EXHIBIT 10.3


 


FOURTH AMENDMENT TO

REVOLVING CREDIT AND TERM LOAN AGREEMENT


 


THIS FOURTH AMENDMENT TO
REVOLVING CREDIT AND TERM LOAN AGREEMENT dated as of December 29, 2003
(the “Amendment”), is entered into by and between CAPITALSOURCE FINANCE
LLC, a Delaware limited liability company, in its capacity as administrative
agent and collateral agent for the Lenders under the Agreement referenced below
(“Agent”), the Lenders party thereto, and GARDENBURGER, INC., an Oregon
corporation (“Borrower”). 
Capitalized terms used and not otherwise defined herein are used as
defined in the Agreement (as defined below).


 


WHEREAS, the Agent,
Lenders and Borrower have entered into that certain Revolving Credit and Term
Loan Agreement dated as of January 10, 2002 (as amended, supplemented,
modified and/or restated from time to time, the “Agreement”), together
with a First Amendment to the Agreement dated as of September 30, 2002, a
Second Amendment to the Agreement dated as of December 31, 2002, and a
Third Amendment to the Agreement dated as of March 31, 2003;


 


WHEREAS, Borrower has
requested that Agent and Lenders amend certain provisions of the Agreement and
consent to certain modifications to the subordinated indebtedness of Borrower,
all as provided herein; and


 


WHEREAS, subject to
satisfaction of the conditions set forth herein, Agent and the Lenders are
willing to amend the Agreement as provided herein;


 


NOW, THEREFORE, in
consideration of the premises and the other mutual covenants contained herein,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:


 


SECTION 1.           Amendments.  As of the Effective Date, the Agreement is
amended as follows:


 


(a)                                  Section 2.8
of the Agreement shall be and hereby is amended and restated and replaced in
its entirety to read in full as follows:


 


“2.8                         Repayment of
Term Loan; Maturity


 


Payment of principal (in
addition to the interest payments in Section 2.7) and all other
amounts outstanding under the Term Loan shall be made monthly as follows:


 


(a)                                  the
amount per month indicated below (based on the applicable calendar month) shall
be due and payable, beginning January 1, 2004, and continuing on the first
day of each calendar month thereafter through the last month of the Term Loan
Term:


 

















 


	
  Year

  	
   

  	
  Monthly
  Principal Payment

  	
   

  
	
  January 1, 2004 through September 1, 2004

  	
   

  	
  $

  	
  120,000.00

  	
   

  
	
  October 1, 2004 through the last day of the
  Term Loan Term

  	
   

  	
  $

  	
  166,667.00

  	
   

  



 


(b)                                 the
unpaid principal of the Term Loan and all other Obligations under the Term Loan
shall be due and payable in full, and the Term Notes shall mature, if not
earlier in accordance with this Agreement, on the earlier of (i) the occurrence
of an Event of Default if required pursuant hereto or pursuant to Agent’s
demand upon an Event of Default, and (ii) the last day of the Term Loan Term
(such earlier date being the “Term Loan Maturity Date”).”


 


(b)                                 Section 7.11
of the Agreement shall be and hereby is amended and restated and replaced in
its entirety to read in full as follows:


 


“7.11                 Payment on Subordinated
Debt.


 


Borrower shall not (a)
make any payment or prepayment of any part or all of the Subordinated Debt, (b)
repurchase, redeem or retire any instrument evidencing the Subordinated Debt
prior to maturity, or (c) enter into any agreement (oral or written) which
could in any way be construed to amend, modify, alter or terminate any one or
more instruments or agreements evidencing or relating to the Subordinated Debt;
provided, however, that Borrower may make scheduled and accrued
interest payments on the Subordinated Debt and Excess Cash Flow payments on and
after September 30, 2004, each in accordance with and subject to the
provisions of the Note Purchase Agreement, if after giving effect to such
payments, Borrower has (i) Excess Availability of at least $2,500,000, (ii) a
Pro Forma Fixed Charge Coverage Ratio for the most recently ended Quarterly
Test Period and as of the date of such payment on the Subordinated Debt of at
least 1.00 to 1.00 and (iii) represented to Agent that Borrower will have a Pro
Forma Fixed Charge Coverage Ratio for the two Quarterly Test Periods
immediately following the date of such payment, to the best of Borrower’s
knowledge at the date of such representation, of at least 1.00 to 1.00, which
shall be supported by written projections; provided, further that
any such payment may not be made until Agent (A) has had at least 7 calendar
days to review documents which support the above listed requirements, and (B)
has agreed that such requirements have been satisfied.”


