EXHIBIT 10.1
SIXTH AMENDMENT
TO
REVOLVING CREDIT AGREEMENT
SIXTH AMENDMENT, dated as of October 5, 2000 (this "Sixth
Amendment"), to the Revolving Credit Agreement, dated as of August 26, 1997 (as
amended by (i) that certain First Amendment to Revolving Credit Agreement, dated
September 30, 1997, (ii) that certain Second Amendment to Revolving Credit
Agreement, dated as of August 29, 1998, (iii) those certain letter agreements,
dated October 4, 1999, February 24, 2000 and July 18, 2000, and as may be
hereafter amended, supplemented or modified from time to time in accordance with
its terms, the "Credit Agreement"), by and among WEINER'S STORES, INC., a
Delaware corporation (the "Borrower"), the financial institutions from time to
time party thereto (collectively, the "Lenders") and THE CIT GROUP/BUSINESS
CREDIT, INC., as a Lender (in such capacity, "CIT") and as agent for the Lenders
(in such capacity, the "Agent").
WHEREAS, the Borrower desires to close certain of its
retail stores; and
WHEREAS, the Borrower has revised and delivered to Lenders
its financial projections for the remainder of fiscal year 2000; and
WHEREAS, in connection with such store closures and revised
projections, the Borrower has requested certain amendments to the Credit
Agreement; and
WHEREAS, the Agent and the Lenders are willing to make such
amendments to the Credit Agreement upon the terms and subject to the conditions
set forth in this Sixth Amendment.
NOW THEREFORE, for valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and subject to the fulfillment of
the conditions set forth below, the parties hereto agree as follows:
AMENDMENTS TO THE CREDIT AGREEMENT
----------------------------------
1.1 Definitions. All capitalized terms used herein and not
otherwise defined herein are used herein as defined in the Credit Agreement.
1.2 Amendment to Definition of Borrowing Base. The
definition of the term "Borrowing Base" in Section 1.01 of the Credit Agreement
is hereby amended and restated in its entirety as follows:
"Borrowing Base" shall mean an amount equal to
the difference between (i) the sum of (A) the aggregate of
65% of the Book Value of Eligible Inventory for the months
of June, July and November of each calendar year, and 60%
of the Book Value of Eligible Inventory for each other
month of each calendar year, and (B) $3,000,000 less (ii)
the sum of (A) $1,170,000 provided that the dollar amount
of the $1,170,000 reduction set forth in this subsection
(A) shall be decreased by $10,000 for each landlord waiver
delivered to the Agent pursuant to section 7.17 hereof with
respect to a retail store location of the Borrower, (B) an
additional $1,000,000, provided that the dollar amount of
the $1,000,000 reduction set forth in this subsection (B)
shall be decreased by $200,000 for each credit card
depository agreement delivered to the Agent pursuant to
Section 7.13 hereof and (C) until such time as the sales
tax escrow account required by Section 7.20 hereof is
established and fully funded in accordance with such
Section 7.20, all accrued and unpaid sales tax obligations
of the Borrower determined on a weekly basis. All such
landlord waivers and credit card bank depository agreements
shall be in form and substance satisfactory to the Agent.
1.3 Amendment to Section 2.01. Section 2.01 of the Credit
Agreement is hereby amended by replacing the amount of "$40,000,000" contained
therein with the amount of "$35,000,000".
1.4 Amendment to Section 8.04(b). Section 8.04(b) of the
Credit Agreement is hereby amended and restated in its entirety as follows:
(b) Sell, assign, lease or otherwise transfer or dispose
of, or permit any of its Subsidiaries to sell, assign,
lease or otherwise transfer or dispose of, whether in one
transaction or in a series of related transactions, any of
its properties, rights or other assets whether now owned or
hereafter acquired to any Person, provided that (i) the
Borrower may sell Inventory in the ordinary course of
business, (ii) the Borrower and its Subsidiaries may
dispose of obsolete, worn-out property or excess inventory
in the ordinary course of business, (iii) the Borrower may
sell or discount without recourse its accounts receivable
only in connection with the compromise thereof or the
assignment of past due accounts receivable for collection,
(iv) the Borrower may sell Inventory and other assets for
fair market value, for cash, in connection with the closing
of the retail stores set forth on Schedule 8.04(b), and (v)
the Borrower may sell or otherwise dispose of assets, other
than Inventory, for fair market value, for cash, provided
that the Net Proceeds of such dispositions do not exceed
$250,000 in the aggregate.
