exv10wa






Exhibit 10(a)




EXECUTION COPY




Amendment No. 7 to Credit Agreement




          This Amendment No. 7, dated as of April 13, 2010 (this
“Amendment”), among MVC Capital, inc., a Delaware
corporation (the “Company”), MVC Financial Services,
Inc., a Delaware corporation (“MVCFS”, and together with the Company, each a
“Borrower”, and collectively, the “Borrowers”), the Lenders identified on the
signature pages hereto (the “Lenders”), and Guggenheim Corporate
Funding, LLC, as administrative agent for the lenders (in such capacity, the
“Administrative Agent”), amends certain provisions of the Credit Agreement, dated as of
April 27, 2006 (as amended to the date hereof and as the same may be further amended, supplemented
or otherwise modified from time to time, the “Credit Agreement”) among the Borrowers, the
institutions from time to time party thereto as Lenders (the “Lenders”), and the
Administrative Agent. Capitalized terms used herein and not otherwise defined herein shall have
the meanings ascribed to them in the Credit Agreement.




W i t n e s s e t h: 




          Whereas, the Borrowers have requested that the Lenders amend the Credit Agreement in
certain respects as set forth below;




          Whereas, the Lenders have agreed, subject to the terms and conditions set forth
below, to amend the Credit Agreement in certain respects as set forth below;




          Now, Therefore, in consideration of the premises and the covenants
and obligations contained herein, the sufficiency of which is hereby acknowledged, the parties
hereto agree as follows:




     Section 1. Amendments to the Credit Agreement. Effective as of the Amendment Effective Date
(as defined below) and subject to the satisfaction (or due waiver) of the conditions set forth in
Section 3 (Conditions Precedent to the Effectiveness of this Amendment) hereof, the Credit
Agreement is hereby amended as follows:



          (a) Section 1.1 (Defined Terms) is hereby amended by amending and restating in their entirety
the following definitions:





          “Applicable Margin” with respect to (i) Eurodollar Loans, a rate per annum
equal to 4.50% and (ii) Base Rate Loans, a rate per annum equal to 3.50%.




          “Base Rate” for any day, a rate per annum (rounded upwards, if necessary, to
the next 1/16 of 1%) equal to the greatest of (a) the Prime Rate in effect on such day, (b)
the Federal Funds Effective Rate in effect on such day plus 1/2 of 1% and (c) 2.25%. For
purposes hereof: “Prime Rate” shall mean the prime rate of interest specified
under the Bloomberg reference identified as “PRIMBB Index” on the date that is two
Business Days prior to such day (or such other comparable page as may, in the opinion of
the Administrative Agent, replace such page for the purpose of displaying such rate), as in
effect from time to time. Any change in the Base Rate due to a change in the Prime Rate
actually available or the Federal Funds Effective Rate shall be effective as of the opening
of business on the effective day of such change in the Prime Rate or the Federal Funds
Effective Rate, respectively. The Prime Rate is a reference rate and does not necessarily
represent the lowest or best rate actually available.




          “Consolidated Debt” as of any date of determination thereof, the aggregate
unpaid amount of all Indebtedness (including, without limitation, any Portfolio Company
Guaranty Indebtedness) of the Company and its Consolidated Subsidiaries determined on a



 









 






consolidated basis in accordance with GAAP and denominated in U.S. dollars after giving effect to
the applicable Exchange Rate; provided, that solely until May 1, 2010, Amzak Guarantee
Indebtedness and ESPI Guarantee Indebtedness shall not be included in the calculation of
Consolidated Debt.




