Document:

exv10w1

 

EXHIBIT 10.1

          SECOND AMENDMENT, dated July 7, 2006, but effective as of June 30, 2006,
(this “Amendment”), to the AMENDED AND RESTATED CREDIT AGREEMENT, dated as
of April 2, 2004 (as amended by the First Amendment, dated as of August 18, 2004 and as
further amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among CINEMARK, INC. (the “Parent”), CNMK HOLDING, INC.
(“Holdings”).
CINEMARK USA, INC. (the “Borrower”), the several banks and other financial institutions or
entities from time to time parties to the Credit Agreement (the “Lenders”), LEHMAN
BROTHERS INC. and GOLDMAN SACHS CREDIT PARTNERS L.P., as joint lead arrangers
and joint bookrunners, GOLDMAN SACHS CREDIT PARTNERS L.P., as syndication agent,
DEUTSCHE BANK SECURITIES INC., THE BANK OF NEW YORK, GENERAL
ELECTRIC CAPITAL CORPORATION and CIBC INC., as co-documentation agents, and
LEHMAN COMMERCIAL PAPER INC., as administrative agent (in such capacity, the
“Administrative Agent”).

W I T N E S S E T H:

          WHEREAS, pursuant to the Credit Agreement, the Lenders have agreed to make,
and have made, certain Loans and other extensions of credit to the Borrower;

          WHEREAS, the Borrower has requested that the Lenders agree to make certain
amendments to the Credit Agreement; and

          WHEREAS, the Lenders have agreed to make such amendments solely upon the
terms and conditions provided for in this Amendment;

          NOW, THEREFORE, the parties hereto agree as follows:

          1. Defined Terms. Unless otherwise noted herein, terms defined in the Credit
Agreement and used herein shall have the meanings given to them in the Credit Agreement.

          2. Amendment to Section 1.1 of the Credit Agreement (Defined Terms).

          (a) Section 1.1 of the Credit Agreement is hereby amended by adding the
following new definitions in the appropriate alphabetical order:

          “Determination Date”: as defined in the definition of “Remaining Applicable
Amount”.

     “Second Amendment”: the Second Amendment, dated July 7, 2006, but effective
as of June 30, 2006, to this Agreement.

     “Second Amendment Effective Date”: the date on which the conditions precedent
set forth in Section 10 of the Second Amendment shall have been satisfied.

          (b) Section 1.1 is further amended by deleting the defined term “Remaining
Applicable Amount” and substituting in lieu thereof the following new definition:

 

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     “Remaining Applicable Amount”: as of any date of determination (the
“Determination Date”), the amount (but in no event less than zero) equal to (a) the sum of
(i) the aggregate amount of cash received by the Parent or the Borrower as common
equity after the Second Amendment Effective Date and on or prior to such Determination
Date, (ii) the amount of the net reduction after the Second Amendment Effective Date
and on or prior to such Determination Date, in Investments held by the Parent, Holdings,
the Borrower and its Class I Restricted Subsidiaries in Class II Restricted Subsidiaries,
Unrestricted Subsidiaries and other entities that are not Class I Restricted Subsidiaries
made after the Effective Date resulting from proceeds realized on the sale or other
Disposition of such Investments, proceeds representing the return of capital, including
redemptions, dividends and distributions, the amount of all guarantees released and all
payments of principal of, or interest on, Indebtedness and other obligations that constitute
such Investments, (iii) Consolidated EBITDA minus two times Consolidated Interest
Expense, in each case in this clause (iii) for each full fiscal quarter completed since the
Second Amendment Effective Date and prior to the Determination Date for which
financial statements have been delivered pursuant to Section 
6.1(a) or 6.1(b), as
applicable, (iv) to the extent deducted in computing the Consolidated EBITDA specified
in clause (iii) above and not included in clause (ii) above, any net gains on sales of assets
outside the ordinary course of business (including, without limitation, any such gains that
are extraordinary gains), (v) $114,000,000 and (vi) (A) in the case of expenditures made
pursuant to Sections 7.7(c) and 
7.8(h), $275,000,000 in the aggregate, and (B) in the case
of expenditures made pursuant to Sections 7.9(a)(i)(B) and 7.9(a)(ii), $200,000,000 in the
aggregate, minus (b) the portion of such sum expended on and after the Second
Amendment Effective Date and on or prior to such Determination Date pursuant to
Sections 7.6(k), 7.7(c), 7.8(h), 7.9(a)(i)(B) and 7.9(a)(ii). Expenditures made pursuant to
Sections 7.7(c), 7.8(h), 7,9(a)(i)(B) and 7.9(a)(ii) shall be deemed to utilize the amounts
in clause (vi)(A) above or (vi)(B) above, as applicable, prior to utilization of the amounts
in clauses (i) through (v) above.

