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EXHIBIT 4.1
FOURTH AMENDMENT TO CREDIT AGREEMENT
FOURTH AMENDMENT TO CREDIT AGREEMENT
THIS FOURTH AMENDMENT TO CREDIT AGREEMENT, dated as of July 21, 2000
(this "Amendment"), is by and between CHILDTIME CHILDCARE, INC., an Illinois
corporation (the "Company"), and BANK ONE, MICHIGAN, a Michigan banking
corporation f/k/a NBD Bank (the "Bank").
INTRODUCTION
A. The Company and the Bank have entered into the Credit Agreement,
dated as of February 1, 1996, as amended by letter agreements dated April 1,
1999, May 18, 1999 and May 30, 2000 and by the Third Amendment to Credit
Agreement dated as of December 6, 1999 (as amended, the "Credit Agreement"),
pursuant to which the Bank provides to the Company a revolving credit facility
in an aggregate principal amount not to exceed $7,500,000.
B. The Company has requested the Bank to increase the aggregate
principal amount of such credit facility to $10,000,000 and otherwise to modify
the terms of the Credit Agreement in certain respects, and the Bank is willing
to so amend the Credit Agreement on the terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein and in the Credit Agreement contained, the parties hereto
agree as follows:
ARTICLE 1. AMENDMENTS TO CREDIT AGREEMENT
Effective upon the date (the "Amendment Date") that the conditions
precedent set forth in Article 3 of this Amendment are satisfied, the Credit
Agreement hereby is amended as follows:
1.1 The first paragraph after the heading "INTRODUCTION" on
the first page of the Credit Agreement is amended and restated in its entirety
as follows:
The Company desires to obtain a revolving credit facility,
including letters of credit, in the aggregate principal
amount of $10,000,000, in order to provide funds and other
financial accommodations for working capital and the
Company's other general corporate purposes, and the Bank is
willing to establish such a credit facility in favor of the
Company on the terms and conditions herein set forth.
1.2 The definition of the term "Commitment" in Section 1.1 of
the Credit Agreement is amended by deleting the dollar amount "$10,000,000" and
inserting in its place the dollar amount "$7,500,000".
1.3 Each reference in the Credit Agreement, including without
limitation in the definition of the term "Determination Period" in Section 1.1,
to the terms "Activated Credit
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EXHIBIT 4.1
FOURTH AMENDMENT TO CREDIT AGREEMENT
Commitment Fee Rate" and "Unactivated Credit Commitment Fee Rate" is deleted,
and the single term "Commitment Fee Rate" is inserted in place thereof in each
such place.
1.4 Subparts (a) and (b) of Section 2.3 are amended and
restated in their entirety as follows:
(a) The Company agrees to pay to the Bank a commitment fee
on the daily average unused amount of the Commitment during
any calendar quarter, for the period from the Effective Date
to but excluding the Termination Date, at a rate equal to the
percentage set forth below under the heading "Commitment Fee
Rate" in the row corresponding to the Consolidated Fixed
Charge Coverage Ratio of the Parent Guarantor and its
Subsidiaries for the applicable Determination Period:
Consolidated Fixed
Charge Coverage Ratio Commitment Fee Rate
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Less than or equal to 1.75 to 1.00 0.375%
Greater than 1.75 to 1.00 but not
greater than 2.00 to 1.00 0.300%
Greater than 2.00 to 1.00 but not
greater than 2.25 to 1.00 0.300%
Greater than 2.25 to 1.00 but not
greater than 2.50 to 1.00 0.250%
Greater than 2.50 to 1.00 0.250%
Accrued commitment fees shall be payable quarterly in arrears
on the last Business Day of each March, June, September and
December, commencing on the first such Business Day occurring
after the Effective Date, and on the Termination Date.
(b) [intentionally omitted]
1.5 Exhibit B attached to the Credit Agreement is deleted in
its entirety and Exhibit B attached to this Amendment (there is no Exhibit A to
this Amendment) shall be deemed substituted in place thereof. The Company shall
execute and deliver to the Bank a Note in the form of Exhibit B attached to this
Amendment (the "Replacement Note") to be exchanged for the existing Note issued
by the Company to the Bank under the Credit Agreement (the "Existing Note"). On
the Amendment Date, the principal balance of the Existing Note, as well as all
other information which has been endorsed on the books and records of the Bank
with respect to the Existing Note, shall be endorsed on the books and records of
the Bank with respect to the Replacement Note. The execution and delivery by the
Company of the Replacement Note
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EXHIBIT 4.1
FOURTH AMENDMENT TO CREDIT AGREEMENT
shall not in any circumstances be deemed a novation or to have terminated,
extinguished or discharged the Company's indebtedness evidenced by the Existing
Note, all of which indebtedness shall continue under and be evidenced and
governed by the Replacement Note and the Credit Agreement, as amended, and the
Bank shall be entitled to all the benefits of the Loan Documents with respect to
the indebtedness evidenced by the Replacement Note.
