Exhibit
10.1


 


FOURTH
AMENDMENT TO CREDIT AGREEMENT


 


FOURTH AMENDMENT TO CREDIT AGREEMENT (this “Fourth Amendment”), dated as of November 5, 2009, among
MICHAELS STORES, INC., a Delaware corporation (the “Borrower”),
the Lenders party to the Credit Agreement referred to below (the “Lenders”), and DEUTSCHE BANK AG NEW YORK BRANCH, as
administrative agent (in such capacity, the “Administrative
Agent”).  Unless otherwise
defined herein, capitalized terms used herein and defined in the Credit
Agreement are used herein as therein defined.


 


W  I  T
N  E  S  S  E  T  H :


 


WHEREAS, the Borrower, the Lenders, the
Administrative Agent, the Syndication Agent and the Co-Documentation Agents
have entered into a Credit Agreement, dated as of October 31, 2006 (as
amended, supplemented and/or otherwise modified to, but not including, the date
hereof, the “Credit Agreement”); and


 


WHEREAS, pursuant to Section 10.01 of
the Credit Agreement, the parties hereto wish to amend certain provisions of
the Credit Agreement as provided herein, subject to the terms and conditions
set forth below.


 


NOW, THEREFORE, it is agreed;


 


A.                                   Amendments to the Credit Agreement


 


1.             Section 1.01 of the Credit
Agreement is hereby amended by (i) deleting the definitions of “Applicable Rate”, “Class”, “Commitment”,
“Interest Payment Date”, “Loan”, “Maturity
Date”, “Other Term Commitments”
and “Other Term Loans” appearing
in said Section in their entirety and (ii) inserting in appropriate
alphabetical order the following new definitions:


 


“Applicable Rate” means a percentage per annum equal to (A) with
respect to B-1 Term Loans, (i) in the case of Eurocurrency Rate Loans,
2.25% and (ii) in the case of Base Rate Loans, 1.25% and (B) with
respect to B-2 Term Loans, (i) in the case of Eurocurrency Rate Loans,
4.50% and (ii) in the case of Base Rate Loans, 3.50%, less,
in each case under each of the preceding clauses (A) and (B), if (but only
if) the Moody’s Applicable Corporate Rating then most recently published is B1
or higher (with at least a stable outlook), 0.25%.  Any increase or decrease in the Applicable
Rate resulting from a change in Moody’s Applicable Corporate Rating shall
become effective as of the first Business Day immediately following the date
the then most recent Moody’s Applicable Corporate Rating is published; provided that at the option of the Administrative Agent or
the Required Lenders, no deduction shall apply (x) as of the first
Business Day after the date on which Moody’s ceases to maintain or publish a
Moody’s Applicable Corporate Rating (of any level), and shall continue not to
apply to and including the date on which a new Moody’s Applicable Corporate
Rating is so published (with any deduction as otherwise determined in
accordance with this definition to apply 


 

















 


thereafter), and (y) as
of the first Business Day after an Event of Default under Section 8.01(a),
(f) or (g) shall have occurred and be continuing, and shall continue
not to apply to but excluding the date on which such Event of Default is cured
or waived (with any deduction as otherwise determined in accordance with this
definition to apply thereafter). It is understood and agreed that (w) the “Applicable
Rate” (as defined herein immediately prior to giving effect to the First
Amendment Effective Date) shall apply for all periods prior to the First
Amendment Effective Date, (x) the “Applicable Rate” (as defined herein
immediately after giving effect to the First Amendment Effective Date and prior
to the Second Amendment Effective Date) shall apply for all periods on and
after the First Amendment Effective Date and prior to the Second Amendment
Effective Date,  (y) the “Applicable
Rate” (as defined herein immediately after giving effect to the Second
Amendment Effective Date and prior to the Fourth Amendment Effective Date)
shall apply for all periods on and after the Second Amendment Effective Date
and prior to the Fourth Amendment Effective Date and (z) the “Applicable
Rate” (as defined herein immediately after giving effect to the Fourth
Amendment Effective Date) shall apply for all periods on and after the Fourth
Amendment Effective Date. Notwithstanding the foregoing, (x) the
Applicable Rate in respect of Extended Term Loans of any Extension Series or
Refinancing Term Loans of any Refinancing Series shall be the applicable
percentages per annum provided pursuant to the relevant Extension Amendment or
Refinancing Amendment, as the case may be, and (y) the Applicable Rate of
certain Loans shall be increased as, and to the extent, necessary to comply
with the provisions of Section 2.16.


 


“B-1 Term Lender” means, at any time, any Lender that has a
B-1 Term Loan at such time.


 


“B-1 Term Loan” has the meaning provided in Section 2.01(e)(i).


 


“B-1 Term Loan
Amount” means, as to any Lender, the amount set forth
opposite such Lender’s name on Schedule 2.01B under the caption “B-1 Term Loan
Amount”, as such amount may be adjusted from time to time in accordance with
this Agreement.


 


“B-2 Term Commitment” means, as to each Lender, its
obligation to convert all or a portion of its Existing Loans into a B-2 Term
Loan pursuant to Section 2.01(e)(ii) on the Fourth Amendment
Effective Date in an aggregate principal amount not to exceed the amount set
forth opposite such Lender’s name on Schedule 2.01B under the caption “B-2 Term
Commitment”, as such amount may be adjusted from time to time in accordance
with this Agreement.  On the Fourth
Amendment Effective Date, (x) the initial aggregate amount of the B-2 Term
Commitments is $1,000,000,000 and (y) the B-2 Term Commitment of each
Lender equals its B-2 Term Loan Extension Amount.


 


“B-2 Term Lender” means, at any time, any Lender that has a
B-2 Term Commitment or a B-2 Term Loan at such time.


 


“B-2 Term Loan” has the meaning provided in Section 2.01(e)(ii).


 


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“B-2 Term Loan Extension Amount” means, as to the Existing
Loans of any Extending B-2 Term Lender, the product obtained by multiplying (x) the
principal amount of such Lender’s Existing Loans subject to a B-2 Term Loan
Extension Election (determined after giving effect to the Amortization
Adjustment referred to therein) by (y) a fraction, the numerator of which
is the aggregate principal amount of all Existing Loans accepted for extension
by the Borrower on the Fourth Amendment Effective Date and the denominator of
which is the aggregate principal amount of all Existing Loans subject to B-2
Term Loan Extension Elections, as such resulting product may be modified by the
Administrative Agent to account for rounding adjustments.  The Administrative Agent shall determine the
final B-2 Term Loan Extension Amount of each Lender on the Fourth Amendment
Effective Date and shall notify each such Lender of its B-2 Term Loan Extension
Amount promptly following the Fourth Amendment Effective Date. All such determinations
made by the Administrative Agent shall, absent manifest error, be final,
conclusive and binding on the Borrower and the Lenders and the Administrative
Agent shall have no liability to any Person with respect to such determination
absent gross negligence or willful misconduct.


 


“B-2 Term Loan Extension Election” means an election by a
Lender provided in accordance with the procedures set forth in the Fourth
Amendment to have the B-2 Term Loan Extension Amount of its Existing Loan
converted into a B-2 Term Loan pursuant to Section 2.01(e)(ii).


 


“Class” (a) when used with respect to Lenders, refers to
whether such Lenders are B-1 Term Lenders, B-2 Term Lenders, Refinancing Term
Lenders for a given Refinancing Series of Refinancing Term Commitments or
Refinancing Term Loans or Extending Term Lenders for a given Extension Series of
Extended Term Commitments or Extended Term Loans, (b) when used with
respect to Commitments, refers to whether such Commitments are Replacement
Commitments, B-2 Term Commitments, Refinancing Term Commitments of a given
Refinancing Series or Extended Term Commitments of a given Extension Series and
(c) when used with respect to Loans or a Borrowing, refers to whether such
Loans, or the Loans comprising such Borrowing, are B-1 Term Loans, B-2 Term
Loans, Refinancing Term Loans of a given Refinancing Series or Extended
Term Loans of a given Extension Series.


 


“Commitment”
means, as to each Lender, its Original Commitment, its New Commitment, its
Replacement Commitment, its B-2 Term Commitment, its Refinancing Term
Commitment of a given Refinancing Series or its Extended Term Commitment of a given
Extension Series, as the context may require.