          (c) Section 1.1 is further amended by deleting the defined terms “Applicable
Amount” and “Investment Limit”.

          (d) Section 1.1 is further amended by deleting the reference to clause (1) of
Section 7.5 where it appears in the definition of “Asset Sale” and substituting in lieu thereof a
reference to clause (m) of Section 7.5.

          3. Amendment to Section 7.1 of the Credit Agreement (Financial Condition Covenants).

          (a) Section 7.1 of the Credit Agreement is hereby amended by deleting clause
(b) in its entirety and substituting in lieu thereof the following new clause (b):

    “(b) Consolidated Senior Leverage Ratio. Permit the Consolidated Senior
Leverage Ratio for any period of four consecutive fiscal quarters to exceed 2.00 to 1.00.”

 

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          (b) Section 7.1 of the Credit Agreement is hereby amended by deleting clause
(c) in its entirety and substituting in lieu thereof the following new clause (c):

    “(c) Consolidated Adjusted Leverage Ratio. Permit the Consolidated Adjusted
Leverage Ratio for any period of four consecutive fiscal quarters to exceed 5.85 to 1.00.”

          4. Amendment to Section 7.5 of the Credit Agreement (Limitation on Disposition
of Property). Section 7.5 of the Credit Agreement is hereby amended by inserting the
following clause (m) immediately after clause (1) thereof and by re-lettering clauses (m) and (n) thereof as
(n) and (o), respectively:

          “(m) the Disposition of the Borrower’s or any Class I Restricted Subsidiary’s
minority interest in National CineMedia, LLC or any holding company holding such interest and
the subsequent Disposition of any consideration received pursuant to such Disposition;”

          5. Amendment to Section 7.6 of the Credit Agreement (Limitation on Restricted
Payments). Section 7.6 of the Credit Agreement is hereby amended by (i) deleting the word “and”
at the end of clause (i) thereof, (ii) deleting the period at the end of clause (j) and
substituting in lieu thereof the word “; and”, and (iii) adding the following clause (k) immediately after clause
(j) thereof:

    “(k) the Parent, Holdings, the Borrower or any Class I Restricted Subsidiary may
make additional Restricted Payments in an amount not to exceed the Remaining
Applicable Amount at the time of, and immediately prior to the making of, any such
Restricted Payment; provided that, at the time of and immediately after giving effect to
any such Restricted Payment, no Default or Event of Default shall have occurred and be
continuing.”

          6. Amendment to Section 7.8(h) of the Credit Agreement (Limitation on Investments). Section 7.8(h) of the Credit Agreement is hereby amended by deleting clause
(ii) therein, relettering clause (iii) as clause (ii) and deleting the words “or the Investment Limit”
at the end thereof.

          7. Amendment to Section 7.8(i) of the Credit Agreement (Limitation on
Investments). Section 7.8(i) of the Credit Agreement is hereby amended by deleting such section
in its entirety and substituting in lieu thereof the following new Section 7.8(i):

          “(i) Investments by the Borrower or any of its Class I Restricted
Subsidiaries in Permitted Acquisitions, provided that, (A) to the extent such Investment
results in the creation or acquisition of a Subsidiary of the Borrower (other than an
Excluded Foreign Subsidiary of the Class I Restricted Subsidiary so acquired), such
Subsidiary must be a Class I Restricted Subsidiary and (B) immediately prior to and after
giving effect to such Permitted Acquisition, no Default or Event of Default shall have
occurred and be continuing;”

 

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          8. Amendment to Section 7.9 of the Credit Agreement (Limitation on Optional Payments and Modifications of Debt Instruments). Section 7.9 of the Credit Agreement is
hereby amended by deleting the proviso in the first parenthetical in paragraph (a) and substituting in
lieu thereof the following:

