FIRST AMENDMENT TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is
entered into as of June 7, 1999, by and among Coinstar, Inc., a Delaware
corporation ("Borrower"), the financial institutions named on the signature
pages hereof (each, a "Lender" and collectively the "Lenders"), and Imperial
Bank, as Agent for the Lenders ("Agent"), with reference to the following
facts:
A. Borrower, Agent, and Lenders are parties to that certain
Credit Agreement dated as of February 19, 1999 (the "Credit Agreement").
B. The parties desire to amend the Credit Agreement in accordance
with the terms of this Amendment.
NOW, THEREFORE, in consideration of the promises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
1. DEFINED TERMS. Capitalized terms not otherwise defined herein
shall have the same meanings as set forth in the Credit Agreement.
2. AMENDMENTS TO CREDIT AGREEMENT. The Credit Agreement is hereby
amended as follows:
(a) Section 6.2(z) is amended in its entirety to read as
follows:
(z) RESTRICTIONS ON TRANSFERS TO SUBSIDIARIES;
RESTRICTIONS ON EXPENDITURES FOR ELECTRONIC COMMERCE. Notwithstanding
any other provisions of this Agreement to the contrary, allow the total
aggregate amounts of any (a) consideration given in any Acquisition
from a Domestic Subsidiary or a Foreign Person pursuant to Section
6.2(k)(ii)(iv), (b) loans to, Investments in, or guaranties of the
obligations of any Domestic or Foreign Subsidiaries pursuant to Section
6.2(l)(v), (c) Contingent Liabilities in favor of any Domestic or
Foreign Subsidiaries pursuant to Section 6.2(m)(iv), (d) sales, leases,
or transfers of assets to Domestic or Foreign Subsidiaries pursuant to
Section 6.2(n)(iii), (e) amounts transferred to any Domestic or Foreign
Subsidiaries prior to the date of this Agreement as set forth on
Schedule 5.1(n), and (f) amounts expended or used by the Borrower or
any Subsidiary for the development of electronic commerce or
internet-related business, in each case individually or in the
aggregate, to exceed $5,000,000 at any time.
(b) EXHIBIT F is deleted and replaced with EXHIBIT F
hereto.
3. CONDITIONS TO EFFECTIVENESS.
This Amendment shall become effective as of June 7, 1999 (the
"Effective Date"), only upon:
(a) receipt by the Agent of the following (each of which
shall be in form and substance satisfactory to the Agent and its counsel):
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(i) counterparts of this Amendment duly executed
on behalf of the Borrower and the Lenders;
(ii) copies of resolutions of the Board of
Directors or other authorizing documents of the Borrower, authorizing the
execution and delivery of this Amendment; and
(iii) an affirmation of the Guaranty, duly
executed on behalf of the Guarantor.
4. REPRESENTATIONS AND WARRANTIES. In order to induce the Lenders
to enter into this Amendment, the Borrower represents and warrants to the
Lenders that the following statements are true, correct and complete as of the
effective date of this Amendment:
(a) CORPORATE POWER AND AUTHORITY. The Borrower has all
requisite corporate power and authority to enter into this Amendment and to
carry out the transactions contemplated by, and perform its obligations under,
the Credit Agreement as amended by this Amendment (the "Amended Agreement"). The
Certificate of Incorporation and Bylaws of the Borrower have not been amended
since the copies previously delivered to the Lenders.
(b) AUTHORIZATION OF AGREEMENTS. The execution and
delivery of this Amendment and the performance by the Borrower of the Amended
Agreement have been duly authorized by all necessary corporate action on the
part of the Borrower.
(c) NO CONFLICT. The execution and delivery by the
Borrower of this Amendment do not and will not contravene (i) any law or any
governmental rule or regulation applicable to the Borrower, except to the extent
not resulting in a Material Adverse Effect, (ii) the Certificate of
Incorporation or Bylaws of the Borrower, (iii) any order, judgment or decree of
any court or other agency of government binding on the Borrower, or (iv) any
material agreement or instrument binding on the Borrower, except to the extent
not resulting in a Material Adverse Effect.
(d) GOVERNMENTAL CONSENTS. The execution and delivery by
the Borrower of this Amendment and the performance by the Borrower of the
Amended Agreement do not and will not require any registration with, consent or
approval of, or notice to, or other action to, with or by, any federal, state or
other governmental authority or regulatory body (except routine reports required
pursuant to the Securities and Exchange Act of 1934, as amended, which reports
will be made in the ordinary course of business).
(e) BINDING OBLIGATION. This Amendment and the Amended
Agreement have been duly executed and delivered by the Borrower and are the
binding obligations of the Borrower, enforceable against the Borrower in
accordance with their respective terms, except in each case as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
liquidation, moratorium or other similar laws and equitable principles relating
to or affecting creditors' rights.
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(f) INCORPORATION OF REPRESENTATIONS AND WARRANTIES FROM
CREDIT AGREEMENT. The representations and warranties contained in Section 5.1 of
the Credit Agreement are correct on and as of the effective date of this
Amendment as though made on and as of such date.
