Exhibit 4.2


 


SECOND AMENDMENT TO
CREDIT AGREEMENT


 


THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this “Second
Amendment”), dated as of March 25, 2005, is by and among CARRIAGE
SERVICES, INC., a Delaware corporation (the “Borrower”), the banks
listed on the signature pages hereof (the “Lenders”), WELLS FARGO BANK, N.A.,
as Syndication Agent (in said capacity, the “Syndication Agent”), and
BANK OF AMERICA, N.A., as Administrative Agent, Swing Line Lender and L/C
Issuer (in said capacity as Administrative Agent, the “Administrative Agent”).


 


BACKGROUND


 


A.                                   The
Borrower, the Lenders, the Syndication Agent, and the Administrative Agent are
parties to that certain Credit Agreement, dated as of August 4, 2003 as
modified by that certain Commitment Increase Agreement, dated as of
May 13, 2004, that certain First Amendment to Credit Agreement, dated as
of January 7, 2005, and that certain Limited Extension to First Amendment
to Credit Agreement, dated as of February 28, 2005 (as modified and
amended, the “Credit Agreement”; the terms defined in the Credit
Agreement and not otherwise defined herein shall be used herein as defined in
the Credit Agreement).


 


B.                                     The
Borrower has requested that the Lenders amend the Credit Agreement, as more
fully set forth herein.


 


C.                                     The
Lenders parties to this Second Amendment (which Lenders constitute the Required
Lenders as required under the Credit Agreement) are willing to agree to such
amendment, subject to the performance and observance in full of each of the
covenants, terms and conditions, and in reliance upon all of the
representations and warranties of the Borrower, set forth herein.


 


NOW, THEREFORE, in consideration of the covenants,
conditions and agreements hereafter set forth, and for other good and valuable
consideration, the receipt and adequacy of which are all hereby acknowledged,
the parties hereto covenant and agree as follows:


 


1.                                       AMENDMENTS.


 


(a)                                  Section 1.01
of the Credit Agreement is hereby amended by adding in proper alphabetical
order the defined terms “Old Senior Notes” and “Trust Preferred
Interest Deferral” thereto to read as follows:


 


“Old Senior Notes” mean, collectively,
(a) the $25,000,000 7.73% Senior Notes of the Borrower,
Series 1999-A, duly July 30, 2004, (b) the $60,000,000 7.96%
Senior Notes of the Borrower, series 1999-B, due July 30, 2006, and
(c) the $25,000,000 8.06% Senior Notes of the Borrower,
Series 1999-C, due July 30, 2008, and in each case including the
unsecured guaranties thereof executed by certain Subsidiaries of the Borrower.


 


1





















 


“Trust Preferred Interest Deferral” means any
deferral of interest payments by the Borrower in respect of the Trust Notes in
accordance with the provisions governing such Trust Notes.


 


(b)                                 The
definition of “Fixed Charge Coverage Ratio” set forth in Section 1.01
of the Credit Agreement is hereby amended to read as follows:


 


“Fixed Charge Coverage Ratio” means, for any
period of determination, for the Borrower and its Subsidiaries, on a
consolidated basis, the ratio of (a) the sum of (i) EBITDA for such
period minus (ii) Capital Expenditures for such period minus
(iii) the cash taxes paid during such period plus (iv) any
cash tax refunds received during such period to (b) the sum of
(i) cash Interest Expense during such period (other than (x) the
Make-Whole Premium paid to the holders of the Old Senior Notes that were
retired in January 2005 and (y) the amount of Trust Preferred
Interest Deferral paid in March 2005] in respect of
interest deferred from September 2003 through December 2004), plus
(ii) scheduled and required principal payments during such period in
respect of Debt (other than scheduled and required principal payments on the
Old Senior Notes) plus, (iii) to the extent not included in
subclause (i) or (ii) above of this clause (b), scheduled and
required payments made by the Borrower in respect of Deferred Purchase Price
for such period.