    “provided that, the aggregate principal amount of the Borrower’s 9% Senior
Subordinated Notes due 2013 repurchased or redeemed after the Second Amendment
Effective Date pursuant to clause (i)(B) above plus the aggregate accreted amount of the
Senior Discount Notes repurchased or redeemed after the Second Amendment Effective
Date pursuant to clause (ii) above shall not exceed the Remaining Applicable Amount at
the time of, and immediately prior to the making of, any such repurchase or redemption”

          9. Amendment to Section 7.10 of the Credit Agreement (Limitation on Transactions with Affiliates). Section 7.10 of the Credit Agreement is hereby amended by
(i)deleting the word “and” at the end of clause (iii) thereof, (ii) deleting the period at the end of
clause (iv) and substituting in lieu thereof the word “; and”, and (iii) adding the following
clause (v) immediately after clause (iv) thereof:

          “(v) transactions in the ordinary course of business with National
CineMedia, LLC and transactions in the ordinary course of business with the other
members of National CineMedia, LLC in relation to Borrower’s or any Class I Restricted
Subsidiary’s interest therein, so long as at the time of entry into of any such transaction
the Borrower determined that such transaction was reasonable in relation to its business.”

          10. Conditions to Effectiveness. This Amendment shall become effective on the
date on which all of the following conditions precedent have been satisfied or waived (the
“Second Amendment Effective Date”):

          (a) The Administrative Agent shall have received a counterpart of this
Amendment duly executed and delivered by the Parent, Holdings and the Borrower.

          (b) The Administrative Agent shall have received an Acknowledgment and
Consent, substantially in the form of Exhibit A hereto (the “Acknowledgment and Consent”),
duly executed and delivered by the Borrower and the Guarantors.

          (c) The Administrative Agent shall have received executed Lender Consent
Letters, substantially in the form of Exhibit B hereto (“Lender Consent Letters”), from
Lenders constituting not less than the Required Prepayment Lenders (as defined in the Credit Agreement
without giving effect to this Amendment).

          (d) On or before the Second Amendment Effective Date, all corporate and
other proceedings taken or to be taken in connection with this Amendment shall be reasonably
satisfactory in form and substance to Administrative Agent and its counsel, and Administrative
Agent and such counsel shall have received all such counterpart originals or certified copies of
such documents as Administrative Agent may reasonably request.

 

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          (e) The Administrative Agent shall have received a certificate of the
Borrower, dated as of the Second Amendment Effective Date, in form and substance reasonably
satisfactory to the Administrative Agent.

          (f) The Administrative Agent shall have received the legal opinion of Akin
Gump Strauss Hauer & Feld LLP, counsel to the Loan Parties, in form and substance reasonably
satisfactory to the Administrative Agent.

          (g) All material governmental and third party approvals necessary in
connection with the continuing operations of the Parent, Holdings, the Borrower and its
Restricted Subsidiaries and the transactions contemplated hereby shall have been obtained and be
in full force and effect.

          (h) The Administrative Agent shall have received all expenses for which
invoices have been presented supported by customary documentation (including reasonable fees,
disbursements and other charges of counsel to the Administrative Agent), on or before the
Second Amendment Effective Date.

          11. Representations and Warranties. The Borrower hereby represents and warrants
to Administrative Agent and each Lender that (before and after giving effect to this Amendment):

          (a) Each Loan Party has the corporate power and authority, and the legal
right, to make, deliver and perform this Amendment and the Acknowledgment and Consent (the
“Amendment Documents”) to which it is a party and, in the case of the Borrower, to borrow
under the Credit Agreement as amended hereby. Each Loan Party has taken all necessary
corporate or other action to authorize the execution, delivery and performance of the Amendment
Documents to which it is a party and, in the case of the Borrower, to authorize the borrowings on
the terms and conditions of the Credit Agreement as amended by this Amendment (the
“Amended Credit Agreement”). No consent or authorization of, filing with, notice to or
other act
by or in respect of, any Governmental Authority or any other Person is required in connection
with the Amendment Documents, the borrowings under the Amended Credit Agreement or the
execution, delivery, performance, validity or enforceability of this Amendment or the
Acknowledgment and Consent, except (i) consents, authorizations, filings and notices which
have been obtained or made and are in full force and effect and (ii) the filings referred to in
Section 4.19 of the Credit Agreement. Each Amendment Document has been duly executed and
delivered on behalf of each Loan Party that is a party thereto. Each Amendment Document and
the Amended Credit Agreement constitutes a legal, valid and binding obligation of each Loan
Party that is a party thereto, enforceable against each such Loan Party in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights
generally and by general equitable principles (whether enforcement is sought by proceedings in
equity or at law).

