EXHIBIT 10.96
AMENDED AND RESTATED SENIOR SECURED NOTE AGREEMENT
AMENDED AND RESTATED SENIOR SECURED NOTE AGREEMENT, dated as of September
30, 1996 (this "Agreement"), by and between ARIS INDUSTRIES, INC., a New York
corporation ("Borrower"), and XXXXXX FINANCIAL, INC., a Delaware corporation
(together with its successors and assigns, "Xxxxxx").
W I T N E S E T H
WHEREAS, Borrower and Xxxxxx are parties to that certain Senior Secured
Note Agreement dated as of June 30, 1993 (as amended, supplemented or otherwise
modified prior to the date hereof, the "Existing Note Agreement");
WHEREAS, Borrower and Xxxxxx desire to amend and restate the Existing Note
Agreement pursuant to the terms of this Agreement;
WHEREAS, Borrower currently owns all of the outstanding capital stock of
Perry Manufacturing Company, a North Carolina corporation ("Perry");
WHEREAS, it is a condition precedent to the effectiveness of this Agreement
that Borrower sell (the "Perry Sale") all of the capital stock of Perry to Page
Holding Company, a Delaware corporation ("Newco"), pursuant to the Stock
Purchase Agreement dated as of September 19, 1996 between Newco and Borrower
(the "Stock Purchase Agreement");
WHEREAS, Newco, as consideration for such sale, will, among other things,
pay Borrower $40,857,500.00 in immediately available funds;
WHEREAS, all of the cash proceeds of the Perry Sale will be used to repay a
portion of the outstanding indebtedness (the "Borrower Indebtedness") owed by
Borrower to Xxxxxx pursuant to the terms of the Existing Note Agreement;
WHEREAS, Xxxxxx, subject to the terms and conditions hereof, will accept
such payment as full and final satisfaction of the principal and other Borrower
Indebtedness (other than interest thereof evidenced by the Interest Note, as
hereinafter defined);
WHEREAS, for the period from February 4, 1996 through July 31, 1996
interest in the amount of $2,600,000 (the "Accrued Interest") has accrued with
respect to the Borrower Indebtedness pursuant to the terms of the Existing Note
Agreement;
WHEREAS, in connection with the restructuring of the Borrower Indebtedness
provided for herein (the "Restructuring"),
Borrower shall issue, execute and deliver to Xxxxxx a note in substantially the
form of Exhibit A hereto (the "Interest Note") and in a principal amount equal
to $1,000,000 to evidence the obligation of Borrower to repay to Xxxxxx a
portion of the Accrued Interest in accordance with the terms of the Interest
Note;
WHEREAS, the Interest Note will be secured by all of the capital stock of
Europe Crafts Imports, Inc. and Above the Belt, Inc. pursuant to the terms of
that certain amended and restated Primary Pledge Agreement in substantially the
form of Exhibit B hereto (the "Pledge Agreement") between the Borrower and
Xxxxxx;
WHEREAS, the Borrower, Xxxxxx, AIF-II, L.P. and BNY Financial Corporation
are currently parties to that certain Intercreditor Agreement dated as of June
30, 1993 (as amended, supplemented or otherwise modified from time to time, the
"Intercreditor Agreement");
WHEREAS, it is the intent of the parties that the Intercreditor Agreement
shall remain in full force and effect;
WHEREAS, in connection with, and as a condition precedent to, the
Restructuring, the Borrower will issue its warrant in substantially the form of
Exhibit C hereto (the "Warrant") to purchase an aggregate of 584,345 (subject to
adjustment as therein provided) shares of the common stock of Borrower;
WHEREAS, Borrower and Xxxxxx have agreed to the Restructuring in the
manner, and on the terms and conditions, provided for herein; and
WHEREAS, each of the parties hereto is agreeable to amending and restating
the Existing Note Agreement on the terms and conditions set forth herein;
NOW THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt, adequacy and sufficiency of which are
hereby acknowledged, Borrower and Xxxxxx hereby agree that, effective on
satisfaction of the conditions set forth in Section 4 hereof, the Existing Note
Agreement is amended and restated in its entirety to read as follows:
1. Defined Terms. In addition to the defined terms appearing in this
Agreement, capitalized terms used in this Agreement and/or the other
Reorganization Documents (as hereinafter defined) shall have the following
respective meanings:
"Collateral" shall mean the "Pledged Shares" and other "Pledged Collateral"
as defined in the Pledge Agreement, in
which Xxxxxx now has or in the future obtains a lien as security for the
Obligations.
"Obligations" shall mean all obligations, liabilities (including, without
limitation under Section 5 of this Agreement) and indebtedness of every nature
of Borrower from time to time owed to Xxxxxx under the Interest Note and the
other Reorganization Documents, including the principal amount of all debts,
claims and indebtedness, accrued and unpaid interest and all fees, cash and
expenses, whether primary, secondary, direct, contingent, fixed or otherwise,
heretofore, now and/or from time to time hereafter owing, due or payable whether
before or after the filing of a proceeding under Title 11 of the United States
Code entitled "Bankruptcy," as amended from time to time or any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect and all
rules and regulations promulgated thereunder.
2. Forgiveness of Principal; Termination of Other Agreements; Release of
Perry Stock; Application of Proceeds. Upon satisfaction of the conditions
precedent set forth in Section 4 hereof on the date hereof, Xxxxxx hereby agrees
and acknowledges that all of the principal and other Borrower Indebtedness
(other than interest thereof evidenced by the Interest Note) shall be fully paid
and satisfied and each of Borrower and Xxxxxx agrees and acknowledges that the
Existing Note Agreement shall be amended and restated as provided for herein and
the Other Agreements (as defined in the Existing Note Agreement) other than the
Intercreditor Agreement shall be terminated and have no further force or effect
other than provisions thereof (such as indemnities and expense reimbursements
including, without limitation, such types of provisions set forth in the
Existing Note Agreement prior to giving effect to the amendment and restatement
thereof provided for herein) which by their express terms survive the
termination thereof; provided that the foregoing shall in no way be construed to
impair the ongoing effectiveness, validity or enforceability of this Agreement,
the Interest Note (including, without limitation, the obligation of Borrower to
repay the Obligations), the Pledge Agreement, including, without limitation,
with respect to the Collateral granted thereunder, the Warrant, the
Intercreditor Agreement and any other agreement, instrument, document, contract
or certificate for the benefit of Xxxxxx now or hereafter entered into in
connection with and/or pursuant to this Agreement or the Interest Note
(collectively, the "Reorganization Documents"). In addition to the foregoing,
Xxxxxx, upon satisfaction of the conditions set forth in Section 4 hereof and in
connection with the Perry Sale and the application of the proceeds thereof to
the Primary Debt (as defined in the Intercreditor Agreement) as contemplated by
Section 3.4 of the Intercreditor Agreement, hereby terminates and releases any
security interest or liens on the capital stock of Perry which Borrower has
heretofore granted to Xxxxxx whether
pursuant to the Existing Note Agreement or otherwise and the liens of the
Secondary Collateral Agent, the Secondary Debt Representative and the Holders of
the Secondary Debt (as each such term is defined in the Intercreditor Agreement)
shall be automatically, unconditionally and simultaneously released; provided
that nothing set forth herein shall constitute a termination or release of any
lien or security interest in the capital stock of Perry granted by Newco to
Xxxxxx. In addition, Xxxxxx agrees to furnish additional lien releases and such
other and further documents and instruments as may reasonably be requested by
the Company in order to effect and evidence more fully the release of the
security interest in the capital stock of Perry.
3. Representations and Warranties. To induce Xxxxxx to enter into this
Agreement, Borrower hereby represents and warrants to Xxxxxx that:
(a) Borrower: (i) is a corporation duly organized, validly existing and in
good standing under the laws of the State of New York and is duly qualified to
do business and is in good standing in each other jurisdiction where its
ownership or lease of property or the conduct of its business requires such
qualification and the failure to so qualify would have a material adverse effect
on the business of Borrower; (ii) has the requisite corporate power and
authority and the legal right to own, pledge, mortgage or otherwise encumber and
operate its properties, to lease the property it operates under lease, and to
conduct its business as now, heretofore and proposed to be conducted and to
enter into the Reorganization Documents and the Stock Purchase Agreement; (iii)
has all material licenses, permits, consents or approvals from or by, and has
made all filings with, and has given all notices to, all governmental
authorities having jurisdiction, to the extent required for such ownership,
operation and conduct; (iv) is in compliance with its articles or certificate of
incorporation and by-laws; and (v) is in compliance in all material respects
with all applicable provisions of law.
(b) The execution, delivery and performance by Borrower of the
Reorganization Documents and the Stock Purchase Agreement and all other
instruments and documents to be delivered by Borrower hereunder and thereunder,
the issuance of the Interest Note and the Warrant, the creation and/or
continuation of all liens provided for herein and therein and the consummation
of the Perry Sale: (i) are within Borrower's corporate power; (ii) have been
duly authorized by all necessary corporate and shareholder action; (iii) are not
in contravention of any provision of Borrower's articles or certificate of
incorporation or by-laws or other organizational documents; (iv) will not
violate any law or regulation, or any order or decree of any court or
governmental instrumentality; (v) will not conflict with or result in the breach
or termination of, constitute a
default under or accelerate any performance required by, any indenture,
mortgage, deed of trust, lease, agreement or other instrument to which Borrower
is a party or by which Borrower or any of its property is bound; (vi) will not
result in the creation or imposition of any lien upon any of the property of
Borrower other than those in favor of Xxxxxx, all pursuant to the Reorganization
Documents; and (vii) do not require the consent or approval of any governmental
authority or any other person or entity, except those which have been duly
obtained, made or complied with and which are in full force and effect. Each of
the Reorganization Documents and the Stock Purchase Agreement has been duly
executed and delivered for the benefit of or on behalf of Borrower and each
constitutes a legal, valid and binding obligation of Borrower, enforceable
against Borrower in accordance with its terms, subject to applicable bankruptcy,
insolvency, moratorium, reorganization or other similar laws affecting
creditors' rights and to equitable principles of general applicability.
(c) No action, claim or proceeding is now pending or, to the knowledge of
Borrower, threatened against Borrower, at law, in equity or otherwise, before
any court, board, commission, agency or instrumentality of any federal, state,
or local government or of any agency or subdivision thereof, or before any
arbitrator or panel of arbitrators which challenges Borrower's right, power, or
competence to enter into or perform any of its obligations under the
Reorganization Documents or the Stock Purchase Agreement, or the validity or
enforceability of any Reorganization Document or the Stock Purchase Agreement or
any action taken thereunder.
(d) The representations and warranties of Borrower contained in the Stock
Purchase Agreement are true and correct in all respects on the date hereof, and
Xxxxxx shall be entitled to rely on such representations and warranties with the
same force and effect as if they were incorporated in this Agreement and made to
Xxxxxx directly; provided, that the representations and warranties made to
Xxxxxx shall be subject to the same qualifications, limitations and exceptions
as such representations and warranties made to Newco pursuant to the Stock
Purchase Agreement.
4. Conditions Precedent. This Agreement shall not be effective and neither
Borrower nor Xxxxxx shall be obligated to take, fulfill or perform any action
hereunder and, without limiting the foregoing, Section 2 hereof shall have no
force or effect, until the following conditions shall have been fulfilled to the
satisfaction of Xxxxxx:
(a) Perry Sale and Proceeds Thereof. The Perry Sale shall have been
consummated on terms and conditions satisfactory to Xxxxxx and Borrower
shall have paid to Xxxxxx from the proceeds thereof, for application to the
Borrower
Indebtedness immediately available funds in an aggregate amount at least
equal to $40,857,500.00.
(b) Agreement. Xxxxxx shall have received four original copies of this
Agreement duly executed and delivered by Xxxxxx and Borrower.
(c) Interest Note. Borrower shall have issued, executed and delivered
to Xxxxxx the Interest Note.
(d) Warrant. Borrower shall have issued, executed and delivered to
Xxxxxx the Warrant.
(e) Pledge Agreement. Xxxxxx shall have received four original copies
of the Pledge Agreement duly executed and delivered by Xxxxxx and the
Borrower together with the delivery of:
(i) Certificates or other evidence of ownership representing the
Pledged Shares (as defined therein) and appropriate undated stock
powers (or the equivalent thereof) executed in blank; and
(ii) Evidence that all action necessary or, in the opinion of and
at the request of Xxxxxx, desirable to perfect and/or continue to
perfect and protect the security interests created by the Pledge
Agreement has been taken.
(f) Opinion. Xxxxxx shall have received an opinion of Herrick,
Feinstein, counsel to Borrower in form and substance satisfactory to
Xxxxxx.
(g) Payment of Expenses. Borrower shall have paid to Xxxxxx all costs,
fees and expenses owing in connection with the Existing Note Agreement,
this Agreement and the other Reorganization Documents and due to Xxxxxx
(including, without limitation, reasonable legal fees and expenses);
provided, that in no event shall Borrower be required to reimburse Xxxxxx
for any out-of-pocket costs, fees and expenses directly incurred by Xxxxxx
in connection with that certain Credit Agreement (the "Page Credit
Agreement") dated as of September 30, 1996 between Page Holding Company and
Xxxxxx and the other Loan Documents (as defined in the Page Credit
Agreement).
(h) Board Resolutions and Incumbency Certificate. A certificate of the
Secretary or an Assistant Secretary of Borrower certifying (i) the
resolutions adopted by the Board of Directors of Borrower approving the
Stock Purchase Agreement, this Agreement and the other Reorganization
Documents and the transactions contemplated hereby and thereby and (ii) the
names and true signatures of the authorized officers of Borrower.
(i) No Event of Default. No Event of Default under the Interest Note
shall have occurred and be continuing.
(j) Consents. Aris shall have received any consents, approvals or
authorizations of any governmental entity or other Person (including,
without limitation, the consent of AIF-II, L.P.) which are necessary in
order to consummate the transactions contemplated by the Stock Purchase
Agreement, this Agreement and the other Reorganization Documents, and
copies of such consents, approvals or authorizations shall be provided to
Xxxxxx and be in form and substance satisfactory to Xxxxxx.
