EXHIBIT 4-C-6
EXECUTION
HARTMARX CORPORATION
SIXTH AMENDMENT TO CREDIT AGREEMENT
This SIXTH AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is dated as
of October 15, 1997 and entered into by and among HARTMARX CORPORATION, a
Delaware corporation ("Borrower"), the LENDERS LISTED ON THE SIGNATURE PAGES
HEREOF (each individually referred to as a "Lender" and collectively as
"Lenders"), GENERAL ELECTRIC CAPITAL CORPORATION as Managing Agent and
Collateral Agent for Lenders ("Managing Agent") and THE BANK OF NEW YORK and
BANKAMERICA BUSINESS CREDIT, INC. as co-agents ("Co-Agents") and, for purposes
of Section 3 hereof, the GUARANTORS IDENTIFIED ON THE SIGNATURE PAGES HEREOF,
(collectively the "Guarantors"), and is made with reference to that certain
Credit Agreement dated as of March 23, 1994, among Borrower, Lenders and Agent,
as amended by the First Amendment to Credit Agreement dated as of August 26,
1994 among Borrower, Lenders and Agent, by the Second Amendment to Credit
Agreement dated as of March 20, 1995 among Borrower, Lenders and Agent, by the
Third Amendment to Credit Agreement dated as of June 30, 1995 among Borrower,
Lenders, Managing Agent, Co-Agents and consented to by Guarantors, by the Fourth
Amendment to Credit Agreement dated as of November 30, 1995 by and among
Borrower, Lenders, Managing Agent, Co-Agents and consented to by Guarantors and
by the Fifth Amendment to Credit Agreement dated as of January 30, 1996 by and
among Borrower, Lenders, Managing Agent, Co-Agents and consented to by
Guarantors (the "Credit Agreement"; capitalized terms used herein without
definition shall have the same meanings herein as set forth in the Credit
Agreement). Unless otherwise indicated, Section and subsection references
contained herein shall be to the corresponding Sections and subsections of the
Credit Agreement.
R E C I T A L S
- - - - - - - -
WHEREAS, Borrower and Lenders desire to amend the Credit Agreement as set
forth below;
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
SECTION 1
AMENDMENT
1.1 Amendments to the Credit Agreement.
A. Definitions. Section 1.1 of the Credit Agreement is amended by
adding thereto the following definitions, which shall be inserted in proper
alphabetical order:
"'Sixth Amendment Effective Date' means the date as of which the Sixth
Amendment to this Credit Agreement becomes effective in accordance with its
terms."
B. Revolving Loans. Section 2.1A(i) of the Credit Agreement is amended
by deleting clause (b) of the second paragraph thereof in its entirety and
substituting the following therefor:
"(b) Intentionally Omitted."
C. Swing Line Loans. Section 2.1A(ii) of the Credit Agreement is amended
by deleting clause (b) in the second paragraph thereof in its entirety and
substituting the following therefor:
"(b) Intentionally Omitted;"
D. Rate of Interest. Section 2.2.A of the Credit Agreement is amended by
deleting clause (i) in the second paragraph and substituting the following
therefor: "(i) if an Index Rate Loan, then at the Index Rate minus the
Applicable Margin per annum; or".
Section 2.2A of the Credit Agreement is further amended by deleting the
third paragraph and the fourth paragraph thereof in their entirety and
substituting the following therefor:
"The "Applicable Margin" for each Index Rate Loan and LIBOR Rate
Loan for any fiscal quarter shall be the percentage which is set forth
below for that type of Loan based upon the Consolidated Debt Service
Coverage Ratio for the four consecutive fiscal quarters of Borrower ending
on the last day of the most recently reported fiscal quarter of Borrower.
Consolidated Debt Service Applicable Margin
Coverage Ratio Index Rate Loan LIBOR Rate Loan
--------------- ---------------
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Less than 1.10:1.00 0.00% 2.00%
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Greater than or equal to 1.10:1.00
but less than 1.20:1.00 0.00% 1.875%
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Consolidated Debt Service Applicable Margin
Coverage Ratio Index Rate Loan LIBOR Rate Loan
--------------- ---------------
--------------------------------------------------------------------------------
Greater than or equal to 1.20:1.00
but less than 1.50:1.00 0.00% 1.75%
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Greater than or equal to 1.50:1.00
but less than 1.75:1.00 0.25% 1.50%
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Greater than or equal to 1.75:1.00
but less than 2.00:1.00 0.50% 1.25%
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Greater than or equal to 2.00:1.00 0.75% 1.00%
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The Applicable Margin shall be adjusted, to the extent required, on
the date of delivery of each Compliance Certificate delivered pursuant to
subsection 6.1(iv), such adjustment to remain in effect until the next date
of delivery of a Compliance Certificate (and related financial information
required at such time pursuant to subsection 6.1) pursuant to subsection
6.1(iv); provided that without limiting any Event of Default or Potential
Event of Default that may result therefrom, in the event Borrower does not
deliver any Compliance Certificate required pursuant to subsection 6.1(iv)
by the date specified therefor, then (i) the Applicable Margin for Index
Rate Loans shall automatically be adjusted to 0.00% and (ii) the Applicable
Margin for Libor Rate Loans shall automatically be adjusted to 2.00%, in
each case commencing on the date such Compliance Certificate was required
to be delivered and expiring on the actual date of delivery thereof."
