Exhibit 10.19


 




 





 


AMENDMENT NO. 5 TO THE


 


FIRST LIEN SENIOR SECURED
CREDIT AGREEMENT


 


Dated as of March 26,
2010


 


among


 


WII MERGER CORPORATION,

as the initial Borrower,


 


CREDIT SUISSE AG (fka Credit
Suisse),

as Administrative Agent, Swing Line Lender and

an L/C Issuer,


 


The Other Lenders Parties
Hereto


 


and


 


CREDIT SUISSE AG (fka Credit
Suisse),

as Collateral Agent


 


	
   

  	
   

  	
   

  



 


CREDIT SUISSE SECURITIES
(USA) LLC


 


Sole Lead Arranger and Sole
Bookrunning Manager


 


	
   

  	
   

  	
   

  



 




 





 

















 


AMENDMENT NO. 
5 TO THE

CREDIT AGREEMENT


 


Dated as of March 26, 2010


 


AMENDMENT NO. 5 TO THE CREDIT
AGREEMENT (this “Amendment”) among WII COMPONENTS,
INC., a Delaware corporation (the “Borrower”), the Lenders party thereto
and CREDIT SUISSE AG (formerly known as Credit Suisse), acting through one or
more of its branches, or any Affiliate thereof (collectively, “Credit Suisse”),
as Administrative Agent, Swing Line Lender, an L/C Issuer and Collateral Agent.


 


PRELIMINARY STATEMENTS:


 


(1)           WII Merger Corporation and Credit Suisse entered into a
Credit Agreement dated as of January 9, 2007, as amended by Amendment No. 1
dated as of February 7, 2007, Amendment No. 2 dated as of June 12,
2007, Amendment No. 3 dated February 19, 2008 and Amendment No. 4
dated as of March 30, 2009 (as so amended, the “Credit Agreement”).  Capitalized terms not otherwise defined in
this Amendment have the same meanings as specified in the Credit Agreement.


 


(2)           Pursuant to the Merger and the Assumption Agreement, the
Borrower assumed all of the obligations of WII Merger Corporation under the
Loan Documents.


 


(3)           The Borrower has requested that the Required Lenders agree
to amend certain provisions of the Credit Agreement as described herein.


 


(4)           The Required Lenders have agreed, subject to the terms and
conditions stated below, to amend the Credit Agreement as hereinafter set
forth.


 


SECTION 1.         Amendments to Credit Agreement.  The Credit
Agreement is, effective as of the date hereof and subject to the satisfaction
of the conditions precedent set forth in Section 2, hereby amended as
follows:


 


(a)           Section 1.01 is hereby amended by adding the
following definitions in the correct alphabetical order:


 


“Borrowing Base Certificate”
means a certificate in substantially the form of Exhibit N hereto, duly
certified by the chief financial officer or the chief executive officer of the
Borrower.


 


“Borrowing Base Deficiency” has the
meaning specified in Section 2.05(b)(vi).


 


“Eligible Collateral”
means, collectively, Eligible Inventory and Eligible Receivables.


 


“Eligible Inventory”
means Inventory of the Loan Parties, other than the following classes of
Inventory, except to the extent otherwise expressly agreed in writing by the
Administrative Agent:


 


(a)   Inventory not in the possession of or under the
sole control of any Loan Party (other than (i) Inventory located on leased
property (which is covered by clause (b) below) and (ii) inventory
consigned by a Borrower to a customer or 


 

















 


located in a third party warehouse; provided, with respect to any such customer or warehouseman,
the Administrative Agent shall have received a collateral access and
subordination agreement reasonably acceptable to the Administrative Agent);


 


(b)           Inventory located on leased property
as to which  the landlord has not entered
into a collateral access and subordination agreement reasonably acceptable to
the Administrative Agent providing the Collateral Agent with the right to
repossess such Inventory and such other reasonable rights as may be required by
the Collateral Agent; provided, in
the event such landlord does not enter into a collateral access and
subordination agreement, the Administrative Agent shall establish a rent
reserve of not more than two months with respect to such location and Inventory
located at such location shall not be excluded from Eligible Inventory solely
by reason of this clause (b);