 


(c)                                  The
definition of “Revolving Facility Term” set forth in Appendix A to the
Agreement shall be and hereby is amended and restated and replaced in its
entirety to read in full as follows:


 


“‘Revolving Facility Term’ shall mean the
period commencing on the Closing Date and ending on January 31, 2007;
provided that this period shall automatically end on December 10, 2005, if
Borrower has not delivered to Agent by April 30, 2004, a file-stamped and
certified copy of (x) Articles of Amendment in the form attached to the Fourth
Amendment as Exhibit A or (y) designations of terms of one or more
newly-created series of preferred stock, in each case


 


2

















 


pursuant to which the first scheduled principal
payment or redemption specified therein, with respect to all of the shares of
Borrower’s preferred stock then outstanding, will not occur before
June 30, 2008; provided  further that this period shall
automatically end on December 15, 2004, at any time the maturity date of
the Subordinated Debt is not on a date which is on or after March 25,
2006.”


 


(d)                                 The
definition of “Term Loan Term” set forth in Appendix A to the Agreement
shall be and hereby is amended and restated in its entirety to read in full as
follows:


 


“‘Term Loan Term’ shall mean the period
commencing on the Closing Date and ending on January 31, 2007; provided
that this period shall automatically end on December 10, 2005, if Borrower
has not delivered to Agent by April 30, 2004, a file-stamped and certified
copy of (x) Articles of Amendment in the form attached to the Fourth Amendment
as Exhibit A or (y) designations of terms of one or more newly-created
series of preferred stock, in each case pursuant to which the first scheduled
principal payment or redemption specified therein, with respect to all of the
shares of Borrower’s preferred stock then outstanding, will not occur before
June 30, 2008; provided  further that this period shall
automatically end on December 15, 2004, at any time the maturity date of
the Subordinated Debt is not on a date which is on or after March 25,
2006.”


 


(e)                                  The
definition of “Excess Availability” set forth in Appendix A to the
Agreement shall be and hereby is amended and restated in its entirety to read
in full as follows:


 


“Excess Availability” shall mean Availability plus
cash of Borrower less the outstanding balance of all Advances.”


 


(f)                                    The
following definition is hereby added to Appendix A to the Agreement:


 


“Fourth Amendment” shall mean that certain
Fourth Amendment to Revolving Credit and Term Loan Agreement dated as of
December 29, 2003 among Borrower, Agent and Lenders.”


 


(g)                                 Annex I
and Schedule A-1 to the Agreement shall be and hereby are amended and
restated and replaced in their entirety as set forth on Annex I and Schedule A-1
attached hereto.


 


(h)                                 Borrower
shall pay to Lenders an amendment fee of $129,415 (the “Fourth Amendment Fee”),
which shall be deemed earned in full on the Effective Date and shall be payable
in two payments of $64,707.50 on (1) 
the Effective Date and (2) September 30, 2004.


 


SECTION 2.                                Conditions.  This Amendment shall be effective upon the
satisfaction of the following conditions precedent (the “Effective Date”):  (a) the representations and warranties
contained herein and in all other Loan Documents shall be true and correct in
all material respects as of the date hereof, except for such representations
and warranties limited by their terms to a specific date; (b) no Default or
Event of Default shall be in existence as of the date hereof; (c) Borrower
shall have delivered to the Agent an executed original copy of this


 


3

















 


Amendment and each
other agreement, document or instrument reasonably requested by the Agent in
connection with this Amendment; (d) (i) the holders of the Subordinated Debt
and Borrower shall have executed a Fifth Amendment to Note Purchase Agreement
(the “Note Purchase Agreement Amendment”) in the form attached hereto as
Exhibit B and a First Amendment to Amended and Restated Convertible
Senior Subordinated Note (the “Note Amendment”) in the form attached
hereto as Exhibit C and (ii) the holders of the Subordinated Debt
shall have consented in writing to this Amendment, in form and substance
satisfactory to Agent, and none of the provisions of this Amendment shall be a
breach or event of default under the Note Purchase Agreement or with respect to
the Subordinated Debt; (e) Borrower shall have paid to Agent all fees,
costs and expenses owed to and/or incurred by the Agent and Lenders arising in
connection with the Loan Documents and/or this Amendment, including all amounts
owed pursuant to Section 7(f) below and the portion of the Fourth
Amendment Fee due on the Effective Date; (f) Borrower shall have delivered to
Agent a certificate of the corporate secretary or assistant secretary of
Borrower dated as of the date of this Amendment, as to the incumbency and
signature of the Persons executing this Amendment on behalf of Borrower, in
form and substance acceptable to Agent; and (g) all proceedings taken in
connection with the transactions contemplated by this Amendment and all
documentation and other legal matters incident thereto shall be satisfactory to
the Agent.