 


“Effective Yield” means, as to any Loans of any Class, the
effective yield on such Loans as determined by the Administrative Agent, taking
into account the applicable interest rate margins, any interest rate floors or
similar devices and all fees, including upfront or similar fees or original
issue discount (amortized over the shorter of (x) the life of such Loans
and (y) the four years following the date of incurrence thereof) payable
generally to Lenders making such Loans, but excluding any arrangement,
structuring or other fees payable in connection therewith that are not
generally shared with the relevant Lenders and customary consent fees paid
generally to consenting Lenders.


 


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“Existing Loan”
means each Replacement Loan outstanding on the Fourth Amendment Effective Date
(immediately prior to giving effect thereto).


 


“Existing Term Loan Tranche” has the meaning provided in Section 2.16.


 


“Extended Term Commitments” means one or more commitments
hereunder to convert Loans under an Existing Term Loan Tranche to Extended Term
Loans of a given Extension Series pursuant to an Extension Amendment.


 


“Extended Term Loans” has the meaning provided in Section 2.16.


 


“Extending B-2 Term Lender” mean any Lender that has
submitted an executed B-2 Term Loan Extension Election with respect to all or a
portion of its Existing Loans in accordance with the instructions provided on
the signature page to the Fourth Amendment prior to the deadline specified
in Fourth Amendment.


 


“Extending Term Lender” has the meaning provided in Section 2.16.


 


“Extension” means any establishment of Extended Term
Commitments and Extended Term Loans pursuant to Section 2.16 and the
applicable Extension Amendment.


 


“Extension Amendment” has the meaning provided in Section 2.16.


 


“Extension Election” has the meaning provided in Section 2.16.


 


“Extension Request” has the meaning provided in Section 2.16.


 


“Extension Series” has the meaning provided in Section 2.16.


 


“Fourth
Amendment” means the Fourth Amendment to this Agreement, dated as of
November 5, 2009.


 


“Fourth Amendment Effective Date” has the meaning provided in
the Fourth Amendment.


 


“Interest Payment Date” means, (a) as to any Loan of any
Class other than a Base Rate Loan, the last day of each Interest Period
applicable to such Loan and the applicable Maturity Date of such Loan; provided that if any Interest Period for a Eurocurrency Rate
Loan exceeds three months, the respective dates that fall every three months
after the beginning of such Interest Period shall also be Interest Payment
Dates; and (b) as to any Base Rate Loan of any Class, the last Business
Day of each January, April, July and October and the applicable
Maturity Date for such Loan.


 


“Loan” means (a) the
making of an Original Loan by a Lender to the Borrower pursuant to Section 2.01(a),
(b) the making of an Additional New Loan by a 


 


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Lender
to the Borrower pursuant to Section 2.01(c), (c) the conversion of an
Original Loan to a Converted New Loan by a Lender pursuant to Section 2.01(b),  (d) the making of a Replacement Loan by
a Lender to the Borrower pursuant to Section 2.01(d), (e) the
conversion of all or a portion of an Existing Loan into a B-1 Term Loan by a
Lender pursuant to Section 2.01(e)(i), (f) the conversion of all or a
portion of an Existing Loan into a B-2 Term Loan by a Lender pursuant to Section 2.01(e)(ii),
(g) the making of a Refinancing Term Loan of a given Refinancing Series by
a Lender or an Additional Lender to the Borrower pursuant to Section 2.15
and the applicable Refinancing Amendment and (h) the making of an Extended
Term Loan of a given Extension Series by a Lender to the Borrower pursuant
to Section 2.16 and the applicable Extension Amendment.  For the avoidance of doubt, on and after the
Fourth Amendment Effective Date, the term “Loan” shall include each B-1 Term
Loan and each B-2 Term Loan.


 


“Maturity Date” means (a) with respect to the B-1 Term
Loans, October 31, 2013, and (b) with respect to B-2 Term Loans, July 31,
2014; provided, however,
that such date applicable to B-2 Term Loans referred to in clause (b) will
automatically become July 31, 2016 if (x) no Senior Notes or any
Refinancing Indebtedness in respect thereof (other than Refinancing
Indebtedness that does not mature or require any scheduled amortization or
payments of principal prior to the date that is ninety-one (91) days after July 31,
2016) remain(s) outstanding as of July 30, 2014 or (y) (i) the
ratio of (a) the Consolidated Total Indebtedness of the Borrower and its
Restricted Subsidiaries that is secured by Liens as at the last day of the Test
Period ended closest to April 30, 2014 to (b) the Borrower’s EBITDA
for the Test Period ended closest to April 30, 2014, in each case with
such pro  forma adjustments to EBITDA as are appropriate and
consistent with the pro  forma adjustment provisions set forth in
the definition of “Fixed Charge Coverage Ratio”, is less than or equal to
3.25:1.00 and (ii) the Borrower shall have delivered to the Administrative
Agent a certificate of a Responsible Officer of the Borrower to such effect, together
with all relevant financial information, not later than the date occurring 45
days after April 30, 2014.


 


“Other
Allocable Share” means, in the case of any determination with
respect to any Lender (or its Class of Commitments or Loans) at any
time on or after the Fourth Amendment Effective Date, a fraction (expressed as
a percentage, carried out to the ninth decimal place), the numerator of which
is the amount of the Commitments of such Lender under the applicable Class at
such time and the denominator of which is the aggregate amount of all
Commitments under the applicable Class at such time (or, if such
Commitments have been terminated at such time, a fraction (expressed as a
percentage, carried out to the ninth decimal place), the numerator of which is
the principal amount of the Loans of such Lender under the applicable Class at
such time and the denominator of which is the aggregate principal amount of the
Loans of all Lenders under the applicable Class at such time).


 


“Refinancing
Series” shall mean all Refinancing Term Loans or Refinancing Term
Commitments that are established pursuant to the same Refinancing Amendment (or
any subsequent Refinancing Amendment to the extent such Refinancing Amendment
expressly provides that the Refinancing Term Loans or Refinancing Term
Commitments provided for therein are intended to be a part of any previously
established 


 


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Refinancing
Series) and that provide for the same interest margins and amortization schedule.


 


“Refinancing
Term Commitments” means one or more term loan commitments hereunder
that fund Refinancing Term Loans of the applicable Refinancing Series hereunder
pursuant to a Refinancing Amendment.


 


“Refinancing
Term Lenders” means, at any time, any Lender that has a Refinancing
Term Commitment of a given Refinancing Series or a Refinancing Term Loan
of a given Refinancing Series at such time.


 


“Refinancing Term Loans” means one or more term loans
hereunder that result from a Refinancing Amendment.


 


2.             The definition of “Applicable Consolidated
Secured Debt Ratio” appearing in Section 1.01 of the Credit
Agreement is hereby amended by (i) inserting the text “, which for
purposes of any determination of Pro  Forma Compliance with the
then ‘Applicable Consolidated Secured Debt Ratio’ pursuant to this Agreement
shall be less than or equal to the applicable ratio set forth below at the time
of such determination” immediately after the text “Pro  Forma
Compliance” appearing in said definition and (ii) inserting the text “and
each year thereafter” immediately after the text “2013” appearing in the first
column of the table set forth in said definition.


 


3.             The definition of “Borrowing”
appearing in Section 1.01 of the Credit Agreement is hereby amended by (i) inserting
the text “and Class” immediately after the text “Loans of the same Type”
appearing in said definition, (ii) inserting a comma (“,”) immediately
after the text “the same Interest Period” appearing in said definition and (iii) inserting
the text “having Commitments of the respective Class” immediately after the
text “each of the Lenders” appearing in said definition.


 


4.             The definition of “Committed Loan Notice”
appearing in Section 1.01 of the Credit Agreement is hereby amended by (i) inserting
the text “with respect to a given Class of Loans” immediately after the
text “a Borrowing” appearing in clause (a) of said definition and (ii) inserting
the text “of a given Class” immediately after the text “a conversion of Loans”
appearing in clause (b) of said definition.


