**Exhibit10.25**

 

**AMENDMENTAGREEMENT NO. 4**

 

tothat certain

 

**LOAN ANDSECURITY AGREEMENT**

 

This **AMENDMENT AGREEMENT NO. 4** (this “**Amendment**”), dated as of July 21, 2004, is among **GANDER MOUNTAIN COMPANY** (the “**Borrower**”),**FLEET RETAIL GROUP, INC.**(f/k/a Fleet RetailFinance, Inc.)****and the other lendinginstitutions from time to time party to the Loan Agreement (as hereinafterdefined) (collectively, the “**Revolving Credit Lenders**”),and **FLEET RETAIL GROUP, INC.** as agent (the“**Agent**”) for itself and the other RevolvingCredit Lenders.

 

**WHEREAS**, theBorrower, the Agent and the Revolving Credit Lenders are parties to thatcertain Loan and Security Agreement, dated as of December 19, 2001 as amendedby the Amendment Agreement No. 1, dated as of May 23, 2003, the AmendmentAgreement No. 2, dated as of June 4, 2003 and the Amendment Agreement No. 3,dated as of January 2, 2004 (as so amended and as otherwise amended and ineffect from time to time, the “**Loan Agreement**”),pursuant to which the Revolving Credit Lenders, upon certain terms andconditions, have agreed to make loans to, and to cause the issuance of lettersof credit for the benefit of, the Borrower;

 

**WHEREAS**, theBorrower has requested that the Agent and the Revolving Credit Lenders agree,and the Agent and the Revolving Credit Lenders have agreed, on the terms andsubject to the conditions set forth herein, to amend certain of the terms andprovisions of the Loan Agreement;

 

**NOW, THEREFORE,** theparties hereto hereby agree as follows:

 

**§1.          DefinedTerms.**    Capitalizedterms which are used herein without definition and which are defined in theLoan Agreement shall have the same meanings herein as in the Loan Agreement.

 

**§2.          Amendmentsto Loan Agreement.**

 

(a)           Article I of the LoanAgreement is hereby amended by inserting the following new definition in theappropriate alphabetical order:

 

““**GAAP EBITDA**”:With respect to any fiscal period, an amount equal to the sum of (a) Net Incomeof the Borrower for such fiscal period, *plus*(b) in each case to the extent deducted in the calculation of Net Income andwithout duplication, (i) depreciation and amortization for such fiscal period, *plus* (ii) income tax expense for suchfiscal period, *plus* (iii)Interest Expense paid or accrued during such fiscal period, *plus* (iv) other noncash charges for suchfiscal period (excluding LIFO reserves), all as determined in accordance withGAAP, after eliminating therefrom all extraordinary nonrecurring items ofincome or expense.”.

 

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(b)           The definition of “**Applicable Margin**” contained in Article I of the LoanAgreement is hereby restated in its entirety as follows:

 

““**Applicable Margin**”:  For each period commencing on an AdjustmentDate through the date immediately preceding the next Adjustment Date (each a“Rate Adjustment Period”), the Applicable Margin shall be the applicable marginper annum set forth in the table below opposite to the Borrower’s applicableEBITDA as determined for the applicable period consisting of the twelve (12)consecutive months ending on or about the calendar quarter ending immediatelyprior to the applicable Rate Adjustment Period pertaining to such AdjustmentDate :

 
| **LEVEL** | ** ** | **EBITDA**                                                      | ** ** | **LIBOR RATE  APPLICABLE  MARGIN** | ** ** | **BASE RATE  APPLICABLE  MARGIN** | ** ** |
|-----------|------------|-----------------------------------------------------------------|------------|------------------------------------|------------|-----------------------------------|------------|
| I         |       | Greater than or equal  to $42,500,000                           |       | 1.75                               | %          | 0.00                              | %          |
| II        |       | Greater than or equal  to $30,000,000 and less than $42,500,000 |       | 2.00                               | %          | 0.50                              | %          |
| III       |       | Less than $30,000,000                                           |       | 2.25                               | %          | 0.75                              | %          |

 

Notwithstanding the foregoing, (i) effective July 1, 2004, the ApplicableMargin shall be set at the amount set forth opposite Level I above until thedate immediately preceding the next Adjustment Date and (ii) if on anyAdjustment Date the Borrower’s GAAP EBITDA is greater than or equal to$42,500,000 as determined for the period consisting of the twelve (12)consecutive months ending on or about the calendar quarter ended immediatelyprior to such Adjustment Date, than for the Rate Adjustment Period applicableto such Adjustment Date the LIBOR Rate Applicable Margin shall equal 1.50% andthe Base Rate Applicable Margin shall equal 0.00%.

 

Furthermore, any delay by the Borrower in delivering the financialstatements and reports required to be delivered by the Borrower pursuant toSection 6.5 shall, at the Agent’s option, result in the Applicable Margin beingset at the amount set forth opposite Level III above or such other Level asdetermined by the Agent until the next Adjustment Date.”.

