Exhibit 10.1
TWELFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT
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THIS TWELFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this "Amendment") is made and entered into this
19th day of December, 2002, by and among TROPICAL SPORSTWEAR INT'L CORPORATION, a Florida corporation
("Tropical"), TROPICAL SPORTSWEAR COMPANY, INC., a Delaware corporation ("TSCI"), SAVANE INTERNATIONAL CORP., a
Texas corporation ("Savane"), APPAREL NETWORK CORPORATION, a Florida corporation ("Apparel"), TSI BRANDS, INC., a
Delaware corporation ("TSI"), TSIL, INC., a Delaware corporation ("TSIL"), DUCK HEAD APPAREL COMPANY, LLC, a
Georgia limited liability company ("Duck Head"), and DELTA MERCHANDISING, INC., a South Carolina corporation
("Delta"; Tropical, TSCI, Savane, Apparel, TSI, TSIL, Duck Head and Delta collectively referred to hereinafter as
"Borrowers" and individually as a "Borrower"), each with its chief executive office and principal place of
business at 0000 Xxxx Xxxxxx Xxxxxx, Xxxxx, Xxxxxxx 00000-0000; and FLEET CAPITAL CORPORATION, a Rhode Island
corporation, in its capacity as collateral and administrative agent for the Lenders (together with its successors
in such capacity, "Agent") with an office at 000 Xxxxxxxx Xxxxxxx, X.X., Xxxxx 000, Xxxxxxx, Xxxxxxx 00000, and
on behalf of the various financial institutions that are "Lenders" as provided in the Loan Agreement (as defined
below).
Recitals:
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Borrowers, Agent and Lenders, are parties to a certain Loan and Security Agreement dated June 10, 1998,
as amended by that certain First Amendment to Loan and Security Agreement dated July 9, 1998, that certain Second
Amendment to Loan and Security Agreement dated August 27, 1998, that certain Third Amendment to Loan and Security
Agreement dated December 31, 1998, that certain Fourth Amendment to Loan and Security Agreement dated May 21,
1999, that certain Fifth Amendment to Loan and Security Agreement dated July 16, 1999, that certain Sixth
Amendment to Loan and Security Agreement dated October 28, 1999, that certain Seventh Amendment to Loan and
Security Agreement dated November 12, 1999, that certain Eighth Amendment to Loan and Security Agreement dated
January 19, 1999, that certain Ninth Amendment to Loan and Security Agreement dated April 12, 2001, and that
certain letter agreement dated April 25, 2001, and that certain Eleventh Amendment to Loan and Security Agreement
dated May 22, 2002 (as at any time amended, the "Loan Agreement"), pursuant to which Lenders have made certain
revolving credit loans and letter of credit accommodations to Borrowers.
Borrowers have requested that Agent and Lenders amend the terms of the Loan Agreement. Agent and
Lenders are willing to amend the Loan Agreement on the terms and conditions as hereinafter set forth.
NOW, THEREFORE, for TEN DOLLARS ($10.00) in hand paid and other good and valuable consideration, the
receipt and sufficiency of which are hereby severally acknowledged, the parties hereto, intending to be legally
bound hereby, agree as follows:
1. Definitions. All capitalized terms used in this Amendment, unless otherwise defined herein,
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shall have the meaning ascribed to such terms in the Loan Agreement.
2. Amendment to Loan Agreement. The Loan Agreement is hereby amended as follows:
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(a) By deleting the definitions of "Consolidated EBITDA" and "Obligations" in
Section 1 of the Loan Agreement in its entirety and by substituting the following new
definitions in lieu thereof:
Consolidated EBITDA - for any fiscal period of Borrowers, Borrowers' (i)
income (or loss) before interest and taxes, plus (ii) to the extent recognized in
determining such income (or loss) for such period, depreciation, amortization and
other similar non-cash charges and reserves other than non-cash charges or credits
resulting from changes in prepaid assets of accrued liabilities in the ordinary course
of business, minus (iii) to the extent recognized in determining such income (or loss)
for such period, extraordinary gains (or losses), restructuring charges or other
non-recurring items, minus (iv) to the extent recognized in determining such income
(or loss) for such period, the 2002 Synergy Charge, minus (v) to the extent recognized
in determining such income (or loss) for such period, the Xxxxxxx Xxxxxxxxx Charge.
For all purposes of this Agreement, Consolidated EBITDA shall be calculated for the
period of four consecutive Fiscal Quarters ended on the last date of the most recent
Fiscal Quarter for which financial statements have been provided pursuant to Section
10.1.3 hereof.