 


5.             The definition of “Interest Period”
appearing in Section 1.01 of the Credit Agreement is hereby amended by (i) deleting
the text “one, two,” appearing in the introductory clause of said definition, (ii) relettering
clause (c) of said definition as clause (d) and inserting the
following new clause (c) “(c) any Interest Period that begins prior
to the Fourth Amendment Effective Date and which (x) has a duration of
either one (1) month or two (2) months and (y) is in respect of
an outstanding Existing Loan that has been converted into a B-1 Term Loan or a
B-2 Term Loan pursuant to Section 2.01(e), shall be permitted under this
Agreement until such Interest Period ends;”, (iii) inserting the text “applicable”
immediately before the text “Maturity Date” appearing in new clause (d) of
said definition and (iv) inserting the text “for the Class of Loans
of which such Eurocurrency Rate Loan is a part” immediately preceding the
period (“.”) appearing at the end of new clause (d) of such definition.


 


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6.             The definition of “Latest Maturity Date”
appearing in Section 1.01 of the Credit Agreement is hereby amended by (i) replacing
the text “Other Term Loan or any Other Term Commitment” appearing in said definition
with the text “Refinancing Term Loan, any Refinancing Term Commitment, any
Extended Term Loan or any Extended Term Commitment”.


 


7.             The definition of “Note” appearing
in Section 1.01 of the Credit Agreement is hereby amended by (i) inserting
the text “(with such modifications thereto as may be necessary to reflect
differing Classes of Loans)” immediately after the text “Exhibit C hereto”
appearing in said definition and (ii) inserting the text “of a given Class”
immediately after the text “the Loans” appearing in said definition.


 


8.             The definition of “Outstanding Amount”
appearing in Section 1.01 of the Credit Agreement is hereby amended by (i) inserting
the text “of any Class” immediately after the text “with respect to the Loans”
appearing in said definition and (ii) inserting the text “of such Class”
immediately after the text “prepayments or repayments of Loans” appearing in
said definition.


 


9.             The definition of “Relevant Reference Period”
appearing in Section 1.01 of the Credit Agreement is hereby amended by (i) deleting
the text “and” appearing at the end of clause (i) of said definition and (ii) inserting
the text “and (iii) in the case of any determination of EBITDA and
Consolidated Total Indebtedness (and any component definitions used therein)
for purposes of the definition of Maturity Date, the Test Period ended April 30,
2014” immediately preceding the period (“.”) appearing at the end of said
definition.


 


10.           Section 1.03 of the Credit
Agreement is hereby amended by (i) inserting the text “or the ratio set
forth in the definition of Maturity Date” immediately after the first instance
of the text “the Applicable Consolidated Secured Debt Ratio” appearing in
clause (b) of said Section, (ii) deleting the text “or” appearing
immediately before the second instance of the text “the Applicable Consolidated
Secured Debt Ratio” appearing in clause (b) of said Section and
including a comma in lieu thereof and (iii) inserting the text “or
Maturity Date” immediately after the second instance of the text “Applicable
Consolidated Secured Debt Ratio” appearing in clause (b) of said Section.


 


11.           Section 1.08 of the Credit
Agreement is hereby amended by replacing the text “the Applicable Consolidated
Secured Debt Ratio and the Consolidated Secured Debt Ratio” appearing in said Section with
the text “the Applicable Consolidated Secured Debt Ratio, the Consolidated
Secured Debt Ratio and Consolidated Total Indebtedness as used in the
definition of Maturity Date”.


 


12.           Section 2.01 of the Credit
Agreement is hereby amended by deleting said Section in its entirety and
inserting the following new Section 2.01 in lieu thereof:


 


“2.01 The Loans.  Subject to the terms and conditions set forth
herein, (a) each Lender severally agrees to make to the Borrower a single loan
denominated in Dollars in a principal amount equal to such Lender’s Commitment
on the Closing Date, (b) on the First Amendment Effective Date, all
outstanding Original Loans of each Lender that has theretofore executed and
delivered a counterpart of the First Amendment to the Administrative Agent in
accordance with the terms thereof (each such Lender, a “Converting
Lender” and, collectively, the “Converting Lenders”)
shall be 


 


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automatically converted (the
“Loan Conversion”) into new term loans
hereunder denominated in Dollars (each such term loan, a “Converted
New Loan” and, collectively, the “Converted
New Loans”), (c) each Lender with a New Commitment severally
agrees to make to the Borrower a single term loan denominated in Dollars (each,
an “Additional New Loan” and, collectively,
the “Additional New Loans” and, together
with the Converted New Loans, the “New Loans”) in
a principal amount equal to such Lender’s New Commitment on the First Amendment
Effective Date, (d) on the Second Amendment Effective Date, each Lender
with a Replacement Commitment severally agrees to make to the Borrower a single
term loan denominated in Dollars (each, a “Replacement Loan”
and, collectively, the “Replacement Loans”)
in a principal amount equal to such Lender’s Replacement Commitment on the
Second Amendment Effective Date, and (e) on the Fourth Amendment Effective
Date, (i) a portion of each Existing Loan of each Lender outstanding on
such date shall be automatically converted on such date into a new term loan of
such Lender hereunder denominated in Dollars in an aggregate principal amount
equal to the B-1 Term Loan Amount of such Lender (each such term loan, a “B-1 Term Loan” and, collectively, the “B-1 Term
Loans”) and (ii) a portion of each Existing Loan of each
Extending B-2 Term Lender outstanding on such date shall be automatically
converted on such date into a new term loan of such Lender hereunder
denominated in Dollars in an aggregate principal amount equal to the B-2 Term
Commitment of such Extending B-2 Term Lender (each such term loan, a “B-2 Term Loan” and, collectively, the “B-2 Term
Loans”).  Amounts borrowed
under this Section 2.01 and repaid or prepaid may not be reborrowed.  Loans may be Base Rate Loans or Eurocurrency
Rate Loans, as further provided herein.”.


 


13.           Section 2.02 of the Credit
Agreement is hereby amended by (i) inserting the text “of a given Class”
immediately after each instance of the text “conversion of Loans” appearing in
clause (a) of said Section, (ii) inserting the text “(and the
applicable Class thereof)” immediately after the text “requesting a
Borrowing” appearing in clause (a) of said Section and (iii) 
inserting the text “(or, if then applicable, Other Allocable Share)” immediately
after the text “Pro  Rata Share” appearing in clause (b) of
said Section.


 


14.           Section 2.02 of the Credit
Agreement is hereby further amended by inserting the text “, or such other amount
as requested by the Borrower from time to time and agreed to by Administrative
Agent in its sole discretion” immediately after each instance of
the text “in excess thereof” appearing in clause (a) of said Section.


 


15.           Section 2.02 of the Credit
Agreement is hereby further amended by restating clause (e) of said Section in
its entirety as follows:


 


“(e)         After giving effect to all Borrowings,
all conversions of Loans of a given Class from one Type to the other, and
all continuations of Loans of a given Class as the same Type, there shall
not be more than eight (8) Interest Periods in effect; provided that after the establishment of any new Class of
Loans pursuant to a Refinancing Amendment or Extension Amendment, the number of
Interest Periods otherwise permitted by this Section 2.02(e) shall
increase by three (3) Interest Periods for each applicable Class so
established.”.