1.5 Amendment to Section 8.08. Section 8.08 of the Credit
Agreement is amended and restated in its entirety as follows:
8.08 Capital Expenditures. Make or be committed
to make, or permit any of its Subsidiaries to make or be
committed to make, any expenditure (by purchase or
capitalized lease) for fixed or capital assets other than
expenditures (including obligations under Capitalized
Leases) which would not cause the aggregate amount of all
such expenditures to exceed (i) $7,200,000 for the fiscal
year of the Borrower ending February 3, 2001, (ii)
$3,000,000 for each of the fiscal years ending February 2,
2002, and February 1, 2003, respectively, or (iii)
$2,000,000 for the period beginning on February 2, 2003 and
ending on August 30, 2003.
1.6 Amendment to Section 8.12. Section 8.12 of the Credit
Agreement is amended and restated in its entirety as follows:
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Cumulative FIFO EBITDA. (i) Permit Cumulative FIFO EBITDA
for any fiscal quarter (calculated on a rolling twelve (12)
month basis) of the Borrower ending on the dates set forth
below to be less than the amount specified opposite each
such fiscal quarter.
Fiscal Quarter Amount
-------------- ------
October 28, 2000 $(10,900,000)
February 3, 2001 (4,000,000)
May 5, 2001 2,875,000
August 4, 2001 2,875,000
November 3, 2001 2,875,000
February 2, 2002 3,375,000
May 4, 2002 3,875,000
August 3, 2002 3,875,000
November 2, 2002 3,875,000
February 1, 2003 4,375,000
May 3, 2003 4,875,000
August 2, 2003 4,875,000
The Lenders and the Borrower acknowledge that when and if
any or all of the retail stores set forth on Schedule
8.04(b) are closed, the Borrower and the Lenders will
discuss whether any adjustments to the amounts set forth
above are necessitated as a result of such closures.
1.7 Amendment to Section 8.16. Section 8.16 of the Credit
Agreement is amended and restated in its entirety as follows:
The Borrower shall not permit the aggregate amount of its
Inventory (valued at Book Value) at the end of each fiscal
quarter ending on the dates set forth below to be more than
the amounts specified opposite each such fiscal quarter set
forth below:
Fiscal Quarter Maximum Amount
-------------- --------------
October 28, 2000 $65,000,000
February 3, 2001 65,000,000
May 5, 2001 65,000,000
August 4, 2001 65,000,000
November 3, 2001 65,000,000
February 2, 2002 65,000,000
May 4, 2002 65,000,000
August 3, 2002 65,000,000
November 2, 2002 65,000,000
February 1, 2003 65,000,000
May 3, 2003 65,000,000
August 2, 2003 and each 65,000,000
fiscal year thereafter
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1.8 Amendment to Article VII. Article VII is amended by
adding Section 7.19 at the end of such Article.
7.19 Sales Tax Escrow Account. The Borrower shall
on or prior to October 6, 2000 establish and thereafter
maintain a separate bank account in its name, but styled
"for the benefit of sales taxing authorities," and shall
maintain an amount of cash in this account equal to an
estimate, updated weekly in a manner acceptable to the
Agent, of the Borrower's accrued sales tax obligations.
1.9 Amendment to Section 9.01(c). Section 9.01(c) of the
Credit Agreement is amended by replacing the phrase "or 7.18" with the phrase,
"7.18 or 7.19".
1.10 Amendment to Section 10. 13(a). Section 10. 13 (a) of
the Credit Agreement is amended and restated in its entirety as follows:
10. 13. Assignment: Participations. (a) Each
Lender shall have the right at any time to assign to one or
more Persons (then entitled to receive payments of
principal, interest and fees for the account of its lending
office under this Agreement free from withholding of
Federal income tax) a portion of its rights and obligations
under this Agreement (including, without limitation, a
portion of its Revolving Credit Commitment, the Loans owing
to it and its rights and obligations as a Lender with
respect to Letters of Credit) and the other Related
Documents; provided, however, that (i) the parties to each
such assignment shall execute and deliver to the Agent, for
its acceptance and recording in the Register (as
hereinafter defined), an Assignment and Acceptance, and
(ii) after giving effect to such assignment, CIT's
Revolving Credit Commitment shall be at least equal to the
lesser of (1) $17,500,001 and (2) an amount equal to a
majority of the aggregate amount of the Revolving Credit
Commitments. The Borrower shall pay any and all costs and
fees that are paid to induce any assignee (other than CIT)
under an Assignment and Acceptance to execute such
Assignment and Acceptance. Such payment may be charged, at
the Agent's sole option, to any account of the Borrowers
maintained by the Agent. Upon such execution, delivery,
acceptance and recording, from and after the effective date
specified in each Assignment and Acceptance, (A) the
assignee thereunder shall be a party hereto and to the
other Related Documents and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to
such Assignment and Acceptance, have the rights and
obligations (including, without limitation, the obligation
to participate in Letters of Credit) of a Lender hereunder
and thereunder and (B) the assignor shall, to the extent
that rights and obligations hereunder have been assigned by
it pursuant to such Assignment and Acceptance, relinquish
its rights and be released from its obligations under this
Agreement.