 


SECTION 3.                                Consent
to Modifications of Agreements with Subordinated Lender.  As of the Effective Date, Agent and Lenders
hereby consent to Borrower’s execution and delivery of the Note Purchase
Agreement Amendment and the Note Amendment.


 


SECTION 4.                                Waivers.  Agent and Lenders (a) hereby acknowledge
that Events of Default exist because of Borrower’s failure to comply with the
following financial covenants as of September 30, 2003:  Minimum Adjusted EBITDA, Leverage Ratio and
Fixed Charge Coverage Ratio; and (b) as of the Effective Date waive all such
Events of Default.


 


SECTION 5.                                Agreement
in Full Force and Effect as Amended. 
Except as specifically amended hereby, the Agreement and other Loan
Documents shall remain in full force and effect and are hereby ratified and
confirmed as so amended.  Except as
expressly set forth herein, this Amendment shall not be deemed to be a waiver,
amendment or modification of any provisions of the Agreement or any other Loan
Document or any right, power or remedy of Agent or Lenders, or constitute a
waiver of any provision of the Agreement or any other Loan Document, or any
other document, instrument and/or agreement executed or delivered in connection
therewith or of any Default or Event of Default under any of the foregoing, in
each case whether arising before or after the date hereof or as a result of
performance hereunder or thereunder. 
This Amendment also shall not preclude the future exercise of any right,
remedy, power, or privilege available to Agent and/or Lenders whether under the
Agreement, the other Loan Documents, at law or otherwise.  All references to the Agreement shall be
deemed to mean the Agreement as modified hereby.  This Amendment shall not constitute a novation or satisfaction
and accord of the Agreement and/or other Loan Documents, but shall constitute
an amendment thereof.  The parties
hereto agree to be bound by the terms and conditions of the Agreement and Loan
Documents as amended by this Amendment, as though such terms and conditions
were set forth herein.  Each reference
in the Agreement to “this Agreement,” “hereunder,” “hereof,” “herein” or words
of similar import shall mean and be a reference to the Agreement as amended by
this Amendment, and each reference herein or in any other Loan Documents to the
“Loan


 


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Agreement” or
“Credit Agreement” shall mean and be a reference to the Agreement as amended
and modified by this Amendment.


 


SECTION 6.                                Representations.  Borrower hereby represents and warrants to
Agent and Lenders as follows:  (i) it is
duly incorporated or organized, validly existing and in good standing under the
laws of its jurisdiction of organization; (ii) the execution, delivery and
performance by it of this Amendment and all other Loan Documents executed
and/or delivered in connection herewith are within its powers, have been duly
authorized, and do not contravene (A) its articles of organization, operating
agreement, or other organizational documents, or (B) any applicable law; (iii)
no consent, license, permit, approval or authorization of, or registration, filing
or declaration with any Governmental Authority or other Person, is required in
connection with the execution, delivery, performance, validity or
enforceability of this Amendment or any other Loan Documents executed and/or
delivered in connection herewith by or against it; (iv) this Amendment and all
other Loan Documents executed and/or delivered in connection herewith has been
duly executed and delivered by it; (v) this Amendment and all other Loan
Documents executed and/or delivered in connection herewith constitute its
legal, valid and binding obligation enforceable against it in accordance with
its terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors’ rights generally or by general principles of equity;
(vi) after giving effect to this Amendment, it is not in default under the Loan
Documents and no Default or Event of Default exists, has occurred and is
continuing or would result by the execution, delivery or performance of this
Amendment; and (vii) the representations and warranties contained in the Loan
Documents are true and correct in all material respects as of the date hereof
as if made on the date hereof, except for such representations and warranties
limited by their terms to a specific date.


 


SECTION 7.                                Miscellaneous.