          (b) The execution, delivery and performance of the Amendment Documents,
the borrowings under the Amended Credit Agreement and the use of the proceeds thereof will
not violate any Requirement of Law or any material Contractual Obligation of the Parent,

 

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Holdings, the Borrower or any of its Restricted Subsidiaries and will not result in, or require,
the creation or imposition of any Lien on any of their respective properties or revenues pursuant to
any Requirement of Law or any such Contractual Obligation (other than the Liens created by the
Security Documents).

          (c) Each of the representations and warranties made by any Loan Party herein
or in or pursuant to the Loan Documents is true and correct in all material respects on and as of
the Second Amendment Effective Date as if made on and as of such date (except that any
representation or warranty which by its terms is made as of an earlier date shall be true and
correct in all material respects as of such earlier date).

          (d) The Borrower and each other Loan Party has performed in all material
respects all agreements and satisfied all conditions which this Amendment and the other Loan
Documents provide shall be performed or satisfied by the Borrower or the other Loan Parties on
or before the Second Amendment Effective Date.

          (e) After giving effect to this Amendment, no Default or Event of Default has
occurred and is continuing, or will result from the consummation of the transactions
contemplated by this Amendment.

          12. Payment of Expenses. The Borrower agrees to pay or reimburse the
Administrative Agent for all of its reasonable out-of-pocket costs and expenses incurred in
connection with this Amendment, any other documents prepared in connection herewith and the
transactions contemplated hereby, including, without limitation, the reasonable fees and
disbursements of counsel to the Administrative Agent.

          13. No Other Amendments or Waivers; Confirmation. Except as expressly
provided hereby, all of the terms and provisions of the Credit Agreement and the other Loan
Documents are and shall remain in full force and effect. The amendments contained herein shall
not be construed as an amendment or waiver of any other provision of the Credit Agreement or the
other Loan Documents or for any purpose except as expressly set forth herein or a consent to any
further or future action on the part of the Borrower that would require the consent of the
Administrative Agent or the Lenders.

          14. GOVERNING LAW; Miscellaneous.

          (a) THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.

          (b) On and after the Second Amendment Effective Date, each reference in the
Credit Agreement to “this Agreement”, “hereunder”, “hereof, “herein”, or words of like import
referring to the Credit Agreement, and each reference in 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 hereby.

 

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          (c) This Amendment may be executed by one or more of the parties to this Agreement on any
number of separate counterparts, and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of this Amendment, the Acknowledgment
and Consent and the Lender Consent Letters signed by all the parties shall be lodged with the
Borrower and the Administrative Agent. This Amendment may be delivered by facsimile transmission of
the relevant signature pages hereof.

          (d) Upon execution and delivery thereof by a Lender, each Lender Consent Letter shall be binding
upon such Lender and each of its successors and assigns (including assignees of its Loans in whole
or in part prior to effectiveness hereof).

 

 

          IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and
delivered by their respective proper and duly authorized officers as of the day and year first
above written.

	 	 	 	 	 
	 	CINEMARK, INC.

 	 
	 	By:  	/s/ Michael Cavalier
 	 
	 	 	Name: Michael Cavalier 	 
	 	 	Title:   Senior Vice President-General Counsel

            and Secretary 	 
	 

	 	 	 	 	 
	 	CNMK HOLDING, INC.

 	 
	 	By: 	/s/
Michael G. Morgan	 
	 	 	Name: Michael G. Morgan 	 
	 	 	Title:   Vice President 	 
	 

	 	 	 	 	 
	 	CINEMARK USA, INC.

