**Exhibit10.18**

** **
|   | For Bank Use Only                | Reviewed by            |
|--------|----------------------------------|------------------------|
|   |                             |
|   | Due                              | SEPTEMBER 5, 2007 |   |
|   |                             |
|   | Customer #  6517384088 | Loan #  34   |
|        |                                  |                        |  |  |  |

 

**AMENDMENTTO LOAN AGREEMENT AND NOTE**

 

This amendment (the **“Amendment”**), dated as of the date specified below, is byand between the borrower (the **“Borrower”**) andthe bank (the **“Bank”**) identified below,

 

**RECITALS**

 

A.  The Borrower and the Bank have executed aLoan Agreement (the **“Agreement”**)dated SEPTEMBER 30, 2004 and the Borrower has executed a Note (the **“Note”**), dated SEPTEMBER 30, 2004, either or both whichmay have been amended and replaced from time to time, and the Borrower (and ifapplicable, certain third parties) have executed the collateral documents whichmay or may not be identified in the Agreement and certain other related documents(collectively the **“Loan Documents”**),setting forth the terms and conditions upon which the Borrower may obtain loansfrom the Bank from time to time in the original amount of$5,000,000.00, as may be amended from time to time.

 

B.  TheBorrower has requested that the Bank permit certain modifications to theAgreement and Note as described below.

 

C.  The Bankhas agreed to such modifications, but only upon the terms and conditionsoutlined in this Amendment.

 

**TERMS OFAGREEMENT**

 

In consideration of the mutual covenants containedherein, and for other good and valuable consideration, the Borrower and theBank agree as follows:

 

ý  **Change in Maturity Date.** If checked here, any references inthe Agreement or Note to the maturity date or date of final payment are herebydeleted and replaced with “SEPTEMBER 5, 2007”.

 

ý  **Change in Maximum Loan Amount**. If checked here, allreferences in the Agreement and in the Note (whether or not numerically) to themaximum loan amount are hereby deleted and replaced with “$ 8,000,000.00”, whichevidences an additional $ 3,000,000.00 available to be advanced subject to theterms and conditions of the Agreement and Note.

 

o  **Temporary Increase in Maximum Loan Amount**. If checked here,notwithstanding the maximum principal amount that may be borrowed from time totime under the Agreement and Note, the maximum principal amount that may be borrowedthereunder shall increase from $                           to$                           effective                           through                           annually. On                           through                           annually,the maximum principal amount that may be borrowed thereunder shall revert to $                           andany loans outstanding in excess of that amount will be immediately due andpayable without further demand by the Bank.

 

o  **Change in Multiple Advance Termination Date**. If checkedhere, all references in the Agreement and in the Note to the termination datefor multiple advances are hereby deleted and replaced with “                           ”.

 

**Change in Financial Covenant(s).**

 

(i)  o If checkedhere, all references to “$                           ”in the Agreement as the minimum Net Working Capital amount are hereby deletedand replaced with “$                           ” for the period beginning                           andthereafter.

 

(ii)  o ifchecked here, all references to “$                            ”in the Agreement as the minimum Tangible Net Worth amount are hereby deletedand replaced with “$                           ”for the period beginning                           andthereafter.

 

(iii)  o Ifchecked here, all references to “                           ”in the Agreement as the maximum Debt to Worth Ratio are hereby deleted andreplaced with “                           ”for the period beginning                           andthereafter.

 

(iv)  o Ifchecked here, all references to “                           ”in the Agreement as the minimum Current Ratio are hereby deleted and replacedwith “                           ”for the period beginning                           andthereafter.

 

(v)  o Ifchecked here, all references to “$                           ”in the Agreement as the maximum Capital Expenditures amount are hereby deletedand replaced with “$                          ”for the period beginning                           andthereafter.

 

(vi)  o Ifchecked here, all references to “                           ”in the Agreement as the minimum Cash Flow Coverage Ratio are hereby deleted andreplaced with “                           ”for the period beginning                           andthereafter.