CONDITIONS TO EFFECTIVENESS
---------------------------
This Sixth Amendment shall become effective only upon
satisfaction in full of the following conditions precedent (the first date upon
which all such conditions have been satisfied being herein called the "Effective
Date"):
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2.1 The Agent shall have received a counterpart of this
Sixth Amendment which bears the signature of the Borrower.
2.2 All legal matters incident to this Sixth Amendment
shall be satisfactory to the Agent and its counsel.
2.3 The Borrower shall have paid all accrued and unpaid
fees and expenses of Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, counsel to the
Agent, including, without limitation, the fees and expenses of counsel to the
Agent incurred in connection with this Sixth Amendment.
EXPENSES
--------
3.1 Without in any way limiting Section 10.06 of the Credit
Agreement, the Borrower will pay on demand all fees, costs and expenses, if any,
incurred by Agent in connection with the preparation, execution and delivery of
this Sixth Amendment, including, without limitation, the fees and expenses of
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, counsel to Agent.
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the Lenders as
follows:
4.1 The execution, delivery and performance by the Borrower
of this Sixth Amendment and the performance by the Borrower of the Credit
Agreement as amended hereby (i) have been duly authorized by all necessary
corporate action and (ii) do not and will not contravene its organizational
documents or any applicable law.
4.2 This Sixth Amendment and the Credit Agreement, as
amended hereby, constitute the legal, valid and binding obligations of the
Borrower, enforceable against the Borrower in accordance with their terms.
4.3 The representations and warranties contained in the
Credit Agreement are correct on and as of the Effective Date as though made on
and as of the Effective Date (except to the extent such representations and
warranties expressly relate to an earlier date), and no Event of Default or
Potential Default has occurred and is continuing on and as of the Effective
Date.
CONTINUED EFFECTIVENESS OF CREDIT AGREEMENT
-------------------------------------------
5.1 The Borrower hereby (i) confirms and agrees that each
Related Document to which it is a party is, and shall continue to be, in full
force and effect and is hereby ratified and confirmed in all respects except
that on and after the Effective Date of this Sixth Amendment all references in
any such Related Document to "the Credit Agreement", "thereto", "thereof",
"`thereunder" or words of like import referring to the Credit Agreement shall
mean the Credit Agreement as amended by this Sixth Amendment; and (ii) confirms
and agrees that to the extent that any such Related Document purports to grant
to the Lenders or the Agent a security interest in or lien on, any collateral as
security for the Obligations of the Borrower from time to time existing in
respect of the Credit Agreement and the Related Documents, such security
interest or lien is hereby ratified and confirmed in all respects.
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MISCELLANEOUS
-------------
6.1 This Sixth Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which shall be deemed to be an original, but all of which taken together shall
constitute one and the same agreement.
6.2 Section and paragraph headings herein are included for
convenience of reference only and shall not constitute a part of this Sixth
Amendment for any other purpose.
6.3 This Sixth Amendment shall be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to choice of law principles.
6.4 Except as herein expressly amended, the Credit
Agreement and the other documents executed and delivered in connection therewith
are each ratified and confirmed in all respects and shall remain in full force
and effect in accordance with their respective terms.
IN WITNESS WHEREOF, the parties hereto have caused this
Sixth Amendment to be executed by their respective officers thereunto duly
authorized as of the day and year first above written.