 	 
	 	By:  	/s/ Robert  Copple
 	 
	 	 	Name: Robert  Copple 	 
	 	 	Title:   Senior Vice President, Treasurer,

            Chief Financial Officer & Assistant Secretary 	 
	 

	 	 	 	 	 	 	 	 	 
	 	 	LEHMAN COMMERCIAL PAPER INC., as 
Administrative Agent	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	/s/ Craig Malloy	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	Craig Malloy	 	 
	 

	 	 	 	Title:
	 	Authorized
Signatory

	 	 
	 

	 	 	 	 	 	 

	 	 

	 	 	 	 	 	 	 	 	 
	 	 	LEHMAN BROTHERS INC., as Sole Arranger of
 the Tranche D Term Loan
Commitments	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	/s/ Craig Malloy	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	Craig Malloy	 	 
	 

	 	 	 	Title:
	 	Vice
President

	 	 
	 

	 	 	 	 	 	 

	 	 

 

 

EXHIBIT A

FORM OF ACKNOWLEDGMENT AND CONSENT

          Reference
is made the Second Amendment, dated July 7, 2006, but effective
as of June 30, 2006 (the
“Amendment”), to the Amended and Restated Credit Agreement, dated as of April 2, 2004 (as
amended, supplemented or otherwise modified in writing from time to
time, the “Credit Agreement”),
among CINEMARK, INC. (the “Parent”), CNMK HOLDING, INC. (“Holdings”), CINEMARK USA,
INC. (the “Borrower”), the several banks and other financial institutions or entities from
time to time parties to the Credit Agreement (the
“Lenders”), LEHMAN BROTHERS INC. and
GOLDMAN SACHS CREDIT PARTNERS L.P., as joint lead arrangers and joint bookrunners, GOLDMAN SACHS
CREDIT PARTNERS L.P., as syndication agent, DEUTSCHE BANK SECURITIES
INC., THE BANK OF NEW YORK,
GENERAL ELECTRIC CAPITAL CORPORATION and CIBC INC., as co-documentation agents, and LEHMAN
COMMERCIAL PAPER INC., as administrative agent. Unless otherwise defined herein, capitalized terms
used herein and defined in the Credit Agreement are used herein as therein defined.

          Each of the undersigned parties to the Guarantee and Collateral Agreement hereby (a) consents to
the transactions contemplated by the Amendment and (b) acknowledges and agrees that the guarantees
and grants of security interests made by such party contained in the Guarantee and Collateral
Agreement are, and shall remain, in full force and effect after giving effect to the Amendment.

 

 

          IN WITNESS WHEREOF, each of the undersigned has caused this Acknowledgment and Consent to be duly
executed and delivered as of the date first above written.

	 	 	 	 	 
	 	CINEMARK, INC.

 	 
	 	By:  	/s/ Michael Cavalier
 	 
	 	 	Michael Cavalier 	 
	 	 	Senior Vice President-General Counsel
 and Secretary 	 
	 

	 	 	 	 	 
	 	CNMK HOLDING, INC.

 	 
	 	By:  	/s/
Michael G. Morgan	 
	 	 	Michael G. Morgan 	 
	 	 	Vice President 	 
	 

	 	 	 	 	 
	 	CINEMARK USA, INC.

 	 
	 	By:  	/s/ Robert Copple
 	 
	 	 	Name:  	Robert Copple 	 
	 	 	Title:  	Senior Vice President, Treasurer,

Chief Financial Officer & Assistant Secretary 	 
	 

	 	 	 	 	 
	 	CINEMARK INVESTMENTS CORPORATION

CINEMARK LEASING COMPANY

CINEMARK, L.L.C.

CINEMARK MEXICO (USA), INC.

GREELEY HOLDINGS, INC.

CINEMARK PARTNERS I, INC.

CINEMARK PROPERTIES, INC.

MULTIPLEX SERVICES, INC.

SUNNYMEAD CINEMA CORP.

TRANS TEXAS CINEMA, INC.

BRASIL HOLDINGS, L.L.C.

 	 
	 	By:  	/s/ Michael Cavalier
 	 
	 	 	Name:  	Michael Cavalier 	 
	 	 	Title:  	Senior Vice President-General Counsel 
and Secretary 	 
	 

 

 

	 	 	 	 	 
	 	CNMK TEXAS PROPERTIES, LTD.

 	 
	 	By:  	  Sunnymead Cinema Corp., its general partner
 	 

	 	 	 	 	 
	 	 	 
	 	By:  	/s/ Michael Cavalier
 	 
	 	 	Name:  	Michael Cavalier 	 
	 	 	Title:  	Senior Vice President-General 
Counsel and Secretary 	 
	 

	 	 	 	 	 
	 	 	LAREDO THEATRE, LTD.
	 