 


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16.           Section 2.04 of the Credit
Agreement is hereby amended by deleting the said Section in its entirety
and inserting the following new Section 2.04 in lieu thereof:


 


“2.04.  Special Provisions Relating to Conversions
of Existing Loans into B-1 Term Loans and B-2 Term Loans. (a) Notwithstanding
anything to the contrary in this Agreement,


 


(A) on
the Fourth Amendment Effective Date, (i) B-1 Term Loans shall be deemed
made as Eurocurrency Rate Loans in an amount equal to the principal amount of
the Existing Loans converted into B-1 Term Loans pursuant to Section 2.01(e)(i) that
were outstanding as Eurocurrency Rate Loans at the time of conversion (such B-1
Term Loans to correspond in amount to Existing Loans so converted of a given
Interest Period), (ii) Interest Periods for the B-1 Term Loans described
in clause (i) above shall end on the same dates as the Interest Periods
applicable to the corresponding Existing Loans described in clause (i) above,
and the Eurocurrency Rates applicable to such B-1 Term Loans during such
Interest Periods shall be the same as those applicable to the Existing Loans so
converted, and (iii) B-1 Term Loans shall be deemed made as Base Rate
Loans in amount equal to the principal amount of Existing Loans converted into
B-1 Term Loans pursuant to Section 2.01(e)(i) that were outstanding
as Base Rate Loans at the time of conversion;


 


(B) on
the Fourth Amendment Effective Date, (i) B-2 Term Loans shall be deemed
made as Eurocurrency Rate Loans in an amount equal to the principal amount of
the Existing Loans converted into B-2 Term Loans pursuant to Section 2.01(e)(ii) that
were outstanding as Eurocurrency Rate Loans at the time of conversion (such B-2
Term Loans to correspond in amount to Existing Loans so converted of a given
Interest Period), (ii) Interest Periods for the B-2 Term Loans described
in clause (i) above shall end on the same dates as the Interest Periods
applicable to the corresponding Existing Loans described in clause (i) above,
and the Eurocurrency Rates applicable to such B-2 Term Loans during such
Interest Periods shall be the same as those applicable to the Existing Loans so
converted, and (iii) B-2 Term Loans shall be deemed made as Base Rate
Loans in amount equal to the principal amount of Existing Loans converted into
B-2 Term Loans pursuant to Section 2.01(e)(ii) that were outstanding
as Base Rate Loans at the time of conversion;


 


(C) (i) each
B-1 Term Loan shall continue to be entitled to all accrued and unpaid interest
with respect to the Existing Loan from which such B-1 Term Loan was converted
up to but excluding the Fourth Amendment Effective Date and (ii) each B-2
Term Loan shall continue to be entitled to all accrued and unpaid interest with
respect to the Existing Loan from which such B-2 Term Loan was converted up to
but excluding the Fourth Amendment Effective Date; and


 


(D) 
no conversion of outstanding Existing Loans into B-1 Term Loans or B-2 Term
Loans pursuant to Section 2.01(e) shall constitute a voluntary or
mandatory payment or prepayment for purposes of this Agreement.


 


(b)  On and
after the Fourth Amendment Effective Date, each Lender which holds a Note shall
be entitled to surrender such Note to the Borrower against delivery of a new Note
completed in conformity with Section 2.11 evidencing the B-1 Term Loans
and B-2 


 


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Term Loans into which the
Existing Loans of such Lender were converted on the Fourth Amendment Effective
Date; provided that if any such Note is not so
surrendered, then from and after the Fourth Amendment Effective Date such Note
shall be deemed to evidence the B-1 Term Loans and/or B-2 Term Loans into which
the Existing Loans theretofore evidenced by such Note have been converted.”.


 


17.           Section 2.05 of the Credit
Agreement is hereby amended by restating clause a(i) of said Section in
its entirety as follows:


 


“(a) Optional  (i)  The Borrower may, upon notice to the Administrative Agent, at
any time or from time to time voluntarily prepay Loans in whole or in part
without premium or penalty; provided that (1) such
notice must be received by the Administrative Agent not later than 12:30 p.m.
(New York, New York time) (A) three (3) Business Days prior to any
date of prepayment of Eurocurrency Rate Loans and (B) one (1) Business
Day prior to any date of prepayment of Base Rate Loans; (2) any prepayment
of Eurocurrency Rate Loans shall be in a principal amount of $2,500,000 or a
whole multiple of $500,000 in excess thereof; (3) any prepayment of Base
Rate Loans shall be in a principal amount of $500,000 or a whole multiple of
$100,000 in excess thereof or, in each case, if less, the entire principal
amount thereof then outstanding; and (4) each prepayment of
Loans pursuant to this Section 2.05(a)(i) shall be applied pro
rata to each Class of Loans (based upon the then
outstanding principal amounts of the respective Classes of Loans); provided
that (x) at any time the Borrower may, at its option, direct that any
voluntary prepayment of Loans pursuant to this Section 2.05(a)(i) be
applied (in which case it shall be applied) (I) first, to then
outstanding B-1 Term Loans and (II) second, after the repayment in
full of all then outstanding B-1 Term Loans, to then outstanding B-2 Term Loans
and (y) it is understood and agreed that preceding clause (4) may be
modified as expressly provided in Section 2.15 or 2.16 in connection with
a Refinancing Amendment or Extension Amendment, as the case may be.  Each such notice shall specify the date and
amount of such prepayment, the Type(s) of Loans to be prepaid and the
manner in which such prepayment shall be applied to scheduled repayments of
Loans of a given Class required pursuant to Section 2.07; provided that in the event such notice fails to specify the
manner in which the respective prepayment shall be applied to scheduled
repayments of such Class of Loans required pursuant to Section 2.07,
such prepayment of such Class of Loans shall be applied in direct order of
maturity to scheduled repayments thereof required pursuant to Section 2.07.  The Administrative Agent will promptly notify
each Appropriate Lender of its receipt of each such notice, and of the amount
of such Lender’s Pro  Rata Share (or, if applicable,
Other Allocable Share) of such prepayment.  If such
notice is given by the Borrower, the Borrower shall make such prepayment and
the payment amount specified in such notice shall be due and payable on the
date specified therein.  Any prepayment
of a Eurocurrency Rate Loan shall be accompanied by all accrued interest
thereon, together with any additional amounts required pursuant to Section 3.05.  Each prepayment of the Loans of a given Class pursuant
to this Section 2.05(a) shall be paid to the Appropriate Lenders in
accordance with their respective Pro  Rata Shares (or,
if applicable, Other Allocable Shares).”.


 


18.           Section 2.05 of the Credit
Agreement is hereby further amended by restating clause (b)(ii)(B) of said
Section in its entirety as follows:


 


10

















 


“(B) If the
Borrower incurs or issues any Credit Agreement Refinancing Indebtedness (other
than solely
by means of extending or renewing then existing Credit Agreement Refinancing
Indebtedness of the type described in clause (a) or (b) of the
definition thereof without resulting in any Net Proceeds), the Borrower
shall prepay an aggregate principal amount of Loans in an amount equal to 100%
of the Net Proceeds of such Credit Agreement Refinancing Indebtedness on the
date such Credit Agreement Refinancing Indebtedness is incurred or issued; provided, that each prepayment of Loans required by this
clause (B) shall be applied (i) first, to the Class or
Classes of Loans with the earliest Maturity Date (ratably among such Classes,
if multiple Classes exist with the same Maturity Date), until all such Loans of
such Class or Classes have been repaid in full and (ii) thereafter,
to the successive Class or Classes of Loans with the then next earliest
Maturity Date (ratably among such Classes, if multiple Classes exist with the
same Maturity Date), and so on, until 100% of the Net Proceeds from such Credit
Agreement Refinancing Indebtedness has been applied to the Loans as required by
this clause (B).”.


 


19.           Section 2.05 of the Credit
Agreement is hereby further amended by restating clause (b)(iii) of said Section in
its entirety as follows:


 


“(iii) The
amount of each principal repayment of Loans made as required by this Section 2.05(b) shall
be applied pro  rata to each Class of Loans (based
upon the then outstanding principal amounts of the respective Classes of Loans);
provided that (x) repayments of
Loans required to be made by clause (b)(ii)(B) shall be applied to the Class or
Classes of Loans required by such clause and (y) the foregoing application
provision may be modified as expressly provided in Section 2.15 in
connection with a Refinancing Amendment.  Each prepayment of Loans of a given Class pursuant
to this Section 2.05(b) shall be applied in direct order of maturity
to scheduled repayments of such Loans required pursuant to Section 2.07
and each such prepayment shall be paid to the Appropriate Lenders in accordance
with their respective Pro  Rata Shares (or, if applicable, Other
Allocable Shares).”.


 


20.           Section 2.05 of the Credit
Agreement is hereby further amended by inserting the text “(or, if applicable,
Other Allocable Share)” immediately after the text “Pro  Rata
Share” appearing in clause (b)(iv) of said Section.


 


21.           Section 2.06 of the Credit
Agreement is hereby amended by (i) inserting the text “(a)” immediately
prior to the text “The Original Commitment” appearing in said Section and (ii) inserting
the following new clause (b) immediately following the new clause (a) of
said Section:


 


“(b) The B-2
Term Commitment of each B-2 Term Lender shall be automatically and permanently
reduced to $0 upon the conversion of all or a portion of such B-2 Term Lender’s
Existing Loans into B-2 Term Loans pursuant to Section 2.01(e).”.