          “Eligible Debt Investments” Investments in senior debt, subordinated debt and
junior subordinated debt that have been purchased or otherwise acquired by the Company or a
Consolidated Subsidiary in the ordinary course of business; provided, that no such
Investment shall be an Eligible Debt Investment unless (a) such Investment is (i) evidenced
by an instrument or agreement that has been duly authorized, executed and delivered and is
enforceable against the obligor thereof or (ii) in the form of a participation;
provided, that the aggregate amount of Investments that may constitute Eligible
Debt Investments shall not exceed 7.5% of Total Assets at any time, (b) such Investment, if
applicable, is denominated and payable either in (1) United States dollars or (2) the
currency of a jurisdiction other than the United States of America, provided, that
the aggregate amount of Investments permitted under this subclause (2) and clause (b)(2) of
the definition of Eligible Equity Investments shall not exceed the maximum amount permitted
under applicable law, including, without limitation, the Investment Company Act and the
Code, (c) such Investment is not subject to any Lien and, if such Investment is owned by a
Consolidated Subsidiary, the Company shall not have pledged or otherwise encumbered the
stock of such Consolidated Subsidiary or any direct or indirect parent thereof, (d) except
as set forth on Schedule II hereto, such Investment has a minimum cash coupon of at least
the lesser of (1) 6% per annum and (2) the Eurodollar Base Rate plus 3% per annum, (e) no
right of rescission, set-off, counterclaim, defense or other material dispute has been
asserted with respect to such Investment, (f) the obligor in respect of such Investment is
not (1) an individual, (2) the subject of a Bankruptcy Event (other than with respect to an
Investment in the form of debtor-in-possession financing provided to such obligor under the
Bankruptcy Code) or (3) a party to a Defaulted Investment and (g) the obligor in respect of
such Investment is (1) organized or incorporated under the laws of the United States of
America or (2) organized or incorporated under the laws of a jurisdiction other than the
United States of America, provided, that (x) the aggregate amount of Investments
permitted under this subclause (2) and clause (f)(2) of the definition of Eligible Equity
Investments shall not exceed 25% of Total Assets at any time and (y) no single Investment
permitted under this subclause (2) and clause (f)(2) of the definition of Eligible Equity
Investments shall exceed 15% of Total Assets at any time. It is understood that solely for
the purpose of determining compliance with Section 6.1(d), Vitality Preferred shall be
deemed an Eligible Debt Investment in an aggregate principal amount of up to $10,000,000.




          “Eurodollar Base Rate” with respect to each day during each Interest Period,
the rate per annum determined on the basis of the rate for deposits in Dollars for a period
equal to such Interest Period commencing on the first day of such Interest Period appearing
on Page 3750 of the Telerate screen as of 11:00 a.m., London time, two Business Days prior
to the beginning of such Interest Period; provided that in no event shall the
Eurodollar Rate be less than 1.25% per annum. In the event that such rate does not appear
on Page 3750 of the Telerate screen (or otherwise on such screen), the “Eurodollar Base
Rate” for purposes of this definition shall be determined by reference to such other
comparable publicly available service for displaying eurodollar rates as may be selected by
the Administrative Agent.




          “Maturity Date” the seventh anniversary of the Closing Date.



          (b) Section 1.1 (Defined Terms) is hereby amended by inserting among the existing defined
terms therein in alphabetical order the following defined term:





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          “Additional Permitted Guarantee Request” a written request made by the
Borrowers to the Administrative Agent, from time to time, in the form of Exhibit G, and
otherwise in form and substance satisfactory to the Administrative Agent, that a Borrower
be permitted to enter into a Guarantee Obligation on behalf of a Portfolio Company and that
such Guaranty Obligation be added to Schedule 6.2(d) pursuant to Section 6.2(d);
provided, that any Additional Permitted Guarantee Request shall be sent to the
Administrative Agent at least 10 Business Days prior to the proposed date of the requested
Guarantee Obligation; provided, further, that the Administrative Agent may
reject any Additional Permitted Guarantee Request in its sole discretion for any reason.



          (c) Section 6.1(b) (Interest Coverage Ratio) is hereby amended and restated in its entirety as
follows:





          (b) Interest Coverage Ratio. Permit the ratio of EBIT (excluding any interest
or other income received on account of the BB&T Investments) to Interest Expense (excluding
all Interest Expense related to the Indebtedness pursuant to the BB&T Credit Facility) of
the Company and its Consolidated Subsidiaries, determined on a consolidated basis as of the
last day of each fiscal quarter for the period of four consecutive fiscal quarters ended on
such day, to be less than 1.75 to 1.0.



          (d) Section 6.1(d) (Asset Coverage) is hereby amended and restated in its entirety as follows:





          (i) Permit the ratio of Total Assets (excluding (x) any BB&T Investments in the BB&T
Account and (y) with respect to Eligible Debt Investments or Eligible Equity Investments,
collectively, any Investments in any issuer or obligor organized or incorporated in under
the laws of a jurisdiction other than the United States of America in excess of 25% of the
aggregate amount of Total Assets) to Consolidated Debt (excluding all Indebtedness pursuant
to the BB&T Credit Facility) to be less than 2.5 to 1.0 as of the last day of any fiscal
quarter; provided, that with respect to Guarantee Obligations incurred by the
Company or its Subsidiaries permitted under this Agreement, upon receipt by the
Administrative Agent of evidence that a note or other debt instrument will be issued to the
Company or such Subsidiary at the time of payment of such Guarantee Obligations, on terms
satisfactory to the Administrative Agent, evidencing the amounts owing under such Guarantee
Obligation from the Person on whose behalf such Guarantee Obligation was undertaken, the
face value of such note or debt instrument shall be included in the calculation of “Total
Assets” solely for purposes of this Section 6.1(d)(i).




