EXHIBIT 10.1
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AMENDMENT NO. 1 TO CREDIT AGREEMENT
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THIS AMENDMENT NO. 1 TO CREDIT AGREEMENT (this "Amendment No. 1") is
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made and entered into effective as of the 20th day of December, 2001, by and
among XXX XXXXXX, INC., a Delaware corporation ("Borrower"), THE UNDERSIGNED
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GUARANTORS, and BANK OF AMERICA, N.A., a national banking association in its
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capacity as administrative agent (in such capacity, the "Administrative
Agent"), for each of the lenders (the "Lenders") now or hereafter party to the
Credit Agreement referenced below.
W I T N E S S E T H:
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WHEREAS, the Borrower, the Lenders, the issuing banks named therein, the
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syndication agents named therein, and the Administrative Agent have entered
into an Amended and Restated Credit Agreement dated as of April 30, 2001 (as
hereby amended and as from time to time further amended, supplemented,
modified, replaced, or restated, the "Credit Agreement"), pursuant to which
the Lenders agreed to make certain revolving credit and letter of credit
facilities available to the Borrower; and
WHEREAS, each of the undersigned Subsidiaries of the Borrower is a
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Guarantor and has materially benefited and will materially benefit from the
Loans made and to be made and the Letters of Credit issued and to be issued
under the Credit Agreement; and
WHEREAS, the Borrower has requested that the Credit Agreement be amended
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as set forth herein and the Requisite Lenders are willing to amend the Credit
Agreement as set forth herein; and
WHEREAS, the undersigned Subsidiaries consent to the amendments to the
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Credit Agreement as set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants and the
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fulfillment of the conditions set forth herein, and intending to be legally
bound, the parties hereto do hereby agree as follows:
1. Definitions. The term "Credit Agreement" as used herein and in
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the Loan Documents shall mean the Credit Agreement as hereby amended and
modified. Any capitalized terms used herein without definition shall have
the meaning set forth in the Credit Agreement.
2. Amendment of Section 1.02 of the Credit Agreement. Subject to the
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terms and conditions set forth herein, Section 1.02 of the Credit Agreement
is hereby amended as set forth below:
(a) The definition of "Base Rate" is hereby amended and restated
in its entirety to read as follows:
"Base Rate" shall mean, for any day a fluctuating rate per annum
equal to the higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b)
the Prime Rate for such day; provided, however, that if on any date of
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calculation the Leverage Ratio as reflected on the most recently
delivered Compliance Certificate is greater than 3.25 to 1.00 but less
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than 3.75 to 1.00, then a premium of .25% shall be added to the Base
Rate and provided, further, that if such Leverage Ratio as so reflected
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on such Compliance Certificate is greater than 3.75 to 1.00, a premium
of .50% shall be added to the Base Rate. Any change in the Base Rate
due to a change in the Prime Rate or the Federal Funds Rate shall be
effective at the opening of business on the day specified in the public
announcement of such change.
(b) The definition of "EBITDAR" is hereby amended and restated in
its entirety to read as follows:
"EBITDAR" shall mean, for any period, the sum of the amounts for
such period, of (a) Net Income, plus (b) to the extent Net Income is
reduced thereby (i) all charges for amortization of intangibles and
depreciation, (ii) Interest Expense, (iii) income tax expense, (iv)
certain charges for non-recurring items to be taken during the fourth
fiscal quarter of Fiscal Year 2001 in an aggregate amount not exceeding
$17,000,000, and (v) without duplication, extraordinary losses (net of
tax benefits) as shown on the consolidated income statement of ATSC, the
Borrower and its Restricted Subsidiaries, plus (c) Rental Expense, minus
(d) extraordinary gains, including gains realized from the disposition
of assets in connection with discontinued operations (net of taxes), as
shown on the consolidated income statement of ATSC, the Borrower and its
Restricted Subsidiaries.
(c) The definition of "EBITR" is hereby amended and restated in
its entirety to read as follows:
"EBITR" shall mean, for any period, the sum of the amounts for such
period, of (a) Net Income, plus (b) to the extent Net Income is reduced
thereby (i) Interest Expense, (ii) income tax expense, (iii) certain
charges for non-recurring items to be taken during the fourth fiscal
quarter of Fiscal Year 2001 in an aggregate amount not exceeding
$17,000,000, and (iv) without duplication, extraordinary losses (net of
tax benefits) as shown on the consolidated income statement of ATSC, the
Borrower and its Restricted Subsidiaries, plus (c) Rental Expense, minus
(d) extraordinary gains, including gains realized from the disposition
of assets in connection with discontinued operations (net of taxes), as
shown on the consolidated income statement of ATSC, the Borrower and its
Restricted Subsidiaries.
