ex_10-2.htm


    Exhibit 10.2

     

    Execution
Version

    SECOND AMENDMENT
AGREEMENT

     

    SECOND AMENDMENT AGREEMENT, dated as of
October 28 2009 (this "Agreement" or "Second Amendment"),
is entered into by and among MCG CAPITAL CORPORATION, a
Delaware corporation (the "Company"), and the
holders of the Notes party hereto relating to the Note Purchase Agreement, dated
as of October 3, 2007, between the Company and each of the purchasers listed
therein pursuant to which the Company issued $25,000,000 aggregate principal
amount of its 6.71% Series
2007-A Senior Notes due October 3, 2012 (the "Notes""), as amended
by that certain First Amendment Agreement (the "First Amendment"
dated as of February 26, 2009 and that certain Consent Request dated July 13,
2009 (as amended, the "Note Purchase
Agreement").  Capitalized terms used herein and not otherwise
defined herein shall have the respective meanings set forth in the Note Purchase
Agreement.

     

    W I T N E S S E T H :

     

    WHEREAS,
the Company has entered into the Note Purchase Agreement with the Purchasers,
pursuant to which the Company issued and sold the Notes; and

     

    WHEREAS, the parties hereto mutually
desire to amend the terms of the Note Purchase Agreement.

     

    NOW THEREFORE, in consideration of
the premises and other good and valuable consideration, the parties hereto
hereby agree as follows:

     

    1. Prepayment.

     

    1.1 As
provided for in Section 8.2 of the Note Purchase Agreement but subject to
Section 1.3 below, on or before the Second Amendment Effective Date the Company
will prepay the Notes and the Series 2005-A Notes in the total principal amount
of $5,000,000 plus accrued interest on such amount (the "October
Prepayment").

     

    1.2 The
October Prepayment shall be allocated pro rata as between the Notes and the
Series 2005-A Notes based on the outstanding principal amount
thereof.

     

    1.3 The
holders of the Notes agree to waive (i) their right to the Make Whole Amount on
the October Prepayment as would otherwise be due and owing pursuant to Section
8.2 of the Note Purchase Agreement following a prepayment; (ii) the notices
required to be delivered by the Company in connection with a prepayment pursuant
to Section 8.2 of the Note Purchase Agreement; and (iii) the minimum prepayment
requirement of $5,000,000 as set forth in Section 8.2 of the Note Purchase
Agreement.  Each of the foregoing waivers shall apply only to the
October Prepayment and shall not constitute a waiver, whether express or
implied, of any other provision of the Note Purchase Agreement or a waiver of
compliance with Section 8.2 in connection with any possible future
prepayment.

     

    2. Amendments to Note Purchase
Agreement.  The Company and the undersigned holders of the
Notes hereby agree that as of the Second Amendment Effective Date (as defined in
Section 3 below), without any further action, the Note Purchase Agreement shall
be amended as follows:

    
       

       

      
        
        

      

      
        
           
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    2.1 Schedule B Defined
Terms.  Schedule B to the Note Purchase Agreement shall be
amended as follows:

     

    (a) The
definition of "Available Monetization Proceeds" in Schedule B shall be deleted
in its entirety and replaced with the following:

     

    "Available Monetization
Proceeds" shall mean, with respect to any Monetization Event, the
greatest of (i) 40% of Net Proceeds, (ii) from and after the date on which the
Company is no longer obligated pursuant to the CLFT Sale and Servicing Agreement
to reduce the obligations thereunder by the additional 7.5% of Net Proceeds as
required by Section 2.3(c) clause (ii) of the CLFT Sale and Servicing Agreement,
45% of Net Proceeds or (iii) if a Subsidiary Non-Recourse Debt Event of Default
has occurred and is continuing, 60% of Net Proceeds.