 


22.           Section 2.07 of the Credit
Agreement is hereby amended by deleting the said Section in its entirety
and inserting the following new Section 2.07 in lieu thereof:


 


“2.07. Amortization
of Loans.  (a) The Borrower
shall repay to the Administrative 


 


11

















 


Agent for the ratable
account of the B-1 Term Lenders on each date set forth below the aggregate
principal amount of B-1 Term Loans as is set forth opposite such date below (as
such scheduled amortization amount shall be reduced as a result of the
application of prepayments in accordance with the order of priority set forth
in Section 2.05 or in connection with any Extension as provided in Section 2.16):


 


	
  Date

  	
   

  	
  Amount

  	
   

  
	
  January 31,
  2010

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  April 30,
  2010

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  July 31,
  2010

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  October 31,
  2010

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  January 31,
  2011

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  April 30,
  2011

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  July 31,
  2011

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  October 31,
  2011

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  January 31,
  2012

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  April 30,
  2012

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  July 31,
  2012

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  October 31,
  2012

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  January 31,
  2013

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  April 30,
  2013

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  July 31,
  2013

  	
   

  	
  $

  	
  3,297,680.41

  	
   

  
	
  October 31,
  2013

  	
   

  	
  $

  	
  1,230,034,793.85

  	
   

  



 


(b) The
Borrower shall repay to the Administrative Agent for the ratable account of the
B-2 Term Lenders on each date set forth below the aggregate principal amount of
B-2 Term Loans as is set forth opposite such date below (which scheduled
amortization amounts shall be reduced as a result of the application of
prepayments in accordance with the order of priority set forth in Section 2.05
or in connection with any Extension as provided in Section 2.16):


 


12

















 


	
  Date

  	
   

  	
  Amount

  	
   

  
	
  January 31,
  2010

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  April 30,
  2010

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  July 31,
  2010

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  October 31,
  2010

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  January 31,
  2011

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  April 30,
  2011

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  July 31,
  2011

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  October 31,
  2011

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  January 31,
  2012

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  April 30,
  2012

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  July 31,
  2012

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  October 31,
  2012

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  January 31,
  2013

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  April 30,
  2013

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  July 31,
  2013

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  October 31,
  2013

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  January 31,
  2014

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  April 30,
  2014

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  July 31,
  2014

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  October 31,
  2014

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  January 31,
  2015

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  April 30,
  2015

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  July 31,
  2015

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  October 31,
  2015

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  January 31,
  2016

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  April 30,
  2016

  	
   

  	
  $

  	
  2,577,319.59

  	
   

  
	
  July 31,
  2016

  	
   

  	
  $

  	
  932,989,690.66

  	
   

  



 


13

















 


provided that, notwithstanding the foregoing,
repayments of B-2 Term Loans shall in any event be required to be made on the
Maturity Date therefor as provided in Section 2.07(c).


 


(c) The
Borrower shall repay to the Administrative Agent for the ratable account of the
Appropriate Lenders on the Maturity Date for each Class of Loans, the
aggregate principal amount of all such Loans outstanding on such date.”.


 


23.           Section 2.11 of the Credit
Agreement is hereby amended by (i) inserting the text “or Notes”
immediately after the first instance of the text “Note” appearing in clause (a) of
said Section and (ii) inserting the text “of the applicable Class or
Classes” immediately after the text “such Lender’s Loans” appearing in clause (a) of
said Section.


 


24.           Section 2.15 of the Credit
Agreement is hereby amended by deleting the said Section in its entirety
and inserting the following new Section 2.15 in lieu thereof:


 


“2.15. Refinancing
Amendments. At any time after the Third Amendment Effective Date, the
Borrower may obtain from any Lender or any Additional Lender Credit Agreement
Refinancing Indebtedness in respect of all or any portion of the Loans then
outstanding under this Agreement (which for this purpose will be deemed to
include any then outstanding Refinancing Term Loans), in the form of
Refinancing Term Loans or Refinancing Term Commitments, in each case pursuant
to a Refinancing Amendment; provided that
such Credit Agreement Refinancing Indebtedness (i) will rank pari passu in right of payment and of security with the
other Loans and Commitments hereunder, (ii) have such pricing and optional
prepayment terms as may be agreed by the Borrower and the Lenders thereof, (iii) except
as otherwise provided in Section 2.05(b)(ii)(B) or as may be agreed
to by the Lenders and Additional Lenders providing such Credit Agreement
Refinancing Indebtedness in the respective Refinancing Amendment (but solely as
it relates to such Lenders waiving their pro rata share of any applicable
prepayment or repayment), each Class of Refinancing Term Loans shall be
prepaid and repaid (or offered to be repaid in the case of Section 2.05(c))
on a pro rata basis with all voluntary prepayments and mandatory prepayments (other
than amortization payments) of the other Classes of Loans and (iv) otherwise
be treated hereunder no more favorably, including with respect to covenants and
events of default, than the Refinanced Debt; provided
further that the terms and conditions applicable
to such Credit Agreement Refinancing Indebtedness may provide for any additional
or different financial or other covenants or other provisions that are agreed
between the Borrower and the Lenders thereof and applicable only during periods
after the Latest Maturity Date that is in effect 


 


14

















 


on the date such Credit
Agreement Refinancing Indebtedness is issued, incurred or obtained.  The effectiveness of any Refinancing
Amendment shall be subject to the satisfaction on the date thereof of each of
the conditions set forth in Sections 4.01 (i), (j) and (k) and, to
the extent reasonably requested by the Administrative Agent, receipt by the
Administrative Agent of (i) legal opinions, board resolutions and officers’
certificates consistent with those delivered on the Closing Date other than
changes to such legal opinion resulting from a change in law, change in fact or
change to counsel’s form of opinion reasonably satisfactory to the
Administrative Agent and (ii) reaffirmation agreements  and/or such amendments to the Collateral
Documents as may be reasonably requested by the Collateral Agent (including
Mortgage amendments) in order to ensure that the Refinancing Term Loans are
provided with the benefit of the applicable Loan Documents.  Each tranche of Credit Agreement Refinancing
Indebtedness incurred under this Section 2.15 shall be in an aggregate
principal amount that is not less than $50,000,000.  The Administrative Agent shall promptly
notify each Lender as to the effectiveness of each Refinancing Amendment.  Each of the parties hereto hereby agrees that
this Agreement and the other Loans Documents may be amended pursuant to a
Refinancing Amendment, without the consent of any other Lenders, to the extent
(but only to the extent) necessary to (i) reflect the existence and terms
of the Credit Agreement Refinancing Indebtedness incurred pursuant thereto
(including any amendments necessary to treat the Loans and Commitments subject
thereto as Refinancing Term Loans and/or Refinancing Term Commitments), (ii) provide
certain class protection to the Lenders and Additional Lenders providing such
Credit Agreement Refinancing Indebtedness with respect to voluntary prepayments
and mandatory prepayments, (iii) make such other changes to this Agreement
and the other Loan Documents consistent with the provisions and intent of the
second paragraph of Section 10.01 and (iv) effect such other
amendments to this Agreement and the other Loan Documents as may be necessary or
appropriate, in the reasonable opinion of the Administrative Agent and the
Borrower, to effect the provisions of this Section, and the Required Lenders
hereby expressly authorize the Administrative Agent to enter into any such
Refinancing Amendment.”.