          (ii) Permit the ratio of (1) the sum of Unrestricted Cash (excluding any BB&T
Investments that are Cash Equivalents) plus Eligible Debt Investments (excluding
any Investments in any obligor organized or incorporated in under the laws of a
jurisdiction other than the United States of America in excess of 25% of the aggregate
amount of Eligible Debt Investments) to (2) Consolidated Debt (excluding all Indebtedness
pursuant to the BB&T Credit Facility) to be less than 1.5 to 1.0 as of the last day of any
fiscal quarter; provided, that with respect to Guarantee Obligations incurred by
the Company or its Subsidiaries permitted under this Agreement, upon receipt by the
Administrative Agent of evidence that a note or other debt instrument will be issued to the
Company or such Subsidiary at the time of payment of such Guarantee Obligations, on terms
satisfactory to the Administrative Agent, evidencing the amounts owing under such Guarantee
Obligation from the Person on whose behalf such Guarantee Obligation was undertaken, the
face value of such note or debt instrument shall be



3









 







included in the calculation of “Eligible Debt Investments” solely for purposes of this
Section 6.1(d)(ii).



          (e) Section 6.2 (Limitation on Indebtedness) is hereby amended by amending and restating
clause (d) as follows:




          (d) Indebtedness outstanding on the Closing Date and listed on Schedule 6.2(d);
provided, that Schedule 6.2(d) may be amended following the Closing Date pursuant
to the approval by the Administrative Agent of an Additional Permitted Guarantee Request;



          (f) Section 6.2 (Limitation on Indebtedness) is hereby amended by amending and restating
clause (g) as follows:




          (g) solely until May 1, 2010, Amzak Guarantee Indebtedness and solely until August 1,
2010, ESPI Guarantee Indebtedness; and



     Section 2. Termination of Revolving Credit Commitment



          On the Amendment Effective Date, the Revolving Credit Commitment of each Lender shall be
irrevocably and permanently terminated and reduced to zero ($0) and the Total Revolving Commitments
shall be irrevocably and permanently terminated and reduced to zero ($0). The Borrowers hereby
acknowledge that immediately prior to the effectiveness of this Amendment, there are no Revolving
Credit Outstandings.



     Section 3. Conditions Precedent to the Effectiveness of this Amendment



          This Amendment shall become effective as of the date (such date, the “Amendment Effective
Date”) when, and only when, the Administrative Agent shall have received: (i) this Amendment,
duly executed by the Borrowers, the Administrative Agent and all Lenders, (ii) payment from the
Borrower, for the account of each Lender a fee equal to 0.50% of such Lender’s Term Loan Commitment
currently in effect and (iii) reimbursement for all its out-of-pocket costs and expenses incurred
in connection with the Credit Agreement and the negotiation, preparation, execution and delivery of
this Amendment and the transactions contemplated hereby, including, without limitation, reasonable
fees and disbursements and other charges of counsel to the Administrative Agent; provided,
that upon receipt of the items set forth in subclauses (i) — (iii), the amendment set forth in
Section 1(f) hereof shall be effective as of December 31, 2009.




     Section 4. Representations and Warranties



          On and as of the date hereof, after giving effect to this Amendment, the Borrowers hereby
represent and warrant to the Administrative Agent and each Lender as follows:




          (a) this Amendment has been duly authorized, executed and delivered by each Borrower and
constitutes the legal, valid and binding obligation of each Borrower, enforceable against each
Borrower in accordance with its terms, and the Credit Agreement as amended by this Amendment
constitutes the legal, valid and binding obligation of each Borrower, enforceable against each
Borrower in accordance with its terms;




          (b) each of the representations and warranties contained in Section 3 (Representations and
Warranties) of the Credit Agreement, the other Loan Documents or in any certificate, document or
financial or other statement furnished at any time under or in connection






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therewith is true and correct in all material respects on and as of the date hereof as if made on
and as of such date and except to the extent that such representations and warranties specifically
relate to a specific date, in which case such representations and warranties shall be true and
correct in all material respects as of such specific date; provided, however, that references
therein to the “Credit Agreement” shall be deemed to refer to the Credit Agreement as amended
hereby;




          (c) no Default or Event of Default has occurred and is continuing; and




          (d) no litigation has been commenced against any Loan Party or any of its Subsidiaries seeking
to restrain or enjoin (whether temporarily, preliminarily or permanently) the performance of any
action by any Loan Party required or contemplated by this Amendment, the Credit Agreement or any
Loan Document, in each case as amended hereby (if applicable).