 


(c)           Inventory that is obsolete, unusable
or otherwise unfit for sale;


 


(d)           Inventory with respect to which the
representations and warranties set forth in the Collateral Documents applicable
to Inventory are not true and correct in all material respects;


 


(e)           Inventory consisting of promotional,
marketing, packaging or shipping materials and supplies;


 


(f)            Inventory that fails to meet all
standards imposed by any Governmental Authority having regulatory authority
over such Inventory or its use or sale;


 


(g)           Inventory that is subject to any
licensing, patent, royalty, trademark, trade name or copyright agreement with
any third party from which any Loan Party has received notice of a dispute with
respect to infringing upon the rights of such licensor or any other Person in
respect of any such agreement;


 


(h)           Inventory located outside the United
States and Canada; and


 


(i)            (i) Inventory located in the
United States in respect of which the Security Agreement, after giving effect
to the related filings of financing statements that have then been made, does
not or has ceased to create a valid and perfected first priority lien or
security interest in favor of the Collateral Agent for the benefit of the
Secured Parties securing the Secured Obligations under applicable laws of the
United States or (ii) Inventory located in Canada in respect of which the
Security Agreement, after giving effect to the related filings of financing
statements that have then been made, does not or has ceased to create a valid
and perfected first priority lien or security interest in favor of the
Collateral Agent for the benefit of the Secured Parties securing the Secured
Obligations under applicable laws of Canada.


 


“Eligible Receivables”
means Receivables of the Loan Parties, other than the following classes of
Receivables, except to the extent otherwise expressly agreed in writing by the
Administrative Agent:


 

















 


(a)           Receivables that do not arise out of
sales of goods or rendering of services in the ordinary course of the business
of the Loan Parties;


 


(b)           Receivables on terms other than those
normal or customary in the business of the Loan Parties, as reasonably
determined by the Borrower in good faith;


 


(c)           Receivables owing from any Person that
is an Affiliate of any Loan Party or any of its Subsidiaries;


 


(d)           Receivables more than 120 days
past the original invoice date or more than 60 days past the date due;


 


(e)           Receivables owing from any Person
from which an aggregate amount of more than 35% of the Receivables owing from
such Person and its Affiliates is more than 60 days past due;


 


(f)            Receivables owing from any Person
that has asserted any claim, demand or liability against any Loan Party or
any of its Subsidiaries, whether by action, suit, counterclaim or otherwise,
but only to the extent of any such claim, demand, liability, counterclaim,
suit,  deduction, defense, setoff or
dispute;


 


(g)           Receivables owing from any Person
that shall take or be the subject of any action or proceeding of a type
described in Section 8.01(f) (other than post-petition accounts
payable of an account debtor that is a debtor-in-possession under the
Bankruptcy Code and reasonably acceptable to the Administrative Agent);


 


(h)           Receivables owing from any
Person that is also a supplier to or creditor of any Loan Party unless such
account debtor has executed a no-offset letter reasonably satisfactory to the
Administrative Agent, provided, that
Receivables shall be ineligible under this clause only to the extent of any offset
or claim of such account debtor;


 


(i)            Receivables arising out of sales to
account debtors outside the United States and Canada, unless such Receivable is
supported by a letter of credit or other similar obligation satisfactory to the
Administrative Agent;


 


(j)            Receivables arising out of sales on
a bill-and-hold, guaranteed sale, sale-or-return, sale on approval or
consignment basis or similar arrangements;


 


(k)           Receivables owing from an account
debtor that is an agency, department or instrumentality of the United States or
any State thereof; and


 


(l)            Receivables in respect of which the
Security Agreement, after giving effect to the related filings of financing
statements that have then been made, does not or has ceased to create a valid
and perfected first priority lien or security interest in favor of the
Collateral Agent for the benefit of the Secured Parties securing the Secured
Obligations.


 

















 


“Inventory” means all
Inventory referred to in Section 1(b) of the Security Agreement.