 


25.           Article II of the Credit
Agreement is hereby amended by inserting the following new Section 2.16
immediately following Section 2.15 of said Article:


 


“2.16  Extended Term Loans. (a) The
Borrower may at any time and from time to time request that all or a portion of
the Loans of a given Class (each, an “Existing Term Loan Tranche”)
be converted to extend the scheduled maturity date(s) of any payment of
principal with respect to all or a portion of any principal amount of such
Loans (any such Loans which have been so converted, “Extended
Term Loans”) and to provide for other terms consistent with this Section 2.16.  In order to establish any Extended Term
Loans, the Borrower shall provide a notice to the Administrative Agent (who
shall provide a copy of such notice to each of the Lenders under the applicable
Existing Term Loan Tranche) (each, an “Extension Request”)
setting forth the proposed terms of the Extended Term Loans to be established,
which shall (x) be identical as offered to each Lender under such Existing
Term Loan Tranche (including as to the proposed interest rates and fees
payable) and (y) be identical to the Loans under the Existing Term Loan Tranche
from which such Extended Term Loans are to be converted, except that: (i) all
or any of the scheduled amortization payments of principal of the Extended Term
Loans 


 


15

















 


may be delayed to
later dates than the scheduled amortization payments of principal of the Loans
of such Existing Term Loan Tranche, to the extent provided in the applicable
Extension Amendment; (ii) the Effective Yield with respect to the Extended
Term Loans (whether in the form of interest rate margin, upfront fees, original
issue discount or otherwise) may be different than the Effective Yield for the
Loans of such Existing Term Loan Tranche, in each case, to the extent provided
in the applicable Extension Amendment; provided that
if at the time of the effectiveness of any Extension Amendment with respect any
new Extended Term Loans, Extended Term Loans of another Extension Series remain
outstanding, then if the Effective Yield in respect of such new Extended Term
Loans shall at any time (over the life of such Extended Term Loans) exceed by
more than 0.25% the Effective Yield on the Extended Term Loans pursuant to any
other Extension Series then outstanding, the Applicable Rate applicable
thereto shall be increased to the extent necessary so that at all times
thereafter the Extended Term Loans of each existing Extension Series do
not receive less than the Effective Yield with respect to such new Extended
Term Loans less 0.25%; (iii) the Extension Amendment may provide for other
covenants and terms that apply solely to any period after the Latest Maturity
Date that is in effect on the effective date of the Extension Amendment
(immediately prior to the establishment of such Extended Term Loans); and (iv) Extended
Term Loans may have optional prepayment terms (including call protection) as
may be agreed by the Borrower and the Lenders thereof; provided
that no Extended Term Loans may be optionally prepaid prior to the date on
which all Loans with an earlier final stated maturity (including Loans under
the Existing Term Loan Tranche from which they were converted) are repaid in
full, unless such optional prepayment is accompanied by a pro rata optional
prepayment of such other Loans; provided,  however, that (A) in no event shall the final maturity
date of any Extended Term Loans of a given Extension Series at the time of
establishment thereof be earlier than the then Latest Maturity Date of any
other Loans hereunder, (B) the Weighted Average Life to Maturity of any
Extended Term Loans of a given Extension Series at the time of
establishment thereof shall be no shorter than the remaining Weighted Average
Life to Maturity of any other Loans then outstanding and (C) any such
Extended Term Loans (and the Liens securing the same) shall be permitted by the
terms of the ABL Credit Agreement and the Intercreditor Agreement (in each
case, to the extent the ABL Credit Agreement and the Intercreditor Agreement
are then in effect).  Any Extended Term
Loans converted pursuant to any Extension Request shall be designated a series
(each, an “Extension Series”) of Extended
Term Loans for all purposes of this Agreement; provided
that any Extended Term Loans converted from an Existing Term Loan Tranche may,
to the extent provided in the applicable Extension Amendment, be designated as
an increase in any previously established Extension Series with respect to
such Existing Term Loan Tranche.  Each
Extension Series of Extended Term Loans incurred under this Section 2.16
shall be in an aggregate principal amount that is not less than $50,000,000.


 


(b) The
Borrower shall provide the applicable Extension Request at least five (5) Business
Days prior to the date on which Lenders under the Existing Term Loan Tranche
are requested to respond, and shall agree to such procedures, if any, as may be
established by, or acceptable to, the Administrative Agent, in each case acting
reasonably to accomplish the purposes of this Section 2.16.  No Lender shall have any obligation to agree
to have any of its Loans of any Existing Term Loan Tranche converted into 


 


16

















 


Extended Term Loans pursuant
to any Extension Request.  Any Lender
(each, an “Extending Term Lender”) wishing to
have all or a portion of its Loans under the Existing Term Loan Tranche subject
to such Extension Request converted into Extended Term Loans shall notify the
Administrative Agent (each, an “Extension Election”)
on or prior to the date specified in such Extension Request of the amount of
its Loans under the Existing Term Loan Tranche which it has elected to request
be converted into Extended Term Loans (subject to any minimum denomination
requirements imposed by the Administrative Agent).  In the event that the aggregate principal
amount of Loans under the Existing Term Loan Tranche subject to Extension
Elections exceeds the amount of Extended Term Loans requested pursuant to the
Extension Request, Loans subject to Extension Elections shall be converted to
Extended Term Loans on a pro rata basis based on the aggregate principal amount
of Loans included in each such Extension Election.


 


(c) Extended
Term Loans shall be established pursuant to an amendment (each, a “Extension Amendment”) to this Agreement among the Borrower,
the Administrative Agent and each Extending Term Lender providing an Extended
Term Loan thereunder which shall be consistent with the provisions set forth in
Section 2.16(a) above (but which shall not require the consent of any
other Lender other than those consents provided pursuant to the Fourth
Amendment).  The effectiveness of any
Extension Amendment shall be subject to the satisfaction on the date thereof of
each of the conditions set forth in Sections 4.01(i), (j) and (k) and,
to the extent reasonably requested by the Administrative Agent, receipt by the
Administrative Agent of (i) legal opinions, board resolutions and officers’
certificates consistent with those delivered on the Closing Date other than
changes to such legal opinion resulting from a change in law, change in fact or
change to counsel’s form of opinion reasonably satisfactory to the
Administrative Agent and (ii) reaffirmation agreements and/or such
amendments to the Collateral Documents as may be reasonably requested by the
Collateral Agent in order to ensure that the Extended Term Loans are provided
with the benefit of the applicable Loan Documents.  The Administrative Agent shall promptly
notify each Lender as to the effectiveness of each Extension Amendment. Each of
the parties hereto hereby agrees that this Agreement and the other Loans
Documents may be amended pursuant to an Extension Amendment, without the
consent of any other Lenders, to the extent (but only to the extent) necessary
to (i) reflect the existence and terms of the Extended Term Loans incurred
pursuant thereto, (ii) modify the scheduled repayments set forth in Section 2.07
with respect to any Existing Term Loan Tranche subject to an Extension Election
to reflect a reduction in the principal amount of the Loans thereunder in an
amount equal to the aggregate principal amount of the Extended Term Loans
converted pursuant to the applicable Extension (with such amount to be applied
ratably to reduce scheduled repayments of such Loans required pursuant to Section 2.07),  (iii) make such other changes to this
Agreement and the other Loan Documents consistent with the provisions and
intent of the second paragraph of Section 10.01 and (iv) effect such
other amendments to this Agreement and the other Loan Documents as may be
necessary or appropriate, in the reasonable opinion of the Administrative Agent
and the Borrower, to effect the provisions of this Section, and the Required Lenders
hereby expressly authorize the Administrative Agent to enter into any such
Extension Amendment.


 


17
















 


(d) 
No conversion of Loans pursuant to any Extension in accordance with this Section 2.16
shall constitute a voluntary or mandatory payment or prepayment for purposes of
this Agreement.”.


 


26.           Section 7.03 of the Credit
Agreement is hereby amended by replacing the text “Section 2.15” appearing
in clause (b)(i)(y) of said Section with the text “Sections 2.15 and
2.16”.


 


27.           Section 7.06 of the Credit
Agreement is hereby amended by replacing the text “Section 7.05” appearing
in clause (a)(iv) of said Section with the text “the then Applicable
Consolidated Secured Debt Ratio”.


 


28.           Section 7.12 of the Credit
Agreement is hereby amended by replacing each instance of the text “Other Term
Loans” appearing in said Section with the text “Refinancing Term Loans”.


 


29.           Section 10.01 of the Credit
Agreement is hereby amended by inserting the text “of a given Class”
immediately after the text “all outstanding Loans” appearing in the last
paragraph of said Section.