     Section 5. Fees and Expenses



          The Borrowers and each other Loan Party agree to pay on demand in accordance with the terms of
Section 9.5 (Payment of Expenses) of the Credit Agreement all reasonable out of pocket costs and
expenses of the Administrative Agent in connection with the preparation, reproduction, execution
and delivery of this Amendment and all other Loan Documents entered into in connection herewith.




     Section 6. Reference to the Effect on the Loan Documents



          (a) As of the date hereof, each reference in the Credit Agreement to “this
Agreement,” “hereunder,” “hereof,” “herein,” or words of like import, and each reference in the
other Loan Documents to the Credit Agreement (including, without limitation, by means of words like
“thereunder”, “thereof” and words of like import), shall mean and be a reference to the Credit
Agreement as modified hereby, and this Amendment and the Credit Agreement shall be read together
and construed as a single instrument.



          (b) Except as expressly modified hereby, all of the terms and provisions of the Credit
Agreement and all other Loan Documents are and shall remain in full force and effect and are hereby
ratified and confirmed.



          (c) The execution, delivery and effectiveness of this Amendment shall not, except as expressly
provided herein, operate as a waiver of any right, power or remedy of the Lenders or the
Administrative Agent under any of the Loan Documents, nor constitute a waiver or amendment of any
other provision of any of the Loan Documents or for any purpose except as expressly set forth
herein.



          (d) This Amendment shall be deemed a Loan Document.



     Section 7. Execution in Counterparts



          This Amendment may be executed in any number of counterparts and by different parties in
separate counterpart (including by facsimile), each of which when so executed shall be deemed to be
an original and all of which taken together shall constitute one and the same agreement. Signature
pages may be detached from multiple separate counterparts and attached to a single counterpart so
that all signature pages are attached to the same document. Delivery of an executed counterpart by
telecopy shall be effective as delivery of a manually executed counterpart of this Amendment.




     Section 8. Governing Law



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          This Amendment shall be governed by and construed in accordance with the law of the State of
New York.




     Section 9. Section Titles



          The Section titles contained in this Amendment are and shall be without substantive meaning or
content of any kind whatsoever and are not a part of the agreement between the parties hereto.




     Section 10. Notices



          All communications and notices hereunder shall be given as provided in the Credit Agreement.




     Section 11. Severability



          The fact that any term or provision of this Agreement is held invalid, illegal or
unenforceable as to any person in any situation in any jurisdiction shall not affect the validity,
enforceability or legality of the remaining terms or provisions hereof or the validity,
enforceability or legality of such offending term or provision in any other situation or
jurisdiction or as applied to any person.




     Section 12. Successors



          The terms of this Amendment shall be binding upon, and shall inure to the benefit of, the
Lenders, the other parties hereto and their respective successors and assigns.




     Section 13. Waiver of Jury Trial



          Each of the parties hereto irrevocably waives trial by jury in any action or proceeding with
respect to this Amendment or any other Loan Document.




[Signature Pages Follow]






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          In Witness Whereof, the parties hereto have caused this Amendment to be executed by
their respective officers thereunto duly authorized, as of the date first written above.




	 	 	 	 	 
	 	MVC Capital, Inc.

as Borrower

 	 
	 	By:  	/s/ Michael Tokarz
 	 
	 	 	Name:  	Michael Tokarz 	 
	 	 	Title:  	Chairman 	 
	 
	 	MVC Financial Services, Inc.

as Borrower

 	 
	 	By:  	/s/ Michael Tokarz
 	 
	 	 	Name:  	Michael Tokarz 	 
	 	 	Title:  	Chairman 	 
	 



[Signature page to MVC Amendment No. 7]





 









 








	 	 	 	 	 
	 	Guggenheim Corporate Funding, LLC,

as Administrative Agent

 	 
	 	By:  	/s/ Bill Hagner
 	 
	 	 	Name:  	Bill Hagner 	 
	 	 	Title:  	Managing Director 	 
	 



[Signature page to MVC Amendment No. 7]





 











 