E. Prepayments and Reductions in Commitments. Section 2.4A(iii)(b) is
amended by deleting (i) the reference to "(1)" contained in the first sentence
thereof and (ii) the reference to "and (2) to give effect to the limitations
set forth in clause (b) of the second paragraph of each of subsections 2.1A(i)
and (ii)" contained in the first sentence thereof.
F. Letters of Credit. Section 3.1A is amended by deleting clause (iii)
thereof in its entirety and substituting the following therefor:
"(iii) Intentionally Omitted;".
G. Contingent Obligations. Section 7.4(ii) of the Credit Agreement is
amended by deleting clause (c) thereof and substituting the following therefor:
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"(c)(x) from the Closing Date through and including December 31, 1996,
forward Currency Agreements in an aggregate notional principal amount not
to exceed at any time $15,000,000 and (y) from and after January 1, 1997,
forward Currency Agreements entered into solely for purposes of hedging
against currency fluctuations relating to product purchases or sales and
licensing revenue."
H. Restricted Junior Payments. Section 7.5 of the Credit Agreement is
amended by deleting the reference to "(A) an aggregate amount for any four
consecutive fiscal quarter period ending as of the most recently reported fiscal
quarter not to exceed the lesser of (1) the sum of (a) $10,000,000 plus (b) 25%
of Consolidated Net Income for such period (or less 100% of consolidated net
losses for such period, as the case may be) and (2) 50% of the Consolidated Net
Income for such four consecutive fiscal quarter period, and (B) in any event, in
an aggregate cumulative amount from the Closing Date through the Commitment
Termination Date not to exceed $22,500,000" contained therein and substituting
the following therefor:
"an aggregate cumulative amount from the Sixth Amendment Effective Date
through the Commitment Termination Date not to exceed $17,500,000".
Section 7.5 of the Credit Agreement is further amended by deleting clause
(vi) thereof and substituting the following therefor:
"(vi) in addition to transactions permitted by clause (iii) above,
use cash on hand to redeem or repurchase the Senior Subordinated Notes;
provided that either (x) the projected excess of the lesser of (i) the
Revolving Loan Commitments or (ii) the Borrowing Base, over the Total
Utilization of Revolving Loan Commitments shall be equal to or greater than
$50,000,000 immediately after giving effect to such redemption or
repurchase or (y) if the projected excess of the lesser of (i) the
Revolving Loan Commitments or (ii) the Borrowing Base, over the Total
Utilization of Revolving Loan Commitments shall be less than $50,000,000
immediately after giving effect to such redemption or repurchase, prior to
such redemption or repurchase Managing Agent shall have received an
Officer's Certificate of Borrower, in form and substance satisfactory to
Managing Agent, demonstrating in reasonable detail and using reasonable
assumptions that after giving effect to such redemption or repurchase, the
projected excess of the lesser of (i) the Revolving Loan Commitments or
(ii) the Borrowing Base, over the Total Utilization of Revolving Loan
Commitments shall not be less than $25,000,000 on any day during the one-
year period beginning on the date of such redemption or repurchase."
I. Minimum Consolidated Net Worth. Section 7.6C of the Credit Agreement
is deleted in its entirety.
J. Minimum Consolidated Trade Support Ratio. Section 7.6D of the Credit
Agreement is deleted in its entirety.
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K. Acquisitions. Section 7.7(vii) of the Credit Agreement is amended by
deleting the last sentence thereof and substituting the following therefor:
"For the purpose of this Section 7.7(vii), the 'Acquisition Fund Amount'
as of any date shall be equal to the sum of (x) $25,000,000 plus (y) 25% of
aggregate cumulative Consolidated Adjusted EBITDA (without duplication)
since November 30, 1996 calculated as of the most recent complete and
reported fiscal quarter of Borrower, commencing with the fiscal quarter
ended February 28, 1997."