ARTICLE 2. REPRESENTATIONS AND WARRANTIES
In order to induce the Bank to enter into this Amendment, the
Company represents and warrants that:
2.1 The execution, delivery and performance by the Company of
this Amendment and the Replacement Note are within its corporate powers, have
been duly authorized by all necessary corporate action and are not in
contravention of any law, rule or regulation, or any judgment, decree, writ,
injunction, order or award of any arbitrator, court or governmental authority,
or of the terms of the Company's charter or by-laws, or of any contract or
undertaking to which the Company is a party or by which the Company or its
property is or may be bound or affected.
2.2 This Amendment is, and the Replacement Note when delivered
hereunder will be, legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with their respective terms.
2.3 No consent, approval or authorization of or declaration,
registration or filing with any governmental authority or any nongovernmental
person or entity, including without limitation any creditor or stockholder of
the Company, is required on the part of the Company in connection with the
execution, delivery and performance of this Amendment, the Replacement Note or
the transactions contemplated hereby or as a condition to the legality, validity
or enforceability of this Amendment or the Replacement Note.
2.4 After giving effect to the amendments contained in
Article 1 of this Amendment, the representations and warranties contained in
Article V of the Credit Agreement and in the Loan Documents are true on and as
of the date hereof with the same force and effect as if made on and as of the
date hereof.
2.5 No Default or Unmatured Default has occurred and is
continuing.
ARTICLE 3. CONDITIONS PRECEDENT
As conditions precedent to the effectiveness of the amendments to
the Credit Agreement set forth in Article 1 of this Amendment, the Bank shall
receive the following documents and the following matters shall be completed,
all in form and substance satisfactory to the Bank, unless waived by the Bank:
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EXHIBIT 4.1
FOURTH AMENDMENT TO CREDIT AGREEMENT
3.1 The Replacement Note duly executed on behalf of the
Company.
3.2 Certified copies of the resolutions of the board of
directors of the Company authorizing the Company's execution, delivery and
performance of this Amendment, the Replacement Note and the transactions
contemplated hereby.
3.3 Such other documents and agreements reasonably requested
by the Bank.
ARTICLE 4. MISCELLANEOUS
4.1 If the Company shall fail to perform or observe any term,
covenant or agreement in this Amendment, or any representation or warranty made
by the Company in this Amendment shall prove to have been incorrect in any
material respect when made, such occurrence shall be deemed to constitute a
Default.
4.2 All references to the Credit Agreement in any other
document, instrument or certificate referred to in the Credit Agreement or
delivered in connection therewith or pursuant thereto hereafter shall be deemed
references to the Credit Agreement, as amended hereby. All references to the
Existing Note in the Credit Agreement or any other document, instrument or
certificate referred to in the Credit Agreement or delivered in connection
therewith or pursuant thereto hereafter shall be deemed references to the
Replacement Note.
4.3 The Loan Documents and, subject to the amendments herein
provided, the Credit Agreement shall in all respects continue in full force and
effect.
4.4 Capitalized terms used but not defined herein shall have
the respective meanings ascribed thereto in the Credit Agreement.
4.5 This Amendment shall be governed by and construed in
accordance with the laws of the State of Michigan.
4.6 The Company agrees to pay the reasonable fees and expenses
of Dickinson Wright PLLC, counsel for the Bank, in connection with the
negotiation and preparation of this Amendment and the consummation of the
transactions contemplated hereby, and in connection with advising the Bank as to
its rights and responsibilities with respect thereto.
4.7 This Amendment may be executed upon any number of
counterparts with the same effect as if the signatures thereto were upon the
same instrument.
[The rest of this page intentionally left blank.]
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EXHIBIT 4.1
FOURTH AMENDMENT TO CREDIT AGREEMENT
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be duly executed and delivered as of the day and year first-above written.
CHILDTIME CHILDCARE, INC.
By: Michael M. Yeager
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Its: CFO
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BANK ONE, MICHIGAN
By: Thomas A. Gamm
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Its: Vice-President
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GUARANTOR ACKNOWLEDGEMENT
The undersigned hereby acknowledges that it has reviewed and fully
consents to the foregoing Fourth Amendment to Credit Agreement (the "Fourth
Amendment"), that the Irrevocable Guaranty Agreement dated as of February 1,
1996 made by the undersigned in favor of the Bank continues in full force and
effect to secure, among other things, all indebtedness, obligations and
liabilities of Childtime Childcare, Inc. under the Credit Agreement, as amended
by the Fourth Amendment, and acknowledges and agrees that it has no defenses,
counterclaims or offsets with respect thereof. All references to the Credit
Agreement in any Loan Document or any other document, instrument or certificate
referred to in the Credit Agreement or delivered in connection therewith or
pursuant thereto, hereafter shall be deemed references to the Credit Agreement,
as amended by the Fourth Amendment. All references to the Existing Note in any
Loan Document or any other document, instrument or certificate referred to
therein or delivered in connection therewith or pursuant thereto, hereafter
shall be deemed references to the Replacement Note. Except as otherwise
expressly set forth herein, capitalized terms used but not defined herein shall
have the respective meanings ascribed thereto in the Fourth Amendment or the
Credit Agreement, as the case may be.
CHILDTIME LEARNING CENTERS, INC.
By: Michael M. Yeager
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Its: CFO
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