 


(a)                                  This
Amendment may be executed in any number of counterparts (including by
facsimile), and by the different parties hereto on the same or separate
counterparts, each of which shall be deemed to be an original instrument but
all of which together shall constitute one and the same agreement.  Each party agrees that it will be bound by
its own facsimile signature and that it accepts the facsimile signature of each
other party.  The descriptive headings
of the various sections of this Amendment are inserted for convenience of
reference only and shall not be deemed to affect the meaning or construction of
any of the provisions hereof or thereof. 
Whenever the context and construction so require, all words herein in
the singular number herein shall be deemed to have been used in the plural, and
vice versa, and the masculine gender shall include the feminine and neuter and
the neuter shall include the masculine and feminine.


 


(b)                                 This
Amendment may not be changed, amended, restated, waived, supplemented,
discharged, canceled, terminated or otherwise modified orally or by any course
of dealing or in any manner other than as provided in the Agreement.  This Amendment shall be considered part of
the Agreement and shall be a Loan Document for all purposes under the Agreement
and other Loan Documents.


 


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(c)                                  This
Amendment, the Agreement and the Loan Documents constitute the final, entire
agreement and understanding between the parties with respect to the subject
matter hereof and thereof and may not be contradicted by evidence of prior,
contemporaneous or subsequent oral agreements between the parties, and shall be
binding upon and inure to the benefit of the successors and assigns of the
parties hereto and thereto.  There are
no unwritten oral agreements between the parties with respect to the subject
matter hereof and thereof.


 


(d)                                 THIS
AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT
SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE
CHOICE OF LAW PROVISIONS SET FORTH IN THE AGREEMENT AND SHALL BE SUBJECT TO THE
WAIVER OF JURY TRIAL AND NOTICE PROVISIONS OF THE AGREEMENT.


 


(e)                                  Borrower
may not assign, delegate or transfer this Amendment or any of its rights or
obligations hereunder.  No rights are
intended to be created under this Amendment for the benefit of any third party
donee, creditor or incidental beneficiary of Borrower or any Guarantor.  Nothing contained in this Amendment shall be
construed as a delegation to Agent or Lenders of Borrower’s or any Guarantor’s
duty of performance, including, without limitation, any duties under any account
or contract in which Agent has or Lenders have a security interest or
Lien.  This Amendment shall be binding
upon the Borrower and its respective successors and assigns.


 


(f)                                    The
Borrower shall pay all costs and expenses incurred by Agent and Lenders or any
of their affiliates, including, without limitation, documentation and diligence
fees and expenses, all search, audit, appraisal, recording, and filing fees and
expenses and all other out-of-pocket charges and expenses (including, without
limitation, UCC and judgment and tax lien searches and UCC filings and fees for
post-Closing UCC and judgment and tax lien searches) and reasonable fees and
expenses of outside counsel, in connection with entering into, negotiating,
preparing, reviewing and executing this Amendment and the documents, agreements
and instruments contemplated hereby and all related agreements, documents and
instruments, and all of the same shall be part of the Obligations.


 


(g)                                 Borrower
hereby (i) agrees that this Amendment shall not limit or diminish the
obligations of Borrower under the Loan Documents, (ii) reaffirms its
obligations under each of the Loan Documents to which it is a party, and (iii)
agrees that each of such Loan Documents remains in full force and effect and is
hereby ratified and confirmed.


 


(h)                                 All
representations and warranties made in this Amendment shall survive the
execution and delivery of this Amendment and no investigation by Agent or
Lenders shall affect such representations or warranties or the right of Agent
or Lenders to rely upon them.


 


[Signature Page
Follows]


 


6

















 


IN WITNESS WHEREOF, the
parties have caused this Fourth Amendment to Revolving Credit and Term Loan
Agreement to be executed by their respective officers thereunto duly
authorized, as of the date first above written.


 


	
  LENDER/AGENT:

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
   

  
	
  CAPITALSOURCE FINANCE LLC

  	
  GARDENBURGER, INC.

  
	
   

  	
   

  
	
  By:

  	
  /s/ Joseph A. Turitz

  	
   

  	
  By:

  	
  /s/ Scott C. Wallace

  
	
  Name:   Joseph Turitz

  	
  Name:   Scott C. Wallace

  
	
  Title:  Associate General Counsel

  	
  Title:  President and Chief Executive Officer

  
					



 


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ANNEX I


 


FINANCIAL COVENANTS


 


1)                                     Leverage
Ratio


 


The Leverage Ratio shall
not exceed (i) 2.85:1.00 for the Quarterly Test Period ending December 31,
2003, (ii) 3.60:1.00 for the Quarterly Test Period ending March 31, 2004,
(iii) 3.45:1.00 for the Quarterly Test Period ending June 30, 2004, and
(iv) 2.50:1.00 for each Quarterly Test Period after June 30, 2004.