 


(c)                                  Section 7.16
of the Credit Agreement is hereby amended to read as follows:


 


Section
7.16                            Collateral.  On or before April 29, 2005, to secure
the Obligations, the Borrower shall, and shall cause it Subsidiaries (other
than the Trust Subsidiary) to, grant a first priority Lien and security
interest in (a) all Capital Stock of each of its Domestic Subsidiaries
(other than the Trust Subsidiary) and 66% of the Capital Stock of any Foreign
Subsidiary of the Borrower and (b) certain existing and future real and
personal property of the Borrower and each Domestic Subsidiary (other than the
Trust Subsidiary), including, but not limited to, machinery and equipment,
inventory and other goods, accounts receivable, owned real estate, leaseholds,
fixtures, bank accounts, general intangibles, financial assets, investment
property, license rights, patents, trademarks, trade names, copyrights, chattel
paper, insurance proceeds, contract rights, hedge agreements, documents,
instruments, indemnification rights, tax refunds and cash (collectively, the “Collateral”).  The Borrower shall, and shall cause its
Domestic Subsidiaries to provide for the benefit of the Administrative Agent
and the Lenders, all items to fully effect the foregoing, including, without
limitation, provide the Administrative Agent with UCC-1s together with security
agreements, pledge agreements, mortgages, deeds of trust, appraisals, hazard
insurance, title insurance, UCC searches, tax and Lien searches, intellectual
property documentation and registration and other similar types of documents,
consents, authorizations, licenses, instruments and agreements relating to all
property and other assets of the Borrower and its Domestic Subsidiaries as
requested by the Administrative Agent, and opinions of local legal counsel with
respect to the execution and filing thereof, and perfection of Liens created


 


2





















 


thereby.  Notwithstanding the foregoing, in no event
shall any provision of this Section 7.16 require (i) any
assets owned by any Foreign Subsidiary to be pledged or hypothecated to secure
the Obligations or (ii) more than 66% of the issued and outstanding
Capital Stock of any Foreign Subsidiary of the Borrower to be pledged to secure
the Obligations.


 


(d)                                 Exhibit E
to the Credit Agreement is hereby amended to be in the form of Exhibit E
to this Second Amendment.


 


2.                                       REPRESENTATIONS
AND WARRANTIES TRUE; NO EVENT OF DEFAULT. 
By its execution and delivery hereof, the Borrower represents and warrants
that, as of the date hereof:


 


(a)                                  the
representations and warranties contained in the Credit Agreement and the other
Loan Documents are true and correct on and as of the date hereof as made on and
as of such date;


 


(b)                                 no
event has occurred and is continuing which constitutes a Default or Event of
Default;


 


(c)                                  (i) the
Borrower has full power and authority to execute and deliver this Second Amendment,
(ii) this Second Amendment has been duly executed and delivered by the
Borrower, and (iii) this Second Amendment constitutes the legal, valid and
binding obligations of the Borrower, enforceable in accordance with its terms,
except as enforceability may be limited by applicable debtor relief laws and by
general principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law) and except as rights to indemnity may be
limited by federal or state securities laws;


 


(d)                                 neither
the execution, delivery and performance of this Second Amendment, nor the
consummation of any transactions contemplated herein or therein, will conflict
with (i) the certificate or articles of incorporation or the applicable
constituent documents or bylaws of the Borrower or its Subsidiaries,
(ii) to Borrower’s knowledge, any provision or law, statute, rule or
regulation applicable to the Borrower or its Subsidiaries or (iii) any
indenture, agreement or other instrument to which the Borrower, the Subsidiaries
or any of their properties are subject; and


 


(e)                                  no
authorization, approval, consent, or other action by, notice to, or filing
with, any governmental authority or other Person not previously obtained is
required for (i) the execution, delivery or performance by the Borrower of
this Second Amendment or (ii) the acknowledgement by each Guarantor of
this Second Amendment.


 


3.                                       CONDITIONS
OF EFFECTIVENESS.  This Second
Amendment shall be effective on and as March 25, 2005, subject to the
following:


 


(a)                                  the
representations and warranties set forth in Section 3 of this Second
Amendment shall be true and correct;


 


3





















 


(b)                                 the
Administrative Agent shall have received counterparts of this Second Amendment
executed by the Required Lenders; and


 


(c)                                  the
Administrative Agent shall have received counterparts of this Second Amendment
executed by the Borrower and acknowledged by each Guarantor.