 


30.           Section 10.22 of the Credit
Agreement is hereby amended by inserting the following new clause (iv) at
the end of said Section:


 


“(iv) EACH
EXTENDING B-2 TERM LENDER, BY ITS EXECUTION AND DELIVERY OF THE FOURTH
AMENDMENT AND ITS B-2 TERM LOAN EXTENSION ELECTION, HEREBY (I) CONFIRMS
ITS AGREEMENT TO THE FOREGOING PROVISIONS OF THIS SECTION 10.22 AND (II) PURSUANT
TO SECTION 5.2(C) OF THE INTERCREDITOR AGREEMENT, AGREES TO BE BOUND
BY THE TERMS OF THE INTERCREDITOR AGREEMENT AS A “TERM SECURED PARTY”.”.


 


31.           Article X of the Credit
Agreement is hereby amended by inserting the following new Section 10.24
immediately following Section 10.23 of said Article:


 


“10.24. Special
Provisions Relating to the Fourth Amendment. Each Lender which executes and
delivers a counterpart of the Fourth Amendment, any Refinancing Amendment or
any Extension Amendment (for itself and its successors and assigns) hereby
irrevocably agrees, for the benefit of each other Lender (and such Lender’s
successors and assigns), that such Lender (and its successors and assigns) will
not enter into any amendment or modification to this Agreement to the extent
such amendment or modification:


 


(i)                                     amends or modifies this Section 10.24
(or any defined term as used herein) or the definition of “Other Allocable
Share”, unless the consent of each Lender directly affected thereby has been
obtained; or


 


(ii)                                  alters the required application of any
prepayment or repayment as between the various Classes, unless the consent of
Lenders holding more than 50% of the


 


18

















 


respective Class of
Commitment or Loans which is being allocated a lesser prepayment or repayment
as a result of such alteration is obtained (it being understood, however, that (x) the
Required Lenders may waive, in whole or in part, any such prepayment or
repayment, so long as the application, as amongst the various Classes, of any
such prepayment or repayment which is still required to be made is not altered
and (y) any conversion of any Class of Loans into another Class of
Loans hereunder in like principal amount in a manner similar to the conversion
of Existing Loans into B-1 Term Loans and B-2 Term Loans on the Fourth
Amendment Effective Date and any other conversion of any Class of Loans
into Extended Term Loans pursuant to an Extension Amendment shall not be
considered a “prepayment” or “repayment” for purposes of this clause (ii)).


 


Each of the agreements
contained in this Section 10.24 are separate contractual arrangements
among the Loan Parties and the Lenders and each Lender may directly enforce
against any other Lender any breach (or attempted breach) of any of the
agreements contained in this Section 10.24.”.


 


32.           The Credit Agreement is hereby
amended by attaching a new Schedule 2.01B thereto and inserting therein the
information set forth on Schedule 2.01B attached hereto.


 


B.                                     Miscellaneous Provisions


 


1.             In order to induce the Lenders to
enter into this Fourth Amendment, the Borrower, on behalf of itself and the
other Loan Parties, hereby represents and warrants to each of the Lenders that,
as of the Fourth Amendment Effective Date (as defined below):


 


(i)            the execution,
delivery and performance by each Loan Party of this Fourth Amendment and the
performance of the Credit Agreement (as amended hereby) have been duly
authorized by all necessary corporate or other organizational action on the
part of such Loan Party and do not and will not (a) contravene the terms
of any of the certificates of incorporation or by-laws (or equivalent
Organization Documents) of such Loan Party, (b) conflict with or result in
any breach or contravention of, or the creation of any Lien under (other than
as permitted under Section 7.01 of the Credit Agreement), or require the
payment to be made under (x) (A) any New Notes Documentation and any
other indenture, mortgage, deed of trust or loan agreement evidencing
Indebtedness in an aggregate principal amount in excess of the Threshold Amount
or (B) any other Contractual Obligation to which such Loan Party is a
party or affecting such Loan Party or the properties of such Loan Party or any
of its Subsidiaries or (y) any material order, injunction, writ or decree
of any Governmental Authority or any arbitral award to which such Loan Party or
its property is subject, or (c) violate any material Law; except with
respect to any conflict, breach or contravention or payment (but not creation
of Liens) referred to in clause (b)(x), to the extent that such conflict,
breach, contravention or payment could not reasonably be expected to have a
Material Adverse Effect;


 


(ii)           this Fourth
Amendment has been duly authorized, executed and delivered by each Loan Party
and this Fourth Amendment and the Credit Agreement (as amended or otherwise
modified hereby) constitute the legal, valid and binding obligation of such
Loan Party, enforceable against such Loan Party in accordance with their terms,
except as


 


19

















 


such
enforceability may be limited by Debtor Relief Laws and by general principles
of equity;


 


(iii)          the representations
and warranties set forth in Article V of the Credit Agreement and in the
other Loan Documents are, both immediately before and after giving effect to
this Fourth Amendment, true and correct in all material respects both on and as
of the Fourth Amendment Effective Date with the same effect as though made on
and as of the Fourth Amendment Effective Date unless such representations and
warranties relate to a specific earlier date, in which case such
representations and warranties shall be true and correct in all material
respects as of such earlier date; and


 


(iv)          there exists no
Default or Event of Default on the Fourth Amendment Effective Date, both
immediately before and after giving effect to this Fourth Amendment.


 


2.             (a) Except as expressly set
forth herein, this Fourth Amendment shall not by implication or otherwise
limit, impair, constitute a waiver of or otherwise affect the rights and
remedies of the Lenders or the Agents under the Credit Agreement or any other
Loan Document, and shall not alter, modify, amend or in any way affect any of
the terms, conditions, obligations, covenants or agreements contained in the
Credit Agreement or any other provision of the Credit Agreement or of any other
Loan Document, all of which are ratified and affirmed in all respects and shall
continue in full force and effect. 
Nothing herein shall be deemed to entitle the Borrower to receive a
consent to, or a waiver, amendment, modification or other change of, any of the
terms, conditions, obligations, covenants or agreements contained in the Credit
Agreement or any other Loan Document in similar or different circumstances.


 


(b)           On and after the Fourth Amendment
Effective Date, each reference in the Credit Agreement to “this Agreement”, “hereunder”,
“hereof”, “herein”, or words of like import, and each reference to the Credit
Agreement in any other Loan Document shall be deemed a reference to the Credit
Agreement as modified hereby.  This
Fourth Amendment shall constitute a “Loan Document” for all purposes of the
Credit Agreement and the other Loan Documents.


 


3.             This
Fourth Amendment may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, each of which counterparts
when executed and delivered shall be an original, but all of which shall
together constitute one and the same instrument.  Delivery by facsimile or other electronic
imaging means of an executed counterpart of a signature page to this
Fourth Amendment shall be effective as delivery of an original executed
counterpart of this Fourth Amendment. A complete set of counterparts executed
by all the parties hereto shall be lodged with the Borrower and the
Administrative Agent.


 


4.             THIS FOURTH
AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.


 


5.             (a) This Fourth Amendment shall become effective on
the date (the “Fourth Amendment Effective
Date”) when:


 


20

















 


(i)            the Administrative
Agent shall have received executed B-2 Term Loan Extension Elections
representing an aggregate principal amount of at least $750,000,000 in Existing Loans electing
conversion to B-2 Term Loans;


 


(ii)           the Borrower, the
Administrative Agent, the Required Lenders and each Extending B-2 Term Lender shall have signed a
counterpart hereof (whether the same or different counterparts) and the
Borrower, the Required Lenders and each Extending B-2 Term Lender shall have delivered
(including by way of facsimile transmission) their signed counterparts to the
Administrative Agent;


 


(iii)          the Administrative Agent shall have
received a certificate attesting to the Solvency of the Loan Parties (taken as
a whole) after giving effect to this Fourth Amendment, from the Chief Financial
Officer of the Borrower;


 


(iv)          the Administrative Agent shall have
received an opinion from Ropes & Gray LLP, counsel to the Loan
Parties, in a form and substance reasonably acceptable to the Administrative
Agent;


 


(v)           the Administrative Agent shall have received
for the account of each of the Lenders that have requested same not later than
the Consent Deadline (as defined below) an appropriate Note executed by the
Borrower, in each case in the amount, maturity and otherwise as provided in the
Credit Agreement (as modified hereby);


 