 

(c)           The definition of “**Change in Control**” contained in Article I of the LoanAgreement is hereby restated in its entirety as follows:

 

““**Change in Control**”: The occurrence ofany of the following:

 

(a)           Any “person” or“group” (as such terms are used in Sections 13(d) and 14(d) of the SecuritiesExchange Act of 1934, but excluding any employee benefit plan of such person orits subsidiaries, and any person or entity acting in its capacity as trustee,agent or other fiduciary or administrator of any such plan) other than membersof the Erickson Family, the Holiday Companies or Affiliates of HolidayCompanies becomes the “beneficial owner” (as defined in Rules 13d-3 and

 

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13d-5 under theSecurities Exchange Act of 1934, except that a person or group shall be deemedto have “beneficial ownership” of all securities that such person or group hasthe right to acquire (such right, an “option right”), whether such rightis exercisable immediately or only after the passage of time), directly orindirectly, of Forty Percent (40%) or more of the equity securities of theBorrower entitled to vote for members of the board of directors or equivalentgoverning body of the Borrower on a fully-diluted basis (and taking intoaccount all such securities that such person or group has the right to acquirepursuant to any option right).

 

(b)           During any period oftwelve (12) consecutive months, a majority of the members of the board ofdirectors or other equivalent governing body of the Borrower cease to becomposed of individuals (i) who were members of that board or equivalentgoverning body on the first day of such period, (ii) whose election ornomination to that board or equivalent governing body was approved byindividuals referred to in clause (i) above constituting at the time of suchelection or nomination at least a majority of that board or equivalentgoverning body or (iii) whose election or nomination to that board or otherequivalent governing body was approved by individuals referred to in clauses(i) and (ii) above constituting at the time of such election or nomination atleast a majority of that board or equivalent governing body (excluding, in thecase of both clause (ii) and clause (iii), any individual whose initialnomination for, or assumption of office as, a member of that board orequivalent governing body occurs as a result of an actual or threatenedsolicitation of proxies or consents for the election or removal of one or moredirectors by any person or group other than a solicitation for the election ofone or more directors by or on behalf of the board of directors).”.

 

(d)                                 Section 5.19 of the Loan Agreement is herebyrestated in its entirety as follows:

 

**5.19  BUSINESS PLAN.**  The Borrower has provided to the Agent andthe Lenders its Business Plan for the years 2001 through 2004 in connectionwith the Third Amendment to this Agreement dated January 2, 2004.

 

**§3.          Affirmation andAcknowledgment of the Borrower.**  The Borrower hereby ratifies and confirms all of itsObligations to the Revolving Credit Lenders, including, without limitation, theRevolving Credit Loans, and the Borrower hereby affirms its absolute andunconditional promise to pay to the Revolving Credit Lenders all indebtedness,obligations and liabilities in respect of the Revolving Credit Loans, theLetters of Credit, and all other amounts due under the Loan Agreement asamended hereby.  The Borrower hereby confirmsthat the Obligations are and remain secured pursuant to the Loan Documents andpursuant to all other instruments and documents executed and delivered by theBorrower as security for the Obligations.

 

**§4.          RepresentationsandWarranties.**  The Borrower hereby represents andwarrants to the Revolving Credit Lenders as follows:

 

(a)           The execution anddelivery by the Borrower of this Amendment, and the performance by the Borrowerof its obligations and agreements under this Amendment and the Loan Agreementas amended hereby, are within the corporate authority of the Borrower, havebeen duly authorized by all necessary corporate proceedings on behalf of theBorrower and do not and will not contravene any provision of law, statute, ruleor regulation to which the Borrower is subject or any of the Borrower’scharter, other incorporation papers, by-laws or any stock provision or anyamendment thereof or of any agreement or other instrument binding upon theBorrower, the non-compliance with which would materially adversely affect thebusiness, assets or financial condition of the Borrower.

 

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(b)             This Amendment andthe Loan Agreement as amended hereby constitute legal, valid and bindingobligations of the Borrower, enforceable in accordance with their respectiveterms, except as limited by bankruptcy, insolvency, reorganization, moratoriumor other laws relating to or affecting generally the enforcement of creditors’rights in general, and by general principles of equity (regardless of whethersuch enforceability is considered in a proceeding in equity or at law).

 

(c)           No approval or consentof, or filing with, any governmental agency or authority is required to makevalid and legally binding the execution, delivery or performance by theBorrower of this Amendment or the Loan Agreement as amended hereby.

 

(d)           The representations andwarranties contained in Article V of the Loan Agreement are true and correct atand as of the date made and as of the date hereof, except to the extent ofchanges resulting from transactions contemplated or permitted by this LoanAgreement and the other Loan Documents, changes which have been disclosed tothe Agent and the Revolving Credit Lenders prior to the date hereof and changesoccurring in the ordinary course of business that singly or in the aggregateare not materially adverse, and to the extent that such representations andwarranties relate expressly to an earlier date.

 

(e)           The Borrower hasperformed and complied in all material respects with all terms and conditionsherein required to be performed or complied with by it prior to or at the timehereof, and as of the date hereof, after giving effect to the provisionshereof, the Borrower is not InDefault and there exists no Event of Default.

