1
EXHIBIT 10.14.2
SECOND AMENDMENT TO AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT
THIS SECOND AMENDMENT TO AMENDED AND RESTATED LOAN AND SECURITY
AGREEMENT (the "Amendment"), is made as of May 31, 1998, by and between VANS,
INC. ("Borrower"), and BANK OF THE WEST ("Bank"), and is entered into with
respect to the Amended and Restated Loan and Security Agreement, dated as of
October 31, 1997, by and between Borrower and Bank, as amended by the First
Amendment to Amended and Restated Loan and Security Agreement, dated as of
February 3, 1998, by and between Borrower and Bank (the "Agreement").
RECITALS
WHEREAS, Borrower has requested that Bank amend the definition of
Consolidated Net Income to exclude from the computation thereof with respect to
any fiscal period ending on May 31, 1998, all non-recurring restructuring
charges incurred by Borrower during such fiscal period; and
WHEREAS, Bank is willing to agree to the request, on the terms set forth
herein, provided that Borrower waives all causes of action that it may have
against Bank, as provided herein;
NOW, THEREFORE, IT IS AGREED THAT:
1. Definitions. Unless otherwise indicated, words and terms which
are defined in the Agreement shall have the same meaning where used herein.
2. Amendment. The definition of "Consolidated Net Income" in
Section 1.1 of the Agreement is amended to read as follows:
"Consolidated Net Income" means, for any period, the net income (or
deficit) of Borrower and the Subsidiaries for such period (taken as a cumulative
whole) after deducting, without duplication, operating expenses, provisions for
all taxes and reserves (including reserves for deferred income taxes) and all
other proper deductions, all determined in accordance with GAAP on a
consolidated basis, after eliminating all inter-company items in accordance with
GAAP and after deducting portions of income properly attributable to outside
minority interests, if any, in the stock and surplus of any Subsidiary;
provided, however, that there shall be excluded from Consolidated Net Income:
(i) the income (or deficit) of any Person, other than a Subsidiary, in which
Borrower or any Subsidiary has an ownership interest, except to the extent that
any such income has been actually received by Borrower or such Subsidiary in the
form of cash dividends or similar distributions, (ii) any aggregate net gain or
losses during such period arising from the sale, exchange or other disposition
of capital assets (such term to include all fixed assets, whether
1
2
tangible or intangible, and all securities), (iii) any portion of the net income
of a Subsidiary which is unavailable (whether by law, agreement or otherwise)
for the payment of dividends to Borrower or another Subsidiary, (iv) the income
(or deficit) of any other Person accrued prior to the date it becomes a
Subsidiary or is merged or consolidated with a Subsidiary, (v) any write up
(less any non-cash write down) of any asset, other than Inventory adjustments
made in accordance with GAAP, (vi) any net gain from the collection of the
proceeds of life insurance policies, (vii) any gain or loss, or the
extinguishment under GAAP of any Indebtedness of Borrower or any Subsidiary
arising from the acquisition of any securities of Borrower or any Subsidiary,
(viii) any deferred credit representing the excess of equity in any Subsidiary
at the date of acquisition over the cost of the Investment in such Subsidiary,
(ix) in the case of any merger or consolidation of Borrower into another Person,
other than a Subsidiary, any earnings of such Person prior to the consummation
of such merger or consolidation, (x) any portion of the net earnings of Borrower
or any Subsidiary which cannot be freely converted into United States dollars,
(xi) any portion of net earnings (or loss) of Borrower or any Subsidiary which
results from foreign currency translation as determined in accordance with GAAP,
and (xii) to the extent that it is not otherwise excluded from the computation
of Consolidated Net Income under this proviso, all non-recurring restructuring
charges (including asset impairment writedowns, inventory writedowns and all
other restructuring costs) incurred by Borrower and its Subsidiaries during the
fiscal quarter ending on May 31, 1998, to the extent that they do not exceed
Eighteen Million Dollars ($18,000,000) in the aggregate.
3. Conditions Precedent. This Amendment shall not take effect
unless and until all of the following conditions precedent are satisfied:
(a) Execution and Delivery. It is executed by Borrower and
accepted and executed by Bank; and
(b) No Event of Default. No Event of Default or Potential Default
shall exist and the execution, delivery and performance of this Amendment by the
parties hereto shall not cause an Event of Default or a Potential Default to
occur.
Upon the satisfaction of the preceding conditions precedent, the Agreement shall
be deemed amended in accordance with this Amendment as of May 31, 1998.
4. Continued Validity of Agreement. Except as amended by this
Amendment, the Agreement shall continue in full force and effect as originally
constituted and is ratified and affirmed by the parties hereto.
5. Authorization. Each party represents to the other that the
individual executing this Amendment on its behalf is the duly appointed
signatory of such party to this Amendment and that such individual is authorized
to execute this Amendment by or on behalf of such party and to take all action
required by the terms of this Amendment.
2
3
6. Amendment Expenses. All expenses, including, but not limited to,
reasonable attorneys' fees, incurred by Bank in the preparation and
implementation of this Amendment constitute Bank Expenses and as such are
payable by Borrower.
7. Waiver of Claims.
(a) Borrower hereby releases and forever discharges Bank and
Bank's directors, officers, employees and agents, from all actions, and causes
of action, judgments, executions, suits, debts, claims, demands, liabilities,
counterclaims and offsets of every character, known or unknown, direct and/or
indirect, at law or in equity, of whatever kind or nature which have arisen or
accrued through the date of this Amendment and in any way directly or indirectly
arising out of or in any way connected with the Loan Documents and the Revolving
Facility through such date.
(b) Borrower hereby waives all rights which it may have under the
provisions of California Civil Code Section 1542, which reads as follows:
A general release does not extend to claims which the creditor
does not know or suspect to exist in his favor at the time of
executing the release, which if known by him must have materially
affected his settlement with the debtor.
8. Captions. Section headings and numbers have been set forth
herein for convenience only. Unless the contrary is compelled by the context,
everything contained in each section applies equally to this entire Amendment.
9. No Novation. This Amendment is not intended to be, and shall not
be construed to create, a novation or accord and satisfaction, and, except as
otherwise provided herein, the Agreement shall remain in full force and effect.
10. Construction of Amendment. Neither this Amendment nor any
uncertainty or ambiguity herein shall be construed or resolved against Bank on
the basis that this Amendment was drafted by Bank. On the contrary, this
Amendment has been negotiated and reviewed by both parties and shall be
construed and interpreted according to the ordinary meaning of the words used so
as to fairly accomplish the purposes and intentions of the parties hereto.
11. Severability. Each provision of this Amendment shall be
severable from every other provision of this Amendment for the purpose of
determining the legal enforceability of any specific provision.
12. Entire Agreement. This Amendment constitutes the entire
agreement between Borrower and Bank with respect to the subject matter hereof
and supersedes all prior and
3
4
contemporaneous negotiations, communications, discussions and agreements
concerning such subject matter. Borrower acknowledges and agrees that Bank has
not made any representation, warranty or covenant in connection with this
Amendment.
13. Counterparts. This Amendment may be executed in any number of
counterparts, and by Bank and Borrower in separate counterparts, each of which
shall be an original, but all of which shall together constitute one and the
same agreement.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Amendment as of the date first set forth above.
VANS, INC.
By: [SIG]
---------------------------------
Title: Vice President & Gen. Counsel
------------------------------
BANK OF THE WEST
By: /s/ XXX XXXXXXXXX
---------------------------------
Xxx XxXxxxxxx
4