     

    (b) The
definition of "CLFT Sale and Servicing Agreement" in Schedule B shall be deleted
in its entirety and replaced with the following:

     

    "CLFT Sale and Servicing
Agreement" means that certain Amended and Restated Sale and Servicing
Agreement dated as of February 26, 2009 (as amended and as may be further
amended from time to time), by and among the Company, as the originator and
servicer, the CLFT, as the seller, Three Pillars Funding LLC, as a purchaser,
SunTrust Capital Markets, Inc. (now, SunTrust Robinson Humphrey, Inc.), as the
administrative agent and the purchaser agent for Three Pillars Funding LLC, and
Wells Fargo Bank, National Association, as the backup servicer and the
trustee."

     

    3. Second Amendment Effective
Date and Conditions Precedent.  This Agreement shall become
effective on the first date (the "Second Amendment Effective
Date") on which each of the following conditions have been
satisfied:

     

    (a) October
Prepayment.  The Company shall have paid to each holder of a
Note and a Series 2005-A Note, in the manner and at the address for payments
specified in the Note Purchase Agreements, each holder's pro rata share of the
October Prepayment.

     

    (b) Representations and
Warranties.  The representations and warranties contained in
Section 4 of this Agreement shall be true in all material respects on and as of
the Second Amendment Effective Date.

     

    (c) No
Default.  No Default or Event of Default shall have occurred
and be continuing on the Second Amendment Effective Date.

     

    (d) Officer's
Certificate.  The Company shall have delivered to each holder
of Notes an Officer’s Certificate, dated as of the date of this Agreement,
certifying that (i) the representations and warranties of the Company set forth
in Section 4 of this Agreement are true in all material respects, and (ii) no
Default or Event of Default has occurred and is continuing.

     

    (e) Execution and Delivery by
the All Holders.  As of the Second Amendment Effective Date,
this Agreement shall have been executed by all holders and copies of the
executed signature pages of the holders shall have been delivered to each holder
of Notes.

     

    
       

      
        
        

      

      
        
           
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    (f) Delivery by the
Company.  As of the Second Amendment Effective Date, copies of
this Agreement executed by the Company shall have been delivered to each holder
of Notes.

     

    (g) Series 2005-A
Notes.  As of the Second Amendment Effective Date, all holders
under the Series 2005-A Note Purchase Agreement shall have executed an amendment
agreement addressing, among other matters, Sections 1.3 and 2.1 herein, and
copies of the executed signature pages shall have been delivered to each holder
of the Notes or Bracewell & Giuliani LLP on their behalf.

     

    (h) Legal and Advisor
Fees.  The Company shall have paid the reasonable fees and
expenses of Bracewell & Giuliani LLP, special counsel to the holders of
Notes, to the extent reflected in a statement rendered to the Company at least
one Business Day prior to the Second Amendment Effective Date.

     

    4. Representations and
Warranties of the Company.  The Company represents and warrants
to each undersigned holder of Notes that each of the representations and
warranties of the Company set forth in the Note Purchase Agreement are true and
correct in all material respects as of the Second Amendment Effective Date
(except for any such representations and warranties that were made by reference
to a specific earlier date and after giving effect to the supplemental schedules
attached hereto), and further represents and warrants as follows:

     

    (a) Organization; Power and
Authority.  The Company is a Delaware corporation and is in
good standing in its jurisdiction of organization.

     

    (b) Authorization,
etc.  This Agreement has been duly authorized by all necessary
corporate action on the part of the Company, and upon execution and delivery
hereof, this Agreement, and the Note Purchase Agreement, as amended hereby, will
constitute legal, valid and binding obligations of the Company enforceable
against the Company in accordance with their respective terms, except as such
enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors’ rights generally and (ii) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at
law).

     

    (c) Compliance with Laws, Other
Instruments, etc.  The execution, delivery and performance by
the Company of this Agreement will not (i) contravene the provisions of the
certificate of incorporation or bylaws of the Company or result in a breach of
any of the terms of any Material agreement or instrument by which the Company or
any of its Subsidiaries is bound or to which the Company or any of its
Subsidiaries is a party, including, without limitation, any Subsidiary
Non-Recourse Debt Documents, (ii) result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree, or ruling of any court,
arbitrator or Governmental Authority applicable to the Company or any of its
Subsidiaries or (iii) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Company or any of its
Subsidiaries.

