facility Guarantor upon its dissolution or merger
in accordance with the provisions of Section 6.03.
b. The provisions of Section 1.01 of the Credit Agreement are hereby
amended by adding the following definitions in appropriate
alphabetical order:
"L/C Facility" means one or more letter of credit facilities from time
to time established by any of the Borrowers with a financial
institution providing for the issuance of letters of credit (other
than Letters of Credit issued under this Agreement).
"L/C Facility Cash Collateral" means cash, cash equivalents, and/or
marketable securities of a Borrower from time to time deposited or
maintained with the financial institution party to an L/C Facility
which are subject to a first perfected security interest in favor of
such financial institution to secure such Borrower's obligations under
such L/C Facility. The parties acknowledge and agree that Cash and
Cash Equivalents and Additional Collateral, each as defined in that
certain Letter of Credit Agreement of even date herewith, by and
between the Lead Borrower and Bank of America, N.A., as issuing bank,
constitute L/C Facility Cash Collateral under this Agreement.
"Secured Obligations" means the Obligations.
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"Transfer Notice" has the meaning set forth in Section 2.07(k).
3. Amendments to Article II. The provisions of Article II of the Credit
Agreement are hereby amended as follows:
a. The provisions of Section 2.07 are hereby amended by adding the
following new subsection at the end thereof:
(k) The Borrowers may, upon three (3) Business Days written notice (a
"Transfer Notice") to the Issuing Bank and the Administrative Agent,
request that any or all of the letters of credit issued under any L/C
Facility entered into with a Lender hereunder (or any of such Lender's
Affiliates) be transferred to, and deemed issued by, the Issuing Bank
under this Agreement. As long as the issuance of such Letters of
Credit would be permitted under this Agreement and all conditions
precedent to such issuance would be satisfied (as if such Letters of
Credit were newly issued on the date set forth in the Transfer Notice)
and such issuance would not result in the occurrence of a Default or
Event of Default, the Issuing Bank and such Lender shall promptly take
such action, at the expense of the Borrowers, as may be reasonably
required to cause such letters of credit to become Letters of Credit
hereunder.
b. The provisions of Section 2.28 of the Credit Agreement are hereby
amended by deleting the parenthetical in its entirety and substituting
the following in its stead:
(subject to Liens on L/C Facility Cash Collateral to secure
Indebtedness permitted by Section 6.01(g) and Permitted Encumbrances
having priority over the Lien of the Collateral Agent by operation of
law)
c. The provisions of Article II are hereby amended by adding the
following new section at the end thereof:
SECTION 2.30 Acknowledgments Regarding L/C Facilities. The parties
acknowledge and agree that no obligation of any Loan Party under any
L/C Facility shall be deemed to be an obligation under this Agreement
or any other Loan Document, notwithstanding anything to the contrary
herein or therein. The parties further acknowledge and agree that the
grant by any Loan Party of a first-priority security interest in L/C
Facility Cash Collateral to any financial institution party to an L/C
Facility shall not constitute a Default or Event or Default, or
otherwise constitute a breach of this Agreement or any other Loan
Document, notwithstanding anything to the contrary herein or therein.
4. Amendments to Article III. The provisions of Section 3.15 of the Credit
Agreement are hereby amended by deleting the parenthetical in its entirety
and substituting the following in its stead:
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(subject to Liens on L/C Facility Cash Collateral to secure
Indebtedness permitted by Section 6.01(g) and Permitted Encumbrances
having priority over the Lien of the Collateral Agent by operation of
law)
5. Amendments to Article V. The provisions of Section 5.01(f) of the Credit
Agreement are hereby amended by deleting the number "$40,000,000" and
substituting "$80,000,000" in its stead.