 


4.                                       GUARANTOR’S
ACKNOWLEDGMENT.  By signing below,
each Guarantor (i) acknowledges, consents and agrees to the execution,
delivery and performance by the Borrower of this Second Amendment,
(ii) acknowledges and agrees that its obligations in respect of its
Guaranty are not released, diminished, waived, modified, impaired or affected
in any manner by this Second Amendment, or any of the provisions contemplated
herein, (iii) ratifies and confirms its obligations under its Guaranty and
(iv) acknowledges and agrees that it has no claim or offsets against, or
defenses or counterclaims to, its Guaranty.


 


5.                                       REFERENCE
TO THE CREDIT AGREEMENT.


 


(a)                                  Upon
and during the effectiveness of this Second Amendment, each reference in the
Credit Agreement to “this Agreement”, “hereunder”, or words of like import
shall mean and be a reference to the Credit Agreement, as affected and amended
by this Second Amendment.


 


(b)                                 Except
as expressly set forth herein, this Second Amendment shall not by implication
or otherwise limit, impair, constitute a waiver of, or otherwise affect the
rights or remedies of the Administrative Agent or the Lenders under the Credit
Agreement or any of the other Loan Documents, and shall not alter, modify,
amend, or in any way affect the terms, conditions, obligations, covenants, or
agreements contained in the Credit Agreement or the other Loan Documents, all
of which are hereby ratified and affirmed in all respects and shall continue in
full force and effect.


 


6.                                       COSTS
AND EXPENSES.  The Borrower shall be
obligated to pay the costs and expenses of the Administrative Agent in
connection with the preparation, reproduction, execution and delivery of this Second
Amendment and the other instruments and documents to be delivered hereunder.


 


7.                                       EXECUTION
IN COUNTERPARTS.  This Second
Amendment may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed and
delivered shall be deemed to be an original and all of which when taken
together shall constitute but one and the same instrument.  For purposes of this Second Amendment, a
counterpart hereof (or signature page thereto) signed and transmitted by any
Person party hereto to the Administrative Agent (or its counsel) by facsimile
machine, telecopier or electronic mail is to be treated as an original.  The signature of such Person thereon, for
purposes hereof, is to be considered as an original signature, and the
counterpart (or signature page thereto) so transmitted is to be considered to
have the same binding effect as an original signature on an original document.


 


8.                                       GOVERNING
LAW; BINDING EFFECT.  This Second
Amendment shall be governed by and construed in accordance with the laws of the
State of Texas applicable to agreements made and to be performed entirely
within such state; provided that the Administrative Agent and each
Lender shall retain all rights arising under federal law.  This


 


4





















 


Second Amendment shall be binding upon the Borrower
and each Lender and their respective successors and assigns.


 


9.                                       HEADINGS.  Section headings in this Second Amendment are
included herein for convenience of reference only and shall not constitute a
part of this Second Amendment for any other purpose.


 


10.                                 ENTIRE AGREEMENT.  THE CREDIT AGREEMENT, AS AMENDED BY THIS
SECOND AMENDMENT, AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES AS TO THE SUBJECT MATTER THEREIN AND HEREIN AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS BETWEEN THE PARTIES.


 


REMAINDER OF PAGE LEFT INTENTIONALLY BLANK


 


5





















 


IN WITNESS WHEREOF, the parties hereto have executed
this Second Amendment as of the date above written.