L. Consolidated Capital Expenditures. Section 7.8 of the Credit
Agreement is amended by deleting it in its entirety and substituting the
following therefor:
"7.8 Consolidated Capital Expenditures.
Borrower shall not, and shall not permit its Subsidiaries to, make
or incur Consolidated Capital Expenditures, in any Fiscal Year in an
aggregate amount in excess of $25,000,000."
SECTION 2
BORROWERS' REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Amendment, Borrower
represents and warrants to Lenders that after giving effect to this Amendment in
the manner contemplated by Section 4.6 of this Amendment, each of the following
is true and correct:
(a) no event has occurred and is continuing which constitutes an Event of
Default or Potential Event of Default;
(b) the representations and warranties of Borrower and the other Credit
Parties contained in the Credit Agreement and the other Loan Documents are true
and correct on and as of the date hereof and as of the Effective Date (as
defined below) to the same extent as though made on and as of the date hereof
and as of the Effective Date except to the extent such representations and
warranties specifically relate to an earlier date, in which case they are true
and correct in all material respects as of such earlier date;
(c) each of Borrower and the other Credit Parties has performed all
agreements on its part to be performed prior to (x) the date hereof and (y) the
Effective Date, in each case as set forth in the Credit Agreement and the other
Loan Documents;
(d) each of Borrower and the Guarantors has all requisite corporate power
and authority to enter into this Amendment and to carry out the transactions
contemplated by, and perform its obligations under, the Credit Agreement;
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(e) the execution of this Amendment has been duly authorized by all
necessary corporate action on the part of Borrower and the Guarantors; and
(f) the execution and delivery by Borrower and the Guarantors of this
Amendment does not and will not (i) violate any provision of any law or any
governmental rule or regulation applicable to Borrower, the Guarantors or any of
their respective Subsidiaries, the Certificate of Incorporation of Borrower, the
Guarantors or any of their respective Subsidiaries or any order, judgment or
decree of any court or other agency of government binding on Borrower, the
Guarantors or any of their respective Subsidiaries, (ii) conflict with, result
in a breach of or constitute (with due notice or lapse of time or both) a
default under any Contractual Obligation of Borrower, the Guarantors or any of
their respective Subsidiaries, (iii) result in or require the creation or
imposition of any Lien upon any of the properties or assets of Borrower, the
Guarantors or any of their respective Subsidiaries (other than any Liens created
under any of the Loan Documents in favor of Collateral Agent on behalf of
Lenders), or (iv) require any approval of stockholders or any approval or
consent of any Person under any Contractual Obligation of Borrower, the
Guarantors or any of their respective Subsidiaries.
SECTION 3
GUARANTORS
Each of the Guarantors hereby consents to this Amendment and agrees that
each Loan Document to which it is a party shall continue in full force and
effect and shall be valid and enforceable and shall not be impaired or affected
by the execution of this Amendment and is hereby ratified and confirmed.
SECTION 4
MISCELLANEOUS
4.1 References to and Effect on the Credit Agreement and Other Loan Documents.
(i) On and after the Effective Date, each reference in the Credit Agreement
to "this Agreement", "hereunder", "hereof", "herein" or words of like import
referring to the Credit Agreement, and each reference in the other Loan
Documents to the "Credit Agreement", "thereunder", "thereof" or words of like
import referring to the Credit Agreement, shall mean and be a reference to the
Credit Agreement as amended hereby;
(ii) Except as specifically amended by this Amendment, the Credit Agreement
and the other Loan Documents shall remain in full force and effect and are
hereby ratified and confirmed; and
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(iii) The execution, delivery and performance of this Amendment shall not,
except as expressly provided herein, constitute a waiver of any provision of, or
operate as a waiver of any right, power or remedy of any Agent or any Lender
under, the Credit Agreement or any of the other Loan Documents.
4.2 Fees and Expenses.
Borrower acknowledges that all costs, fees and expenses as described in
subsection 10.2 of the Credit Agreement incurred by Managing Agent and its
counsel with respect to this Amendment and the documents and transactions
contemplated hereby shall be for the account of Borrower.
4.3 Headings.
Section and subsection headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose or be given any substantive effect.
4.4 Applicable Law.
THIS AMENDMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
COMMON LAW CONFLICTS OF LAWS PRINCIPLES.
4.5 Counterparts.
This Amendment may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.
4.6 Effectiveness.
This Amendment shall become effective as of October 15, 1997 upon the
execution of a counterpart hereof by each Lender, the Borrower and the
Guarantors and receipt by Borrower and Managing Agent of written or telephone
notification of such execution and authorization of delivery thereof (such date
of execution by each Lender, the Borrower and the Guarantor, and receipt by
Borrower and Managing Agent of such written or telephone notification, being the
"Effective Date").