(d) The definition of "Eurodollar Rate" is hereby amended and
restated in its entirety to read as follows:
"Eurodollar Rate" means, for any Interest Period with respect to
any Eurodollar Rate Loan, a rate per annum determined by the
Administrative Agent pursuant to the following formula:
Eurodollar Rate = Eurodollar Base Rate
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1.00 - Eurodollar Reserve Percentage
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; provided, however, that if on any date of calculation the
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Leverage Ratio as reflected on the most recently delivered Compliance
Certificate is greater than 3.25 to 1.00 but less than 3.75 to 1.00,
then a premium of .25% shall be added to the Eurodollar Rate and
provided, further, that if such Leverage Ratio as so reflected on such
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Compliance Certificate is greater than 3.75 to 1.00, a premium of .50%
shall be added to the Eurodollar Rate.
(e) A new definition of "Leverage Ratio" is hereby added in
appropriate alphabetical order to read as follows:
"Leverage Ratio" means, as of the date of computation thereof,
the ratio of (a) the sum of (i) Funded Debt as of the end of the
four consecutive fiscal quarter period ending on (or most recently
ended prior to) such date plus (ii) the product of (A) Rental
Expense for such period times (B) six to (b) EBITDAR for such
period.
3. Amendment of Section 2.03 of the Credit Agreement. Subject to the
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terms and conditions set forth herein, subsection (b)(ii) of Section 2.03 of
the Credit Agreement is hereby amended to add the following proviso to the
end thereof:
"; provided, however, that in the event that the Leverage Ratio as
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reflected on the most recently delivered Compliance Certificate is
greater than 3.25 to 1.00 but less than 3.75 to 1.00, then a premium of
.125% shall be added to the Commitment Fee and provided, further, that
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if such Leverage Ratio as so reflected on such Compliance Certificate is
greater than 3.75 to 1.00, a premium of .25% shall be added to the
Commitment Fee."
4. Amendment of Section 3.08(a) of the Credit Agreement. (a) Subject
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to the terms and conditions set forth herein, Section 3.08(a)(i) of the
Credit Agreement is hereby amended to add the following proviso to the end of
the first paragraph thereof:
"; provided, however, that if on any date of calculation the Leverage
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Ratio as reflected on the most recently delivered Compliance Certificate
is greater than 3.25 to 1.00 but less than 3.75 to 1.00, then a premium
of .25% shall be added to the Standby Letter of Credit Fee referenced
above and provided, further, that if such Leverage Ratio as so reflected
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on such Compliance Certificate is greater than 3.75 to 1.00, a premium
of .50% shall be added to the Standby Letter of Credit Fee referenced
above."
(b) Subject to the terms and conditions set forth herein, Section
3.08(a)(ii) of the Credit Agreement is hereby amended to add the following
proviso to the end of the first paragraph thereof:
"; provided, however, that if on any date of calculation the Leverage
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Ratio as reflected on the most recently delivered Compliance Certificate
is greater than 3.25 to 1.00 but less than 3.75 to 1.00, then a premium
of .125% shall be added to the Commercial Letter of Credit Fee
referenced above and provided, further, that if such Leverage Ratio as
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so reflected on such Compliance Certificate is greater than 3.75 to
1.00, a premium of .25% shall be added to the Commercial Letter of
Credit Fee referenced above."