(g) ABSENCE OF DEFAULT. No event has occurred and is
continuing or will result from the consummation of the transactions contemplated
by this Amendment that would constitute an Event of Default or a Potential Event
of Default.
5. MISCELLANEOUS.
(a) REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT AND
THE OTHER LOAN DOCUMENTS.
(i) On and after the Effective Date, each
reference in the Credit Agreement to "this Agreement," "hereunder,"
"hereof," "herein" or words of like import referring to the Credit
Agreement, and each reference in the other Loan Documents to the
"Credit Agreement," "thereunder," "thereof" or words of like import
referring to the Credit Agreement, shall mean and be a reference to the
Amended Agreement.
(ii) Except as specifically amended by this
Amendment, the Credit Agreement and the other Loan Documents shall
remain in full force and effect and are hereby ratified and confirmed.
(iii) The execution, delivery and performance of
this Amendment shall not, except as expressly provided herein,
constitute a waiver of any provision of, or operate as a waiver of any
right, power or remedy of the Agent or Lenders under the Credit
Agreement or any of the other Loan Documents.
(b) FEES AND EXPENSES. All costs and expenses of the
Agent and Lenders, including, but not limited to, reasonable attorneys' fees,
incurred by the Agent and Lenders in the preparation and negotiation of this
Amendment constitute costs and expenses in connection with the amendment and
restructuring of the Loan Documents, and as such are payable by the Borrower in
accordance with Section 9.5 of the Credit Agreement.
(c) HEADINGS. Section and subsection headings in this
Amendment are included herein for convenience of reference only and shall not
constitute a part of this Amendment for any other purpose or be given any
substantive effect.
(d) APPLICABLE LAW. THIS AMENDMENT SHALL BE GOVERNED BY,
AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE
STATE OF CALIFORNIA, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
(e) COUNTERPARTS. This 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 an original, but
all such counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple
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separate counterparts and attached to a single counterpart so that all
signature pages are physically attached to the same document.
[REMAINDER INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
BORROWER:
COINSTAR, INC.
By:
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Title:
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AGENT:
IMPERIAL BANK
By:
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Title:
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LENDERS:
IMPERIAL BANK
By:
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Title:
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BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.
By:
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Title:
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By:
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Title:
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EXHIBIT F
[FORM OF COMPLIANCE CERTIFICATE]
COMPLIANCE CERTIFICATE
1. This Compliance Certificate ("Compliance Certificate") is
executed and delivered by Coinstar, Inc., a Delaware corporation (the
"Borrower") to Imperial Bank (the "Agent") pursuant to Section 6.1(a)(iv)(B)
of the Credit Agreement dated as of February 19, 1999 among the Borrower, the
financial institutions named therein and the Agent. Any terms used herein and
not defined herein shall have the meanings defined in the Credit Agreement.
This Compliance Certificate covers the Borrower's:
Calendar month ended _________, 19__
Fiscal quarter ended _________, 19__
Fiscal year ended ________, 19__
2. The following paragraphs set forth calculations in compliance with
obligations pursuant to Section 6.2(a), (b), (c), (d), (e), (f), (g) and (z) of
the Credit Agreement, as of the end of the fiscal period set forth in paragraph
1 hereof.
A. DIRECT CONTRIBUTION MARGIN TO COINSTAR PROCESSING REVENUE
(SEC. 6.2(a)):
(a) Direct Contribution Margin $______
(b) Coinstar Processing Revenue $______
Ratio (a) : (b) _______
Minimum Permitted Ratio: (i) 0.40 to 1.0 as of the last
day of any calendar month during the period from
January 1, 1999 through June 30, 1999; (ii) 0.425 to 1.0
as of the last day of any calendar month during the period
from July 1, 1999 through September 30, 1999; or
(iii) 0.45 to 1.0 as of the last day of any calendar month
during the period from October 1, 1999 through
December 31, 1999.
B. DIRECT CONTRIBUTION MARGIN LESS BASE LINE OVERHEAD TO
CONSOLIDATED PROFORMA DEBT SERVICE (SEC. 6.2(b)):
(a) Direct Contribution Margin
less $10,000,000 $______
(b) Consolidated Proforma Debt Service $______
F-1
Ratio (a) : (b) ________
Minimum Permitted Ratio: (i) 1.50 to 1.0 as of the last
day of any calendar month during the period from
January 1, 1999 through June 30, 1999; or (ii) 1.75 to 1.0
as of the last day of any calendar month during the period
from July 1, 1999 through December 31, 1999.
C. CONSOLIDATED SENIOR DEBT TO COINSTAR UNITS (SEC. 6.2(c)):
1. Consolidated Senior Debt $_______
2. Coinstar Units ________
Ratio (a) : (b) ________
Maximum Permitted Ratio: (i) $3,000 to 1 as of the last
day of any calendar month during the period from
January 1, 1999 through December 31, 1999; or (ii) $4,000
to 1 as of the last day of any fiscal quarter of the
Borrower from and after January 1, 2000
D. CONSOLIDATED EBITDA TO CONSOLIDATED SENIOR DEBT SERVICE
(SEC. 6.2(d)):
(a) Consolidated EBITDA $_______
(b) Consolidated Senior Debt Service $_______
Ratio (a) to (b) ________
Minimum Permitted Ratio: (i) 1.75 to 1.0 as of the last
day of any fiscal quarter of the Borrower during the
period from January 1, 2000 through December 31, 2000; or
(ii) 2.0 to 1.0 as of the last day of any fiscal quarter
of the Borrower from and after January 1, 2001.