6. Amendments to Article VI. The provisions of Article VI of the Credit
Agreement are hereby amended as follows:
a. The provisions of Section 6.01(g) of the Credit Agreement are hereby
deleted in their entirety and the following substituted in their
stead:
(g) Indebtedness with respect to any L/C Facility, provided that the
maximum principal amount of all L/C Facilities shall not exceed
$65,000,000 (or such greater amount (not to exceed $80,000,000) as may
be permitted under such L/C Facilities);
b. The provisions of Section 6.01(j) of the Credit Agreement are hereby
amended by deleting the phrase "clauses (b), (c), (d), (e), (h), or
(i)" and substituting in its stead the phrase "clauses (b), (c), (d),
(e), (g), (h) or (i)."
c. The provisions of Section 6.02 of the Credit Agreement are amended by
deleting the word "and" at the end of Section 6.02(i), by re-lettering
Section 6.02(j) as Section 6.02(k) and adding the following
immediately after said Section 6.02(i):
(j) Liens on L/C Facility Cash Collateral to secure Indebtedness
permitted by Section 6.01(g); and
d. The provisions of Section 6.03(a) of the Credit Agreement are hereby
deleted in their entirety and the following substituted in their
stead:
(a) The Loan Parties will not merge into or consolidate with any other
Person, or permit any other Person to merge into or consolidate with
it, or liquidiate or dissolve, except that if at the time thereof and
immediately after giving effect thereto no Default shall have occurred
and be continuing, (A) PET WISE INC. may be dissolved and (B) (i) any
Subsidiary may merge into a Borrower in a transaction in which a
Borrower is the surviving corporation, and (ii) any Subsidiary that is
not a Borrower may merge into any Subsidiary that is not a Borrower,
provided that any such merger involving a Person that is not a wholly
owned Subsidiary immediately prior to such merger shall not be
permitted unless also permitted by Section 6.04.
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e. The provisions of Section 6.04(d) of the Credit Agreement are hereby
deleted in their entirety and the following substituted in their
stead:
(d) Guarantees constituting Indebtedness permitted by Section 6.01,
provided that such Guarantees by the Borrowers, other than Guarantees
of Indebtedness permitted under Section 6.01(g) or 6.01(i), shall not
exceed $20,000,000 in the aggregate at any time outstanding;
f. The provisions of Section 6.06(b) of the Credit Agreement are hereby
amended by deleting Section 6.06(b)(ii) and substituting the following
Sections 6.06(b)(ii) and 6.06(b)(iii) in its stead:
(ii) payments under any L/C Facility, as and when due; and
(iii) refinancings of Indebtedness described in clause (i) or (ii),
above, to the extent permitted by Section 6.01.
7. Amendments to Article VII. The provisions of Article VII of the Credit
Agreement are hereby amended as follows:
a. The provisions of Section 7.01(m)(iii) of the Credit Agreement are
hereby deleted in their entirety with the following substituted in
their stead:
(iii) any Lien purported to be created under any Security Document
shall cease to be, or shall be asserted by any Loan Party not to be, a
valid and perfected Lien on any Collateral, with the priority required
by the applicable Security Document (subject to the first priority of
Liens on L/C Facility Cash Collateral to secure Indebtedness permitted
by Section 6.01(g), notwithstanding anything to the contrary in any
Security Document), except as a result of the sale or other
disposition of the applicable Collateral in a transaction permitted
under the Loan Documents;
b. The provisions of Section 7.01 of the Credit Agreement are hereby
amended by deleting the word "or" at the end of Section 7.01(p), by
re-lettering Section 7.01(q) as Section 7.01(r) and adding the
following immediately after said Section 7.01(p):
(q) any Loan Party shall fail to make any payment (whether of
principal or interest and regardless of amount) in respect of any L/C
Facility when and as the same shall become due and payable (after
giving effect to the expiration of any grace or cure period set forth
therein); or any event or condition has occurred that has resulted in
any Indebtedness with respect to any L/C Facility becoming due prior
to its scheduled maturity or that enables or permits (with or without
the giving of notice, the lapse of time or both) the holder or holders
of any such
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Indebtedness to cause any such Indebtedness to become due, or to
require the prepayment, repurchase, redemption or defeasance thereof,
prior to its scheduled maturity; or
8. Amendments to Article VIII. The provisions of Section 8.03 of the Credit
Agreement are hereby amended by deleting the first sentence thereof and