Obligations - in each case, whether now in existence or hereafter arising, (i)
all of the Loans and all interest payable in connection therewith, (ii) all LC
Outstandings and all other obligations of any Obligor to Lender or any Affiliate of
Lender (including Bank) arising in connection with the issuance of any Letter of
Credit, (iii) all Debt and other obligations of Borrower to Agent, Fleet, any Lender
or any Affiliate of Agent, Fleet or any Lender (including Bank) for any debt or
obligations related to any Hedging Agreement, and (iv) all other Debts, covenants,
duties, overdrafts and obligations (including contingent obligations) now or at any
time or times hereafter owing by any Obligor to Agent or any Lender or whether
evidenced by any Loan Document or other writing, whether arising from any extension of
credit, opening of a letter of credit, acceptance, loan, guaranty, indemnification or
otherwise, and whether direct or indirect, absolute or contingent, due or to become
due, primary or secondary, or joint or several, including all interest, charges,
expenses, fees or other sums (including Extraordinary Expenses) chargeable to any or
all Obligors under any of the other Loan Documents or any other agreement, but
specifically excluding any amounts owing by any Borrower to NationsBank under the
NationsBank Loan Documents.
(b) By deleting subsection (ii) in the definition of "LC Conditions" in Section
1 of the Loan Agreement and by substituting the following new subsection (ii) in lieu
thereof:
(ii) after giving effect to the issuance of the requested Letter of Credit
and all other unissued Letters of Credit for which an LC Application has been signed
by Fleet, the LC Outstandings would not exceed in the aggregate $40,000,000 with
respect to documentary Letters of Credit or $5,000,000 with respect to standby Letters
of Credit and no Out-of-Formula Condition would exist, and, if no Revolver Loans
are outstanding, the LC Outstandings do not exceed the Borrowing Base;
(c) By adding the following new definitions of "Xxxxxxx Xxxxxxxxx Charge,"
"Hedging Agreement" and "2002 Synergy Charge" to Section 1 of the Loan Agreement in
proper alphabetical sequence:
Xxxxxxx Severance Charge - the pre-tax charge not to exceed $5,700,000 to be
recorded by the Borrowers during its Fiscal Quarter ending December 31, 2002, for
severance pay to Xxxxxxx Xxxxxxx pursuant to the terms of a separation agreement
between Borrowers and Xxxxxxx Xxxxxxx.
Hedging Agreement - any interest rate protection agreement, foreign currency
exchange agreement, commodity price protection agreement or other interest or currency
exchange rate or commodity price hedging arrangement.
2002 Synergy Charge - a charge in an amount not to exceed $17,600,000 to be
recorded by the Borrowers relating to the consolidation of all of Savane's
administrative and fabric cutting functions to Tampa, Florida.
(d) By deleting clauses (ix) and (x) of Section 5.5.1 in its entirety and by
substituting the following new clauses (ix), (x) and (xi) in lieu thereof:
(ix) ninth, to Agent and Lenders in payment of the unpaid principal and accrued
interest in respect of the Loans and any other Obligations (excluding the Swingline
Loans and any debt or obligations associated with any Hedging Agreement) then
outstanding to be shared among Agent and Lenders ratably in proportion to their
respective shares of such Loans and other Obligations, or on such other basis as may
be agreed upon in writing by Agent and Lenders (which agreement or agreements may be
entered into without notice to or the consent or approval of Borrower); (x) tenth, to
the Lenders and their Affiliates in payment of any debt or obligations associated with
any Hedging Agreement, to be shared among such Lenders and their Affiliates ratably in
proportion to their respective shares of such debt or obligations; and (xi) eleventh,
unless an Event of Default exists and Fleet has elected allocation pursuant to clause
(ii) above, to the Swingline Loans.
3. Consent to Stock Repurchase. Borrowers have informed Agent and Lenders that Tropical desires
to repurchase at market price common stock of Tropical in one or more transactions in an aggregate amount not to
exceed $5,000,000 (the "Stock Repurchase"). The Stock Repurchase requires the prior written consent of Agent and
Lenders under Sections 10.2.7 and 10.2.10 of the Loan Agreement. For so long as no Event of Default exists and
no Out-of-Formula Condition exists on the date of any Stock Repurchase transaction, Agent and Lenders hereby
consent to the Stock Repurchase and agree that the Stock Repurchase will not constitute an Event of Default under
(or as defined in) the Loan Agreement.
4. Acknowledgments and Stipulations. Each Borrower acknowledges and stipulates that the Loan
Agreement and the other Loan Documents executed by such Borrower are legal, valid and binding obligations of such
Borrower that are enforceable against such Borrower in accordance with the terms thereof; all of the Obligations
are owing and payable without defense, offset or counterclaim (and to the extent there exists any such defense,
offset or counterclaim on the date hereof, the same is hereby waived by each Borrower); the security interests
and liens granted by each Borrower in favor of Agent are duly perfected, first priority security interests and
liens.
5. Representations and Warranties. Each Borrower represents and warrants to Agent and Lenders, to
induce Agent and Lenders to enter into this Amendment, that no Default or Event of Default exists on the date
hereof; the execution, delivery and performance of this Amendment have been duly authorized by all requisite
corporate action on the part of such Borrower and this Amendment has been duly executed and delivered by such
Borrower; and all of the representations and warranties made by Borrowers in the Loan Agreement are true and
correct on and as of the date hereof, except to the extent any representation or warranty specifically relates to
an earlier date.
6. Reference to Loan Agreement. Upon the effectiveness of this Amendment, each reference in the
Loan Agreement to "this Agreement," "hereunder," or words of like import shall mean and be a reference to the
Loan Agreement, as amended by this Amendment.
7. Breach of Amendment. This Amendment shall be part of the Loan Agreement and a breach of any
representation, warranty or covenant herein shall constitute an Event of Default.
8. Amendment Fee; Expenses of Agent. In consideration of Agent's and Lenders' willingness to
enter into this agreement, Borrowers, jointly and severally agree to pay Agent, for the pro-rata benefit of the
Lenders, an amendment fee in the amount of $15,000 on the date hereof. Borrowers also jointly and severally
agree to pay, on demand, all costs and expenses incurred by Agent in connection with the preparation, negotiation
and execution of this Amendment and any other Loan Documents executed pursuant hereto and any and all amendments,
modifications, and supplements thereto, including, without limitation, the reasonable costs and fees of Agent's
legal counsel and any taxes or expenses associated with or incurred in connection with any instrument or
agreement referred to herein or contemplated hereby.
9. Effectiveness; Governing Law. This Amendment shall be effective upon acceptance by Agent and
Lenders in Atlanta, Georgia (notice of which acceptance is hereby waived), whereupon the same shall be governed
by and construed in accordance with the internal laws of the State of Georgia.
10. Successors and Assigns. This Amendment shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns.
11. No Novation, etc.. Except as otherwise expressly provided in this Amendment, nothing herein
shall be deemed to amend or modify any provision of the Loan Agreement or any of the other Loan Documents, each
of which shall remain in full force and effect. This Amendment is not intended to be, nor shall it be construed
to create, a novation or accord and satisfaction, and the Loan Agreement as herein modified shall continue in
full force and effect.
12. Counterparts; Telecopied Signatures. This Amendment may be executed in any number of
counterparts and by different parties to this Agreement on separate counterparts, each of which, when so
executed, shall be deemed an original, but all such counterparts shall constitute one and the same agreement.
Any signature delivered by a party by facsimile transmission shall be deemed to be an original signature hereto.
13. Further Assurances. Each Borrower agrees to take such further actions as Agent and Lenders
shall reasonably request from time to time in connection herewith to evidence or give effect to the amendments
set forth herein or any of the transactions contemplated hereby.
14. Section Titles. Section titles and references used in this Amendment shall be without
substantive meaning or content of any kind whatsoever and are not a part of the agreements among the parties
hereto.
15. Release of Claims. To induce Agent and Lenders to enter into this Amendment, each Borrower
hereby releases, acquits and forever discharges Agent and Lenders, and all officers, directors, agents,
employees, successors and assigns of Agent and Lenders, from any and all liabilities, claims, demands, actions or
causes or actions of any kind or nature (if there be any), whether absolute or contingent, disputed or
undisputed, at law or in equity, or known or unknown, that such Borrower now has or ever had against Agent and
Lenders arising under or in connection with any of the Loan Documents or otherwise.
16. Waiver of Jury Trial. To the fullest extent permitted by applicable law, the parties hereto
each hereby waives the right to trial by jury in any action, suit, counterclaim or proceeding arising out of or
related to this Amendment.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed under seal and
delivered by their respective duly authorized officers on the date first written above.
BORROWERS:
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ATTEST: TROPICAL SPORTSWEAR INT'L
CORPORATION
/s/Xxxxx X. Xxxxxxxx By: /s/Xxxxx Xxxxx
Assistant Secretary
[CORPORATE SEAL] Title: Senior Vice President
ATTEST: TROPICAL SPORTSWEAR COMPANY, INC.
/s/Xxxxx X. Xxxxxxxx By: /s/Xxxxx Xxxxx
Assistant Secretary
[CORPORATE SEAL] Title: Senior Vice President
ATTEST: SAVANE INTERNATIONAL CORP.
/s/Xxxxx X. Xxxxxxxx By: /s/Xxxxx Xxxxx
Secretary
[CORPORATE SEAL] Title: Senior Vice President
ATTEST: APPAREL NETWORK CORPORATION
/s/Xxxxx X. Xxxxxxxx By: /s/Xxxxx Xxxxx
Assistant Secretary
[CORPORATE SEAL] Title: Senior Vice President
ATTEST: TSI BRANDS, INC.
/s/Xxxxx X. Xxxxxxxx By: /s/Xxxxx Xxxxx
Assistant Secretary
[CORPORATE SEAL] Title: Senior Vice President
ATTEST: TSIL, INC.
/s/Xxxxx X. Xxxxxxxx By: /s/Xxxxx Xxxxx
Assistant Secretary
[CORPORATE SEAL] Title: Senior Vice President
ATTEST: DUCK HEAD APPAREL COMPANY, LLC
/s/Xxxxx X. Xxxxxxxx By: /s/Xxxxx Xxxxx
Assistant Secretary
[CORPORATE SEAL] Title: Senior Vice President
ATTEST: DELTA MERCHANDISING, INC.
/s/Xxxxx X. Xxxxxxxx By: /s/Xxxxx Xxxxx
Assistant Secretary
[CORPORATE SEAL] Title: Senior Vice President
AGENT:
FLEET CAPITAL CORPORATION,
as Agent, and on behalf of the Lenders
By: /s/Xxxxxxxxx X. Xxxxxx
Title: Senior Vice President