 

**§5.          Effectiveness.**  ThisAmendment shall become effective upon the receipt by the Agent of each of thefollowing:

 

(a)           a fully executedcounterpart hereof signed by the Borrower and all Revolving Credit Lenders.

 

(b)           a certificate from aduly authorized officer of the Borrower, on behalf of the Borrower (i) of thedue adoption, continued effectiveness, and setting forth the texts of, eachcorporate resolution adopted in connection with this Amendment and any otherdocuments executed in connection therewith, and (ii) attesting to the truesignatures of each Person authorized as a signatory.

 

**§6.          MiscellaneousProvisions**.

 

(a)           Except as otherwiseexpressly provided by this Amendment, all of the terms, conditions andprovisions of the Loan Agreement shall remain the same.  It is declared and agreed by each of theparties hereto that the Loan Agreement, as amended hereby, shall continue infull force and effect, and that this Amendment and the Loan Agreement shall beread and construed as one instrument.

 

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(b)           This Amendment isintended to take effect as an agreement under seal and shall be construedaccording to and governed by the laws of The Commonwealth of Massachusetts.

 

(c)           This Amendment may beexecuted in any number of counterparts, but all such counterparts shalltogether constitute but one instrument. In making proof of this Amendment it shall not be necessary to produceor account for more than one counterpart signed by each party hereto by andagainst which enforcement hereof is sought.

 

(d)           The Borrower agrees topay to the Agent, on demand by the Agent, all reasonable out-of-pocket costsand expenses incurred or sustained by the Agent in connection with thepreparation of this Amendment (including reasonable legal fees).

 

[Remainder of Page Intentionally Left Blank]

 

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**IN WITNESS WHEREOF,**the parties hereto have executed this Amendment as of the date first writtenabove.

 
|   | **GANDER  MOUNTAIN COMPANY**                                                                                                 |
|--------|------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                         |
|   |                                                                                                                         |
|   | By:                                                                                                                          | /s/ Sharon K. Link |   |
|   | Title:  SVP - Finance and Administration                                                                                     |
|   |                                                                                                                         |
|   |                                                                                                                         |
|   | **FLEET RETAIL  GROUP, INC.**(f/k/a Fleet  Retail  Finance, Inc.),  as Agent and as a  Revolving Credit  Lender         |
|   |                                                                                                                         |
|   |                                                                                                                         |
|   | By:                                                                                                                          |  /s/ | Sally A. Sheehan |   |
|   | Name:                                                                                                                        | Sally A. Sheehan |
|   | Title:                                                                                                                       | Managing  Director  Fleet Retail Group |
|   |                                                                                                                         |
|   |                                                                                                                         |
|   | **WELLS FARGO FOOTHILL, INC.**(f/k/a  Foothill  Capital Corporation), as Syndication Agent and  as a Revolving Credit Lender |
|   |                                                                                                                         |
|   |                                                                                                                         |
|   | By:                                                                                                                          |  /s/ | Brad Engel |   |
|   | Name:                                                                                                                        | Brad Engel |
|   | Title:                                                                                                                       | Assistant Vice  President |
|   |                                                                                                                         |
|   |                                                                                                                         |
|   | **THE CIT GROUP/BUSINESS CREDIT,  INC.,**                                                                                    |
|   | as a Revolving Credit  Lender                                                                                                |
|   |                                                                                                                         |
|   |                                                                                                                         |
|   | By:                                                                                                                          |  /s/ | Adrian Avales |   |
|   | Name:                                                                                                                        | Adrian Avales |
|   | Title:                                                                                                                       | Vice President |

 

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|   | **WEBSTER BUSINESS CREDIT CORPORATION**(f/k/a/ Whitehall Business Credit Corporation)**,** as  a Revolving Credit Lender |
|--------|--------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                     |
|   |                                                                                                                     |
|   | By:                                                                                                                      |  /s/ | Evan Israelson |   |
|   | Name:                                                                                                                    | Evan Israelson |
|   | Title:                                                                                                                   | Vice President |
|   |                                                                                                                     |
|   |                                                                                                                     |
|   | **GENERAL ELECTRIC CAPITAL  CORPORATION,** as a Revolving Credit Lender                                                  |
|   |                                                                                                                     |
|   |                                                                                                                     |
|   | By:                                                                                                                      |  /s/ | Kristina M. Miller |   |
|   | Name:                                                                                                                    | Kristina M. Miller |
|   | Title:                                                                                                                   | By Authorized Signatory |
|   |                                                                                                                     |
|   |                                                                                                                     |
|   | **UBS AG, STAMFORD BRANCH**                                                                                              |
|   |                                                                                                                     |
|   |                                                                                                                     |
|   | By:                                                                                                                      |  /s/ | Wilfred V. Saint |   |
|   | Name:                                                                                                                    | Wilfred V. Saint |
|   | Title:                                                                                                                   | Director  Banking Products  Services, US |
|   |                                                                                                                     |   |
|   |                                                                                                                     |   |
|   | By:                                                                                                                      |  /s/ | Winslowe Ogbourne |   |
|   | Name:                                                                                                                    | Winslowe Ogbourne |
|   | Title:                                                                                                                   | Associate Director  Banking Products  Services, US |

 

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