	 	 	 	 
	 

	 	By:
	 	CNMK Texas Properties, Ltd., 
its general partner

	 	 	 	 	 
	 

	 	By:
	 	Sunnymead Cinema Corp.,
	 

	 	 	 	its general partner

	 	 	 	 	 
	 	 	 
	 	By:  	     /s/ Michael Cavalier
 	 
	 	 	Name:  	Michael Cavalier  	 
	 	 	Title:  	Senior Vice President-General 
 Counsel and Secretary 	 
	 

	 	 	 	 	 
	 	CNMK DELAWARE INVESTMENTS I, L.L.C.

CNMK DELAWARE INVESTMENTS II, L.L.C.

CNMK INVESTMENTS, INC.

MULTIPLEX PROPERTIES, INC.

 	 
	 	By:  	/s/
Michael G. Morgan	 
	 	 	Michael G. Morgan 	 
	 	 	Vice President 	 
	 

	 	 	 	 	 
	 	 	CNMK DELAWARE
INVESTMENT 
PROPERTIES, L.P.
	 
	 	 	 	 
	 

	 	By:
	 	CNMK Delaware Investments I, L.L.C., its 
general partner

	 	 	 	 	 
	 	 	 
	 	By:  	/s/
Michael G. Morgan	 
	 	 	Michael G. Morgan 	 
	 	 	Vice President 	 

 

 

EXHIBIT B

FORM OF LENDER CONSENT LETTER

CINEMARK USA, INC.

AMENDED AND RESTATED CREDIT AGREEMENT

DATED AS OF APRIL 2, 2004

	To:	 	 Lehman Commercial Paper Inc.,

  as Administrative Agent

745 Seventh Avenue

Bank Loans — 5th Floor

New York, New York 10019

Att: Karl Cerni

Ladies and Gentlemen:

          Reference is made to that certain AMENDED AND RESTATED CREDIT AGREEMENT, dated as of April 2, 2004
(the “Credit Agreement”; the terms defined therein being used herein as therein defined), among
CINEMARK, INC. (the “Parent”). CNMK HOLDING, INC. (“Holdings”), CINEMARK USA, INC.
(the “Borrower”), the several banks and other financial institutions or entities from time
to time parties to the Credit Agreement (the
“Lenders”), LEHMAN BROTHERS INC. and GOLDMAN
SACHS CREDIT PARTNERS L.P., as joint lead arrangers and joint bookrunners, GOLDMAN SACHS CREDIT
PARTNERS L.P., as syndication agent, DEUTSCHE BANK SECURITIES INC., THE BANK OF NEW YORK, GENERAL
ELECTRIC CAPITAL CORPORATION and CIBC INC., as co-documentation agents, and LEHMAN COMMERCIAL PAPER
INC., as administrative agent.

          The Borrower has requested that the Required Prepayment Lenders consent to amend the provisions of
the Credit Agreement solely on the terms described in the Second Amendment, dated July 7, 2006, but
effective as of June 30, 2006, substantially in the form delivered to the undersigned Lender on or
prior to the date hereof (the “Amendment”).

          Pursuant to Section 10.1 of the Credit Agreement, the undersigned Lender hereby consents to the
execution by the Administrative Agent of the Amendment.

	 	 	 	 	 	 	 
	 

	 	 	 	Very truly yours,	 	 
	 
	 

	 	 	 	 

(NAME OF LENDER)
	 	 

	 	 	 	 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

Dated: July __, 2006exv10w1

 

Exhibit 10.1

Penford Corporation

First Amendment to Amended and Restated Credit Agreement

     This First Amendment to Amended and Restated Credit Agreement (herein, the “Amendment”) is
entered into as of July 7, 2006, by and among Penford Corporation, a Washington
corporation (the “Borrower”), the direct and indirect Subsidiaries of the Borrower from time to
time party to the Credit Agreement, as Guarantors, the several financial institutions from time to
time party to this Agreement, as Lenders, and Harris N.A., successor by merger to Harris
Trust and Savings Bank, as Administrative Agent as provided herein.

Preliminary Statements

     A. The Borrower, the Guarantors, the Lenders and the Administrative Agent are parties to that
certain Amended and Restated Credit Agreement dated as of August 22, 2005 (the “Credit Agreement”).
All capitalized terms used herein without definition shall have the same meanings herein as such
terms have in the Credit Agreement.

     B. The Borrower and the Lenders have agreed to make certain amendments to the Credit
Agreement, in each case under the terms and conditions set forth in this Amendment.