 


	
   

  	
  CARRIAGE SERVICES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joseph Saporito

  
	
   

  	
   

  	
  Joseph Saporito

  
	
   

  	
   

  	
  Executive Vice
  President

  



 


6





















 


	
   

  	
  BANK OF
  AMERICA, N.A., as Administrative

  Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David A. Johanson

  
	
   

  	
   

  	
  Name:

  	
  David A. Johanson

  
	
   

  	
   

  	
  Title:

  	
   Vice President

  
					



 


7





















 


	
   

  	
  BANK OF
  AMERICA, N.A., as a Lender, L/C

  Issuer and Swing Line Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gary L. Mingle

  
	
   

  	
   

  	
  Name:

  	
  Gary L. Mingle

  
	
   

  	
   

  	
  Title:

  	
   Senior Vice
  President

  
					



 


8





















 


	
   

  	
  WELLS
  FARGO BANK, N.A., as Syndication 

  Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Warren R. Ross

  
	
   

  	
   

  	
  Name:

  	
  Warren R. Ross

  
	
   

  	
   

  	
  Title:

  	
   Vice President

  
					



 


9





















 


	
   

  	
  WELLS
  FARGO BANK, N.A., as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Warren R. Ross

  
	
   

  	
   

  	
  Name:

  	
  Warren R. Ross

  
	
   

  	
   

  	
  Title:

  	
   Vice President

  
					



 


10





















 




	
  GUARANTORS:

  	
   

  
	
   

  	
   

  
	
   

  	
  CARRIAGE
  FUNERAL HOLDINGS, INC.

  
	
   

  	
  CFS
  FUNERAL SERVICES, INC.

  
	
   

  	
  CARRIAGE
  HOLDING COMPANY, INC.

  
	
   

  	
  CARRIAGE
  FUNERAL SERVICES OF MICHIGAN, INC.

  
	
   

  	
  CARRIAGE
  FUNERAL SERVICES OF KENTUCKY, INC.

  
	
   

  	
  CARRIAGE
  FUNERAL SERVICES OF CALIFORNIA, INC.

  
	
   

  	
  CARRIAGE
  CEMETERY SERVICES OF IDAHO, INC.

  
	
   

  	
  WILSON
  & KRATZER MORTUARIES

  
	
   

  	
  ROLLING
  HILLS MEMORIAL PARK

  
	
   

  	
  CARRIAGE
  SERVICES OF CONNECTICUT, INC.

  
	
   

  	
  CSI
  FUNERAL SERVICES OF MASSACHUSETTS, INC.

  
	
   

  	
  CHC
  INSURANCE AGENCY OF OHIO, INC.

  
	
   

  	
  BARNETT,
  DEMROW & ERNST, INC.

  
	
   

  	
  CARRIAGE
  SERVICES OF NEW MEXICO, INC.

  
	
   

  	
  FORASTIERE
  FAMILY FUNERAL SERVICE, INC.

  
	
   

  	
  CARRIAGE
  CEMETERY SERVICES, INC.

  
	
   

  	
  CARRIAGE
  SERVICES OF OKLAHOMA, L.L.C.

  
	
   

  	
  CARRIAGE
  SERVICES OF NEVADA, INC.

  
	
   

  	
  HUBBARD
  FUNERAL HOME, INC.

  
	
   

  	
  CARRIAGE
  TEAM CALIFORNIA (CEMETERY), LLC

  
	
   

  	
  CARRIAGE
  TEAM CALIFORNIA (FUNERAL), LLC

  
	
   

  	
  CARRIAGE
  TEAM FLORIDA (CEMETERY), LLC

  
	
   

  	
  CARRIAGE
  TEAM FLORIDA (FUNERAL), LLC

  
	
   

  	
  CARRIAGE
  SERVICES OF OHIO, LLC

  
	
   

  	
  CARRIAGE
  TEAM KANSAS, LLC

  
	
   

  	
  CARRIAGE
  MUNICIPAL CEMETERY SERVICES OF NEVADA, INC.

  
	
   

  	
  CARRIAGE
  CEMETERY SERVICES OF CALIFORNIA, INC.

  
	
   

  	
  CARRIAGE
  INTERNET STRATEGIES, INC.

  
	
   

  	
  CARRIAGE
  INVESTMENTS, INC.

  
	
   

  	
  CARRIAGE
  MANAGEMENT, L.P.

  
	
   

  	
  HORIZON
  CREMATION SOCIETY, INC.

  
	
   

  	
  CARRIAGE
  LIFE EVENTS, INC.

  
	
   

  	
  CARRIAGE
  MERGER I, INC.