 


“Loan Value” means,
with respect to any Eligible Collateral:


 


(a)     in
the case of Eligible Inventory, 65% of the lower of cost or book value
determined in accordance with GAAP; and


 


(b)     in
the case of Eligible Receivables, 85% of the principal amount thereof.


 


“Receivables” means
all Receivables referred to in Section 1(c) of the Security
Agreement.


 


(b)           Section 2.05(b)(vi) is hereby amended by adding
a new sentence at the end thereof to read as follows:


 


“The Borrower shall,  within one
Business Day of the Business Day on which the aggregate amount of Total
Outstandings exceeds the sum of the Loan Values of the Eligible Collateral on
such Business Day (the amount of any such excess being referred to as the “Borrowing Base Deficiency”), prepay
an aggregate principal amount of the Revolving Credit Loans and the Swing Line
Advances and, after prepayment in full of all such Revolving Credit Loans and
Swing Line Advances, Cash Collateralize the L/C Obligations, in an aggregate
amount equal to such Borrowing Base Deficiency.”


 


(c)           Section 4.02(a) is hereby amended to add a new
clause at the end thereof to read as follows:


 


“; and the sum of the Loan Values of the Eligible Collateral exceeds
the aggregate principal amount of the Total Outstandings plus the amount of
such Credit Extension”.


 


(d)           A new Section 6.22 is hereby added to read as
follows:


 


“6.22.  Borrowing Base
Certificates.  As soon as available
and in any event within 20 days after the end of each month, a Borrowing
Base Certificate, as at the end of the previous month, certified by the chief
financial officer of the Borrower and in form and substance satisfactory to the
Administrative Agent.”


 


(e)           Section 7.02(a)(ii) is hereby amended by
deleting the date “March 31, 2010” appearing therein and replacing it with
the date “March 31, 2011”.


 


(f)            Section 7.06(k) is hereby amended by  deleting each reference to the date “March 31,
2010” appearing therein and replacing it with the date “March 31, 2011”.


 


(g)           For each period of four Fiscal Quarters ending after December 31,
2009, the grid in Section 7.11(a)(i) is hereby amended to read as
follows (it being understood and agreed that such grid for prior periods shall
remain in effect notwithstanding such amendment):


 


	
  Four Fiscal Quarters Ending

  	
   

  	
  Maximum Consolidated

  Leverage Ratio

  
	
  March 31, 2010

  	
   

  	
  17.15:1.00

  



 

















 


	
  Four Fiscal Quarters Ending

  	
   

  	
  Maximum Consolidated

  Leverage Ratio

  
	
  June 30, 2010

  	
   

  	
  18.00:1.00

  
	
  September 30, 2010

  	
   

  	
  18.50:1.00

  
	
  December 31, 2010

  	
   

  	
  20.15:1.00

  
	
  March 31, 2011 through December 31, 2011

  	
   

  	
  6.00:1.00

  
	
  March 31, 2012

  	
   

  	
  4.20:1.00

  
	
  June 30, 2012

  	
   

  	
  4.00:1.00

  
	
  September 30, 2012

  	
   

  	
  3.90:1.00

  
	
  December 31, 2012

  	
   

  	
  3.80:1.00

  



 


(h)           For each period of four Fiscal Quarters ending after December 31,
2009, the grid in Section 7.11(c)(i) is hereby amended to read as
follows (it being understood and agreed that such grid for prior periods shall
remain in effect notwithstanding such amendment):


 


	
  Four
  Fiscal Quarters Ending

  	
   

  	
  Minimum Consolidated

  Interest Coverage Ratio

  
	
  March 31, 2010 through December 31, 2010

  	
   

  	
  1.10:1.00

  
	
  March 31, 2011

  	
   

  	
  3.90:1.00

  
	
  June 30, 2011

  	
   

  	
  4.00:1.00

  
	
  September 30, 2011 through December 31, 2011

  	
   

  	
  4.10:1.00

  
	
  March 31, 2012

  	
   

  	
  4.70:1.00

  
	
  June 30, 2012

  	
   

  	
  5.40:1.00

  
	
  September 30, 2012

  	
   

  	
  6.20:1.00

  
	
  December 31, 2012

  	
   

  	
  7.10:1.00

  



 


(i)            Section 8.01(o) is hereby amended by deleting
the date “March 31, 2010” appearing therein and replacing it with the date
“March 31, 2011”.


