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EXHIBIT 10.25
AMENDMENT NO. 8 TO
AMENDED AND RESTATED LINE OF CREDIT AGREEMENT
This Amendment No. 8 (the "Amendment") dated as of August 14, 1998, is
among Bank of America National Trust and Savings Association (the "Bank"), The
Gymboree Corporation ("TGC"), Gymboree Manufacturing, Inc. ("GMI"), Gymboree,
Inc. ("GI"), Gymboree Industries Limited ("GIL"), Gymboree U.K., Limited
("GUKL"), Gymboree U.K. Leasing Limited ("GUKLL"), Gymboree Ireland Leasing
Limited ("XXXX"), Gymboree of Ireland, Limited ("GOIL"), Gymboree Industries
Holdings Limited ("GIHL"), Gymboree Hong Kong Limited ("GHKL"), and Gymboree
Japan K.K. ("GJKK"). (TGC, GMI, GI, GIL, GUKL, GUKLL, GILL, GOIL, GIHL, GHKL,
and GJKK are hereinafter referred to collectively as the "Borrowers" and
individually as a "Borrower").
RECITALS
A. The Bank, TGC, and GMI entered into a certain Amended and Restated
Line of Credit Agreement dated as of October 27, 1995, as previously amended
(the "Agreement").
Pursuant to Amendment No. 1 to Amended and Restated Line of Credit Agreement
dated as of July 17, 1997, GI and GIL were added as Borrowers.
Pursuant to Amendment No. 2 to Amended and Restated Line of Credit Agreement
dated as of August 11, 1997 ("Amendment No. 2"), GUKL was added as a Borrower
for the limited purpose of making available to GUKL the new foreign exchange
facility added to the Agreement by Amendment No. 2.
Pursuant to Amendment No. 3 to Amended and Restated Line of Credit Agreement and
Waiver dated as of January 9, 1998 ("Amendment No. 3 and Waiver"), GUKLL was
added as a Borrower for the limited purpose of making standby letters of credit
available to GUKLL. Standby letters of credit were also made available to GUKL
pursuant to Amendment No. 3 and Waiver.
Pursuant to Amendment No. 4 to Amended and Restated Line of Credit Agreement
dated as of January 30, 1998, TGC's liquidity covenant was amended for and only
for TGC's fiscal year ending as of January 31, 1998.
Pursuant to Amendment No. 5 to Amended and Restated Line of Credit Agreement
dated as of March 9, 1998 ("Amendment No. 5"), cash advances for use by TGC were
made available under the Agreement, TGC's tangible net worth covenant was
amended, TGC's
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liquidity covenant was further amended, and a requirement for certain additional
guaranties was added to the Agreement.
Pursuant to Amendment No. 6 to Amended and Restated Line of Credit Agreement
dated as of March 9, 1998 ("Amendment No. 6"), GILL, GOIL, GIHL, GHKL, and GJKK
were added as Borrowers for the limited purpose of making available to GILL,
GOIL, GIHL, GHKL, and GJKK the foreign exchange facility added to the Agreement
by Amendment No. 2. The foreign exchange facility was also made available to
GUKLL pursuant to Amendment No. 6. In conjunction with making the foreign
exchange facility available to these Borrowers, the foreign exchange contract
limit, the settlement limit, and the Revaluation Limit were increased
accordingly pursuant to Amendment No. 6.
Pursuant to Amendment No. 7 to Amended and Restated Line of Credit Agreement
dated June 26, 1998 ("Amendment No. 7"), certain within-line limitations
applicable to letters of credit were adjusted in order to make those limitations
more flexible and less restrictive.
B. The Borrowers have requested the Bank to amend the Agreement in order
to increase the Advance Limit during a specific period of time and to delete
TGC's liquidity covenant. The Bank is willing to grant those requests subject to
the additional terms and conditions set forth in this Amendment.
C. Finally, the Bank has decided to further extend the date by which it
was to receive certain guaranties and related ancillary documents from GOIL,
GILL, GHKL, and GJKK under Amendment No. 5, as previously extended under
Amendment No. 7. By its execution of this Amendment, the Bank wishes to confirm
its decision regarding those certain guaranties.
AGREEMENT
1. Definitions. Capitalized terms used but not defined in this Amendment
shall have the meaning given to them in the Agreement.
2. Amendment. The Agreement is hereby amended as follows:
2.1 Paragraph 1.1(b) is amended to read in its entirety as follows:
(b) This is a revolving line of credit providing for cash
advances and letters of credit. During the period that cash advances
are available (which period is shorter than this line of credit's
overall availability period described below), the Borrowers may repay
principal amounts of cash advances and reborrow
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them. The aggregate principal balance of cash advances permitted to be
outstanding at any one time (the "Advance Limit") is Thirty Million
Dollars ($30,000,000) from July 28, 1998, through November 29, 1998,
Fifteen Million Dollars ($15,000,000) from November 30, 1998, through
December 30, 1998, and Zero Dollars ($0.00) from December 31, 1998,
through the Expiration Date.