     Now, Therefore, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as follows:

Section 1. Amendments to the Credit Agreement.

     Subject to the satisfaction of the conditions precedent set forth in Section 2 hereof, the
Credit Agreement shall be and hereby is amended as follows:

     1.1. The definition of the term “Indebtedness for Borrowed Money” appearing in Section 5.1 of
the Credit Agreement shall be amended to read as follows:

     “Indebtedness for Borrowed Money” means for any Person (without duplication) (a) all
indebtedness of such Person for borrowed money, whether current or funded, or secured or
unsecured, (b) all indebtedness for the deferred purchase price of Property or services, (c)
all indebtedness created or arising under any conditional sale or other title retention
agreement with respect to Property acquired by such Person (even though the rights and
remedies of the seller or Lender under such agreement in the event of a default are limited
to repossession or sale of such Property), (d) all indebtedness secured by a purchase money
mortgage or other Lien to secure all or part of the purchase price of Property subject to
such mortgage or Lien, (e) all obligations under leases which shall have been or must be, in
accordance with GAAP, recorded as Capital Leases in respect of

 

 

which such Person is liable as lessee, (f) any counter-indemnity obligation in respect
of a guarantee, indemnity, bond, standby or documentary letter of credit or any other
instrument issued by a bank or financial institution, (g) any indebtedness, whether or not
assumed, secured by Liens on Property acquired by such Person at the time of acquisition
thereof, (h) any shares which are expressed to be redeemable and (i) any liability in
respect of any guarantee or indemnity for any of the items referred to above, and (j) all
indebtedness secured by any Lien upon Property of such Person, whether or not such Person
has assumed or become liable for the payment of such indebtedness; it being understood that
the term “Indebtedness for Borrowed Money” shall not include trade payables arising in the
ordinary course of business.

     1.2. Section 8.22(d) of the Credit Agreement shall be amended to read as follows:

     (d) Capital Expenditures. The Borrower shall not, nor shall it permit any of its
Subsidiaries to, incur Capital Expenditures (but excluding Capital Expenditures made with
the Net Cash Proceeds of any Event of Loss as permitted by Section 1.9(b)(i) hereof and
Capital Expenditures made with the proceeds of grants from governmental entities) in an
amount in excess of:

     (i) $20,000,000 (or the Australian Dollar Equivalent or NZ Dollar Equivalent)
in the aggregate during the fiscal year ending August 31, 2006;

     (ii) $48,000,000 (or the Australian Dollar Equivalent or NZ Dollar Equivalent
with respect to not more than $20,000,000) during the fiscal year ending August 31,
2007, of which not more than $20,000,000 (or the Australian Dollar Equivalent or NZ
Dollar Equivalent) shall be for Capital Expenditures that are unrelated to the
construction (including the acquisition and installation of equipment) of an ethanol
production facility in Cedar Rapids, Iowa; and

     (iii) $20,000,000 (or the Australian Dollar Equivalent or NZ Dollar Equivalent)
in the aggregate during any fiscal year thereafter;

provided, however, for any fiscal year when Total Senior Funded Debt/EBITDA Ratio is less than
2.0 to 1.0 for each fiscal quarter of such fiscal year, Capital Expenditures for such year (or in
the case of the fiscal year ending August 31, 2007, Capital Expenditures that are unrelated to the
construction (including the acquisition and installation of equipment) of an ethanol production
facility in Cedar Rapids, Iowa) shall not exceed $25,000,000 (or the Australian Dollar Equivalent
or NZ Dollar Equivalent) for such fiscal year.

     1.3. The Required Lenders hereby agree that the construction and operation of an ethanol
production facility in Cedar Rapids, Iowa shall not be a violation of Section 8.18 of the Credit
Agreement.

-2-

 

Section 2. Conditions Precedent.

     The effectiveness of this Amendment is subject to the satisfaction of all of the following
conditions precedent:

     2.1. The Borrower, the Guarantors, and the Required Lenders shall have executed and delivered
this Amendment.

     2.2. Each of the representations and warranties set forth in Section 6 of the Credit Agreement
shall be true and correct in all material respects, except that the representations and warranties
made under Section 6.5 shall be deemed to refer to the most recent financial statements of the
Borrower delivered to the Lenders.