  
	
   

  	
  CARRIAGE
  MERGER II, INC.

  
	
   

  	
  CARRIAGE
  MERGER III, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joseph Saporito

  	
   

  	 

	
   

  	
   

  	
  Joseph Saporito

  	 

	
   

  	
   

  	
  Executive Vice
  President

  	 







 


11





















 


	
   

  	
  CARRIAGE INSURANCE AGENCY OF MASSACHUSETTS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Melvin C. Payne

  	
   

  
	
   

  	
   

  	
  Melvin C. Payne

  
	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  COCHRANE’S
  CHAPEL OF THE ROSES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Wendy Wilson Boyer

  	
   

  
	
   

  	
   

  	
  Wendy Wilson Boyer

  
	
   

  	
   

  	
  President

  



 


12





















 


EXHIBIT E


 


FORM OF COMPLIANCE CERTIFICATE


 


Financial Statement Date:               ,          


 


To:                              Bank
of America, N.A., as Administrative Agent


 


Ladies and Gentlemen:


 


Reference is made to that certain Credit Agreement,
dated as of August 4, 2003 (as amended, restated, extended, supplemented or
otherwise modified in writing from time to time, the “Agreement;” the
terms defined therein being used herein as therein defined), among Carriage
Services, Inc., a Delaware corporation (the “Borrower”),
the Lenders from time to time party thereto, and Bank of America, N.A., as
Administrative Agent, L/C Issuer and Swing Line Lender.


 


The undersigned Responsible Officer hereby certifies
as of the date hereof that he/she is the                                                      
                              of
the Borrower, and that, as such, he/she is authorized to execute and deliver
this Certificate to the Administrative Agent on the behalf of the Borrower, and
that:


 


[Use
following paragraph 1 for fiscal year-end
financial statements]


 


1.                                       Attached
hereto as Schedule 1 are the year-end audited financial statements
required by Section 6.01(a) of the Agreement for the fiscal year of
the Borrower ended as of the above date, together with the report and opinion
of an independent certified public accountant required by such section.


 


[Use
following paragraph 1 for fiscal quarter-end
financial statements]


 


1.                                       Attached
hereto as Schedule 1 are the unaudited financial statements
required by Section 6.01(b) of the Agreement for the fiscal quarter
of the Borrower ended as of the above date. 
Such financial statements fairly present the financial condition,
results of operations and cash flows of the Borrower and its Subsidiaries in
accordance with GAAP as at such date and for such period, subject only to
normal year-end audit adjustments and the absence of footnotes.


 


2.                                       The
undersigned has reviewed and is familiar with the terms of the Agreement and
has made, or has caused to be made under his/her supervision, a detailed review
of the transactions and condition (financial or otherwise) of the Borrower
during the accounting period covered by the attached financial statements.


 


3.                                       A
review of the activities of the Borrower during such fiscal period has been made
under the supervision of the undersigned with a view to determining whether
during such fiscal period the Borrower performed and observed all its
Obligations under the Loan Documents, and


 


E - 1


Form of Compliance
Certificate





















 


[select
one:]


 


[to the best knowledge of the undersigned during
such fiscal period, the Borrower performed and observed each covenant and
condition of the Loan Documents applicable to it.]


 


—or—


 


[the following covenants
or conditions have not been performed or observed and the following is a list
of each such Default and its nature and status:]


 


4.                                       The
representations and warranties of the Borrower contained in Article V
of the Agreement, or which are contained in any document furnished at any time
under or in connection with the Loan Documents, are true and correct on and as
of the date hereof, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they are true
and correct as of such earlier date, and except that for purposes of this
Compliance Certificate, the representations and warranties contained in
subsections (a) and (b) of Section 5.05 of the Agreement shall
be deemed to refer to the most recent statements furnished pursuant to
clauses (a) and (b), respectively, of Section 6.01 of the
Agreement, including the statements in connection with which this Compliance
Certificate is delivered.


 


5.                                       The
financial covenant analyses and information set forth on Schedule 2
attached hereto are true and accurate on and as of the date of this
Certificate.