 

(vii)  o Ifchecked here, all references to “$                           ”in the Agreement as the maximum Officers, Directors, Partners, and ManagementSalaries and Other Compensation amount are hereby deleted and replaced with “$                           ”for the period beginning                           andthereafter.

 

o  **Change in Payment Schedule.** If checked here, effective uponthe date of this Amendment, any payment terms are amended as follows:

 

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o  **Change in Late Payment Fee**. If checked here, subject to applicable law, if any payment is not madeon or before its due date, the Bank may collect a delinquency charge of                           % of the unpaid amount.  Collection of the late payment fee shall notbe deemed to be a waiver of the Bank’s right to declare a default hereunder.

 

o  **Change in Closing Fee**. If checked here and subject to applicable law, the Borrower will pay theBank a closing fee of $                           (apart from any prior closing fee)contemporaneously with the execution of this Amendment. This fee is in additionto all other fees, expenses and other amounts due hereunder.

 

o  **Change in Borrowing Base**. If checked here, the BorrowingBase is hereby changed to an amount equal to the sum of (i) xxxxxxxxxxxx %of the face amount of Eligible Accounts, and (ii) the lesser of $ xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxor xxxxxxxxxxxxxxx % of the Borrower’s cost of Eligible Inventory, as suchcost may be diminished as a result of any event causing loss or depreciation invalue of Eligible Inventory less (iii) the current outstanding loan balanceon note(s) in the original amount(s) of $ xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx,and less (iv) undrawn amounts of outstanding letters of credit issued byBank or any affiliate thereof. The Borrower will provide the Bank withinformation regarding the Borrowing Base in such form and at such times as theBank may request. The terms used in this section will have the meaningsset forth in a supplement entitled “Financial Definitions,” a copy of which theBorrower acknowledges having received with this Amendment, which isincorporated herein by reference and which replaces any prior FinancialDefinitions supplement.

 

ý  **Change in Paid-in-Full Period**. If checked here, allrevolving loans under the Agreement and the Note must be paid in full for aperiod of at least 30 consecutive days during each fiscal year. Any previousPaid-in-Full provision is hereby replaced with this provision.

 

**DefaultInterest Rate**.Notwithstanding any provision of this Note to the contrary, upon any default orat any time during the continuation thereof (including failure to pay uponmaturity), the Bank may, at its option and subject to applicable law, increasethe interest rate on this Note to a rate of 5% per annum plus the interest rateotherwise payable hereunder. Notwithstanding the foregoing and subject toapplicable law, upon the occurrence of a default,**the Borrower or any guarantor involving bankruptcy,insolvency, receivership proceedings or an assignment for the benefit ofcreditors, the interest rate on this Note shall automatically increase to arate of 5% per annum plus the rate otherwise payable hereunder.

 

**Effectiveness of Prior Documents**. Except as specifically amended hereby, theAgreement, the Note and the other Loan Documents shall remain in full force andeffect in accordance with their respective terms. All warranties andrepresentations contained in the Agreement and the other Loan Documents arehereby reconfirmed as of the date hereof. All collateral previously provided tosecure the Agreement and/or Note continues as security, and all guarantiesguaranteeing obligations under the Loan Documents remain in full force andeffect. This is an amendment, not a novation.

 

**Preconditions to Effectiveness**. This Amendment shall only become effective upon execution by theBorrower and the Bank, and approval by any other third party required by theBank.

 

**No Waiver of Defaults; Warranties**. This Amendment shall not be construed as orbe deemed to be a waiver by the Bank of existing defaults by the Borrower,whether known or undiscovered. All agreements, representations and warrantiesmade herein shall survive the execution of this Amendment.

 

**Counterparts**.This Amendment may be signed in any number of counterparts, each of which shallbe considered an original, but when taken together shall constitute onedocument.

 

**Authorization**.The Borrower represents and warrants that the execution, delivery andperformance of this Amendment and the documents referenced herein are withinthe authority of the Borrower and have been duly authorized by all necessaryaction.