 


2)                                     Minimum
Adjusted EBITDA


 


Adjusted EBITDA
for each Quarterly Test Period shall not be less than the amounts specified
below:


 


	
  Quarterly Test Period

  	
   

  	
  Amount

  	
   

  
	
  December 31, 2003

  	
   

  	
  $

  	
  3,400,000

  	
   

  
	
  March 31, 2004

  	
   

  	
  $

  	
  3,300,000

  	
   

  
	
  June 30, 2004

  	
   

  	
  $

  	
  3,000,000

  	
   

  
	
  September 30, 2004

  	
   

  	
  $

  	
  4,900,000

  	
   

  
	
  December 31, 2004

  	
   

  	
  $

  	
  5,000,000

  	
   

  
	
  March 31, 2005

  	
   

  	
  $

  	
  5,100,000

  	
   

  
	
  June 30, 2005

  	
   

  	
  $

  	
  5,700,000

  	
   

  
	
  September 30, 2005
  and thereafter

  	
   

  	
  $

  	
  6,000,000

  	
   

  



 


3)                                     Fixed
Charge Coverage Ratio


 


The Fixed Charge
Coverage Ratio for each Quarterly Test Period shall not be less than the ratios
specified below:


 


	
  Quarterly Test Period

  	
   

  	
  Ratio

  	
   

  
	
  September 30, 2005

  	
   

  	
  1.10:1.00

  	
   

  
	
  December 31, 2005 and thereafter

  	
   

  	
  1.25:1.00

  	
   

  



 


4)                                     Capital
Expenditures


 


Borrower shall not permit
its Capital Expenditures in the aggregate to exceed $1,200,000 for the fiscal
year ending on September 30, 2004, and $1,100,000 for each fiscal year
ending on or after September 30, 2005.


 


1

















 


5)                                     Senior
Fixed Charge Coverage Ratio.


 


The Senior Fixed Charge
Coverage Ratio for each Quarterly Test Period set forth below shall not be less
than the ratios specified below:


 


	
  Quarterly Test Period

  	
   

  	
  Ratio

  	
   

  
	
  December 31, 2003

  	
   

  	
  1.00:1.00

  	
   

  
	
  March 31, 2004

  	
   

  	
  1.00:1.00

  	
   

  
	
  June 30, 2004

  	
   

  	
  0.90:1.00

  	
   

  
	
  September 30, 2004

  	
   

  	
  1.35:1.00

  	
   

  
	
  December 31, 2004

  	
   

  	
  1.35:1.00

  	
   

  
	
  March 31, 2005

  	
   

  	
  1.48:1.00

  	
   

  
	
  June 30, 2005

  	
   

  	
  1.57:1.00

  	
   

  



 


For purposes of the
covenants set forth in this Annex I, the terms listed below shall have the
following meanings:


 


“Adjusted EBITDA”
shall mean EBITDA plus the amounts listed on the attached Schedule A-1 for
the applicable Quarterly Test Period to the extent actually incurred by
Borrower and verified by Agent.


 


“Capital Expenditures”
shall mean, for any fiscal year, the sum (without duplication) of all
expenditures (whether paid in cash or accrued as liabilities) during such
fiscal year that are or should be treated as capital expenditures under GAAP.


 


“EBITDA” shall
mean, for any Quarterly Test Period, the sum, without duplication, of the
following for Borrower, on a consolidated and consolidating basis:  Net Income determined in accordance with
GAAP, plus, (a) Interest Expense, (b) taxes on income, whether
paid, payable or accrued, (c) depreciation expense, (d) amortization
expense, (e) non-cash dividends on preferred stock, and (f) all other
non-cash, non-recurring charges and expenses, excluding accruals for cash
expenses made in the ordinary course of business, all of the foregoing
determined in accordance with GAAP, less (f) all non-cash income.