2.2 Paragraph 1.6(a) is amended to read in its entirety as follows:
(a) Unless the Borrowers elect an optional interest rate as
described below, the interest rate is the Bank's Reference Rate.
2.3 In the last sentence of Paragraph 1.8(a), the spread "plus 0.75
percentage point" is substituted for the spread "plus 0.5 percentage
point."
2.4 Article 2 is amended to read in its entirety as follows:
2. PERIODIC FEE.
The Borrowers agree to pay a fee equal to 0.0625% per annum of the
Advance Limit, payable in arrears. It is provided, however, that during any
period when the Advance Limit exceeds Fifteen Million Dollars ($15,000,000), the
Borrowers agree to pay a fee, payable in arrears, equal to 0.0625% per annum of
that portion of the Advance Limit up to and including Fifteen Million Dollars
($15,000,000) and 0.15% per annum of that portion of the Advance Limit that
exceeds Fifteen Million Dollars ($15,000,000). This fee was paid on July 31,
1998, and is next due on October 31, 1998, and thereafter on December 31, 1998.
2.5 In Paragraph 7.2, the first sentence is amended to read in its
entirety as follows:
To maintain on a consolidated basis tangible net worth equal to at least
the amount indicated as of the last day of each fiscal period specified
below:
Period Amount
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2nd fiscal quarter of $157,000,000
1998 fiscal year
3rd fiscal quarter of $160,000,000
1998 fiscal year
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1998 fiscal year $166,000,000
2.6 A new sentence is added at the end of Paragraph 7.2, and it reads
in its entirety as follows:
In calculating TGC's tangible net worth in accordance with the foregoing
definition, the gross book value of TGC's assets shall include the
aggregate gross book value of TGC's lease rights up to a maximum aggregate
value of Two Million Five Hundred Thousand Dollars ($2,500,000) for all
such lease rights.
2.7 Paragraph 7.4 is deleted.
2.8 A new Paragraph 7.5 is added to the Agreement, and it reads in
its entirety as follows:
7.5 Dividends. Not to declare or pay any dividends on any of its
shares except dividends payable in capital stock of TGC, and not to
purchase, redeem, or otherwise acquire for value any of its shares, or
create any sinking fund in relation thereto. It is provided, however, that
TGC may at any time and in any amount purchase, redeem, or otherwise
acquire its shares for value from its employees. It is further provided
that TGC may spend up to Three Million Dollars ($3,000,000) in each fiscal
year in order to purchase, redeem, or otherwise acquire its shares for
value from shareholders who are not its employees.
3. Representations and Warranties. When the Borrowers sign this
Amendment, the Borrowers represent and warrant to the Bank that: (a) there is no
event which is, or with notice or lapse of time or both would be, a default
under the Agreement, except those events, if any, that have been disclosed in
writing to the Bank or waived in writing by the Bank, (b) the representations
and warranties in the Agreement are true as of the date of this Amendment as if
made on the date of this Amendment, (c) this Amendment is within each Borrower's
powers, has been duly authorized, and does not conflict with any Borrower's
organizational papers, (d) this Amendment does not conflict with any law,
agreement, or obligation by which any Borrower is bound, and (e) the Borrowers
are entering into this Amendment on the basis of their own investigation and for
their own reasons, without reliance upon the Bank or any other entity or
individual.
4. GOIL's, GILL's, GHKL's, and GJKK's Guaranties. By its execution of
this Amendment, the Bank confirms its unilateral decision to further extend to
October 31, 1998, the deadline for its receipt of the guaranties to be signed by
GOIL, GILL, GHKL,
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and GJKK, respectively, and the related ancillary documents required under
Section 4 of Amendment No. 5.
5. Effect of Amendment. Except as provided in this Amendment, all of the
terms and conditions of the Agreement shall remain in full force and effect.
This Amendment is executed as of the date stated at the beginning of this
Amendment.
Bank of America National Trust
and Savings Association
By
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By
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The Gymboree Corporation
By
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By
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Gymboree Manufacturing, Inc.
By
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By
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Gymboree, Inc.
By
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By
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Gymboree Industries Limited
By
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By
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Gymboree U.K., Limited
By
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By
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Gymboree U.K. Leasing Limited
By
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By
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Gymboree Ireland Leasing Limited
By
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By
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Gymboree of Ireland, Limited
By
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By
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Gymboree Industries Holdings Limited
By
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Gymboree Hong Kong Limited
By
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Gymboree Japan K.K.
By
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By
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