EXHIBIT 10.3
AMENDMENT NUMBER ONE TO SECOND AMENDMENT
AND RESTATED LOAN AND SECURITY AGREEMENT
BETWEEN THE COMPANY AND FOOTHILL CAPITAL
CORPORATION, DATED APRIL, 2002
AMENDMENT NUMBER ONE TO SECOND
AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
This Amendment Number One to Second Amended and Restated Loan and Security
Agreement ("Amendment") is entered into as of April, 2002, among THE CHILDREN'S
PLACE RETAIL STORES, INC., a Delaware corporation ("Borrower"), on the one hand,
and the financial institutions listed on the signature pages hereof (such
financial institutions, together with their respective successors and assigns,
are referred to hereinafter each individually as a "Lender" and collectively as
the "Lenders"), and FOOTHILL CAPITAL CORPORATION, as Agent, on the other hand:
A. Agent, Borrower and Lenders have previously entered into that certain
Second Amended and Restated Loan and Security Agreement, dated as of July 5,
2000 (the "Agreement").
B. Borrower has organized an indirect wholly-owned Subsidiary, The
Children's Place (Canada), LP, a Canadian limited partnership ("Children's Place
Canada"), for the purpose of owning and operating retail stores in Canada.
C. Agent, Borrower and Lenders desire to amend the Agreement as provided
for and on the conditions herein.
NOW, THEREFORE, Agent, Borrower and Lenders hereby amend and supplement
the Agreement as follows:
1. DEFINITIONS. All initially capitalized terms used in this
Amendment shall have the meanings given to them in the Agreement unless
specifically defined herein.
2. AMENDMENTS.
(a) Section 1.1 of the Agreement is hereby amended by adding the
following definition:
"`CHILDREN'S PLACE CANADA' has the meaning set forth in the
preamble to Amendment Number One to the Agreement."
(b) Notwithstanding anything to the contrary in Section 2.1(a)(y) of
the Agreement, inventory acquired by Letters of Credit for Children's Place
Canada shall not be included in such section. For purposes of clarification, the
inventory referred to herein is not part of Inventory as that term is defined in
the Agreement.
(c) Pursuant to Section 2.2 of the Agreement, Borrower shall have
the right to cause Letters of Credit for the purchase of inventory by Children's
Place Canada. For purposes of clarification, the inventory referred to herein is
not part of Inventory as that term is defined in the Agreement.
(d) Agent and Lenders consent to Borrower's additional
Subsidiaries, and Schedule 5.8 of the Agreement is amended in its entirety to
include the following additional subsidiaries: The Children's Place Canada
Holdings, Inc., a Delaware corporation; TCP Investment Canada I Corp., a Nova
Scotia unlimited liability corporation; TCP Investment Canada II Corp., a Nova
Scotia unlimited liability corporation; The Children's Place (Canada), LP, an
Ontario limited partnership; TCP Canada, Inc., a Nova Scotia corporation; TCP
Resources, LLC, a Delaware limited liability company; and The Children's Place
(Virginia), Inc., a Virginia corporation.
(e) Section 6.2 is amended to require that Borrower's monthly
consolidating financial statements shall include Children's Place Canada.
(f) Notwithstanding anything to the contrary in Section 6.4 of the
Agreement, Borrower shall only be required to deliver to Agent a designation of
Inventory specifying the retail selling price of Borrower's
16
Inventory not less frequently than monthly (rather than weekly) so long as there
has been at least $25,000,000 of borrowing Availability under Section 2.1
(without being limited by the Maximum Amount).
(g) Section 7.11 (ii) of the Agreement is amended to read as
follows:
"(ii) there has been at least $10,000,000 of borrowing
Availability under SECTION 2.1 (without being limited by the Maximum
Amount) as of the end of each of the three months preceding such payment
or purchase, and on such date, after taking into account the payment or
purchase of such stock."
(h) Section 7.19(b) of the Agreement is amended to read as
follows:
"(b) EBITDA. EBITDA for the trailing 12-month period ending on
each of Borrower's fiscal quarters commencing on or about April 30, 2002
and for each fiscal quarter thereafter shall be not less than
$75,000,000."
3. REPRESENTATIONS AND WARRANTIES. Borrower hereby affirms to Agent
and Lenders that all of Borrower's representations and warranties set forth in
the Agreement are true, complete and accurate in all respects as of the date
hereof.
4. NO DEFAULTS. Borrower hereby affirms to Agent and Lenders that no
Event of Default has occurred and is continuing as of the date hereof.
5. CONDITION PRECEDENT. The effectiveness of this Amendment is
expressly conditioned upon receipt by Agent of an executed copy of this
Amendment.
6. COSTS AND EXPENSES. Borrower shall pay to Agent all of Agent's
out-of-pocket costs and expenses (including, without limitation, the fees and
expenses of its counsel, search fees, filing and recording fees, documentation
fees and other fees) arising in connection with the preparation, execution, and
delivery of this Amendment and all related documents. Agent and Lenders are not
charging a fee for this Amendment.
7. LIMITED EFFECT. In the event of a conflict between the terms and
provisions of this Amendment and the terms and provisions of the Agreement, the
terms and provisions of this Amendment shall govern. In all other respects, the
Agreement, as amended and supplemented hereby, shall remain in full force and
effect.
8. COUNTERPARTS: EFFECTIVENESS. This Amendment may be executed in any
number of counterparts and by different parties on separate counterparts, each
of which when so executed and delivered shall be deemed to be an original. All
such counterparts, taken together, shall constitute but one and the same
Amendment. This Amendment shall become effective upon the execution of a
counterpart of this Amendment by each of the parties hereto.
17
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the date first set forth above.
FOOTHILL CAPITAL CORPORATION,
a California corporation, as Agent and
Lender
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Title: Vice President
--------------------------------------
FLEET RETAIL FINANCE INC.,
as a Lender
By: /s/ Xxxxx Xxxxxxxxxxx
-----------------------------------------
Title: Assistant Vice President
--------------------------------------
THE CHILDREN'S PLACE RETAIL STORES, INC., a
Delaware corporation
By: /s/ Xxxx X. Xxxxxx
-----------------------------------------
Title: Vice President and CFO
--------------------------------------
18