 


IN WITNESS WHEREOF, the
undersigned has executed this Certificate on behalf of the Borrower as of                ,          .


 


	
   

  	
  CARRIAGE
  SERVICES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joseph Saporito

  
	
   

  	
   

  	
  Name:

  	
  Joseph Saporito

  
	
   

  	
   

  	
  Title

  	
  Executive Vice
  President

  
					



 


E - 2





















 


For the Quarter/Year
ended               (“Statement
Date”)


 


SCHEDULE
2

to the Compliance Certificate

($ in 000’s)


 




	
  I.

  	
   

  	
  Section 7.11 (a) – Maximum
  Leverage Ratio.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  A.

  	
  Total Senior Debt (excluding the Trust Notes) at Statement Date:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  B.

  	
  EBITDA for four consecutive fiscal quarters ending
  on the Statement Date (“Subject Period”):

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (1)

  	
   

  	
  Net Income for the Subject Period:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (2)

  	
   

  	
  To the extent deducted in calculating Net Income,
  Interest Expense for the Subject Period:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (3)

  	
   

  	
  To the extent deducted in calculating Net Income,
  the provision for federal, state, local and foreign income taxes payable by
  the Borrower and its Subsidiaries for the Subject Period:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (4)

  	
   

  	
  To the extent deducted in calculating Net Income,
  depreciation and amortization expenses and payments in respect of Deferred
  Purchase Price for the Subject Period:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (5)

  	
   

  	
  To the extent deducted in calculating Net Income,
  other expenses of the Borrower and the Subsidiaries reducing Net Income which
  do not represent a cash item in the Subject Period or any future period:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (6)

  	
   

  	
  Non-cash items increasing Net Income for the Subject
  Period:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (7)

  	
   

  	
  EBITDA (Lines I.B.1 + 2 + 3 + 4 + 5 - 6):

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  C.

  	
  Leverage Ratio (Line I.A.  ̧
  Line I.B.7):

  	
   

  	
          to        

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Maximum permitted:

  	
   

  	
  4.00 to 1.00

  	
   

  






 


E - 3





















 




	
  II.

  	
   

  	
  Section
  7.11(b) – Minimum Fixed Charge Coverage Ratio.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  A.

  	
  EBITDA for the
  Subject Period (Line I.B.7. above):

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  B.

  	
  Capital
  Expenditures for the Subject Period:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  C.

  	
  Cash taxes paid
  during the Subject Period:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  D.

  	
  Cash tax refunds
  received during the Subject Period:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  E.

  	
  Cash Interest Expenses during the Subject Period (other than
  (x) Make-Whole Premiums paid to the holders of the Old Senior Notes that
  were retired in January 2005 and (y) the amount of Trust Preferred
  Interest Deferral paid in March 2005] in respect
  of interest deferred from September 2003 through December 2004):

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  F.

  	
  Scheduled and
  required principal payments during the Subject Period in respect of Debt:
  (other than scheduled and required principal payments on the Old Senior
  Notes):

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  G.

  	
  Scheduled and
  required payments made by the Borrower in respect of Deferred Purchase Price
  for the Subject Period (to extent not included in II.E. and II.F. above):

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  H.

  	
  Fixed Charge
  Coverage Ratio (Lines II.A. – II.B. – II.C. + II.D.)  ̧
  (Lines II.E. + II.F. + II.G):

  	
   

  	
          to  1

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Minimum required

  	
   

  	
  2.00 to 1.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  III.

  	
   

  	
  Section 7.11(c) 
  Minimum EBITDA 

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  A.

  	
  (1)

  	
  Minimum EBITDA for the Subject Period ending the
  last day of each fiscal quarter through and including the fiscal quarter in
  which the Series A Note Payment Date occurs:

  	
   

  	
  $

  	
   36,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (2)

  	
  Actual

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  B.

  	
  (1)

  	
  Minimum EBITDA for the Subject Period ending the last day of each
  fiscal quarter thereafter:

  	
   

  	
  $

  	
   35,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (2)

  	
  Actual

  	
   

  	
  $

  	
   

  






 


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