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
BORROWER:
HARTMARX CORPORATION
By: /S/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx
Executive Vice President and
Chief Financial Officer
GUARANTORS:
AMERICAN APPAREL BRANDS, INC.
ANNISTON SPORTSWEAR CORPORATION
BlLTWELL COMPANY, INC.
BRIAR, INC.
C.M. CLOTHING, INC.
C.M. OUTLET CORP.
CHICAGO TROUSER COMPANY, LTD.
COUNTRY MISS, INC.
COUNTRY MISS INTERNATIONAL LIMITED
COUNTRY SUBURBANS, INC.
DIRECT ROUTE MARKETING CORPORATION
E-TOWN SPORTSWEAR CORPORATION
XXXXXXXX-XXXXX, INC.
GLENEAGLES, INC.
TAG APPAREL, INC. (formerly known as XXXXX
XXXXXXX APPAREL, INC.)
HANDMACHER FASHIONS FACTORY OUTLET, INC.
XXXXXXXXXX-XXXXX, INC.
HARTMARX INTERNATIONAL, INC.
XXXX XXXXXXXXX & XXXX
XXXX SERVICES, INC.
XXXX. XXXXX CLOTHES, INC.
TAG LICENSING, INC. (formerly known as HGA
LICENSING, INC.)
XXXXXX-XXXXXXX CO., INC.
S-1
XXXXXXX, XXXXX & XXXX, INC.
NOVAPPAREL, INC. (formerly known as HMXUS, INC.)
HOOSIER FACTORIES, INCORPORATED
HSM UNIVERSITY, INC.
INTERCONTINENTAL APPAREL, INC.
INTERNATIONAL WOMEN'S APPAREL, INC.
XXXXXX-XXXX, INC.
JRSS, INC.
KUPPENHEIMER MEN'S CLOTHIERS DADEVILLE, INC.
MEN'S QUALITY BRANDS, INC.
NATIONAL CLOTHING COMPANY, INC.
106 REAL ESTATE CORP.
PLAID CLOTHING COMPANY, INC.
XXXXXX SPORTSWEAR CORPORATION
XXXXXXX INTERNATIONAL CORPORATION
SALHOLD, INC.
SEAFORD CLOTHING CO.
SOCIETY BRAND, LTD.
XXXXXX SURREY, INC.
TAILORED TREND, INC.
THORNGATE UNIFORMS, INC.
TRADE FINANCE INTERNATIONAL LIMITED
UNIVERSAL DESIGN GROUP, LTD.
X. XXXX & COMPANY, INC.
WINCHESTER CLOTHING COMPANY
YORKE SHIRT CORPORATION
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------
Xxxxx X. Xxxxxx Vice President of each of
the foregoing (except for Country Miss
International Limited) and a Director of
Country Miss International Limited
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LENDERS:
GENERAL ELECTRIC CAPITAL CORPORATION,
individually, as Managing Agent and
as Collateral Agent
By: /S/ Xxxxxxx X. Xxx Xxxx
------------------------------------
Title: Duly Authorized Signatory
---------------------------------
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THE BANK OF NEW YORK,
individually, as Co-Agent and as Issuing
Lender for the Letters of Credit (other
than the Existing Letters of Credit)
By: /S/ Xxxxxxxxx Xxxx
------------------------------------
Title: Vice President
------------------------------------
S-4
BANKAMERICA BUSINESS CREDIT, INC.,
individually and as Co-Agent
By: /S/ [Signature Appears Here]
-------------------------------
Title: Vice President
--------------------------------
S-5
THE FIRST NATIONAL BANK OF CHICAGO,
individually and as Issuing Lender for
Existing Letters of Credit
By: /S/ [Signature Appears Here]
----------------------------------
Title: Vice President
----------------------------------
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MANUFACTURERS AND TRADERS TRUST COMPANY
By: /S/ Xxxxxxxx X. Xxxx
--------------------------------
Title: Vice President
--------------------------------
S-7
XXXXXX TRUST AND SAVINGS BANK
By: /S/ Xxxx X. Xxxxxx
---------------------------
Title: VICE PRESIDENT
---------------------------
S-8
THE NORTHERN TRUST COMPANY
By: /S/ Xxxxxxxx X. Xxxxxx
-------------------------------
Title: VICE PRESIDENT
-------------------------------
S-9
THE CHASE MANHATTAN BANK
By: /S/ Xxxxx X. Xxxxxx
---------------------------------
Title: Vice President
---------------------------------
S-10
SANWA BUSINESS CREDIT CORPORATION
By: /S/ Xxxxxxx Xxxxxxxx
----------------------------------
Title: Vice President
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