 


(j)            A new Exhibit N is hereby added to the Credit
Agreement in the form of Exhibit N hereto.


 


SECTION 2.         Conditions of Effectiveness.  This Amendment shall become effective as of
the date first above written when, and only when,


 


(a)           the Administrative Agent shall have received counterparts
of this Amendment executed by each Loan Party and the Required Lenders;


 


(b)           the Administrative Agent shall have received, in form and
substance reasonably satisfactory to the Administrative Agent, a certificate of
the Secretary or an Assistant Secretary of each Loan Party certifying that the
certified resolutions of the Board of Directors (or similar governing body) of
each Loan Party delivered in connection with the Credit Agreement have not been
amended, modified or revoked and are in full force and effect on the date
hereof; and


 


(c)           all expenses and reasonable fees of
the Administrative Agent (including all reasonable fees and expenses of counsel
to the Administrative Agent), to the extent invoiced and due prior to the date
hereof, shall have been paid.


 

















 


SECTION 3.         Confirmation of Representations and
Warranties and No Event of Default. 
Each of the Loan Parties hereby represents and warrants (a) on and
as of the date hereof, that the representations and warranties contained in the
Loan Documents are true and correct in all material respects on and as of the
date hereof, but after giving effect to this Amendment, as though made on and
as of the date hereof, other than any such representations or warranties that,
by their terms, refer to a specific date and (b) after giving effect to
this Amendment, no event has occurred and is continuing that constitutes a
Default.


 


SECTION 4.         Affirmation
of Guarantors.  Each Guarantor hereby consents to the amendments to the
Credit Agreement effected hereby, and hereby confirms and agrees that, notwithstanding the
effectiveness of this Amendment, the obligations of such Guarantor contained in
the Holdings Guaranty or the Subsidiary Guaranty (as the case may be), or in
any other Loan Document to which it is a party are, and shall remain, in full
force and effect and are hereby ratified and confirmed in all respects, except
as set forth in Section 6(a) below.


 


SECTION 5.         Reference to and Effect on the Loan
Documents.  (a) On and after the
effectiveness of this Amendment, each reference in the Credit Agreement to “this
Agreement”, “hereunder”, “hereof” or words of like import referring to the Credit
Agreement, and each reference in each of the other Loan Documents to “the
Credit Agreement”, “thereunder”, “thereof” or words of like import referring to
the Credit Agreement, shall mean and be a reference to the Credit Agreement, as
amended by this Amendment.


 


(b)   The Credit Agreement and each of the other
Loan Documents, as specifically amended by this Amendment, are and shall
continue to be in full force and effect and are hereby in all respects 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 any Lender or the Administrative Agent
under the Credit Agreement, nor constitute a waiver of any provision of the
Credit Agreement or any other Loan Document.


 


SECTION 6.         Costs, Expenses.  The Borrower agrees to pay on demand all
costs and expenses of the Administrative Agent (including, without limitation,
the reasonable fees and expenses of counsel for the Administrative Agent) in
connection with the preparation, execution, delivery and administration,
modification and amendment of this Amendment and the other instruments and
documents to be delivered hereunder, in accordance with the terms of Section 10.04
of the Credit Agreement.


 


SECTION 7.         Execution in Counterparts.  This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute but one and the same agreement.  Delivery of an executed counterpart of a
signature page to this Amendment by facsimile shall be effective as
delivery of a manually executed counterpart of this Amendment.


 


SECTION 8.         Governing Law.  This Amendment shall be governed by, and
construed in accordance with, the laws of the State of New York.


 


[The remainder of this page intentionally left blank.]


 

















 


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 above written.


