Exhibit 4.2
-----------
March 31, 2002
LOEHMANN'S OPERATING CO.,
0000 Xxxxxx Xxxxxx
Xxxxx, Xxx Xxxx 00000
Attention: Mr. Xxxxxx Xxxxx
Ladies and Gentlemen:
Reference is hereby made to (a) that certain Credit Agreement dated as of
September 29, 2000 (the "Credit Agreement"), by and among LOEHMANN'S OPERATING
CO., a Delaware corporation ("Borrower"), BANKERS TRUST COMPANY, a New York
banking corporation (in its individual capacity, hereinafter referred to as
"BTCo") and the other financial institutions parties thereto as lenders
thereunder (BTCo and each of such other financial institutions hereinafter are
referred to, collectively, as "Lenders"), and BTCo, acting in its capacity as
agent (BTCo, in such capacity, hereinafter referred to as "Agent") for itself
and the other Lenders; (b) that certain Guaranty dated as of September 29, 2000
(the "Holdings Guaranty"), executed by Xxxxxxxx'x Inc., a Delaware corporation
("Holdings") in favor of Agent; and (c) that certain Guaranty dated as of
September 29, 2000 (the "Xxxxxxxx'x Real Estate Guaranty"), executed by
Xxxxxxxx'x Real Estate Holdings Inc., a Delaware corporation ("Xxxxxxxx'x Real
Estate") in favor of Agent (Borrower, Holdings and Xxxxxxxx'x Real Estate
sometimes hereinafter referred to individually as a "Credit Party" and
collectively as the "Credit Parties"). Annexed hereto as Schedule 1 is a list of
each Person that is currently a Lender under the Credit Agreement and the
Proportionate Share of each such Lender. Capitalized terms used herein and not
otherwise defined herein shall have the respective meanings ascribed thereto in
the Credit Agreement.
The Credit Parties: (a) have advised Agent that Borrower has entered into a
certain Purchase Option Agreement dated January 11, 2002 (the "Xxxxxx Option
Agreement"), with Commerce-Halsey LLC, a New York limited liability company
("Purchaser"), pursuant to which Borrower has agreed to enter into a certain
contract of sale (the "Halsey Sale Agreement") among Borrower, Purchaser and
Westchester Creek Corporation, a New York corporation ("Landlord"), pursuant to
which Borrower will (i) sell to Purchaser (the "Xxxxxx Sale") certain of
Borrower's leased real property and interests in leased real property commonly
known as 0000 Xxxxxx Xxxxxx, Xxxxx, Xxx Xxxx (the "Xxxxxx Real Property") and
(ii) agree with Landlord and Purchaser as to the termination of Borrower's
leasehold estate in the Xxxxxx Real Property (the "Xxxxxx Lease Disposition"),
the execution and delivery of a new lease by Landlord to Purchaser of the Xxxxxx
Real Property and the sublease of a portion of the Xxxxxx Real Property by
Purchaser to Xxxxxxxx'x Real Estate (the "Xxxxxx Sublease"), all for a total
gross purchase price of $5,400,000; and (b) in connection therewith, have
requested, among
Xxxxxxxx'x Operating Co.
__________ __, 2002
Page 2
other things, that (I) Agent and Lenders consent to the Xxxxxx Sale, the Xxxxxx
Lease Disposition and the Xxxxxx Sublease (the Xxxxxx Sale, Xxxxxx Lease
Disposition and Xxxxxx Sublease sometimes hereinafter referred to collectively
as the "Xxxxxx Dispositions"), and (II) Agent execute and deliver to or at the
direction of Borrower a mortgage release in the form attached hereto as Exhibit
A (the "Mortgage Release"), pertaining to the leasehold mortgage described
therein.
Effective upon receipt by Agent of: (a) a copy of this consent letter duly
executed by the Majority Lenders and acknowledged and agreed to by each of the
Credit Parties, (b) a landlord agreement substantially in the form attached
hereto as Exhibit B, or in such other form as shall be in form and substance
satisfactory to Agent, duly executed by Purchaser and Landlord, respectively,
and (c) for the account of each Lender which has executed and delivered a copy
of this consent letter to Agent, a non-refundable consent fee in immediately
available Dollars equal to such Lender's Proportionate Share of $50,000, Agent
and Lenders hereby consent to the Xxxxxx Dispositions and agree that
notwithstanding the terms and provisions of the Credit Documents, the execution
and delivery by Borrower of the Xxxxxx Option Agreement, Xxxxxx Sale Agreement
and Xxxxxx Sublease, and the performance by Borrower of the respective
transactions contemplated thereunder, including, without limitation, the Xxxxxx
Dispositions shall not constitute an Event of Default and further agree as
follows:
(i) at the request of Borrower, to promptly deliver to Jenkens &
Xxxxxxxxx Xxxxxx Xxxxxx, for the attention of Xxxxxx Xxxxxxxxx, Esq.,
counsel to Borrower ("Borrower's Counsel"), a duly executed and
acknowledged Mortgage Release, to be held in escrow by Borrower's Counsel
pending deposit of $4,400,000 into the BT Account in immediately available
Dollars such deposit to be confirmed by receipt by Borrower's Counsel of
telephonic confirmation by Agent (or its legal counsel, Xxxxxx X. Burn,
Esq.); and
(ii) that the automatic and permanent reduction in the Fixed Asset
Sublimit occurring as a result of the Xxxxxx Sale and receipt by or for the
account of Borrower of the Net Disposition Proceeds thereof shall be in the
amount of such Net Disposition Proceeds, notwithstanding anything to the
contrary contained in clause (c) of the definition of the term "Fixed Asset
Sublimit" set forth in the Credit Agreement.
