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Exhibit 10.1
AMENDMENT NO. 2
TO LOAN AND SECURITY AGREEMENT
THIS AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT (this "SECOND
AMENDMENT") is entered into this 9th day of February, 1999, effective
December 27, 1998 among:
SPINCYCLE, INC., a Delaware corporation ("BORROWER") with its principal
place of business at 15990 North Greenway/Hayden Loop, Suite 400, Scottsdale,
Arizona 85260;
The several financial institutions from time to time party to the Loan
Agreement (as defined herein) (each a "LENDER" and, collectively, "LENDERS");
and
HELLER FINANCIAL, INC., a Delaware corporation for itself as a Lender and
as Agent (in its capacity as Agent, the "AGENT") with offices at 500 West
Monroe, Chicago Illinois 60661.
RECITALS
WHEREAS:
(A) Borrower, the Lenders and the Agent have entered into that certain
Loan and Security Agreement dated as of April 29, 1998 (as heretofore amended
by a certain First Amendment to Loan and Security Agreement, the "LOAN
AGREEMENT"); and
(B) Borrower, the Lenders and the Agent have agreed to amend certain
provisions of the Loan Agreement;
NOW, THEREFORE, in consideration of the agreements and provisions contained
herein, the parties hereto hereby agree as follows:
1. DEFINITIONS. Capitalized terms used but not otherwise defined herein
shall have the meanings ascribed to such terms in the Loan Agreement.
2. CERTAIN AMENDMENTS TO LOAN AGREEMENT. The Loan Agreement is hereby
amended, subject to the fulfilment of the conditions precedent set forth in
Section 5 hereof, as follows:
2.1 Section 1 (Definitions) of the Loan Agreement is hereby amended
by deleting in its entirety the definition "Trigger Period".
2.2 Subsection 5.6 (Collection of Accounts and Payments) of the Loan
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Agreement is hereby amended by deleting the dollar amount "$15,000,000"
contained in the proviso to such subsection and replacing such dollar amount
with "$10,000,000".
2.3 Subsection 6.1 (Fixed Charge Coverage) of the Loan Agreement is
deleted in its entirety.
2.4 Subsection 6.2 (Minimum Mature Store Average EBITDA) of the Loan
Agreement is deleted in its entirety.
2.5 Subsection 6.3 (Minimum Unused Availability) of the Loan
Agreement is deleted in its entirety and the following is substituted therefor:
"Borrower shall maintain at all times Unused Availability greater than
or equal to $10,000,000".
3. REPRESENTATIONS AND WARRANTIES. In order to induce the Lenders and the
Agent to enter into this Second Amendment, Borrower hereby represents and
warrants to the Lenders and the Agent that:
3.1 No Default. After giving effect to this Second Amendment, no
Default or Event of Default shall have occurred or be continuing.
3.2 Existing Representations and Warranties. Except as set forth on
Schedule 3.2 annexed hereto, as of the date hereof and after giving effect to
this Second Amendment, each and every one of the representations and warranties
set forth in the Loan Documents are true, accurate and complete in all respects
and with the same effect as though made on the date hereof, and each is hereby
incorporated herein in full by reference as if restated herein in its entirety,
except for any representation or warranty limited by its terms to a specific
date and except for changes in the ordinary course of business which are not
prohibited by the Loan Agreement (as amended hereby) and which do not, either
singly or in the aggregate, have a Material Adverse Effect.
3.3 Authority; Enforceability. (a) The execution, delivery and
performance by Borrower of this Second Amendment are within its organizational
powers and have been duly authorized by all necessary corporate action on the
part of Borrower, (ii) the Second Amendment is the legal, valid and binding
obligation of the Borrower, enforceable against Borrower in accordance with its
terms and (iii) this Second Amendment and the execution, delivery and
performance by Borrower thereof does not: (A) contravene the terms of Borrower's
corporate charter or by-laws; (B) conflict with or result in any breach or
contravention of, or the creation of any Lien under, any document evidencing any
contractual obligation to which Borrower is a party or any order, injunction,
writ or decree to which Borrower or its property is subject; or (C) violate any
requirement of law.
4. CONDITIONS PRECEDENT TO EFFECTIVENESS OF AMENDMENTS. The amendments
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contemplated by Section 2 hereof are subject to the satisfaction of each of the
following conditions precedent:
4.1 Second Amendment. Borrower shall have executed and delivered to
the Agent and each Lender an original counterpart of this Second Amendment.
4.2 No Default. As of the date hereof, no Default or Event of Default
shall have occurred and be continuing.
4.3 Warranties. As of the date hereof, the representations and
warranties contained in Section 3 of this Second Amendment shall be true and
correct.
4.4 Other Documents. The Agent shall have received, in form and
substance satisfactory to it, such other documents, agreements and instruments
as the Agent may reasonably request for a transaction of the nature contemplated
by this Second Amendment.
5. REFERENCE TO AND EFFECT UPON THE LOAN AGREEMENT.
5.1 Effect. Except as specifically amended hereby, the Loan
Agreement and the other Loan Documents shall remain in full force and effect in
accordance with their terms and are hereby ratified and confirmed.
5.2 No Waiver; References. The execution, delivery and
effectiveness of this Second Amendment shall not operate as a waiver of any
right, power or remedy of the Agent or any Lender under the Loan Agreement, nor
constitute a waiver of any provision of the Loan Agreement, except as
specifically set forth herein. Upon the effectiveness of this Second Amendment,
each reference in:
(i) the Loan Agreement to "this Agreement", "hereunder",
"hereof", "herein" or words of similar import shall mean and be a reference to
the Loan Agreement as amended hereby;
(ii) the other Loan Documents to the "Loan Agreement" shall
mean and be a reference to the Loan Agreement as amended hereby; and
(iii) the Loan Documents to the "Loan Documents" shall be deemed
to include this Second Amendment.
6. Miscellaneous.
6.1 Expenses. Borrower agrees to pay the Agent upon demand for all
reasonable expenses, including reasonable attorneys' fees and expenses of the
Agent, incurred by the Agent in connection with the preparation, negotiation
and execution of this Second
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Amendment.
6.2 Headings. Section headings in this Second Amendment are included
herein for convenience of reference only and shall not constitute a part of
this Second Amendment for any other purposes.
6.3 Law. THIS SECOND AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK.
6.4 Successors. This Second Amendment shall be binding upon
Borrower, the Lenders and the Agent and their respective successors and
assigns, and shall inure to the benefit of Borrower, the Lenders and the Agent
and the successors and assigns of the Lenders and the Agent.
6.5 Execution in Counterparts. This Second Amendment may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to
be an original and all of which taken together shall constitute one and the
same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment
to be executed and delivered by their respective officers thereunto duly
authorized on the date first written above, effective December 27, 1998.
SPINCYCLE, INC.
By: /s/ James R. Puckett
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Name: James R. Puckett
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Title: Chief Financial Officer
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HELLER FINANCIAL, INC.,
as a Lender and as Agent
By: /s/ Dwayne L. Coker
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Name: Dwayne L. Coker
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Title: V.P.
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FINOVA CAPITAL CORPORATION
By: /s/ Brian Ruiewitz
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Name: Brian Ruiewitz
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Title: AVP
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