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5. Amendment of Section 8.05 of the Credit Agreement. Subject to the
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terms and conditions set forth herein, Section 8.05 of the Credit Agreement
is hereby amended to add the following clause (C) to the end of subsection
(d) thereof:
"and (C) on a pro forma basis after giving effect to such
Restricted Payment, as evidenced in a certificate of a Responsible Officer,
the Leverage Ratio for the four consecutive fiscal quarters ending with the
fiscal quarter in which such Restricted Payment is to be made shall not
exceed 3.00 to 1.00;
6. Amendment of Section 9.02 of the Credit Agreement. Subject to the
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terms and conditions set forth herein, Section 9.02 of the Credit Agreement
is hereby amended and restated in its entirety to read as follows:
9.02. Leverage Ratio. As of the end of each period of four
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consecutive fiscal quarters ending with the applicable fiscal quarter
set forth below, the Borrower shall not permit the Leverage Ratio for
such period to be greater than the ratio set forth opposite such fiscal
quarter:
Ending Quarter Maximum Ratio
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3rd Quarter, Fiscal Year 2001 3.50 to 1.00
4th Quarter, Fiscal Year 2001 4.00 to 1.00
1st Quarter, Fiscal Year 2002 4.00 to 1.00
2nd Quarter, Fiscal Year 2002 4.00 to 1.00
3rd Quarter, Fiscal Year 2002 4.00 to 1.00
4th Quarter, Fiscal Year 2002 4.00 to 1.00
1st Quarter, Fiscal Year 2003 3.75 to 1.00
2nd Quarter, Fiscal Year 2003 3.75 to 1.00
3rd Quarter, Fiscal Year 2003 3.75 to 1.00
4th Quarter, Fiscal Year 2003
and each fiscal quarter thereafter 3.50 to 1.00
7. Amendment of Section 9.03 of the Credit Agreement. Subject to the
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terms and conditions set forth herein, Section 9.03 of the Credit Agreement
is hereby amended and restated in its entirety to read as follows:
9.03. Minimum Fixed Charge Coverage Ratio. The Borrower shall not
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permit the Fixed Charge Coverage Ratio, as determined for and at the end
of each period of four consecutive fiscal quarters ending with the
applicable fiscal quarter set forth below, to be less than the ratio set
forth opposite such fiscal quarter:
Ending Quarter Minimum Ratio
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3rd Quarter, Fiscal Year 2001 1.15 to 1.00
4th Quarter, Fiscal Year 2001 1.10 to 1.00
1st Quarter, Fiscal Year 2002 1.10 to 1.00
2nd Quarter, Fiscal Year 2002 1.20 to 1.00
3rd Quarter, Fiscal Year 2002 1.20 to 1.00
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4th Quarter, Fiscal Year 2002 1.20 to 1.00
1st Quarter, Fiscal Year 2003 1.35 to 1.00
2nd Quarter, Fiscal Year 2003 1.35 to 1.00
3rd Quarter, Fiscal Year 2003 1.35 to 1.00
4th Quarter, Fiscal Year 2003
and each fiscal quarter thereafter 1.50 to 1.00
8. Amendment of Exhibit 6.01(d)(i) of the Credit Agreement. Subject
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to the terms and conditions hereof, Exhibit 6.01(d)(i)of the Credit Agreement
is hereby amended and restated in its entirety in the form of Exhibit A to
this Amendment No. 1.
9. Representations and Warranties. In order to induce the
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Administrative Agent and the Lenders to enter into this Amendment No. 1, the
Borrower represents and warrants to the Administrative Agent and the Lenders
as follows:
(a) Except as previously disclosed in writing to the Lenders or as
consented to and waived herein, the representations and warranties made
by the Borrower in Article V of the Credit Agreement are true and
correct on and as of the date hereof, except that the financial
statements referred to in Section 5.01(f) (solely for the purpose of the
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representation and warranty contained in such Section 5.01(f) but not
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for the purpose of any cross reference to such Section 5.01(f) or to the
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financial statements described therein contained in any other provision
of Section 5.01 or elsewhere in Article V) shall be those most recently
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furnished to each Lender pursuant to Section 6.01;
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(b) There has been no material adverse change in the condition,
financial or otherwise, of the Borrower, ATSC and its Restricted
Subsidiaries, taken as a whole, since the date of the most recent
financial reports of the Borrower received by the Administrative Agent
and each Lender under Section 6.01 of the Credit Agreement;
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(c) The business and properties of the Borrower, ATSC and its
Restricted Subsidiaries, taken as a whole, are not, and since the most
recent financial report of the Borrower, ATSC and its Restricted
Subsidiaries received by the Administrative Agent and the Lenders under
Section 6.01 of the Credit Agreement, have not been, materially
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adversely affected in any substantial way as the result of any fire,
explosion, earthquake, accident, strike, lockout, combination of
workers, flood, embargo, riot, activities of armed forces, war or acts
of God or the public enemy, or cancellation or loss of any major
contracts; and
(d) No event has occurred and is continuing which constitutes, and
no condition exists which upon the consummation of the transaction
contemplated hereby would constitute, a Default or an Event of Default
under the Credit Agreement as amended hereby which has not been waived
and consented to hereby.