substituting the following in its stead:
Each of the Lenders, the Agents and the Issuing Bank agrees that if it
shall, through the exercise of a right of banker's lien, setoff or
counterclaim against the Loan Parties, including, but not limited to,
a secured claim under Section 506 of the Bankruptcy Code or other
security or interest arising from, or in lieu of, such secured claim
and received by such Lender, any Agent or the Issuing Bank under any
applicable bankruptcy, insolvency or other similar law, or otherwise,
obtain payment in respect of the Obligations owed it (an "excess
payment") as a result of which such Lender, such Agent or the Issuing
Bank has received payment of any Loans or other Obligations
outstanding to it in excess of the amount that it would have received
if all payments at any time applied to the Loans and other Obligations
had been applied in the order of priority set forth in Section 2.23,
then such Lender, Agent or the Issuing Bank shall promptly purchase at
par (and shall be deemed to have thereupon purchased) from the other
Lenders, such Agent and the Issuing Bank, as applicable, a
participation in the Loans and Obligations outstanding to such other
Persons, in an amount determined by the Administrative Agent in good
faith as the amount necessary to ensure that the economic benefit of
such excess payment is reallocated in such manner as to cause such
excess payment and all other payments at any time applied to the Loans
and other Obligations to be effectively applied in the order of
priority set forth in Section 2.23 pro rata in proportion to its
Commitment; provided, that if any such excess payment is thereafter
recovered or otherwise set aside such purchase of participations shall
be correspondingly rescinded (without interest), and provided further
that the foregoing provisions shall not apply to any L/C Facility Cash
Collateral (which shall be retained by the financial institution party
to such L/C Facility).
9. Amendments to Article IX. The provisions of Section 9.09 of the Credit
Agreement are hereby amended by deleting the first sentence thereof and
substituting the following in its stead:
If an Event of Default shall have occurred and be continuing, each
Lender and each of its Affiliates is hereby authorized at any time and
from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand,
provisional or final, but not any L/C Facility Cash Collateral) at any
time held and other obligations at any time owing by such
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Lender or Affiliate to or for the credit or the account of the Loan
Parties against any of and all the obligations of the Loan Parties now
or hereafter existing under this Agreement held by such Lender,
irrespective of whether or not such Lender shall have made any demand
under this Agreement and although such obligations may be unmatured.
10. Amendments to Borrower Security Agreement. The provisions of the Borrower
Security Agreement are hereby amended as follows:
a. The second paragraph of the Recitals to the Borrower Security
Agreement is hereby amended to add the following at the end thereof:
Notwithstanding anything to the contrary contained herein, the term
"Obligations" shall not include, and there shall be excluded
therefrom, any Indebtedness under any L/C Facility.
b. The provisions of Section 3.3 of the Borrower Security Agreement are
hereby amended by deleting clause (a) from the first sentence thereof
and substituting the following in its stead:
(a) a legal and valid perfected first priority security interest in
all the Collateral securing the payment and performance of the
Obligations (subject to the first priority of Liens on L/C Facility
Cash Collateral to secure Indebtedness permitted by Section 6.01(g) of
the Credit Agreement), and
11. Amendments to Subsidiary Security Agreement. The provisions of Section 3.3
of the Subsidiary Security Agreement are hereby amended by deleting clause
(a) from the first sentence thereof and substituting the following in its
stead:
(a) a legal and valid perfected first priority security interest in
all the Collateral securing the payment and performance of the
Obligations (subject to the first priority of Liens on L/C Facility
Cash Collateral to secure Indebtedness permitted by Section 6.01(g) of
the Credit Agreement), and
12. Conditions to Effectiveness. This First Amendment shall not be effective
until each of the following conditions precedent have been fulfilled to the
satisfaction of the Administrative Agent:
a. This First Amendment shall have been duly executed and delivered by
the Borrowers, the Administrative Agent, the Collateral Agent and the
Required Lenders. The Administrative Agent shall have received a fully
executed copy hereof and of each other document required hereunder.