 

**Transferable Record.** The agreement and note, as amended, is a “transferable record” asdefined in applicable law relating to electronic transactions. Therefore, theholder of the agreement and note, as amended,may, on behalf of Borrower, create a microfilm or optical disk or otherelectronic image of the agreement and note, as amended, that is anauthoritative copy as defined in such !aw. The holder of the agreement andnote, as amended, may store the authoritative copy of such agreement and note,as amended, in its electronic form and then destroy the paper original as partof the holder’s normal business practices. The holder, on its own behalf, maycontrol and transfer such authoritative copy as permitted by such law.

 

**Attachments. All documents attachedhereto, including any appendices, schedules, riders, and exhibits to thisAmendment, are hereby expressly incorporated herein by reference.**

 

**[SIGNATURE(S)ON NEXT PAGE]**

 

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| Dated as of:          | OCTOBER 18, 2005  |                           |                    |               |
|-----------------------|------------------------|--------------------------------|-------------------------|--------------------|
|                  |                   |                           |
|                  |                   | Outdoor Channel Holdings, Inc. |
| (Individual Borrower) |                   | Borrower Name (Organization)   |
|                  |                   |                           |
|                  |                   |                           |
|                  |                   | a                              | Delaware Corporation    |
|                  |                   |                           |
| Borrower Name         | N/A                    |                           | By:                     | /s/William A. Owen |
|                  |                   |                           | William A. Owen         |
|                  |                   | Name and Title:                | Chief Financial Officer |
|                  |                   |                           |
|                  |                   | By:                            |                    |
|                  |                   |                           |                    |
| Borrower Name         | N/A                    |                           | Name and Title:         |               |
|                  |                   |                           |
| Agreed to:            |                   |                           |
|                  |                   |                           |
| U.S.  BANK N.A.       | ** **             | ** **                     |
| (Bank)                |                   |                           |
|                  |                   |                           |
| By:                   | /s/Maureen K. Sullivan |                           |                    |               |
|                  | Maureen K. Sullivan    |                           |                    |               |
| Name and Title:       | Vice President         |                           |                    |
|                       |                        |                                |                         |                    |  |  |  |  |  |  |  |  |  |

 

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**ADDENDUM TO REVOLVING CREDITAGREEMENT AND****NOTE**

 

This Addendum is made part of the Revolving Credit Agreement and Note(the “Agreement”) made and entered into by and between the undersigned borrower(the “Borrower”) and the undersigned bank (the “Bank”) as of the dateidentified below. The warranties, covenants and other terms described below arehereby added to the Agreement.

 

**Amendments to Financial Covenants.**Financial covenants set forth in the Agreement are modified, added, deleted orrestated as more specifically set forth below. Financial covenants which arenot modified, restated or deleted below shall remain in full force and effect.Financial terms used in the Amendment which are not specifically defined in theAmendment shall have the meanings ascribed to them under generally acceptedaccounting principles. For any Borrower or Guarantor who does not have aseparate fiscal year end for tax reporting purposes, the fiscal year will bedeemed to be the calendar year.

 

**Modification of Borrower Financial Covenants.**All Borrower financial covenants, whether set forth below or in the Agreement,will be maintained by Borrower (for purposes of all existing, new and amendedfinancial covenants, the **“Subject Party”**).

 

**Additional or Modified Financial Covenants.**The following covenants are hereby added or restated:

 

**Fixed Charge Coverage Ratio**as of the end of each fiscal quarter for the four (4) fiscal quarters thenended of at least 1.30 to 1.

 

**“Fixed Charge Coverage Ratio”**shall mean (a) EBITDAR minus cash taxes, cash dividends and MaintenanceCapital Expenditures divided by (b) the sum of all required principalpayments (on short and long term debt and capital leases), interest and rentalor lease expense.

 

**“EBITDAR”** shall meannet income, plus interest expense, plus income tax expense, plus depreciationexpense plus amortization expense plus rent or lease expense.

 

**“Maintenance Capital Expenditures”**shall mean the dollar amount of Capital Expenditures that are necessary tomaintain the current level of revenues. For the purposes of the covenantcalculation, at no time shall the amount of the Capital Expenditures used beless than $560,000.00 per fiscal year, prorated evenly for the measurementperiods required above.