BORROWER:
---------
WEINER'S STORES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chairman and Chief Executive
Officer
AGENT AND LENDER:
----------------
THE CIT GROUP/BUSINESS CREDIT, INC-
By: /s/ Xxxxx Xxxxx
---------------------------------------
Name: Xxxxx Xxxxx
Title: AVP
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SCHEDULE 8.04 (b)
STORE CLOSING SCHEDULE
STORE # STORE NAME & ADDRESS STORE # STORE NAME & ADDRESS
------------------- ---------------------------------------------- ---------------- ---------------------------------------
1 Bellwood 70 Stafford
00000 Xxxxxxxx Xxxxxxxxx 000 XX 0000
Xxxxxxx, XX 00000 Xxxxxxxx, XX 00000
00 Xxxxxxxxx Xxxxx 00 Xxxxxxxxx
0000 Bellaire Boulevard 000 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
00 Xxxxxxxxx 00 Xxxxxxxx
0000 Xxxxxxxx 00 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000 Xxxxxx Xxxxxxx, XX 00000
23 Gonzales 85 Portland
000 Xxxxx Xxxxxxx Xxxxxxx 0000 Xxxxxxx 000
Xxxxxxxx, XX 00000 Xxxxxxxx, XX 00000
00 Xxxx Xxxx 00 Xxxxxxxxx Xxxx
0000 Xxxxxx Xxxxxx 0000 Xxxx Xxxxxx Xxxxxxx
Xxxx Xxxx, XX 00000 Xxxx Xxxxxx, XX 00000
00 Xxxxxxxxxxx 000 Xxxxxxxx
000 Xxxxxxx Xxxx #000 Xxxxxxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000 Xxxxxxxx, XX 00000
48 Kuykendahl 000 Xxxx Xxxx
0000 XX 0000 Xxxx 0000 Xxxx Xxxxx
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
54 Gretna 111 Jasper
00-X Xxxxxxxx Xxxxxxxxxx 000 Xxxxx Xxxxxxx
Xxxxxx, XX 00000 Xxxxxx, XX 00000
58 Humble 114 Waco
000 Xxxx Xxxxx Xxxxxx 0000 Xxxxxxxx
Xxxxxx, XX 00000 Xxxx, XX 00000
00 Xxxxxxx Xxxxxx 000 Xxxxxxxx
0000 Xxxxxxx Xxxxxxx 000 Xxxxxxxx Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000 Xxxxxxxx, XX 00000
68 Orange 127 Tomball
0000 XxxXxxxxx Xxxxx 00000 Xxxxxxx Xxxxxxx
Xxxxxx, XX 00000 Xxxxxxx, XX 00000
000 Xxxxx Xxxxx Xxxxx 000 Xxx Xxxxxxx/Xx. Xxxxxxx
0000 Xxxxxxx Xxxx 0000 Xx. Xxxxxxx Xxxxxx
Xxxxx Xxxxx, XX 00000 Xxx Xxxxxxx, XX 00000
STORE # STORE NAME & ADDRESS STORE # STORE NAME & ADDRESS
------------------- ---------------------------------------------- ---------------- ---------------------------------------
000 Xxxxxxx Xxxxxxx 000 Xxxxxxxxx
0000 Xxxxx Xxxx 0000 Xxx Xxxxxx Xxxx
Xxxxx Xxxxx, XX 00000 Xxxxxxxxx, XX 00000
000 Xxxxx Xxxxx Xxxxxxx 000 Xxxx Xxx Xxxxxxx
0000 Xxxxxxx Xxxxxxxxx 000 X-00 Xxxxxxx Xx., Xxxxx X
Xxxxx Xxxxx, XX 00000 Xxx Xxxxxxx, XX 00000
140 Beaumont North 167 Jewella
0000 Xxxxxx Xxx. 0000 Xxxxxxx Xxxx
Xxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000
143 Pearland 000 Xxxxxxxxx
0000 Xxxx Xxxxxxxx 0000 X. 00xx Xxxxxx
Xxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000
147 Covington 000 Xxxxx Xxxx
#0 Xx. Xxxxxxx Xxxxx 0000 Xxxx Xxxxxx
Xxxxxxxxx, XX 00000 Xxx Xxxxxxx, XX 00000
000 Xxxxxxxxx 000 Xxxxxxx Xxxx
0000 X. Xxxxx Xxxxx Xxxxx 0000 Xxx Xxxxxx Xx., Xxx. 00
Xxxxxxxxx, XX 00000 Xxxxxxx Xxxx, XX 00000
150 LaPlace 000 Xxxx Xxxxx
0000 Xxxx Xxxxxxx Xxxxxxx 0000 Xxxx Xxxxxx
Xx Xxxxx, XX 00000 Xxxxx Xxxxxx Xxxx, XX 00000
000 Xxx Xxxxxxx/Xxxxxxxxxx 000 Xxxxx Xxxxxxx, Xxxxxx Xxxx
3900 Dublin Street 0000 Xxxxx Xxxxxxx
Xxx Xxxxxxx, XX 00000 Xxxxxx Xxxx, XX 00000
154 Marrero 000 Xxxxxxxxxx Xxxxx
0000 Xxxxxxxxx Xxxxxxxxx 0000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000 Xxxxxx Xxxx, XX 00000
000 Xxxxxxx 000 Xxxx Xxxxx
0000 Xxxx Xxxxxx Xxxxxx 0000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000 Xxxx Xxxxx, XX 00000
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