E. CONSOLIDATED EBITDA TO CONSOLIDATED TOTAL DEBT SERVICE
(SEC. 6.2(e)):
(a) Consolidated EBITDA $_______
(b) Consolidated Total Debt Service $_______
F-2
Ratio (a) to (b) ________
Minimum Permitted Ratio: (i) 1.25 to 1.0 as of the last
day of any fiscal quarter of the Borrower during the
period from January 1, 2000 through December 31, 2000;
(ii) 1.50 to 1.0 as of the last day of any fiscal quarter
of the Borrower during the period from January 1, 2001
through December 31, 2001; or (iii) 1.75 to 1.0 as of the
last day of any fiscal quarter of the Borrower from and
after January 1, 2002.
F. CONSOLIDATED SENIOR DEBT TO CONSOLIDATED EBITDA
(SEC. 6.2(f)):
(a) Consolidated Senior Debt $_______
(b) Consolidated EBITDA $_______
Ratio (a) to (b) ________
Maximum Permitted Ratio: (i) 2.0 to 1.0 as of the last
day of any fiscal quarter of the Borrower during the
period from January 1, 2000 through December 31, 2000; or
(ii) 1.50 to 1.0 as of the last day of any fiscal quarter
of the Borrower from and after from January 1, 2001.
G. CONSOLIDATED TOTAL DEBT TO CONSOLIDATED EBITDA
(SEC. 6.2(g)):
(a) Consolidated Total Debt $_______
(b) Consolidated EBITDA $_______
Ratio (a) to (b) ________
F-3
Maximum Permitted Ratio: (i) 6.50 to 1.0 as of the last
day of either of the fiscal quarters ending March 31, 2000
or June 30, 2000; (ii) 5.0 to 1.0 as of the last day of
either of the fiscal quarters ending September 30, 2000 or
December 31, 2000; (iii) 4.0 to 1.0 as of the last day of
either of the fiscal quarters ending March 31, 2001 or
June 30, 2001; (iv) 3.50 to 1.0 as of the last day of
either of the fiscal quarters ending September 30, 2001 or
December 31, 2001; or (v) 2.50 to 1.0 as of the last day
of any fiscal quarter of the Borrower from and after
January 1, 2002.
H. TRANSFERS TO SUBSIDIARIES; ELECTRONIC COMMERCE
(SEC. 6.2(z))
(a) Acquisitions from Domestic $_______
Subsidiaries or Foreign Persons
(b) Loans to, Investments in, $_______
guarantees of obligations of Domestic
or Foreign Subsidiaries
(c) Contingent Liabilities in favor $_______
of Domestic or Foreign Subsidiaries
(d) Sales, leases, transfers of $_______
assets to Domestic or Foreign
Subsidiaries
(e) Amounts transferred to $_______
Domestic or Foreign Subsidiaries prior
to closing
(f) Amounts used for Electronic $_______
Commerce or Internet Related Business
Total: $_______
Total must not exceed $5,000,000
F-4
3. The undersigned has reviewed the terms of the Credit
Agreement and has made, or caused to be made under his/her supervision, a
review in reasonable detail of the transactions and condition of the Borrower
and its Domestic Subsidiaries during the fiscal period covered by this
Compliance Certificate. The undersigned does not (either as a result of such
review or otherwise) have any knowledge of the existence as of the date of
this Compliance Certificate of any condition or event that constitutes an
Event of Default or a Potential Event of Default, with the exception set
forth below in response to which the Borrower is taking or proposes to take
the following actions (if none, so state):
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4. The undersigned hereby certifies that the representations
and warranties contained in the Agreement and the other Loan Documents are
true and correct in all material respects on and as of the date hereof
(except to the extent they relate specifically to any earlier date, in which
case such representations and warranties shall continue to have been correct
as of such date).
5. This Compliance Certificate is executed on _______________,
____ by the Chief Executive Officer, Chief Financial Officer, Treasurer or
Controller of the Borrower. The undersigned hereby certifies that each and
every matter contained herein is derived from the Borrower's books and
records and is, to the best knowledge of the undersigned, true and correct.
COINSTAR, INC.,
a Delaware corporation
By:
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Title:
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F-5
AFFIRMATION OF GUARANTY
The undersigned Guarantor hereby acknowledges and agrees to the
terms of the foregoing First Amendment to Credit Agreement (the "Amendment"),
and further acknowledges and agrees that nothing contained in the Amendment
in any way affects the validity and enforceability of that certain Subsidiary
Guaranty (the "Guaranty") dated as of February 19, 1999, executed by the
undersigned Guarantor in favor of Lenders, the validity and effectiveness of
which Guaranty is hereby reaffirmed as of the Effective Date of the Amendment.
MY XXXXXXXXXXXX.XXX, INC.
By:
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Name:
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Title:
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