     2.3. Upon giving effect to this Amendment, (a) the Borrower shall be in full compliance with
all of the terms and conditions of the Loan Documents and (b) no Default or Event of Default shall
have occurred and be continuing thereunder or shall result after giving effect to this Amendment.

Section 3. Representations.

     In order to induce the Required Lenders to execute and deliver this Amendment, the Borrower
hereby represents to the Lenders that as of the date hereof, and after giving effect to the
amendments called for hereby, the representations and warranties set forth in Section 6 of the
Credit Agreement are and shall be and remain true and correct in all material respects (except that
for purposes of this paragraph the representations contained in Section 6.5 shall be deemed to
refer to the most recent financial statements of the Borrower delivered to the Lenders) and after
giving effect to this Amendment (a) the Borrower is in compliance with all of the terms and
conditions of the Loan Documents and (b) no Default or Event of Default exists under the Credit
Agreement or shall result after giving effect to this Amendment.

Section 4. Miscellaneous.

     4.1. The Borrower and the Guarantors heretofore executed and delivered to the Agent and the
Lenders the Collateral Documents to which it is a party. Each of the Borrower and the Guarantors
hereby acknowledges and agrees that the Liens created and provided for by the Collateral Documents
to which it is a party continue to secure, among other things, the indebtedness, obligations and
liabilities described therein; and the Collateral Documents to which it is a party and the rights
and remedies of the Agents and the Lenders thereunder, the obligations of the Borrower and the
Guarantors thereunder, and the Liens created and provided for thereunder remain in full force and
effect and shall not be affected, impaired or discharged hereby. Nothing herein contained shall in
any manner affect or impair the priority of the Liens created and provided for by the Collateral
Documents to which it is a party as to the indebtedness, obligations and liabilities which would be
secured thereby prior to giving effect to this Amendment.

     4.2. Except as specifically amended herein or waived hereby, the Credit Agreement shall
continue in full force and effect in accordance with its original terms. Reference to this

-3-

 

specific Amendment need not be made in the Credit Agreement, the other Loan Documents, or any other
instrument or document executed in connection therewith, or in any certificate, letter or
communication issued or made pursuant to or with respect to the Credit Agreement, any reference in
any of such items to the Credit Agreement being sufficient to refer to the Credit Agreement as
amended hereby.

     4.3. This Amendment may be executed in any number of counterparts, and by the different
parties on different counterpart signature pages, all of which taken together shall constitute one
and the same agreement. Any of the parties hereto may execute this Amendment by signing any such
counterpart and each of such counterparts shall for all purposes be deemed to be an original. This
Amendment shall be governed by the internal laws of the State of Illinois.

     4.4. The Borrower agrees to pay all reasonable out-of-pocket costs and expenses incurred by
the Administrative Agent in connection with the credit facilities and the preparation, execution
and delivery of this Amendment, and the documents and transactions contemplated hereby, including
the reasonable fees and expenses of counsel for the Administrative Agent with respect to the
foregoing.

[Remainder of Page Intentionally Left Blank]

-4-

 

          This First Amendment to Amended and Restated Credit Agreement is entered into as of the date
and year first above written.

	 	 	 	 	 	 	 	 	 
	 	 	“Borrower”	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Penford Corporation	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	“Guarantors”	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Penford Products Co.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title	 	 	 	 
	 

	 	 	 	 	 	 	 	 

Penford Corporation

Signature Page to First Amendment

to Amended and Restated Credit Agreement

 

 

          Accepted and agreed to as of the date and year last above written.

	 	 	 	 	 	 	 	 	 
	 	 	“Lenders”	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Harris N.A., in its individual capacity
as a Lender, as L/C Issuer, and as
Administrative Agent
	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Wells Fargo Bank, N.A.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	U.S. Bank National Association	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	LaSalle Bank National Association	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title	 	 	 	 
	 

	 	 	 	 	 	 	 	 

Penford Corporation

Signature Page to First Amendment

to Amended and Restated Credit Agreement

 

 

	 	 	 	 	 	 	 	 	 
	 	 	Cooperative Centrale

Raiffeisen-Boerenleenbank B.A., 
“Rabobank
Nederland,” New York 
Branch
	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Australia and New Zealand Banking Group
      Limited	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title	 	 	 	 
	 

	 	 	 	 	 	 	 	 

Penford Corporation

Signature Page to First Amendment

to Amended and Restated Credit Agreement

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