Exhibit 10.1
 
FIRST AMENDMENT TO CREDIT AGREEMENT
 
THIS FIRST AMENDMENT TO CREDIT AGREEMENT is made as of June 19, 2009 (the “First
Amendment to Credit Agreement,” or this “Amendment”), among SPORT SUPPLY GROUP,
INC., a Delaware corporation (“Borrower”), the lenders party hereto (the
“Lenders”) and BANK OF AMERICA, N.A., as administrative agent for the Lenders
(“Administrative Agent”).
 
R E C I T A L S

A.           Borrower, Administrative Agent and the Lenders are parties to that
certain Credit Agreement dated as of February 9, 2009, as modified pursuant to
the terms of that certain letter dated as of April 1, 2009 from Administrative
Agent to Borrower (the “Original Credit Agreement”).
 
B.           The parties desire to amend the Original Credit Agreement as
hereinafter provided.
 
NOW, THEREFORE, in consideration of these premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
 
1.           Same Terms.  All terms used herein which are defined in the
Original Credit Agreement shall have the same meanings when used herein, unless
the context hereof otherwise requires or provides.  In addition, all references
in the Loan Documents to the “Agreement” shall mean the Original Credit
Agreement, as amended by this First Amendment to Credit Agreement, as the same
shall hereafter be amended from time to time.  In addition, the following term
has the meaning set forth below:
 
“Effective Date” means June 19, 2009.
 
2.           Amendments to Original Credit Agreement.  On the Effective Date,
the Original Credit Agreement shall be amended as follows:
 
(a)           The definition of “Permitted Acquisition” shall be amended and
restated as follows:
 
“Permitted Acquisition” means, (a) any Acquisition by a Loan Party so long as
the Dollar amount of such Acquisition, together with the aggregate Dollar amount
of all other Acquisitions (including Acquisitions permitted by Section 7.02(m))
made by any Loan Party after the Closing Date, does not exceed $2,000,000, and
(b) any Acquisition by a Loan Party that does not meet the requirements in part
(a) above, so long as it satisfies each of the following requirements:
 
(i)           if such Acquisition is an Acquisition of Equity Interests of a
Person, such newly-created or acquired Subsidiary shall comply with the
requirements of Section 6.12;
 
(ii)           such Acquisition shall not include or result in any contingent
liabilities that could reasonably be expected to have a Material Adverse Effect;
 
(iii)           the target of such Acquisition shall not have had an operating
loss for the period of 12 consecutive months ending on the date of the
acquisition
 
FIRST AMENDMENT TO CREDIT AGREEMENT– Page 1 

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(the calculation of such operation gain or loss in each case shall include such
adjustments as may be reasonable to reflect items not reflective of the target
or assets to be acquired, and non-recurring items, which calculations shall be
in form and substance reasonably acceptable to the Administrative Agent);
 
(iv)           immediately after giving effect to such Acquisition, the
Consolidated Leverage Ratio would not exceed 2.50 to 1.0;
 
(v)           (A) immediately before and immediately after giving pro forma
effect to any such Acquisition, no Event of Default shall have occurred and be
continuing and (B) immediately after giving effect to such Acquisition, the
Companies shall be in pro forma compliance with all of the Financial Covenants,
such compliance to be determined on the basis of the financial information most
recently delivered to the Administrative Agent and the Lenders pursuant to
Section 6.01 as though such Acquisition had been consummated as of the first day
of the fiscal period covered thereby;
 
(vi)           the Senior Convertible Subordinated Notes shall have been repaid
in full prior to such Acquisition; and
 
(vii)           the Borrower shall have delivered to the Administrative Agent
and each Lender such other information concerning the Acquisition as the
Administrative Agent shall reasonably request.
 
(b)           Section 7.02(m) shall be amended and restated as follows:
 
“(m)           other Investments (other than Acquisitions) not exceeding
$500,000 in the aggregate in any fiscal year of the Borrower.”
 