 


 


	
   

  	
  WII
  COMPONENTS, INC., as Borrower

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/
  Dale B. Herbst

  
	
   

  	
   

  	
  Name:
  Dale B. Herbst

  
	
   

  	
   

  	
  Title:
  CFO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WII
  HOLDING, INC.,

  
	
   

  	
  as
  Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/
  Dale B. Herbst

  
	
   

  	
   

  	
  Name:
  Dale B. Herbst

  
	
   

  	
   

  	
  Title:
  CFO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WOODCRAFT INDUSTRIES, INC.,

  
	
   

  	
  as
  Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/
  Dale B. Herbst

  
	
   

  	
   

  	
  Name:
  Dale B. Herbst

  
	
   

  	
   

  	
  Title:
  CFO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BRENTWOOD
  ACQUISITION CORP.,

  
	
   

  	
  as
  Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/
  Dale B. Herbst

  
	
   

  	
   

  	
  Name:
  Dale B. Herbst

  
	
   

  	
   

  	
  Title:
  CFO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PRIMEWOOD,
  INC.,

  
	
   

  	
  as
  Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/
  Dale B. Herbst

  
	
   

  	
   

  	
  Name:
  Dale B. Herbst

  
	
   

  	
   

  	
  Title: CFO

  



 

















 


	
   

  	
  CREDIT
  SUISSE AG (formerly known as Credit Suisse), Cayman Islands Branch,

  
	
   

  	
  as
  Administrative Agent and Collateral Agent

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/
  Bill O’Daly

  
	
   

  	
   

  	
  Name:
  Bill O’Daly

  
	
   

  	
   

  	
  Title:
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/
  Vipul Dhadda

  
	
   

  	
   

  	
  Name:
  Vipul Dhadda

  
	
   

  	
   

  	
  Title: Associate

  



 

















 


	
   

  	
  CREDIT
  SUISSE AG (formerly known as Credit Suisse), Cayman Islands Branch,

  
	
   

  	
  as
  Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/
  Bill O’Daly

  
	
   

  	
   

  	
  Name:
  Bill O’Daly

  
	
   

  	
   

  	
  Title:
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/
  Vipul Dhadda

  
	
   

  	
   

  	
  Name:
  Vipul Dhadda

  
	
   

  	
   

  	
  Title: Associate

  



 

















 


EXHIBIT N


 


FORM OF BORROWING BASE CERTIFICATE


 


To:          Credit Suisse AG, as Administrative
Agent


 


Date:         ,


 


(1)          Accounts
Receivable


 


(2)           Total Ineligible Receivables


 


(3)           Eligible Receivables       (line
1 — line 2)


 


(4)           Loan Value of Eligible Receivables
(85% of line 3)


 


(5)           Inventory


 


(6)           Ineligible Inventory


 


(7)           Rent Reserve and other adjustments*


 


(8)           Eligible Inventory (line 5 — line 6 —
line 7)


 


(9)           Loan Value of Eligible Inventory (65%
of line 8)


 


(10)         Loan Value of Eligible Collateral (line
4 + line 9)


 






*Explain:


 


This report (this “Certificate”) is submitted pursuant to the
Credit Agreement, dated as of January 9, 2007 (as amended, restated,
extended, supplemented or otherwise modified in writing from time to time, the “Credit
Agreement”), among WII COMPONENTS, Inc., a Delaware corporation (the “Borrower”),
the Lenders from time to time party thereto, and CREDIT SUISSE AG (formerly
known as Credit Suisse), acting through one or more of its branches or any
Affiliate thereof, as Administrative Agent, Swing Line Lender, an L/C Issuer
and Collateral Agent.  Unless otherwise
indicated, capitalized terms used but not defined herein shall have the
meanings ascribed to them in the Credit Agreement.


 


The undersigned hereby certifies, solely in his/her capacity as an
authorized officer of the Borrower and not in his/her individual capacity, as
of the date first written above, that the amounts and calculations herein
accurately reflect the Eligible Collateral.


 


	
   

  	
  WII
  COMPONENTS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title: