EXHIBIT 10(a) Amendment Number Six to the Loan and Security Agreement by and
between Congress Financial Corporation (Southern) as Lender and the Registrant,
One Price Clothing Stores, Inc. of Puerto Rico and One Price Clothing - U.S.
Virgin Islands, Inc. as Borrowers dated June 30, 2000.
AMENDMENT NO. 6 TO FINANCING AGREEMENTS
June 30, 0000
Xxx Price Clothing Stores, Inc.
0000 Xxxx Xxxx Xxxxxx
Xxxxxx, Xxxxx Xxxxxxxx 00000
One Price Clothing of Puerto Rico, Inc.
0000 Xxxx Xxxx Xxxxxx
Xxxxxx, Xxxxx Xxxxxxxx 00000
Gentlemen:
Congress Financial Corporation (Southern) ("Lender"), One Price
Clothing Stores, Inc. ("One Price") and One Price Clothing of Puerto Rico, Inc.
("One Price PR"; and together with One Price, individually referred to as a
"Borrower" and collectively as the "Borrowers") have entered into certain
financing arrangements pursuant to the Loan and Security Agreement, dated March
25, 1996, between the Lender and Borrowers (the "Loan Agreement"), as amended by
Amendment No. 1 to Financing Agreements, dated May 16, 1997, Amendment No. 2 to
Financing Agreements, dated June 17, 1997, Amendment No. 3 to Financing
Agreements, dated February 19, 1998, Amendment No. 4 to Financing Agreements,
dated January 31, 1999, and Amendment No. 5 to Financing Agreements, dated
February 23, 2000 together with various other agreements, documents and
instruments at any time executed and/or delivered in connection therewith or
related thereto (as the same now exist or may hereafter be amended, modified,
supplemented, extended, renewed, restated or replaced, collectively, the
"Financing Agreements"). All capitalized terms used herein and not herein
defined shall have the meanings given to them in the Financing Agreements.
Borrowers have requested that Lender agree (a) to a reduction of the
applicable interest rates, (b) to reduce the unused line and letter of credit
fees, (c) extend the term of the Financing Agreements, and (d) amend certain
other provisions of the Loan Agreement. Lender is willing to do so on the terms
and conditions and to the extent set forth herein.
In consideration of the foregoing, the mutual agreements and covenants
contained herein and other good and valuable consideration, the parties hereto
agree as follows:
1. Definitions. (a) The definition of "Collateral Access Agreement"
is hereby added to Section 1 of the Loan Agreement as follows:
""Collateral Access Agreement" shall mean an
agreement in writing, in form and substance satisfactory to
Lender, from any lessor of premises to any Borrower, or any
other person to whom any Collateral (including Inventory,
Equipment, bills of lading or other documents of title) is
consigned or who has custody, control or possession of any
such Collateral or is otherwise the owner or operator of any
premises on which any of such Collateral is located, pursuant
to which such lessor, consignee or other person, inter alia,
acknowledges the first priority security interest of Lender in
such Collateral, agrees to waive any and all claims such
lessor, consignee or other person may, at any time, have
against such Collateral, whether for processing, storage or
otherwise, and agrees to permit Lender access to, and the
right to remain on, the premises of such lessor, consignee or
other person so as to exercise Lender's rights and remedies
and otherwise deal with such Collateral and in the case of any
person who at any time has custody, control or possession of
any bills of lading or other documents of title, agrees to
hold such bills of lading or other documents as bailee for
Lender and to follow all instructions of Lender with respect
thereto."
(b) The definition of "Interest Rate" set forth at Section
1.33 of the Loan Agreement is amended in its entirety to
read as follows:
"1.33 "Interest Rate" shall mean:
(a) subject to clauses (b) and (c) below, as to Prime
Rate Loans, a rate of one-quarter (1/4%) percent per annum in
excess of the Prime Rate and as to Eurodollar Rate Loans a
rate of two (2 %) percent per annum in excess of the Adjusted
Eurodollar Rate (based on the Eurodollar Rate applicable for
the Interest Period selected by Borrower as in effect three
(3) Business Days after the date of receipt by Lender of the
request of Borrower for such Eurodollar Rate Loans in
accordance with the terms hereof, whether such rate is higher
or lower than any Eurodollar Rate previously quoted to
Borrower); provided, that;
(b) effective as of July 1, 2000, "Interest Rate"
shall mean, the Prime Rate, as to Prime Rate Loans, and as to
Eurodollar Rate Loans, a rate of one and one-half (1 1/2 %)
percent per annum in excess of the Adjusted Eurodollar Rate
(based on the Eurodollar Rate applicable for the Interest
Period selected by Borrower as in effect three (3) Business
Days after the date of receipt by Lender of the request of
Borrower for such Eurodollar Rate Loans in accordance with the
terms hereof, whether such rate is higher or lower than any
Eurodollar Rate previously quoted to Borrower); except, that,
if at the end of (i) any fiscal year of One Price or (ii) any
second fiscal quarter of One Price, the Adjusted Net Worth of
One Price and its Subsidiaries calculated on a consolidated
basis, for any such period as set forth in the audited
consolidated financial statements of Borrower and its
Subsidiaries for such period delivered to Lender in accordance
with Section 9.6 hereof, shall be less than $40,000,000,
effective as of the first day of the month after the receipt
by Lender of the such financial statements of One Price and
its Subsidiaries for such period, the Interest Rate shall
increase to the rates set forth in clause (a) above; and
(c) notwithstanding anything to the contrary
contained herein, the Interest Rate shall mean the rate of two
(2%) percent per annum in excess of the Prime Rate as to Prime
Rate Loans and the rate of three and one -half (3 1/2%)
percent per annum in excess of the Adjusted Eurodollar Rate as
to Eurodollar Rate Loans, at Lender's option, without notice,
(i) for the period on and after (A) the date of termination or
non-renewal hereof and until such time as all Obligations are
indefeasibly paid in full (notwithstanding entry of any
judgment against either Borrower), or (B) the date of the
occurrence of any Event of Default or act, condition or event
which with notice or passage of time or both would constitute
an Event of Default, and for so long as such Event of Default
or other event is continuing as determined by Lender and (ii)
on the Loans at any time outstanding in excess of the amounts
available to the respective Borrowers under Section 2 (whether
or not such excess(es), arise or are made with or without
Lender's knowledge or consent and whether made before or after
an Event of Default)."
2. Revolving Loans. Section 2.1(a) of the Loan Agreement is hereby
deleted in its entirety and the following substituted therefor:
"(a) Subject to, and upon the terms and conditions
contained herein, Lender agrees to make Revolving Loans to
each Borrower from time to time in amounts requested by such
Borrower (or by One Price on behalf One Price PR), up to the
amount equal to the sum of: (i) the least of: (A) eighty (80%)
percent of the Value of the Eligible Inventory of such
Borrower, or (B) eighty-five (85%) percent of the Net Recovery
Cost Percentage multiplied by the Cost of the Eligible
Inventory of such Borrower, or (C) eighty-five (85%) percent
of the Net Recovery Retail Percentage multiplied by the Retail
Value of the Eligible Inventory of such Borrower, minus (ii)
any Availability Reserves."
3. Unused Line Fee. Section 3.4 of the Loan Agreement is hereby
amended in its entirety to read as follows:
"3.4 Unused Line Fee. Borrowers shall pay to Lender
monthly an unused line fee at a rate equal to one-quarter of
one (.25%) percent per annum calculated upon the amount by
which the Inventory Loan Limit exceeds the average daily
principal balance of the outstanding Revolving Loans and
Letter of Credit Accommodations during the immediately
preceding month (or part thereof) while this Agreement is in
effect and for so long thereafter as any of the Obligations
are outstanding, which fee shall be payable on the first day
of each month in arrears."
4. Merger. (a) Section 9.7 (a) of the Loan Agreement is hereby
deleted in its entirety and the following substituted therefor:
"(a) merge into or with or consolidate with any
Person or permit any other Person to merge with or into or
with or consolidate with it except that:
(i) any Subsidiary of One Price (other than
One Price PR) may, after prior written notice to Lender, merge
or consolidate with any other Subsidiary of One Price;
(ii) any Subsidiary of One Price
incorporated in any State of the United States of America may
merge with and into or consolidate with One Price, provided,
that, each of the following conditions is satisfied as
determined by Lender: (A) Lender shall have received not less
than five (5) days prior written notice of the intention of
One Price to so merge or consolidate and such information with
respect thereto as Lender may request, (B) as of the effective
date of the merger or consolidation and after giving effect
thereto, no Event of Default or act, condition or event which
with notice or passage of time or both would constitute an
Event of Default, shall exist or have occurred, (C) Lender
shall have received true, correct and complete copies of all
agreements, documents and instruments relating to such merger,
including, but not limited to, the certificate or certificates
of merger as filed with each appropriate Secretary of State or
other Governmental Authority, (D) the surviving entity shall
immediately upon the effectiveness of the merger expressly
confirm in writing pursuant to an agreement, in form and
substance reasonably satisfactory to Lender, its continuing
liability in respect of the Obligations and Financing
Agreements and execute and deliver such other agreements,
documents and instruments as Lender may reasonably request in
connection therewith, (E) the surviving entity shall,
immediately before and immediately after giving effect to such
transaction or series of transactions have an Adjusted Net
Worth (including, without limitation, any Indebtedness
incurred or anticipated to be incurred in connection with or
in respect of such transaction or series of transactions)
equal to or greater than the Adjusted Net Worth of each of the
entities involved in such merger immediately prior to such
transaction or series of transactions, and (F) each Obligor
shall ratify and confirm that its guarantees of the
Obligations shall apply to the Obligations as assumed by such
surviving entity,
(iii) One Price may merge with and into or
consolidate with any other corporation which has its chief
executive office and substantially all of its assets in the
United States, provided, that, each of the following
conditions is satisfied as determined by Lender:
(A) Lender shall have received not less than thirty
(30) days' prior written notice of the proposed merger and
such information with respect thereto as Lender may request,
including (1) the proposed date of the merger, (2) the name,
address, jurisdiction of incorporation and federal
identification number of the person with whom One Price is
merging, (3) a list and description of the assets to be
acquired pursuant to such merger (including the addresses of
the locations thereof and whether such locations are owned,
leased or operated by a third party, and if leased or operated
by a third party, the name and address of the lessor or third
party), and (4) the total consideration to be paid in
connection with such merger (and the terms of payment of such
consideration),
(B) as of the date of such merger and after giving
effect thereto, no Event of Default or act, condition or event
which with notice or passage of time or both would constitute
an Event of Default, shall exist or have occurred and be
continuing,
(C) promptly upon Lender's request, One Price shall
deliver, or cause to be delivered to Lender, true, correct and
complete copies of all agreements, documents and instruments
relating to such merger (including drafts thereof in advance
of the proposed merger or acquisition),
(D) promptly upon Lender's request, One Price shall
execute and deliver, or cause to be executed and delivered, to
Lender such agreements, documents and instruments in
connection with such merger as Lender may reasonably request,
including, without limitation, UCC financing statements,
Collateral Access Agreements and any amendments or supplements
hereto,
(E) the assets and properties being acquired by One
Price pursuant to the merger shall be substantially consistent
with, and related to, the business of One Price as currently
conducted as of the date hereof,
(F) the assets acquired by One Price pursuant to such
merger shall be free and clear of any security interest,
mortgage, pledge, lien, charge, or other encumbrance (other
than security interests and liens permitted under Section 9.8
hereof), and Lender shall have received evidence reasonably
satisfactory to it of the same,
(G) the acquisition by One Price of such assets
pursuant to the merger shall not violate any law or regulation
or any order or decree of any court or Governmental Authority
in any respect and shall not and will not conflict with or
result in the breach of, or constitute a default in any
respect under, any agreement, document or instrument to which
One Price is a party or may be bound, or result in the
creation or imposition of any lien, charge or encumbrance upon
any of the property of One Price (other than as permitted
under Section 9.8 hereof) or violate any provision of the
Certificate of Incorporation or By-Laws of One Price,
(H) the merger consideration shall be payable in
commercially reasonable amounts and terms and in a bona fide
arms' length transaction with a person other than an
Affiliate,
(I) One Price shall, immediately before and
immediately after giving effect to such transaction or series
of transactions, have an Adjusted Net Worth equal to or
greater than the Adjusted Net Worth it had immediately prior
to such transaction or series of transactions,
(J) One Price shall not become obligated with respect
to any Indebtedness, nor any of its property become subject to
any security interest, mortgage, pledge, lien, charge, or
other encumbrance pursuant to such merger unless One Price
could incur such Indebtedness or create such security
interest, mortgage, pledge, lien, charge, or other encumbrance
hereunder or under the other Financing Agreements,
(K) Lender shall have received, in form and substance
reasonably satisfactory to Lender, (1) evidence that Lender
has first priority valid and perfected security interests in
and liens upon the assets acquired pursuant to such merger
subject to any liens as permitted in Section 9.8 hereof, (2)
all Collateral Access Agreements and other consents, waivers,
acknowledgments and other agreements from third persons which
Lender may reasonably deem necessary or desirable in order to
permit, protect and perfect its security interests in and
liens upon the assets acquired pursuant to such merger, (3)
the agreement of the other party to the merger consenting to
the collateral assignment by One Price of all rights and
remedies and claims for damages of One Price relating to the
Collateral (including, without limitation, any bulk sales
indemnification) under the agreements, documents and
instruments relating to such merger and (4) such other
agreements, documents and instruments as Lender may reasonably
request in connection therewith,
(L) Lender shall have conducted a field examination
with respect to the Person, its assets and its business with
whom One Price is merging and in no event shall any Inventory
acquired by One Price pursuant to such merger be deemed
Eligible Inventory unless the results of such field
examination shall be satisfactory to Lender in all respects
(and the reporting with respect to such inventory shall have
been incorporated into the accounting systems of Borrowers in
a manner satisfactory to Lender), and then only to the extent
the criteria for Eligible Inventory set forth herein are
satisfied with respect thereto (or as modified by Lender in
connection with the Inventory acquired to reflect the results
of Lender's field examination, including any separate advance
percentage with respect to such Inventory or any Availability
Reserves as Lender may determine), and upon the request of
Lender, the Inventory acquired by One Price pursuant to such
merger shall at all times after such merger be separately
identified and reported to Lender in a manner satisfactory to
Lender,
(M) in no event shall the total amount of all
payments by One Price in connection with such merger, together
with all amounts paid by One Price in respect of purchases of
Capital Stock under Section 9.10(i) hereof or assets of any
Person under Section 9.10(j) hereof, exceed $10,000,000 in the
aggregate,
(N) in no event shall the total amount of all
payments by One Price in connection with any one merger or
series of related mergers exceed $10,000,000,
(O) as of the date of such merger and after giving
effect thereto (including the payment of all costs related to
such merger), in the event that all inventory to be acquired
by One Price pursuant to such merger shall be deemed by Lender
to be Eligible Inventory, the Excess Availability for each of
the immediately preceding ninety (90) consecutive days (after
giving pro forma effect during such 90 day period to the
additions to the amount of loans available to Borrowers as a
result of Eligible Inventory to be acquired by One Price
pursuant to such merger) shall have been not less than
$10,000,000 and as of the date of such merger and after giving
effect thereto, the Excess Availability of Borrowers shall be
not less than $10,000,000 (after giving effect to the
additions to the amount of loans available to Borrowers as a
result of any Eligible Inventory acquired by One Price
pursuant to such merger);
(P) not less than fifteen (15) days prior to the date
of such merger or consolidation, Lender shall have received,
in form and substance reasonably satisfactory to Lender,
projected financial statements of One Price for the remaining
portion of the then current year and for the succeeding year
after giving effect to the acquisition (including forecasted
income statements, cash flow statements and balance sheets)
prepared on a monthly basis as to the current year and the
immediately succeeding year, all in reasonable detail,
together with such supporting information as Lender may
reasonably request, which projections shall represent One
Price's reasonable best estimate of the future financial
performance of One Price for the periods set forth therein and
shall have been prepared on the basis of the assumptions set
forth therein which One Price believes are fair and reasonable
in light of current and reasonably foreseeable business
conditions (it being understood that such projections do not
constitute a warranty as to the future performance of One
Price and that actual results may vary from such projections),
(Q) One Price shall be the surviving corporation and
after giving effect to such merger its chief executive office
shall continue to be in the United States of America,
(R) promptly upon Lender's request, One Price shall
immediately upon the effectiveness of the merger expressly
confirm in writing pursuant to an agreement, in form and
substance reasonably satisfactory to Lender, its continuing
liability in respect of the Obligations and Financing
Agreements and execute and deliver, or cause to be executed
and delivered, such other agreements, documents and
instruments as Lender may reasonably request in connection
therewith (including, without limitation, UCC financing
statements, as to new locations and Collateral Access
Agreements),
(S) any Obligor shall, promptly upon Lender's
request, ratify and confirm, in form and substance reasonably
satisfactory to Lender, that its guarantee of the Obligations
shall apply to the Obligations of One Price as the surviving
corporation, and
(T) upon the effective date of the merger, Lender
shall have received a certificate duly executed and delivered
by One Price in form and substance reasonably satisfactory to
Lender, addressing all of the conditions set forth in this
Section 9.7(a)(iii) (as modified to refer to the applicable
merger), together with all schedules thereto, with respect to
the acquisition of such assets and the representations and
warranties contained therein shall be true and correct in all
material respects; or"
(b) Section 9.7(c) of the Loan Agreement is hereby deleted in
its entirety and the following substituted therefor:
"(c) form or acquire any subsidiaries except as
permitted under Section 9.10(i) hereof, or"
5. Encumbrances. Section 9.8(e) of the Loan Agreement is hereby
amended by deleting the number "$5,000,000" and substituting the
following therefor: "$10,000,000".
6. Investments. Section 9.10 of the Loan Agreement is hereby amended
to add the following additional Sections 9.10 (i) and (j) as
follows:
"(i) the purchase by One Price of all or a
substantial part of the assets or property of any person
located in the United States (other than purchases of Capital
Stock), provided, that, each of the following conditions is
satisfied as determined by Lender:
(i) Lender shall have received not less than
thirty (30) days' prior written notice of the proposed
acquisition and such information with respect thereto as
Lender may request, including (A) the proposed date of the
acquisition, (B) a list and description of the assets to be
acquired (including the addresses of the locations thereof and
whether such locations are owned, leased or operated by a
thirty party, and if leased or operated by a third party, the
name and address of the lessor or third party), and (C) the
total purchase price for the assets to be purchased (and the
terms of payment of such purchase price),
(ii) as of the date of such purchase and
after giving effect thereto, no Event of Default or act,
condition or event which with notice or passage of time or
both would constitute an Event of Default, shall exist or have
occurred and be continuing,
(iii) promptly upon Lender's request, One
Price shall deliver, or cause to be delivered to Lender, true,
correct and complete copies of all agreements, documents and
instruments relating to such acquisition,
(iv) promptly upon Lender's request, One
Price shall execute and deliver, or cause to be executed and
delivered, to Lender such agreements, documents and
instruments in connection with such acquisition as Lender may
reasonably request, including, without limitation, UCC
financing statements, Collateral Access Agreements and any
amendments or supplements hereto,
(v) the assets and properties being acquired
by One Price shall be substantially consistent with, and
related to, the business of One Price as currently conducted
as of the date hereof,
(vi) the assets acquired by Borrower shall
be free and clear of any security interest, mortgage, pledge,
lien, charge, or other encumbrance (other than security
interests and liens permitted under Section 9.8 hereof) and
Lender shall have received evidence reasonably satisfactory to
it of the same,
(vii) the acquisition by One Price of such
assets shall not violate any law or regulation or any order or
decree of any court or Governmental Authority in any respect
and shall not and will not conflict with or result in the
breach of, or constitute a default in any respect under, any
agreement, document or instrument to which One Price is a
party or may be bound, or result in the creation or imposition
of any lien, charge or encumbrance upon any of the property of
One Price other than as permitted by Section 9.8 hereof, or
any Affiliate or violate any provision of the Certificate of
Incorporation or By-Laws of One Price,
(viii) such purchase shall be on
commercially reasonable prices and terms and in a bona fide
arms' length transaction with a person other than an
Affiliate,
(ix) One Price shall, immediately before and
immediately after giving effect to such transaction or series
of transactions, have an Adjusted Net Worth equal to or
greater than the Adjusted Net Worth it had immediately prior
to such transaction or series of transactions,
(x) One Price shall not become obligated
with respect to any Indebtedness, nor any of their property
become subject to any security interest, mortgage, pledge,
lien, charge, or other encumbrance pursuant to such
acquisition unless One Price could incur such Indebtedness or
create such security interest, mortgage, pledge, lien or
charge as permitted in Sections 9.8 and 9.9 hereof, as the
case may be,
(xi) Lender shall have received, in form and
substance reasonably satisfactory to Lender, (A) evidence that
Lender has first priority valid and perfected security
interests in and liens upon the assets purchased subject to
any security interests and liens as permitted in Section 9.8
hereof, (B) all Collateral Access Agreements and other
consents, waivers, acknowledgments and other agreements from
third persons which Lender may reasonably deem necessary or
desirable in order to permit, protect and perfect its security
interests in and liens upon the assets purchased, (C) the
agreement of the seller consenting to the collateral
assignment by One Price, of all rights and remedies and claims
for damages of One Price relating to the Collateral
(including, without limitation, any bulk sales
indemnification) under the agreements, documents and
instruments relating to such acquisition and (D) such other
agreements, documents and instruments as Lender may reasonably
request in connection therewith,
(xii) Lender shall have conducted a field
examination with respect to the Person, its assets and its
business whose assets are being purchased and in no event
shall any Inventory so acquired by One Price pursuant to such
acquisition be deemed Eligible Inventory unless the results of
such field examination shall be satisfactory to Lender in all
respects (and the reporting with respect to such inventory
shall have been incorporated into the accounting systems of
Borrowers in a manner reasonably satisfactory to Lender), and
then only to the extent the criteria for Eligible Inventory
set forth herein are satisfied with respect thereto (or as
modified by Lender in connection with the Inventory acquired
to reflect the results of Lender's field examination,
including any separate advance percentage with respect to such
Inventory or Availability Reserves as Lender may determined),
and upon the reasonable request of Lender, the Inventory
acquired by One Price pursuant to such acquisition shall at
all times after such acquisition be separately identified and
reported to Lender in a manner reasonably satisfactory to
Lender,
(xiii) in no event shall the total amount
of all payments by Borrowers in connection with such
acquisitions, together with all amounts paid by Borrowers in
respect of mergers under Section 9.7(a)(iii) and purchases of
Capital Stock under Section 9.10(j), exceed $10,000,000 in the
aggregate at any time,
(xiv) in no event shall the total amount of
all payments by Borrowers in connection with any one
acquisition or series of related acquisitions under this
Section 9.10(i) exceed $10,000,000,
(xv) as of the date of such acquisition and
after giving effect thereto (including the payment of all
costs related to such acquisition), the Excess Availability of
Borrowers for each of the immediately preceding ninety (90)
consecutive days (after giving pro forma effect during such 90
day period to the additions to the amount of loans available
to Borrowers as a result of any Eligible Inventory to be
acquired by One Price pursuant to such acquisition) shall have
been not less than $10,000,000, and as of the date of such
acquisition and after giving effect thereto, the Excess
Availability shall be not less than $10,000,000 (after giving
effect to the additions to the amount of loans available to
Borrowers as a result of any Eligible Inventory to be acquired
by One Price pursuant to such acquisition),
(xvi) not less than fifteen (15) days prior
to the date of such acquisition, Lender shall have received,
in form and substance reasonably satisfactory to Lender,
projected financial statements of One Price for the remaining
portion of the then current year and for the succeeding year
after giving effect to the acquisition (including forecasted
income statements, cash flow statements and balance sheets)
prepared on a monthly basis as to the current year and the
immediately succeeding year, all in reasonable detail,
together with such supporting information as Lender may
reasonably request, which projections shall represent One
Price's reasonable best estimate of the future financial
performance of One Price for the periods set forth therein and
shall have been prepared on the basis of the assumptions set
forth therein which One Price believe are fair and reasonable
in light of current and reasonably foreseeable business
conditions (it being understood that such projections do not
constitute a warranty as to the future performance of Borrower
and that actual results may vary from such projections),
(xvii) upon the effective date of the
acquisition of such assets by One Price, Lender shall have
received a certificate duly executed and delivered by
One Price in form and substance reasonably satisfactory
to Lender, addressing all of the conditions set forth
in this Section 9.10(i) (as modified to refer to the
applicable acquisition), together with all schedules
thereto, with respect to the acquisition of such
assets and the representations and warranties contained
therein shall be true and correct in all material respects;
and
(j) the purchase by One Price of all of the Capital
Stock of any Person with its chief executive office and
substantially all of its assets in the United States,
provided, that, each of the following conditions is satisfied
as determined by Lender:
(i) Lender shall have received not less than
thirty (30) days' prior written notice of the proposed
acquisition and such information with respect thereto as
Lender may request, including (A) the proposed date of the
acquisition, (B) the name, address, jurisdiction of
incorporation and federal employer identification number of
the person whose Capital Stock is being purchased, (C) a list
and description of the assets of the Person whose Capital
Stock is being purchased (including the addresses of the
locations thereof and whether such locations are owned, leased
or operated by a thirty party, and if leased or operated by a
third party, the name and address of the lessor or third
party), and (D) the total purchase price for the Capital Stock
to be purchased (and the terms of payment of such purchase
price),
(ii) as of the date of such purchase and
after giving effect thereto, no Event of Default or act,
condition or event which with notice or passage of time or
both would constitute an Event of Default, shall exist or have
occurred and be continuing,
(iii) promptly upon Lender's request, One
Price shall deliver, or cause to be delivered to Lender, true,
correct and complete copies of all agreements, documents and
instruments relating to such acquisition,
(iv) promptly upon such acquisition, One
Price shall cause the Person whose Capital Stock is being
purchased to execute and deliver to Lender, in form and
substance satisfactory to Lender: (A) an absolute and
unconditional guarantee of payment of all of the Obligations,
(B) a general security agreement granting to Lender specify a
first and only security interest in and lien upon all of the
assets and properties of such Person (other than as permitted
under Section 9.8 hereof), (C) related UCC financing
statements, and (D) such other agreements, documents and
instruments as Lender, may reasonably require,
(v) promptly upon Lender's request, (A) One
Price shall execute and deliver to Lender, in form and
substance satisfactory to Lender, a pledge and security
agreement granting to Lender a first priority pledge and
security interest in all of the issued and outstanding shares
of Capital Stock of the Person whose Capital Stock is being
purchased and (B) One Price shall deliver the original stock
certificates evidencing such shares of Capital Stock, together
with stock powers with respect thereto duly executed in blank,
(vi) promptly upon Lender's request, One
Price shall execute and deliver, or cause to be executed and
delivered, to Lender such other agreements, documents and
instruments in connection with such acquisition as Lender may
reasonably request, including, without limitation, UCC
financing statements, Collateral Access Agreements and any
amendments or supplements hereto,
(vii) the assets and properties of the
Person whose Capital Stock is being acquired by One Price
shall be substantially consistent with, and related to, the
business of One Price as currently conducted as of the date
hereof,
(viii) the assets of the Person whose
Capital Stock is being acquired by One Price (and the Capital
Stock) shall be free and clear of any security interest,
mortgage, pledge, lien, charge, or other encumbrance and
Lender shall have received evidence satisfactory to it of the
same (other than security interests and liens permitted under
Section 9.8 hereof),
(ix) the acquisition by One Price of such
Capital Stock shall not violate any law or regulation or any
order or decree of any court or Governmental Authority in any
respect and shall not and will not conflict with or result in
the breach of, or constitute a default in any respect under,
any agreement, document or instrument to which One Price is a
party or may be bound, or result in the creation or imposition
of any lien, charge or encumbrance upon any of the property of
One Price (other than as permitted under Section 9.8 hereof)
or any Affiliate or violate any provision of the Certificate
of Incorporation or By-Laws of One Price;
(x) such purchase shall be on commercially
reasonable prices and terms and in a bona fide arms' length
transaction with a person other than an Affiliate,
(xi) One Price shall, immediately before and
immediately after giving effect to such transaction or series
of transactions, have an Adjusted Net Worth equal to or
greater than the Adjusted Net Worth it had immediately prior
to such transaction or series of transactions,
(xii) One Price shall not become obligated
with respect to any Indebtedness, nor any of their property
become subject to any security interest, mortgage, pledge,
lien, charge, or other encumbrance pursuant to such
acquisition unless One Price could incur such Indebtedness or
create such security interest, mortgage, pledge, lien, charge,
or other encumbrance hereunder or under the other Financing
Agreements,
(xiii) Lender shall have received, in form
and substance reasonably satisfactory to Lender, (A) evidence
that Lender has first priority valid and perfected security
interests in and liens upon the assets of the Person whose
Capital Stock is being acquired subject to any security
interests and liens as permitted in Section 9.8 hereof, (B)
all Collateral Access Agreements and other consents, waivers,
acknowledgments and other agreements from third persons which
Lender may reasonably deem necessary or desirable in order to
permit, protect and perfect its security interests in and
liens upon the assets of the Person whose Capital Stock is
being acquired, (C) the agreement of the seller consenting to
the collateral assignment by such Subsidiary of all rights and
remedies and claims for damages of such Subsidiary relating to
the Collateral (including, without limitation, any bulk sales
indemnification) under the agreements, documents and
instruments relating to such acquisition and (D) such other
agreements, documents and instruments as Lender may reasonably
request in connection therewith,
(xiv) in no event shall the total amount of
all payments by One Price in connection with such
acquisitions, together with all amounts paid by One Price in
respect of mergers under Section 9.7(a)(iii) or purchases of
assets of any Person under Section 9.10(i), exceed
$10,000,000,
(xv) in no event shall the total amount of
all payments by One Price in connection with any one
acquisition or series of related acquisitions under this
Section 9.10(j) exceed $10,000,000,
(xvi) as of the date of such acquisition and
after giving effect thereto (including the payment of all
costs related to such acquisition), the Excess Availability of
Borrowers for each of the immediately preceding ninety (90)
consecutive days shall have been not less than $10,000,000,
(xvii) as of the date of such acquisition
and after giving effect thereto (including the payment of all
costs related to such acquisition), the Excess Availability of
Borrowers shall be not less than $10,000,000,
(xviii) not less than fifteen (15) days
prior to the date of such acquisition, Lender shall have
received, in form and substance satisfactory to Lender,
projected financial statements of One Price for the remaining
portion of the then current year and for the succeeding year
after giving effect to the acquisition (including forecasted
income statements, cash flow statements and balance sheets)
prepared on a monthly basis as to the current year and the
immediately succeeding year, all in reasonable detail,
together with such supporting information as Lender may
reasonably request, which projections shall represent One
Price's reasonable best estimate of the future financial
performance of One Price for the periods set forth therein and
shall have been prepared on the basis of the assumptions set
forth therein which Borrower believe are fair and reasonable
in light of current and reasonably foreseeable business
conditions (it being understood that such projections do not
constitute a warranty as to the future performance of Borrower
and that actual results may vary from such projections),
(xix) upon the effective date of the
acquisition of such Capital Stock by One Price, Lender shall
have received a certificate duly executed and delivered by
Borrower in form and substance reasonably satisfactory to
Lender, addressing all of the conditions set forth in this
Section 9.10(j) (as modified to refer to the applicable
acquisition), together with all schedules thereto, with
respect to the acquisition of such assets and the
representations and warranties contained therein shall be true
and correct in all material respects."
7. Dividends and Redemptions. Section 9.11 of the Loan Agreement is
hereby amended to included the following at the end of such
Section:
"except, that, One Price may repurchase its Capital Stock
consisting of common stock, provided, that, as to any such
repurchase, each of the following conditions is satisfied: (a)
as of the date of the payment for such repurchase and after
giving effect thereto, no Event of Default or any act,
condition or event which, with notice or passage of time or
both, would constitute an Event of Default, shall exist or
have occurred and be continuing, (b) such repurchase shall be
paid with funds legally available therefor, (c) such
repurchase shall not violate any law or regulation or the
terms of any indenture, agreement or undertaking to which such
Borrower is a party or by which such Borrower or its property
is bound, (d) as of the date of any such payment for such
repurchase and after giving effect thereto, the Excess
Availability shall be not less than $10,000,000, and (e) the
aggregate amount of all payments for such repurchases during
the term of this Agreement shall not exceed $5,000,000."
8. Term. (a) The first sentence of Section 12.1(a) of the Loan
Agreement is hereby deleted in its entirety and the following
substituted therefor:
"(a) This Agreement and the other Financing
Agreements shall become effective as of the date set forth on
the first page hereof and shall continue in full force and
effect for a term ending on July 31, 2003 (the "Renewal
Date"), and from year to year thereafter, unless sooner
terminated pursuant to the terms hereof."
(b) Clause (iii) of the first sentence of Section 12.1(c) of the Loan
Agreement (as previously amended) is hereby deleted in its entirety and the
following substituted therefor:
"(iii) .125% of the April 1, 2000 to but not
Inventory Loan including July 31, 2003."
9. Carolina First Bank.
(a) Lender hereby consents to an extension of the term of the
Carolina Bank Documents to July 31, 2003.
(b) Lender's consent pursuant to Section 10(a), shall,
however, be conditioned upon Lender's receipt, in form and substance
satisfactory to Lender, of the written agreements between One Price and Carolina
Bank setting forth the foregoing modification, together with, if required by
Lender, a written confirmation by Carolina Bank of the continued effectiveness
of the Intercreditor Agreement, dated May 16, 1997, between Lender and Carolina
Bank, in form and substance satisfactory to Lender and accompanied by the
written agreement and acknowledgment of One Price.
10. Amendment Fee. In consideration of the Agreement set forth herein,
Borrower shall on the date hereof, pay to Lender, and Lender may,
at its option, charge the account of Borrowers maintained by
Lender, a fee in the amount of $25,000, which fee is fully
earned and payable as of the date hereof and shall constitute part
of the Obligations.
11. Conditions Precedent. The effectiveness of the amendments set
forth herein are further conditioned upon the satisfaction of each
of the following conditions precedent in a manner satisfactory to
Lender:
(a) No Event of Default, or act, condition or event which with
notice or passage of time or both would constitute an Event of Default shall
exist or have occurred;
(b) Lender shall have received the fee referred to in Section
5 hereof;
(c) Lender shall have received the confirmation of Carolina
Bank and One Price referred to in Section 10(b) hereof;
and
(d) Lender shall have received an original of this Amendment,
duly authorized, executed and delivered by Borrowers and
One Price VI.
12. Miscellaneous.
(a) Entire Agreement; Ratification and Confirmation of the
Financing Agreements. This Amendment contains the entire agreement of the
parties with respect to the subject matter hereof and supersedes all prior or
contemporaneous term sheets, proposals, discussions, negotiations,
correspondence, commitments and communications between or among the parties
concerning the subject matter hereof. This Amendment may not be modified or any
provision waived, except in writing signed by the party against whom such
modification or waiver is sought to be enforced. Except for those provisions
specifically modified or waived pursuant hereto, subject, nevertheless to the
periods of effectiveness of the temporary waiver and temporary amendment set
forth, respectively, in Sections 1 and 2 hereof, the Financing Agreements are
hereby ratified, restated and confirmed by the parties hereto as of the
effective date hereof. To the extent of conflict between the terms of this
Amendment and the Financing Agreements, the terms of this Amendment shall
control.
(b) Governing Law. This Amendment and the rights and
obligations hereunder of each of the parties hereto shall be governed by and
interpreted and determined in accordance with the internal laws of the State of
Georgia, without regard to principles of conflicts of law.
(c) Binding Effect. This Amendment shall be binding upon and
inure to the benefit of each of the parties hereto and their respective
successors and assigns.
(d) Counterparts. This Amendment may be executed in any number
of counterparts, but all of such counterparts shall together constitute but one
and the same agreement. In making proof of this Amendment it shall not be
necessary to produce or account for more than one counterpart thereof signed by
each of the parties hereto.
By the signature hereto of each of their duly authorized officers, all
of the parties hereto mutually covenant and agree as set forth herein.
Very truly yours,
CONGRESS FINANCIAL CORPORATION
(SOUTHERN)
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------
Xxxxxx X. Xxxxxxxx
Title: Senior Vice President
-------------------------
AGREED AND ACCEPTED:
ONE PRICE CLOTHING STORES, INC.
By: /s/ C. Xxxx Xxxxx
--------------------
C. Xxxx Xxxxx
Title: Vice President & Treasurer
--------------------------
ONE PRICE CLOTHING OF PUERTO RICO, INC.
By: /s/ C. Xxxx Xxxxx
--------------------
C. Xxxx Xxxxx
Title: Vice President & Treasurer
--------------------------
CONSENTED TO AND AGREED:
ONE PRICE CLOTHING - U.S. VIRGIN ISLANDS, INC.
By: /s/ C. Xxxx Xxxxx
--------------------
C. Xxxx Xxxxx
Title: Vice President & Treasurer
--------------------------