In connection with, and in consideration of, this consent letter, Borrower
and each of the other Credit Parties, by their execution and delivery of the
acknowledgment and agreement set forth hereinbelow, hereby represent to Agent
and each of the Lenders that, as of the date of such execution and delivery, and
as of the date of consummation of the Xxxxxx Sale, and assuming effectiveness of
this consent letter: (a) no consent or other authorization in connection with
the execution and delivery of the Xxxxxx Sale Agreement and the performance by
Borrower of its respective obligations thereunder is required pursuant to any
Requirement of Law or any material agreement, document or instrument to which
Borrower or any of the other Credit Parties is a party or by which any of their
respective properties or assets are bound; (b) no Default or
Xxxxxxxx'x Operating Co.
__________ __, 2002
Page 3
Event of Default has occurred and is continuing, or will result from
consummation of the Xxxxxx Dispositions; and (c) Borrower has previously
delivered or caused to be delivered to Agent a true, correct and complete copy
of the Xxxxxx Option Agreement, to which is annexed a true, correct and complete
copy of the Xxxxxx Sale Agreement, and all other material agreements, documents
and instruments, if any, executed and/or delivered, or to be executed and/or
delivered, by Borrower or any of the other Credit Parties pursuant thereto or in
connection therewith.
Borrower and each of the other Credit Parties, by their execution and
delivery of the acknowledgment and agreement set forth hereinbelow, further
acknowledge and agree that, except as otherwise expressly set forth herein (a)
the execution and delivery of this consent letter shall in no way affect any of
the respective rights, powers or remedies of Agent or any of the Lenders under
the Credit Agreement or any of the other Credit Documents, constitute a waiver
of any term or provision thereof or obligate Agent or any of the Lenders, at any
time hereafter, to consent to or effect any other release of Collateral, whether
of a similar or different nature; (b) all of the respective terms and provisions
of the Credit Agreement and the other Credit Documents remain in full force and
effect and are hereby ratified and confirmed in all respects; (c) none of them
has any defenses, claims or set-offs to the enforcement by Agent or any of the
Lenders of any of such terms and provisions or any of the Obligations, and (d)
subject to the receipt by Borrower of the Mortgage Release, as provided
hereinabove, Agent and each of the Lenders has fully performed all obligations
to the respective Credit Parties which such Person may previously have had or
has on and as of date hereof, and on and as of the date of consummation of the
Xxxxxx Sale.
- Remainder of Page Intentionally Left Blank -
[Signature Page Follows]
Xxxxxxxx'x Operating Co.
__________ __, 2002
Page 4
This consent letter may be executed in any number of counterparts and by
the different parties hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all of which shall together
constitute one and the same instrument. Any such counterpart which may be
delivered by facsimile, email or similar electronic transmission shall be deemed
the equivalent of an originally signed counterpart and shall be fully admissible
in any enforcement proceedings regarding this consent letter.
BANKERS TRUST COMPANY, individually
as a Lender and in its capacity as Agent
By: /s/ Xxxxx Xxxxx
----------------
Name: Xxxxx Xxxxx
Title: Director
[SIGNATURE PAGE FOR CONSENT LETTER FOR XXXXXXXX'X OPERATING CO.]
LENDER:
DIME COMMERCIAL CORPORATION
By: /s/ Xxxxxx Xxxxxx
------------------
Name: Xxxxxx Xxxxxx
Title: Vice President
[SIGNATURE PAGE FOR CONSENT LETTER FOR XXXXXXXX'X OPERATING CO.]
LENDER:
GENERAL MOTORS ACCEPTANCE
CORPORATION
By: /s/
-------------------------
Name:
Title: Senior Vice President
[SIGNATURE PAGE FOR CONSENT LETTER FOR XXXXXXXX'X OPERATING CO.]
LENDER:
XXXXXX FINANCIAL, INC.
By: /s/ Xxxxxxx Xxxxxxxx
---------------------
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
[SIGNATURE PAGE FOR CONSENT LETTER FOR XXXXXXXX'X OPERATING CO.]
LENDER:
IBJ WHITEHALL BUSINESS CREDIT
CORPORATION
By: /s/ Xxxx Xxxxxx
----------------
Name: Xxxx Xxxxxx
Title:
[SIGNATURE PAGE FOR CONSENT LETTER FOR XXXXXXXX'X OPERATING CO.]
LENDER:
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ Xxxxxxxx X. Xxxxxx
-----------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Vice President
[SIGNATURE PAGE FOR CONSENT LETTER FOR XXXXXXXX'X OPERATING CO.]
ACKNOWLEDGED AND AGREED TO
as of March 31, 2002
BORROWER:
XXXXXXXX'X OPERATING CO., a
Delaware corporation
By: /s/ Xxxxxx Xxxxx
----------------
Name: Xxxxxx Xxxxx
Title: President
GUARANTORS:
XXXXXXXX'X, INC., a Delaware corporation
By: /s/ Xxxxxx Xxxxx
----------------
Name: Xxxxxx Xxxxx
Title: President
XXXXXXXX'X REAL ESTATE HOLDINGS
INC., a Delaware corporation
By: /s/ Xxxxxx Xxxxx
----------------
Name: Xxxxxx Xxxxx
Title: President
EXHIBIT A
FORM OF MORTGAGE RELEASE
------------------------
Attached.
EXHIBIT B
FORM OF LANDLORD AGREEMENT
--------------------------
Attached.
SCHEDULE 1
----------
Lender Proportionate Share
------ -------------------
1. Bankers Trust Company ..............................................14.00%
2. Dime Commercial Corporation ........................................16.00%
3. General Motors Acceptance Corporation ..............................20.00%
4. Xxxxxx Financial, Inc. .............................................16.00%
5. IBJ Whitehall Business Credit Corporation ..........................20.00%
6. LaSalle Bank National Association ..................................14.00%