(vi)          the Administrative Agent shall have
received (A) copies of resolutions of the board of directors of each Loan
Party approving and authorizing the execution, delivery and performance of this
Fourth Amendment and the Loan Documents as amended by this Fourth Amendment,
certified as of the Fourth Amendment Effective Date by a Responsible Officer,
secretary or assistance secretary of each such Loan Party as being in full
force and effect without modification or amendment and (B) good standing
certificates for each Loan Party from each jurisdiction in which such Loan
Party is organized;


 


(vii)         the Administrative Agent shall have
received an acknowledgement from the ABL Collateral Agent as contemplated by Section 5.2(c) of
the Intercreditor Agreement, in form and substance reasonably acceptable to the
Administrative Agent;


 


(viii)        the Administrative
Agent shall have received payment from the Borrower, for the account of each
Lender that executes and delivers a counterpart signature page to this
Fourth Amendment (whether or not such Lender is an Extending B-2 Term Lender) prior to 5:00 p. m., New
York City time, on October 28, 2009 (the “Consent Deadline”), a
non-refundable consent fee payable in Dollars (each, a “Consent Fee”) in
an aggregate amount equal to 0.05% of the aggregate principal amount of the
outstanding Loans of such Lender as of the Consent Deadline; and


 


(ix)           the Borrower shall
have paid all fees and other amounts due and payable pursuant to the Loan
Documents and any other fee due and payable to a Lender as may be separately
agreed by the Borrower and such Lender in connection with this Fourth
Amendment, including, to the extent invoiced, reimbursement or payment of
reasonable out-of-pocket expenses in connection with this Fourth Amendment and
the transactions


 


21

















 


contemplated
hereby and any other reasonable out-of-pocket expenses of the Administrative
Agent required to be paid or reimbursed pursuant to the Credit Agreement,
including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent.


 


(b)           The Administrative Agent shall notify
the Borrower and the Lenders of the Fourth Amendment Effective Date.


 


6.             By executing and delivering a copy
hereof, each Loan Party hereby (a) consents to the terms of this Fourth
Amendment and the Loan Documents (as amended by this Fourth Amendment) and
agrees that the terms of this Fourth Amendment shall not affect in any way its
obligations and liabilities under any Loan Document (as such Loan Documents are
amended or otherwise expressly modified by this Fourth Amendment), all of which
obligations and liabilities shall remain in full force and effect and each of
which is hereby reaffirmed (as amended or otherwise expressly modified by this
Fourth Amendment) and (ii) agrees that all Loans (including, without
limitation, all B-1 Term Loans and all B-2 Term Loans) shall be fully guaranteed
pursuant to the Guaranty to which it is party in accordance with the terms and
provisions thereof and shall be fully secured pursuant to the applicable
Collateral Documents.


 


7.             From and after the
Fourth Amendment Effective Date, all references in the Credit Agreement and in
the other Loan Documents to the Credit Agreement shall be deemed to be
references to the Credit Agreement as modified hereby.


 


*      *      *


 


22

















 


IN WITNESS WHEREOF, the undersigned have
caused this Fourth Amendment to be duly executed and delivered as of the date first
above written.


 


	
   

  	
  MICHAELS
  STORES, INC. 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Elaine D. Crowley 

  
	
   

  	
   

  	
  Name:
  

  	
  Elaine
  D. Crowley 

  
	
   

  	
   

  	
  Title:

  	
  Executive
  Vice President — Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  DEUTSCHE BANK AG NEW YORK
  BRANCH, Individually and as Administrative Agent 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Patrick
  W. Dowling 

  
	
   

  	
   

  	
  Name:
  

  	
  Patrick
  W. Dowling 

  
	
   

  	
   

  	
  Title:

  	
  Director
  

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:
  

  	
  Stefan
  Parsch 

  
	
   

  	
   

  	
  Name:
  

  	
  Stefan
  Parsch 

  
	
   

  	
   

  	
  Title:

  	
  Director

  
					



 


23

















 


Each of the undersigned Guarantors acknowledges
and agrees to the terms of the Fourth Amendment.


 


	
   

  	
  AARON BROTHERS, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Elaine D. Crowley

  
	
   

  	
   

  	
  Name:

  	
  Elaine
  D. Crowley

  
	
   

  	
   

  	
  Title:

  	
  President — Chief
  Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  MICHAELS FINANCE COMPANY, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Elaine D. Crowley

  
	
   

  	
   

  	
  Name:

  	
  Elaine
  D. Crowley

  
	
   

  	
   

  	
  Title:

  	
  President — Chief
  Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  MICHAELS STORES PROCUREMENT
  COMPANY, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Elaine D. Crowley

  
	
   

  	
   

  	
  Name:

  	
  Elaine
  D. Crowley

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice
  President — Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  MICHAELS STORES CARD SERVICES,
  LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Elaine D. Crowley

  
	
   

  	
   

  	
  Name:

  	
  Elaine
  D. Crowley

  
	
   

  	
   

  	
  Title:

  	
  President — Chief
  Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ARTISTREE, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Elaine D. Crowley

  
	
   

  	
   

  	
  Name:

  	
  Elaine
  D. Crowley

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice
  President — Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  MICHAELS OF CANADA, ULC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Elaine D. Crowley

  
	
   

  	
   

  	
  Name:

  	
  Elaine
  D. Crowley

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice
  President — Chief Financial Officer

  
						



 


24
















 


SIGNATURE PAGE TO THE
FOURTH AMENDMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, TO THE CREDIT
AGREEMENT, DATED AS OF OCTOBER 31, 2006, AMONG MICHAELS STORES, INC., DEUTSCHE
BANK AG NEW YORK BRANCH, AS ADMINISTRATIVE AGENT, JPMORGAN CHASE BANK, N.A., AS
SYNDICATION AGENT, BANK OF AMERICA, N.A. AND CREDIT SUISSE, AS CO-DOCUMENTATION
AGENTS AND VARIOUS LENDERS PARTY THERETO


 


By executing this signature page:


 


A.                                   as an existing Lender that is an
Extending B-2 Term Lender, the undersigned institution agrees (i) to the
terms of the Fourth Amendment and the Credit Agreement (as amended by the
Fourth Amendment) and (ii) on the terms and subject to the conditions set
forth in the Fourth Amendment and the Credit Agreement (as amended by the
Fourth Amendment), to extend and convert all or a portion of its Existing Loans
in the amount reflected below under the heading “Amount of Existing Loans to be
Extended”, provided that, without any further
action by such Lender, such amount specified below shall be reduced on a dollar-for-dollar
basis by the principal amount of Existing Loans of such Lender repaid to such
Lender pursuant to Section 2.07 of the Credit Agreement at any time on or
after the date the Administrative Agent receives this B-2 Term Loan Extension
Election but prior to the Fourth Amendment Effective Date (the “Amortization
Adjustment”); and


 


B.                                     as an existing Lender that is not an
Extending B-2 Term Lender (any such Lender, a “Non-Extending B-1 Term Lender”), the undersigned institution
agrees to the terms of the Fourth Amendment and the Credit Agreement (as
amended by the Fourth Amendment), but NOT to extend and convert any of
its Existing Loans into B-2 Term Loans.


 


	
   

   NAME OF LENDER:__________________________________________________

   

  



 


	
   Executing as an EXTENDING B-2 TERM LENDER:



  By:__________________________________________________



  Name:



  Title:



   For any Lender
  requiring a second signature line:



  By:__________________________________________________



  Name:



  Title: 



  
	
   Credit Agreement
  Reference

  	
   Principal amount
  of Existing Loans held by

   Extending B-2 Term Lender

  	
   Amount of
  Existing Loans to be Extended

  



 


25

















 


	
  Deal CUSIP -
  594088AC0

  	
  $__________________

  	
  $__________________

  



 


	
   Executing as an NON-EXTENDING B-1 TERM LENDER:

   

  By:__________________________________________________



  Name:



  Title:

   

   For any Lender
  requiring a second signature line:

   

  By:__________________________________________________



  Name:



  Title: 

   

  



 


26

















 


SCHEDULE 2.01B


 


	
  LENDER

  	
  B-1
  TERM

  LOAN AMOUNT

  	
  B-2
  TERM

  COMMITMENT

  
	
   

   

  	
   

   

  	
   

   

  



 


27