(k) Amendment to Shareholders Agreement. Xxxxxx shall have received an
Amendment dated as of September 30, 1996 to that certain Shareholders
Agreement dated as of June 30, 1993 among Aris and the Subject Shareholders
(as defined in the Amendment) in form and substance satisfactory to Xxxxxx
and duly executed by Xxxxxx and each of the Subject Shareholders.
5. Indemnification. Borrower shall (to the fullest extent permitted by
applicable law) indemnify Xxxxxx and its directors, officers, employees and
agents from, and hold each of them harmless against, any and all losses,
liabilities, claims, damages or expenses incurred by any of them arising out of
or by reason of any investigation or litigation or other proceeding (or any
threatened investigation, litigation or proceeding and whether or not Xxxxxx is
a party to any such investigation, litigation or other proceeding) relating to
the negotiation, execution, delivery or performance (including, without
limitation, any breach of any representation or warranty by the Borrower
including relating to Borrower's authority to enter into the Stock Purchase
Agreement and consummate the Perry Sale) of the Stock Purchase Agreement, this
Agreement or any other Reorganization Document, including, without limitation,
the reasonable fees and disbursements of counsel incurred in connection with any
such investigation, litigation or proceeding (but excluding any such losses,
liabilities, claims, damages or expenses incurred by reason of the gross
negligence or willful misconduct of the person or entity to be indemnified),
and, if and to the extent that the obligations of Borrower under this sentence
may be unenforceable for any reason, Borrower shall make the maximum
contribution to the payment and satisfaction of each of the losses, liabilities,
claims, damages and expenses referred to above as may be permitted by applicable
law. The obligation of Borrower under this Section 5 shall survive the
termination of this Agreement and the repayment of the obligations owing under
the Interest Note. Any person or entity to be indemnified pursuant to this
Section shall notify Borrower of the commencement of any legal proceeding by any
third person or entity in connection with which indemnification may be sought
provided, however, that the failure to give such notice shall
not limit or prejudice in any respect Borrower's indemnification
obligations pursuant to this Section.
6. Miscellaneous.
(a) Captions. Section captions used in this Agreement are for convenience
only, and shall not affect the construction of this Agreement.
(b) Governing Law. THIS AGREEMENT SHALL BE A CONTRACT MADE UNDER AND
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES. Whenever possible each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by or invalid under
such law, such provision shall be ineffective to the extent of such prohibition
or invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Agreement.
(c) Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties on separate counterparts, and each
such counterpart shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
(d) Successors and Assigns. This Agreement shall be binding upon Borrower
and Xxxxxx and their respective successors and assigns, and shall inure to the
sole benefit of Borrower and Xxxxxx and their respective successors and assigns;
provided, that Borrower shall not assign its rights and obligations under this
Agreement without the prior written consent of Xxxxxx.
(e) Waiver of Claims. Borrower hereby waives, releases, remises and forever
discharges Xxxxxx from any and all suits, actions, costs, fines, deficiencies,
penalties, proceedings, claims, damages, losses, liabilities and expenses
(including reasonable attorneys' fees and disbursements and other costs of
investigation or defense, including those incurred upon any appeal) of any kind
or character, know or unknown, which Borrower ever had, now has or might
hereafter have against Xxxxxx which relates, directly or indirectly, to any acts
or omissions of Xxxxxx on or prior to the date hereof.
(f) Costs, Expenses and Taxes. Borrower affirms and acknowledges that
notwithstanding anything to the contrary contained herein or in Paragraph 1.12
of the Existing Note Agreement such paragraph applies to this Agreement and the
other Reorganization Documents and the
transactions and agreements and documents contemplated hereunder and thereunder;
provided, that in no event shall Borrower be required to reimburse Xxxxxx for
any out-of-pocket costs, fees and expenses directly incurred by Xxxxxx in
connection with the Page Credit Agreement and the other Loan Documents (as
defined in the Page Credit Agreement).
(g) Existing Notes. Upon satisfaction of the conditions precedent set forth
in Section 4 hereof on the date hereof, Xxxxxx hereby agrees to xxxx cancelled
and return to Borrower each of the promissory notes previously delivered by
Borrower to Xxxxxx in connection with the Existing Note Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
ARIS INDUSTRIES, INC
By /s/ XXXXXXX X. RAMAT
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Name: Xxxxxxx X. Ramat
Title: President
XXXXXX FINANCIAL, INC.
By /s/ XXXXXXXX XXXXXXXXX
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Name: Xxxxxxxx Xxxxxxxxx
Title: Senior Vice President