 

**“Capital Expenditures”**shall mean the aggregate amount of all purchases or acquisitions of fixedassets, including real estate, motor vehicles, equipment, fixtures, leases andany other items that would be capitalized on the books of the Subject Partyunder generally accepted accounting principles. The term “Capital Expenditures”will not include expenditures or charges for the usual and customarymaintenance, repair and retooling of any fixed asset or the acquisition of newtooling in the ordinary course of business.

 

**Senior Funded Debt to EBITDA Ratio**as of the end of each fiscal quarter for the fiscal quarter then ended of notmore than 1.50 to 1.

 

**“Senior Funded Debt to EBITDA Ratio”**shall mean the ratio of Senior Funded Debt to EBITDA.

 

**“Senior Funded Debt”**shall mean indebtedness for borrowed money, for the deferred purchase price ofproperty not purchased on ordinary trade terms, for capitalized leases and forother liabilities evidenced by promissory notes or other instruments, but notincluding any indebtedness that has been subordinated to the indebtednessevidenced by the Note pursuant to a writing that has been accepted by Bank.

 

**“EBITDA”** shall meannet income, plus interest expense, plus income tax expense, plus depreciationexpense plus amortization expense.

 

**Amendments to Financial Information andReporting Requirements**. Financial information andreporting requirements set forth in the Agreement are modified, added, deletedor restated as more specifically set forth below. Financial information andreporting requirements which are not modified, restated or deleted below shallremain in full force and effect. Financial terms used in the Amendment whichare not specifically defined in the Amendment shall have the meanings ascribedto them under generally accepted accounting principles. For any Borrower orGuarantor who does not have a separate fiscal year end for tax reportingpurposes, the fiscal year will be deemed to be the calendar year.

 

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**Modification of Borrower FinancialInformation and Reporting.** All Borrower financialinformation and reporting requirements, whether set forth below or in theAgreement, will be provided by Borrower, in form and content acceptable toBank, pertaining to Borrower.

 

**Additional or Modified Financial Informationand Reporting Requirements.** The following financialinformation and reporting requirements are hereby added or restated;

 

**Modification of Borrower FinancialInformation and Reporting.** All Borrower financialinformation and reporting requirements, whether set forth below or in the Agreement,will be provided by Borrower, in form and content acceptable to Bank, pertainingtoBorrower. The following financial information and reportingrequirements are hereby added or restated:

 

**Annual Financial Statements:**Not later than 90 days after the end of each fiscal year, annual financialstatements, audited by a certified public accounting firm acceptable to Bank.

 

**Interim Financial Statements:**Not later than 60 days after the end of each fiscal quarter, interim financialstatements, prepared by Borrower.

 

**Agings of Accounts Receivable**(this requirement pertains to Borrower only, regardless of whether financialreports are otherwise required for Borrower together with others hereunder):Not later than 30 days after the end of each fiscal quarter, a detailed agingby invoice date of accounts and contracts receivable as of the last day of suchperiod, together with an explanation of any adjustments made at the end of suchperiod.

 

**Agings of Accounts Payable**(this requirement pertains to Borrower only, regardless of whether financialreports are otherwise required for Borrower together with others hereunder):Not later than 30 days after the end of each fiscal quarter, a detailed agingby invoice date of accounts payable as of the last day of such period, togetherwith an explanation of any adjustments made at the end of such period.

 

**Certificate of Compliance**(this requirement pertains to Borrower only, regardless of whether financialreports are otherwise required for Borrower together with others hereunder):Not later than 60 days after the end of each fiscal quarter, a certificate,executed by Borrower (or, if Borrower is an entity, by Borrower’s chieffinancial officer or other officer or person acceptable to Bank) certifyingthat the representations and warranties set forth in the Agreement are true andcorrect as of the date of the certificate and further certifying that, as ofthe date of the certificate, no default exists under the Agreement.

