Amendment No. 10 to Credit Agreement
Exhibit
10.1
Execution
Copy
Amendment No. 10 to Credit
Agreement
This
Amendment No. 10 to Credit Agreement (this “Tenth Amendment”) is
entered into as of May 8, 2009 by and among Select Comfort Corporation (the
“Company”),
Select Comfort Retail Corporation, JPMorgan Chase Bank, National Association, as
Administrative Agent and Collateral Agent, Bank of America, N.A., as Syndication
Agent, and the financial institutions signatories hereto as lenders (the “Lenders”).
RECITALS
A. The
undersigned are parties to that certain Credit Agreement dated as of June 9,
2006, as amended pursuant to Amendment No. 1 to Credit Agreement dated as of
June 28, 2007, Amendment No. 2 to Credit Agreement dated as of February 1, 2008,
Amendment No. 3 to Credit Agreement dated as of May 30, 2008, Amendment No. 4 to
the Credit Agreement dated as of December 2, 2008, Amendment No. 5 to the Credit
Agreement dated as of January 2, 2009, Amendment No. 6 to the Credit Agreement
dated as of January 15, 2009 (“Amendment No. 6”), Amendment No. 7 to the Credit
Agreement dated as of January 31, 2009, Amendment No. 8 to the Credit Agreement
dated as of February 28, 2009, and Amendment No. 9 to Credit Agreement dated as
of April 17, 2009 (the “Credit
Agreement”). Unless otherwise specified herein, capitalized
terms used in this Tenth Amendment shall have the meanings ascribed to them by
the Credit Agreement.
B. The
Company has requested that the Administrative Agent and the Lenders grant a
limited waiver with respect to the Credit Agreement.
C. The
Administrative Agent and the undersigned Lenders are willing to grant such
waiver on the terms and conditions set forth below.
Now,
therefore, in consideration of the mutual execution hereof and other good and
valuable consideration, the parties hereto agree as follows:
1. Amendment to Credit
Agreement. On the Effective Date (as defined below), Section
6.13 of the Credit Agreement is hereby amended by restating such section in full
as follows:
“SECTION
6.13 Minimum
Availability. The Company shall not permit the outstanding
principal balance of the Loans plus the LC Exposure to exceed at any time the
aggregate amount of the Commitments less $15,000,000.”
2. Limited
Waiver. On the Effective Date, the Administrative Agent and
the Lenders signatory hereto hereby waive the Company’s (i) breach of Section
5.01(a) of the Credit Agreement occasioned by its delivery of an audit for
fiscal year 2008 with a “going concern” qualification, (ii) breach of Section
6.09 of the Credit Agreement for the respective fiscal periods ending on or
about December 31, 2008 through on or about ▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇▇▇) breach of
Section 6.10 of the Credit Agreement for the fiscal period ending on or
about March
31, 2009, and (iv)
breach of the financial covenant set forth in Section 6.12 of the Credit
Agreement for the fiscal period ending on or about December 31, 2008, provided such waivers
shall expire at 5 p.m. on May 30, 2009, at which time the terms and provisions
of Sections 5.01(a), 6.09, 6.10 and 6.12 of the Credit Agreement shall be
effective with the same force and effect under the Credit Agreement as if such
waivers had not been given.
3. Representations and
Warranties of the Company. The Company represents and warrants
that:
(a) The
execution, delivery and performance by the Company of this Tenth Amendment has
been duly authorized by all necessary corporate action and this Tenth Amendment
is a legal, valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, except as the enforcement thereof may be
subject to (i) the effect of any applicable bankruptcy, insolvency,
reorganization, moratorium or similar law affecting creditors’ rights generally
and (ii) general principles of equity, regardless of whether considered in a
proceeding in equity or at law.
(b) Each
of the representations and warranties contained in the Credit Agreement and the
other Credit Documents is true and correct in all material respects on and as of
the date hereof as if made on the date hereof (except any such representation or
warranty that expressly relates to or is made expressly as of a specific earlier
date, in which case such representation or warranty shall be true and correct
with respect to or as of such specific earlier date).
(c) After
giving effect to this Tenth Amendment, no Default has occurred and is
continuing.
4. Effective
Date. This Tenth Amendment shall become effective (“Effective
Date”) upon receipt by the Administrative Agent of (i) duly executed
counterparts of this Tenth Amendment from the Company, Select Comfort Retail
Corporation and the Required Lenders, and (ii) the Reaffirmation of Guaranty in
the form attached hereto as Exhibit A executed by
each of the Subsidiary Guarantors. On the Effective Date, the
Collateral Agent shall transfer the entire balance of the cash collateral
account held by it for application to the unpaid principal balance of the
Revolving Loans, without any corresponding reduction in the
Commitments. The Company hereby reaffirms its obligations under
paragraph 4(b) of Amendment No. 6 with respect to the deposit into a cash
collateral account with the Collateral Agent of any further federal or state
income tax refunds received hereafter by or for the benefit of the Company or
any Subsidiary Guarantor.
5. Reference to and Effect Upon
the Credit Agreement.
(a) Except
as specifically amended above, the Credit Agreement and the other Credit
Documents shall remain in full force and effect and are hereby ratified and
confirmed.