     

    (d) Governmental Authorizations,
etc.  No consent, approval or authorization of, or
registration, filing or declaration with, any Governmental Authority is required
in connection with the execution, delivery or performance by the Company of this
Agreement.

     

    
       

       

      
         

        
        

      

      
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    (e) Existing Revolving Credit
Facility.  The Existing Revolving Credit Facility has been
repaid in full and cancelled in its entirety.

     

    (f) No
Default.  No Default or Event of Default has occurred and is
continuing.

     

    5. Survival of Representations
and Warranties.  All representations and warranties contained
herein shall survive the execution and delivery of this
Agreement.  All representations and warranties contained herein also
shall survive the transfer by a holder of any Note or portion thereof or
interest therein and the payment of any Note, and may be relied upon by any
subsequent holder, regardless of any investigation made at any time by or on
behalf of any holder.  All statements contained in any certificate or
other instrument delivered by or on behalf of the Company pursuant to this
Agreement shall be deemed representations and warranties of the Company under
this Agreement.

     

    6. Ratification of Note
Purchase Agreement.  This Agreement shall be construed in
connection with and as part of the Note Purchase Agreement, and except as
modified and expressly amended by this Agreement, all terms, conditions and
covenants contained in the Note Purchase Agreement are hereby ratified and shall
remain in full force and effect.

     

    7. References to Note Purchase
Agreement.  Any and all notices, requests, certificates and
other instruments executed and delivered after the execution and delivery of
this Agreement may refer to the Note Purchase Agreement without making specific
reference to this Agreement but nevertheless all such references shall include
this Agreement unless the context otherwise requires.

     

    8. Expenses.  The
Company agrees to pay all reasonable out-of-pocket expenses of the holders
arising in connection with this Agreement, the exchange of the Notes and the
transactions contemplated hereby, including without limitation the reasonable
fees and expenses, including reasonable post-closing fees and expenses, of
Bracewell & Giuliani LLP, special counsel for the holders of the
Notes.

     

    9. Headings.  The
descriptive headings of the various Sections or parts of this Agreement are for
convenience only and shall not affect the meaning or construction of any of the
provisions hereof.

     

    10. Governing
Law.  THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF
THE STATE OF NEW YORK EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH
STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER
THAN SUCH STATE.

     

    11. Counterparts.  This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original and all of which shall constitute one and the same
instrument, and it shall not be necessary in making proof of this Agreement to
produce or account for more than one such counterpart.

     

    [Signature
page follows]

     

     

    


    
      
        
           

           


        

        
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    This
Agreement is hereby accepted

    and
agreed to as of the date thereof.



    
      	 
      	
              MCG
      CAPITAL CORPORATION

            
	 
      	
              By:

            	
              /s/ Stephen
      J. Bacica

            
	 
      	 
      	
              Name:
      Stephen J. Bacica

            
	 
      	 
      	
              Title:
      Chief Financial Officer

            


    

     

     

     

    
 

    
      
        
          
            Signature
Page to 2007 Second Amendment Agreement

            MCG
Capital Corporation

          

           


        

        
           


        

        
           


        

      

    

    This
Agreement is hereby accepted

    and
agreed to as of the date thereof.



    
      	 
      	
              The
      Guardian Life Insurance Company of America

            
	 
      	
              By:

            	
              /s/ Brian
      Keating

            
	 
      	 
      	
              Name:
      Brian Keating

            
	 
      	 
      	
              Title:
      Managing Director

            


    

     

    
      


      
        	 
      	
                The
      Guardian Insurance & Annuity Company, Inc.

              
	 
      	
                By:

              	
                /s/ Brian
      Keating

              
	 
      	 
      	
                Name:
      Brian Keating

              
	 
      	 
      	
                Title:
      Managing Director

              


      

    

    
      
 

      
        	 
      	
                Nationwide
      Life Insurance Company

              
	 
      	
                By:

              	
                /s/ Thomas
      A. Gleason

              
	 
      	 
      	
                Name:
      Thomas A. Gleason

              
	 
      	 
      	
                Title:
      Authorized Signatory

              


      

       

       

       

       

       

      
        
          Signature
Page to 2007 Second Amendment Agreement

          MCG
Capital Corporation