 
| Dated as of       | October 18, 2005 |   |                                                |                                     |   |
|-------------------|-----------------------|--------|-----------------------------------------------------|------------------------------------------|--------|
|              |                  |   |                                                |                                     |
| (Individual)      |                  |   | (Non-Individual)                                    |                                     |
|              |                  |   |                                                |                                     |
|              |                  |   | Outdoor Channel Holdings, Inc.                      |
| Borrower Name n/a |                  |   | a/an                                                | Delaware Corporation                     |   |
|              |                  |   |                                                |
|              |                  |   |                                                |
| Borrower Name n/a |                  |   | By:                                                 | /s/ William A. Owen                      |   |
|              |                  |   | Name* *and Title                               | William A. Owen, Chief Financial Officer |
|              |                  |   |                                                |
|              |                  |   | By:                                                 |                                     |   |
|              |                  |   | Name and Title                                      |                                     |
|              |                  |   |                                                |                                     |
|              |                  |   | Agreed to:                                          |                                     |
|              |                  |   | U.S. BANK N.A.                                      |                                     |
|              |                  |   |                                                |                                     |
|              |                  |   |                                                |                                     |
|              |                  |   | By:                                                 | /s/ Richard Young for                    |   |
|              |                  |   | Name and Title Marueen K. Sullivan, Vice  President |
|                   |                       |        |                                                     |                                          |        |  |  |  |  |  |  |  |

 

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**SECOND ADDENDUM TO AMENDMENT TO LOAN AGREEMENT AND NOTE**

 

This Second Addendum to Amendment to Loan Agreement and Note (this **“Addendum”**) is made part of the Amendment to Loan Agreement and Note (the **“Amendment”**) of even date herewith made and entered into by and between theundersigned borrower (the **“Borrower”**) andU.S. Bank N.A. (the **“Bank”**). The warranties, covenants and otherterms of this Addendum hereby supplement and amend the provisions of (i) theAmendment; (ii) the Addendum to Revolving Credit Agreement and Note ofeven date herewith (the **“First Addendum”**) that is attached to and a part ofthe Amendment; and (iii) the Interest Rate Rider of even date herewith andthe Payment Schedule Rider of even date herewith (the **“Riders”**) that are attached to and part of the Amendment. The FirstAddendum and this Addendum are (notwithstanding the name of the First Addendumand the introductory paragraph in the First Addendum) addendums or riders tothe Amendment. Capitalized terms not defined herein shall have the meaningsascribed to them in the Agreement (as defined in the Amendment). In the eventof any conflict between the provisions of the Agreement, the Amendment, theFirst Addendum or the Riders on one hand, and the provisions of this Addendumon the other, the provisions of this Addendum shall prevail and control.

 

**1.****             FinancialCovenants.**The following financial covenant is in addition to those in theAgreement, the Amendment and the First Addendum. Financial terms used hereinthat are not specifically defined herein, in the Agreement, in the Amendment orin the First Addendum shall have the meanings ascribed to them under generallyaccepted accounting principles.

 

**Quarterly Profits.**TheBorrower shall have and shall report Net Profit After Taxes of an amountgreater than $250,000.00 for each of its fiscal quarters.

 

**2.****             Definition.**The following capitalized term used in this Addendum shall have thefollowing meaning:

 

**“Net Profit After Taxes”**shall mean, for any time period, the sum of theBorrower’s net income (loss) for such period, after the amount of income taxexpense (or benefit) has been deducted (or added).

 

**3.****             ContinuingValidity.**Except as expressly modified above or in other agreements betweenBorrower and Bank, the terms of the Agreement, the Amendment, the FirstAddendum, the Riders and the other Loan Documents (as defined in theAgreement), shall remain unchanged and in full force and effect.

 

Dated as of October 18, 2005

 

Borrower:

 

 

Outdoor Channel Holdings, Inc.,a Delaware corporation

 

 
| By:            | /s/ William A. Owen                       |   |   |
|----------------|-------------------------------------------|--------|--------|
|           | William A. Owen,  Chief Financial Officer |   |   |
|           |                                      |
| Bank:          |                                      |
|           |                                      |
| U.S. Bank N.A. |                                      |
|           |                                      |
|           |                                      |
| By:            | /s/ Richard Young for                     |   |   |
|           | Maureen Sullivan,  Vice President         |   |
|                |                                           |        |        |  |  |

 

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