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b. All action on the part of the Borrowers necessary for the valid
execution, delivery and performance by the Borrowers of this First
Amendment shall have been duly and validly taken. The Administrative
Agent shall have received from each of the Borrowers the resolutions
authorizing the transactions described herein, certified by its
secretary or other appropriate officer to be true and complete.
c. The Borrowers shall have reimbursed the Administrative Agent for all
of its reasonable out-of-pocket expenses incurred in connection
herewith, including, without limitation, reasonable attorneys' fees.
d. The Borrowers shall have paid to the Administrative Agent, for the pro
rata benefit of the Lenders who have entered into this First Amendment
on or prior to the effective date hereof (in accordance with their
respective Commitments), an amendment fee in an amount equal to 0.05%
of the sum of such Lenders' Commitments. Such amendment fee shall be
fully earned and paid by the Borrowers to the Administrative Agent in
full on the effective date of this First Amendment. Such amendment fee
shall not be subject to refund or rebate under any circumstances.
e. No Default or Event of Default shall have occurred and be continuing.
f. The Borrowers shall have provided such additional instruments,
documents, and agreements to the Administrative Agent as the
Administrative Agent and its counsel may have reasonably requested.
13. Miscellaneous.
a. Except as provided herein, all terms and conditions of the Credit
Agreement, the Security Agreements and the other Loan Documents remain
in full force and effect and are hereby ratified.
b. This First Amendment may be executed in several counterparts and by
each party on a separate counterpart, each of which when so executed
and delivered, each shall be an original, and all of which together
shall constitute one instrument. Delivery of an executed counterpart
of a signature page hereto by facsimile shall be effective as delivery
of a manually executed counterpart hereof.
c. This First Amendment expresses the entire understanding of the parties
with respect to the matters set forth herein and supersedes all prior
discussions or negotiations hereon.
d. This First Amendment shall be governed by, and construed in accordance
with, the law of the Commonwealth of Massachusetts.
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[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to
be executed and their seals to be hereto affixed as of the date first above
written.
PETSMART, INC.,
as Lead Borrower and Borrower
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: SVP & CFO
PETSMART STORE SUPPORT GROUP, INC.,
as Borrower
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: SVP & CFO
FLEET RETAIL GROUP, LLC., as
Administrative Agent, Collateral Agent,
and Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Managing Director
BANK OF AMERICA, N.A.,
as Issuing Bank
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Managing Director
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WACHOVIA CAPITAL FINANCE CORPORATION
(WESTERN), as Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------------------
Print Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President
▇▇▇▇▇ FARGO FOOTHILL, INC. (f/k/a
▇▇▇▇▇ Fargo Foothill, LLC), as Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Assistant Vice President
GENERAL ELECTRIC CAPITAL CORPORATION,
as Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Duly Authorized Signatory
Acknowledged and agreed to for
purposes of Section 11:
AUTHORITY PET FOOD COMPANY,
as Facility Guarantor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: SVP & CFO
PACIFIC COAST DISTRIBUTING, INC.,
as Facility Guarantor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Print Name:
Title:
▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ (▇▇▇) HOLDINGS, INC.,
as Facility Guarantor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Print Name:
Title:
PETSTUFF NOVA SCOTIA, INC.,
as Facility Guarantor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Print Name:
Title:
PET WISE INC.,
as Facility Guarantor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Print Name:
Title:
3003300 NOVA SCOTIA COMPANY,
as Facility Guarantor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Print Name:
Title:
PETSCARD, LLC,
as Facility Guarantor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Print Name:
Title:
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PETSMART LEASING, INC.,
as Facility Guarantor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Print Name:
Title:
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