(b) The
execution, delivery and effectiveness of this Tenth Amendment shall not operate
as a waiver of any right, power or remedy of the Administrative
-
2 -
Agent or
any Lender under the Credit Agreement or any Credit Document, nor constitute a
waiver of any provision of the Credit Agreement or any Credit Document, except
as specifically set forth herein. Upon the effectiveness of this
Tenth Amendment, each reference in the Credit Agreement to “this Agreement”,
“hereunder”, “hereof”, “herein” or words of similar import shall mean and be a
reference to the Credit Agreement as amended hereby.
6. Release of Claims and
Waiver. Each of the Company and each of its Subsidiaries
hereby releases, remises, acquits and forever discharges each of the Lenders and
such Lender’s employees, agents, representatives, consultants, attorneys,
fiduciaries, servants, officers, directors, partners, predecessors, successors
and assigns, subsidiary corporations, parent corporations, and related corporate
divisions (all of the foregoing hereinafter called the “Released Parties”),
from any and all actions and causes of action, judgments, executions, suits,
debts, claims, demands, liabilities, obligations, damages and expenses of any
and every character, known or unknown, direct and/or indirect, at law or in
equity, of whatsoever kind or nature, for or because of any matter or things
done, omitted or suffered to be done by any of the Released Parties prior to and
including the date of execution hereof, and in any way directly or indirectly
arising out of or in any way connected to this Tenth Amendment, the Collateral,
the Loans, the Credit Agreement, or the other Credit Documents (all of the
foregoing hereinafter called the “Released
Matters”). Each of the Company and each of its
Subsidiaries acknowledges that the agreements in this paragraph are
intended to be in full satisfaction of all or any alleged injuries or damages
arising in connection with the Released Matters. Each of the Company and each of
its Subsidiaries represents and warrants to the Lenders that it has not
purported to transfer, assign or otherwise convey any right, title or interest
of the Company in any Released Matter to any other person and that the foregoing
constitutes a full and complete release of all Released Matters.
7. Costs and
Expenses. The Company hereby affirms its obligations under
Section 9.03 of the Credit Agreement to reimburse the Administrative Agent for
all reasonable costs and out-of-pocket expenses paid or incurred by the
Administrative Agent in connection with the preparation, negotiation, execution
and delivery of this Tenth Amendment, including but not limited to the
reasonable fees, charges and disbursements of attorneys for the Administrative
Agent with respect thereto.
8. Governing
Law. This Agreement shall be construed in accordance with and
governed by the law of the State of New York (without regard to conflict of law
provisions thereof).
9. Headings. Section
headings in this Tenth Amendment are included herein for convenience of
reference only and shall not constitute a part of this Tenth Amendment for any
other purposes.
10. Counterparts. This
Tenth Amendment may be executed in any number of counterparts, and each of which
when so executed shall be deemed an original but all such counterparts shall
constitute one and the same instrument.
[signature
pages follow]
-
3 -
IN
WITNESS WHEREOF, the parties have executed this Tenth Amendment as of the date
and year first above written.
SELECT
COMFORT CORPORATION, as a Borrower
By /s/ ▇▇▇▇▇ ▇.
▇▇▇▇▇
Name: ▇▇▇▇▇
▇. ▇▇▇▇▇
Title: Senior
Vice President & CFO
SELECT
COMFORT RETAIL CORPORATION
By /s/ ▇▇▇▇▇ ▇.
▇▇▇▇▇
Name: ▇▇▇▇▇
▇. ▇▇▇▇▇
Title: Senior
Vice President & CFO
-
4 -
JPMORGAN
CHASE BANK, NATIONAL ASSOCIATION, individually,
as
Administrative Agent and as Collateral Agent
By /s/ ▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇
Title: Vice
President
BANK OF
AMERICA, N.A., individually and as Syndication Agent
By
Name:
Title:
CITICORP
USA, INC., as a Lender
By /s/ ▇▇▇▇▇
▇▇▇▇▇
Name: ▇▇▇▇▇
▇▇▇▇▇
Title: Vice
President
▇▇▇▇▇
FARGO BANK, NATIONAL ASSOCIATION,
as a
Lender
By /s/ ▇▇▇▇
▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇
▇▇▇▇▇▇▇▇▇
Title: Vice
President
BRANCH
BANKING AND TRUST CO., as a Lender
By /s/ ▇▇▇▇ ▇.
▇▇▇▇▇▇
Name: ▇▇▇▇
▇. ▇▇▇▇▇▇
Title: Senior
Vice President
EXHIBIT
A
REAFFIRMATION OF
GUARANTY
The
undersigned hereby acknowledges receipt of a copy of the Amendment No. 10 to
Credit Agreement, dated as of May 8, 2009, and reaffirms its obligations under
the Subsidiary Guaranty dated as of June 9, 2006 in favor of JPMorgan Chase
Bank, National Association, as Administrative Agent, and the Lenders (as defined
in the Tenth Amendment).
Dated as
of May 8, 2009
SELECT
COMFORT RETAIL CORPORATION
By /s/ ▇▇▇▇▇ ▇.
▇▇▇▇▇
Name: ▇▇▇▇▇
▇. ▇▇▇▇▇
Title:
Senior Vice
President & CFO