 


“Fixed Charge Coverage
Ratio” shall mean, at any date of determination, for Borrower individually
and collectively on a consolidated and consolidating basis, the ratio of
(a) Adjusted EBITDA for the Quarterly Test Period most recently ended
before such date, to (b) Fixed Charges for the Quarterly Test Period most
recently ended before such date, in each case taken as one accounting period.


 


“Fixed Charges”
shall mean, on any calculation date, for any Quarterly Test Period, the sum of
the following for Borrower, individually and collectively, on a consolidated
and consolidating basis:  (a) Total
Debt Service for such period, (b) Capital Expenditures during such period,
(c) income taxes paid in cash or accrued during such period, and (d) dividends paid
or declared during such period.


 


“Interest Expense”
shall mean, for any Quarterly Test Period, total interest expense (including
attributable to Capital Leases in accordance with GAAP) of Borrower


 


2

















 


individually and
collectively, on a consolidated and consolidating basis with respect to all
outstanding Indebtedness including capitalized interest but excluding
commissions, discounts and other fees owed with respect to letters of credit
and bankers’ acceptance financing and net costs under Interest Rate Agreements.


 


“Interest Rate
Agreement” shall mean any interest rate swap, cap or collar agreement or
other similar agreement or arrangement designed to hedge the position with
respect to interest rates.


 


“Leverage Ratio”
shall mean, at any date of determination, for Borrower, the ratio of
(i) the aggregate unpaid principal amount of all Loans on such date, plus
the aggregate liability of Borrower pursuant to any letter of credit or surety
bond to (ii) Adjusted EBITDA.


 


“Net Income” shall
mean, for any Quarterly Test Period, the net income (or loss) of Borrower
individually and collectively on a consolidated and consolidating basis  for
such period taken as a single accounting period determined in conformity with
GAAP; provided, that there shall be excluded (i) the income (or loss) of
any Person in which any other Person (other than Borrower) has a joint
interest, except to the extent of the amount of dividends or other
distributions actually paid to a Borrower by such Person during such period,
(ii) the income (or loss) of any Person accrued prior to the date it becomes a
Borrower or is merged into or consolidated with a Borrower or that Person’s
assets are acquired by a Borrower, (iii) the income of any Subsidiary of
Borrower to the extent that the declaration or payment of dividends or similar
distributions of that income by that Subsidiary is not at the time permitted by
operation of the terms of the charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary, (iv) compensation expense resulting from the issuance of capital
stock, stock options or stock appreciation rights issued to former or current
employees, including officers, of a Borrower, or the exercise of such options
or rights, in each case to the extent the obligation (if any) associated
therewith is not expected to be settled by the payment of cash by a Borrower or
any affiliate thereof, and (v) compensation expense resulting from the
repurchase of capital stock, options and rights described in clause (iv)
of this definition of Net Income.


 


“Pro Forma Fixed
Charge Coverage Ratio” shall mean, at any date of determination, for
Borrower individually and collectively on a consolidated and consolidating
basis, the ratio of (a) Adjusted EBITDA for the Quarterly Test Period most
recently ended before such date, to (b) Fixed Charges (less non-cash Interest
Expense on the Subordinated Debt and non-cash charges relating to premium
payable on the Subordinated Debt) for the Quarterly Test Period most recently
ended before such date, in each case taken as one accounting period.


 


“Quarterly Test Period”
shall mean the twelve month period ending on the last day of each March, June,
September and December of each year.


 


“Senior Fixed Charge
Coverage Ratio” shall mean, at any date of determination, for Borrower
individually and collectively on a consolidated and consolidating basis, the
ratio of (a) Adjusted EBITDA for the Quarterly Test Period most recently
ended before such date, to (b) Fixed Charges (less Interest Expense on the
Subordinated Debt and non-cash charges relating to 


 


3

















 


premium payable on the
Subordinated Debt) for the Quarterly Test Period most recently ended before
such date, in each case taken as one accounting period.


 


“Total Debt Service”
shall mean for any period, for Borrower individually and collectively on a
consolidated and consolidating basis, the sum of (i) scheduled or other
required payments of principal on Indebtedness, (ii) any other fees due or
payable in connection with any Indebtedness, and (iii) Interest Expense
(excluding any non-cash charges accrued for such period with respect to the
Exit Fee, the fees and expenses paid by Borrower in connection with the Closing
and the Fourth Amendment, the closing fees and expenses paid by Borrower in
connection with the Subordinated Debt, and the premium payable on the
Subordinated Debt).


 


4