3.           Certain Representations.  Borrower represents and warrants that, as
of the Effective Date:  (a) each Loan Party has full power and authority to
execute this Amendment and this Amendment executed by each Loan Party
constitutes the legal, valid and binding obligation of such Loan Party
enforceable in accordance with its terms, except as enforceability may be
limited by general principles of equity and applicable bankruptcy, insolvency,
reorganization, moratorium, and other similar laws affecting the enforcement of
creditors’ rights generally; and (b) no authorization, approval, consent or
other action by, notice to, or filing with, any governmental authority or other
person is required for the execution, delivery and performance by each Loan
Party thereof except for (i) filings necessary to perfect and maintain the
perfection of the Liens granted under the Security Agreements, (ii) the
approvals, consents, and authorizations which have been duly obtained, taken,
given, or made and are in full force and effect and (iii) those approvals,
consents, exemptions, authorizations or other actions, notices or filings, the
failure of which to obtain or make could not reasonably be expected to have a
Material Adverse Effect.  In addition, Borrower represents that all
representations and warranties contained in the Original Credit Agreement are
true and correct in all material respects on and as of the Effective Date except
to the extent that such representations and warranties specifically refer to an
earlier date, in which case they shall be true and correct as of such earlier
date, and except that for purposes of Section 4.02 of the Original Credit
Agreement, the representations and warranties contained in subsections (a) and
(b) of Section 5.05 of the Original Credit Agreement shall be deemed to refer to
the most recent statements furnished pursuant to clauses (a) and (b),
respectively, of Section 6.01 of the Original Credit Agreement.
 
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4.           Limitation on Agreements.  The modifications set forth herein are
limited precisely as written and shall not be deemed (a) to be a consent under
or a waiver of or an amendment to any other term or condition in the Original
Credit Agreement or any of the Loan Documents, or (b) to prejudice any right or
rights which Lender now has or may have in the future under or in connection
with the Original
 
Credit Agreement and the Loan Documents, each as amended hereby, or any of the
other documents referred to herein or therein. This Amendment shall constitute a
Loan Document for all purposes.
 
5.           Counterparts.  This Amendment may be executed in any number of
counterparts, each of which when executed and delivered shall be deemed an
original, but all of which constitute one instrument.  In making proof of this
Amendment, it shall not be necessary to produce or account for more than one
counterpart thereof signed by each of the parties hereto.
 
6.           Incorporation of Certain Provisions by Reference.  The provisions
of Section 10.14 of the Original Credit Agreement captioned “Governing Law,” and
the provisions of Section 10.15 of the Original Credit Agreement captioned
“Dispute Resolution Provision” are incorporated herein by reference for all
purposes.
 
7.           Entirety, Etc.  This instrument and all of the other Loan Documents
embody the entire agreement between the parties.  THIS AMENDMENT AND ALL OF THE
OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
 
[Remainder of Page Intentionally Blank; Signatures Begin on Next Page]
 
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment to be
effective as of the Effective Date.
 

  BANK OF AMERICA, N.A.,
as Administrative Agent, Swing Line Lender
and L/C Issuer                             
By:
/s/ Charles Dale        Charles Dale       Senior Vice President          

 

  BANK OF AMERICA, N.A.,
as a Lender                             
By:
 /s/ Charles Dale       Charles Dale        Senior Vice President          

 
FIRST AMENDMENT TO CREDIT AGREEMENT

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  SPORT SUPPLY GROUP, INC.                             
By:
 /s/ John E. Pitts       John E. Pitts        Chief Financial Officer           

 
FIRST AMENDMENT TO CREDIT AGREEMENT

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The terms of this Amendment are acknowledged and agreed to by the following
Guarantors, and such Guarantors agree that the “Guaranteed Debt” (as defined in
the Guaranty) shall include the Obligations as amended by this Amendment.
 
 

  GUARANTORS:           KESSLERS TEAM SPORTS, INC.,
a Delaware corporation                             
By:
 /s/ John E. Pitts       John E. Pitts       Chief Financial Officer          

 

  DIXIE SPORTING GOODS CO., INC.,
a Virginia corporation                             
By:
 /s/ John E. Pitts       John E. Pitts        Chief Financial Officer           

 
 
FIRST AMENDMENT TO CREDIT AGREEMENT

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