10. Entire Agreement. This Amendment No. 1 sets forth the entire
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understanding and agreement of the parties hereto in relation to the subject
matter hereof and supersedes any prior negotiations and agreements among the
parties relative to such subject matter. No promise, condition,
representation or warranty, express or implied, not herein set forth shall
bind any party hereto, and not one of them has relied on any such promise,
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condition, representation or warranty. Each of the parties hereto
acknowledges that, except as in this Amendment No. 1 otherwise expressly
stated, no representations, warranties or commitments, express or implied,
have been made by any party to the other. None of the terms or conditions of
this Amendment No. 1 may be changed, modified, waived or canceled orally or
otherwise, except as provided in the Credit Agreement.
11. Full Force and Effect of Agreement. Except as hereby specifically
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amended, modified, waived or supplemented, the Credit Agreement and all other
Loan Documents are hereby confirmed and ratified in all respects and shall
remain in full force and effect according to their respective terms.
12. Conditions Precedent. The effectiveness of this Amendment No. 1
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shall be subject to the conditions precedent that:
(a) the Administrative Agent shall have received twelve (12) fully
executed originals of this Amendment No. 1;
(b) the Administrative Agent and the Lenders shall have received a
Borrowing Base Certificate dated as of November 30, 2001; and
(c) the Borrower shall have paid to the Administrative Agent for
the benefit of each Lender that approves and consents to this Amendment
No. 1 an amendment fee equal to .25% of such Lender's Commitment.
13. Counterparts. This Amendment No. 1 may be executed in any number
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of counterparts, each of which shall be deemed an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument.
14. Governing Law. This Amendment No. 1 shall in all respects be
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governed by the laws and judicial decisions of the State of New York.
15. Enforceability. Should any one or more of the provisions of this
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Amendment No. 1 be determined to be illegal or unenforceable as to one or
more of the parties hereto, all other provisions nevertheless shall remain
effective and binding on the parties hereto.
16. Successors and Assigns. This Amendment No. 1 shall be binding upon
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and inure to the benefit of each of the Borrower, the Lenders and the
Administrative Agent and their respective successors, assigns and legal
representatives; provided, however, that the Borrower, without the prior
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consent of all the Lenders, may not assign any rights, powers, duties or
obligations hereunder.
17. Consent of Guarantors. Each of the Guarantors by its execution and
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delivery hereof (i) consents and agrees to the amendments to the Loan
Documents set forth herein and (ii) reaffirms its obligations set forth in
the ATSC Guaranty or the Subsidiary Guaranty, as applicable, and each other
Loan Document to which it is a party.
[Signature pages follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1
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to be duly executed by their duly authorized officers, all as of the day and
year first above written.
ANNTAYLOR, INC., AS BORROWER
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By: /s/ Xxxxx Xxxxx
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Name: Xxxxx X. Xxxxx
Title: Senior Vice President-Chief Financial Officer
ANNTAYLOR DISTRIBUTION SERVICES, INC.
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ANNTAYLOR RETAIL, INC.
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ANNCO, INC.
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By: /s/ Xxxxx Xxxxx
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Name: Xxxxx X. Xxxxx
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Title: Senior Vice President
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ANNTAYLOR STORES CORPORATION
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By: /s/ Xxxxx Xxxxx
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Name: Xxxxx X. Xxxxx
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Title: Senior Vice President
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Signature Page 1 of 3
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BANK OF AMERICA, N.A., AS ADMINISTRATIVE AGENT
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By: /s/ T. H. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
BANK OF AMERICA, N.A., AS A LENDER
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By: /s/ T. H. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
JPMORGAN CHASE BANK
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(FORMERLY KNOWN AS THE CHASE MANHATTAN BANK)
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
FIRST UNION NATIONAL BANK
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By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Assistant Vice President
FLEET NATIONAL BANK
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By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: Director
THE CIT GROUP/BUSINESS CREDIT, INC.
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By: /s/ Xxxxxx Xxxxxx
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Name: Xxxxxx Xxxxxx
Title: Vice President
Signature Page 2 of 3
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FIRSTAR BANK, N.A.
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By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Vice President
TRANSAMERICA BUSINESS CAPITAL
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CORPORATION
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By: /s/ Xxxxxxx Xxxxxxxxxx
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Name: Xxxxxxx Xxxxxxxxxx
Title: Senior Vice President
BANK LEUMI USA
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By: /s/ Xxxx Xxxxxxxxxxx
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Name: Xxxx Xxxxxxxxxxx
Title: First Vice President
By: /s/ Xxxxxxx Xxxxxxxxx
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Name: Xxxxxxx Xxxxxxxxx
Title: Vice President
FIFTH THIRD BANK
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By: /s/ Xxx Xxxxxxx
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Name: Xxx Xxxxxxx
Title: Corporate Banking Officer
Signature Page 3 of 3
