ex_10-1.htm


    
      


      Exhibit 10.1

       

      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 11, 2005, between the Company and each of the purchasers listed
therein pursuant to which the Company issued $50,000,000 aggregate principal
amount of its 6.73% Series
2005-A Senior Notes due October 11, 2010 (the “Notes” or "Existing 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 and to provide for the
return and cancellation of the Notes and the issuance of the New Notes (as
defined herein).

       

      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 2007-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 2007-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 and Notes.  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 and the Notes shall be amended as follows:

       

      
        
          
          

        

        
          
             
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      2.1 Exchange of
Notes.  Subject to the terms and conditions of this Agreement,
upon delivery of the Notes by each holder to the Company, each holder shall
receive from the Company new notes in the form of Schedule 1 hereto and
in the principal amounts as set forth opposite such holder's name on Schedule A (the
"New
Notes").

       

      2.2 Increase in Interest
Rate.  The applicable Interest Rate on the Notes shall be
permanently increased to 9.98% from and after the Interest Increase Effective
Date.

       

      2.3 Maturity Date. The
Maturity Date of the New Notes shall be October 11, 2011.

       

      2.4 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 "Default Rate" in Schedule B shall be deleted in its entirety and
replaced with the following:

       

      "'Default Rate' shall mean (a)
with respect to the Series 2005-A Notes, that rate of interest that is the
greater of (a) 11.98% or (b) 2.00% over the rate of interest publicly announced
by Citibank, N.A., in New York, New York as its “base” or “prime” rate and (b)
with respect to the Notes of any Series or tranche of Additional Notes, as set
forth in the Supplement pursuant to which such Series or tranche of Additional
Notes was issued."

      


      (c) 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."

       

      (d) A new
definition of “Interest Increase Effective Date" shall be added to Schedule B as
follows:  shall be deleted in its entirety and replaced with the
following:

       

      “Interest Increase Effective Date” means October
11, 2009.

       

      
        
        

        
          
            
            
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      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 2007-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) Exchange of Notes for New
Notes. The Exchange of Notes for New Notes as provided for in Section 2.1
hereof shall have occurred.

       

      (c) 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.

       

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

       

      (e) Officer's
Certificate.  The Company shall have delivered to each holder
of New 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.

       

      (f) 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.

       

      (g) 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.

       

      (h) Series 2007-A
Notes.  As of the Second Amendment Effective Date, all holders
under the Series 2007-A Note Purchase Agreement shall have executed an amendment
agreement addressing, among other matters, Sections 1.3 and 2.4 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.

       

      (i) 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:

       

      
        
          
          

        

        
          
             
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      (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 and the New Notes  have been
duly authorized by all necessary corporate action on the part of the Company,
and upon execution and delivery hereof and of the New Notes, this Agreement, the
Note Purchase Agreement, as amended hereby, and the New Notes 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 and the New Notes 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 or the New Notes.

       

      (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 and the New
Notes.  All representations and warranties contained herein also shall
survive the transfer by a holder of any New Note or portion thereof or interest
therein and the payment of any New 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 and the New Notes are hereby
ratified and shall remain in full force and effect.

       

      
         

        
          
            
               

            
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      7. References to Note Purchase
Agreement and New Notes.  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.  Any and all notices, requests, certificates and other
instruments executed and delivered after the execution and delivery of the New
Notes may refer to the Notes without making specific reference to the New Notes
but nevertheless all such references shall be deemed to refer to the New Notes
unless the context otherwise requires.  From and after the Second
Amendment Effective Date, all references to Notes in the Note Purchase Agreement
shall be deemed to refer to the New Notes as well.

       

      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 2005 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

                
	 
      	
                  Nationwide
      Life and Annuity Insurance Company

                
	 
      	
                  Nationwide
      Multiple Maturity Separate Account

                
	 
      	
                  By:

                	
                  /s/ Thomas
      A. Gleason

                
	 
      	 
      	
                  Name:
      Thomas A. Gleason

                
	 
      	 
      	
                  Title:
      Authorized Signatory

                


        

      

       

       

      
 

        
          Signature
Page to 2005 Second Amendment Agreement

          MCG
Capital Corporation