WAIVER AND AMENDMENT TO REVOLVING
CREDIT AND SECURITY AGREEMENT
This Waiver and Amendment to Revolving Credit and Security Agreement (the
"Agreement"), dated as of August 6, 2001, is by and among KOALA CORPORATION, a
Colorado corporation ("Borrower"), U.S. BANK NATIONAL ASSOCIATION, a national
banking association ("U.S. Bank") and KEYBANK NATIONAL ASSOCIATION, a national
banking association ("KeyBank") (U.S. Bank and KeyBank are collectively referred
to herein as the "Lenders").
RECITALS
--------
A. Pursuant to that certain Revolving Credit and Security Agreement,
dated as of November 17, 2000 (as amended, amended and restated, supplemented or
otherwise modified from time to time, the "Loan Agreement"; capitalized terms
used and not otherwise defined herein shall have the meanings assigned to such
terms in the Loan Agreement), by and among Borrower and the Lenders, the Lenders
have made available to Borrower the Total Revolving Credit Commitment.
B. The Loan Agreement contains certain financial covenants that Borrower
must comply with or else be in default under the Loan Agreement.
C. As of the date of this Agreement, Borrower is not in compliance with
certain of the required financial covenants under the Loan Agreement, and
Borrower has requested that the Lenders waive Borrower's lack of compliance and
the Lenders have agreed to do so on the terms and conditions set forth herein.
AGREEMENT
---------
NOW, THEREFORE, for and in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
1. Waiver. In consideration of the terms and conditions of this
Agreement, the Lenders hereby waive (i) Borrower's non-compliance with the
covenants of Section 9.12 of the Loan Agreement with respect to Borrower's
maximum Consolidated Leverage Ratio and minimum Interest Coverage for the fiscal
quarter ended June 30, 2001 and (ii) the limitation set forth in Section 2.1(d)
of the Loan Agreement with regard to the aggregate outstanding balance under the
Facility, provided that the waiver set forth in this subsection (ii) shall apply
only until September 30, 2001.
2. Effect of Waiver. The waivers granted in Section 1 of this Agreement
are not continuing waivers and shall in no way extend beyond their specific
terms. In the event any Event of Default occurs under the Loan Agreement,
including the failure of Borrower to be in
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compliance with Section 9.12 of the Loan Agreement for any period (including,
but not limited to the fiscal quarter ending September 30, 2001) other than the
period specifically set forth in Section 1 of this Agreement, the Lenders shall
have all of their rights under the Transaction Documents, and the Lenders'
agreement to the waivers granted in Section 1 of this Agreement shall in no way
limit the Lenders ability to take any action upon any other Event of Default,
whenever occurring, permitted by the Transaction Documents.
3. Amendments to Loan Agreement. The Loan Agreement is hereby amended as
follows:
(a) After the date of this Agreement, Borrower may no
longer choose a Eurodollar Rate when requesting any Advance, and the Lenders
shall have no obligation to make Eurodollar Rate Loans. Therefore, any requested
Advance must be requested as a Base Rate Loan and shall be subject to the new
Applicable Margins set forth in Section 3(b) of this Agreement. Notwithstanding
the foregoing, to the extent Borrower currently has any Eurodollar Rate Loans
outstanding, they shall continue as such until the expiration of their stated
Eurodollar Rate term, at which time such loans shall become Base Rate Loans and
continue as Base Rate Loans thereafter.
(b) The current Exhibit C to the Loan Agreement is deleted
in its entirety and is hereby replaced with the following provisions:
The Applicable Margins for the Revolving Line of Credit will be based on the
Borrower's Consolidated Leverage Ratio (as determined quarterly) as follows (the
Applicable Margins for Letters of Credit shall be 2.75% plus the Applicable
Margin for Base Rate Loans):
Consolidated Leverage Ratio Applicable Margins
--------------------------- For Base Rate Loans
-------------------
Less than 2.50 : 1 0.00%
Less than 3.00 : 1 and greater than
or equal than 2.50 : 1 0.75%
Less than 3.50 : 1 and greater than
or equal to 3.00 : 1 1.50%
Greater than
or equal to 3.50 : 1 2.50%
(c) After the date of this Agreement through September 30,
2001, Borrower agrees that the Lenders shall not be required to honor any
request for an Advance, a Letter of Credit or any other request for funding by
Borrower to the extent such request would cause the Total Revolving Credit
Commitment to exceed $40,000,000.
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4. Waiver Fee. Borrower agrees to pay to the Lenders, on a pro rata
basis, a waiver fee equal to twelve and one-half basis points of the Total
Revolving Credit Commitment. This will result in the following payments being
due from Borrower upon execution of this Agreement:
Payee Amount
----- ------
U.S. Bank $37,500
KeyBank $18,750.
5. Applicable Law. This Agreement, and the transactions evidenced
hereby, shall be governed by, and construed under, the internal laws of the
State of Colorado, without regard to principles of conflicts of law, as the same
may from time to time be in effect.
6. Severability. In case any one or more of the provisions contained
in this Agreement shall be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision hereof, and this Agreement shall be construed as if such
provision had never been contained herein or therein.
7. Notices. All notices, demands, designation, certificates,
requests, offers, consents, approvals, appointments and other instruments given
pursuant to this Agreement (collectively, "Notices") shall be in writing and
given in accordance with the provisions of the Loan Agreement.
8. Jury Trial Waiver. Borrower and the Lenders hereby knowingly,
voluntarily, and intentionally waive any right to trial by jury Borrower or the
Lenders may have in any action or proceeding, in law or in equity, in connection
with this Agreement. Borrower represents and warrants that no representative or
agent of the Lenders has represented, expressly or otherwise, that the Lenders
will not, in the event of litigation, seek to enforce this right to jury trial
waiver. Borrower acknowledges that Lenders have been induced to enter into this
Agreement by, among other things, the provisions of this Section 6.
9. Headings. The headings appearing in this Agreement have been
inserted for convenience only and shall not modify, define, limit or expand the
express provisions of this Agreement.
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IN WITNESS WHEREOF, the parties have entered into this Agreement as of the
day and year first set forth above.
BORROWER:
KOALA CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President Finance and Administration
Address:
00000 Xxxx 00xx Xxxxxx, Xxxx X
Xxxxxx, XX 00000
Attn: Xxxx X. Xxxxxx, President and CEO
Phone: (000) 000-0000
Facsimile: (000) 000-0000
LENDERS:
U.S. BANK NATIONAL ASSOCIATION
By: /s/ Xxxx X. Xxxx
-------------------------------------
Name: Xxxx X. Xxxx
Title: Vice President
Address:
0000 X. Xxxxxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxx, Vice President
Phone: (000) 000-0000
Facsimile: (000) 000-0000
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KEYBANK NATIONAL ASSOCIATION
By:/s/ Xxxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
Address:
0000 Xxxxxxxx, Xxxxx 000
Xxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx
Phone:(000) 000-0000
Fax: (000) 000-0000
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