	 	 	 	 	 
	 	Midland National Life Insurance Company,

as Lender




By:    Guggenheim Partners Asset Management, LLC

 	 
	 	By:  	/s/ Michael Damaso
 	 
	 	 	Name:  	Michael Damaso 	 
	 	 	Title:  	Senior Managing Director 	 
	 
	 	North American Company for Life and

Health Insurance, as Lender





By:    Guggenheim Partners Asset Management, LLC

 	 
	 	By:  	/s/ Michael Damaso
 	 
	 	 	Name:  	Michael Damaso 	 
	 	 	Title:	 Senior Managing Director 	 
	 
	 	Sands Point Funding Ltd., as Lender





By:   Guggenheim Investment Management, LLC,

its Collateral Manager

 	 
	 	By:  	/s/ Michael Damaso
 	 
	 	 	Name:  	Michael Damaso 	 
	 	 	Title:  	Senior Managing Director 	 
	 
	 	Copper River CLO Ltd., as Lender





By:   Guggenheim Investment Management, LLC,
 its Collateral Manager

 	 
	 	By:  	/s/ Michael Damaso
 	 
	 	 	Name:  	Michael Damaso 	 
	 	 	Title:	   Senior Managing Director 	 
	 





[Signature page to MVC Amendment No. 7]






 









 








	 	 	 	 	 
	 	Kennecott Funding Ltd., as Lender





By:  Guggenheim Investment Management, LLC,

its Collateral Manager

 	 
	 	By:  	/s/ Michael Damaso
 	 
	 	 	Name:  	Michael Damaso 	 
	 	 	Title:  	Senior Managing Director 	 
	 
	 	Green Lane CLO Ltd., as Lender





By:  Guggenheim Investment Management, LLC,
its Collateral Manager

 	 
	 	By:  	/s/ Michael Damaso
 	 
	 	 	Name:  	Michael Damaso 	 
	 	 	Title:  	Senior Managing Director 	 
	 



[Signature page to MVC Amendment No. 7]





 









 








	 	 	 	 	 
	 	Iron Hill CLO Limited, as Lender





By:   Guggenheim Partners Europe Limited, its Collateral Manager

 	 
	 	By:  	/s/ Adrian Duffy
 	 
	 	 	Name:  	Adrian Duffy 	 
	 	 	Title:  	Managing Director 	 
	 



[Signature page to MVC Amendment No. 7]





 









 








EXHIBIT G




FORM OF ADDITIONAL PERMITTED GUARANTEE REQUEST




	 	 	 	 	 

	 

	 	 	 	[     ], 201[   ]
	To:

	 	Guggenheim Corporate Funding, LLC

as Administrative Agent

135 East 57th Street

New York, New York 10022

Attention:   Jeff Abrams/Matt Bloom	 	 






          Reference is hereby made to the Credit Agreement, dated as of April 27, 2006 (as amended,
supplemented or modified from time to time, the “Credit Agreement”), among MVC CAPITAL, INC., a
Delaware corporation (the “Company”), MVC FINANCIAL SERVICES, INC.(“MVCFS”, and together with the Company, each a “Borrower”, and collectively, the “Borrowers”),
the Lenders parties thereto, and GUGGENHEIM CORPORATE FUNDING, LLC, as Administrative Agent. Terms
defined in the Credit Agreement and not otherwise defined herein are used herein with the meanings
so defined.




          The Borrowers hereby request that the guaranty (the “Guarantee”) of the Debt Instrument (as
defined below) be added to Schedule 6.2(d) of the Credit Agreement:1




Proposed guarantor:




Expected effective date of proposed Guarantee2:




Portfolio Company:




Debt instrument to be guaranteed (the “Debt Instrument”)3:




Aggregate principal amount of Debt Instrument:




Interest rate of Debt Instrument:




Maturity of Debt Instrument:




Proposed description of Guarantee/Indebtedness to be included on Schedule 6.2(d):






 




			
	1	 	Administrative Agent may request additional information.
	 
	2	 	Attach Guarantee, if available, as Annex A.
	 
	3	 	Attach Debt Instrument as Annex A.




 









 










	 	 	 	 	 
	 	Yours truly,





MVC Capital, Inc.

as Borrower

 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



	 	 	 	 	 
	 	MVC Financial Services, Inc.

as Borrower

 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 









 






	 	 	 	 	 




     The Administrative Agent hereby acknowledges that the Debt Instrument and the description
thereof set forth above shall be added to Schedule 6.2(d) of the Credit Agreement by virtue of its
countersignature to this Additional Permitted Guarantee Request.



	 	 	 	 	 
	 	Guggentheim Corporate Funding, LLC,

as Administrative Agent

 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 









 






	 	 	 	 	 



Annex A




See attached.