FIFTH AMENDMENT TO AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT
This Fifth Amendment to Amended and Restated Loan and Security
Agreement (the "Fifth Amendment") is made as of the 17th day of July, 2000 by
and between
Fleet Retail Finance Inc. f/k/a BankBoston Retail Finance Inc. (in such
capacity, the "Agent"), as Agent for the Lenders party to a certain
Amended and Restated Loan and Security Agreement dated as of June 4, 1998,
as amended and in effect,
the Lenders party thereto, and
Designs, Inc. (the "Borrower"), a Delaware corporation with its principal
executive offices at 00 X Xxxxxx, Xxxxxxx, Xxxxxxxxxxxxx 00000
in consideration of the mutual covenants herein contained and benefits to be
derived herefrom.
W I T N E S S E T H:
WHEREAS, on June 4, 1998, the Agent, the Lenders and the Borrower
entered in a certain Amended and Restated Loan and Security Agreement (as
amended and in effect, the "Agreement"); and
WHEREAS, the Agent, the Lenders and the Borrower desire to modify
certain of the provisions of the Agreement as set forth herein.
NOW, THEREFORE, it is hereby agreed among the Agent, the Lenders and
the Borrowers as follows:
1. CAPITALIZED TERMS. All capitalized terms used herein and not
otherwise defined shall have the same meaning herein as in the
Agreement.
2. AMENDMENT TO ARTICLE 1. The provisions of Article 1 of the Agreement
are hereby amended as follows:
(a) by adding the following new definition:
"June 2000 Resolution": Means the June 26, 2000 resolution of
the Board of Directors of the Borrower pursuant to which, among
other things, the Board of Directors authorized the Borrower to
pay an amount not to exceed $2,500,000.00 in the aggregate to
repurchase certain shares of the Borrower=s capital stock.
(b) by deleting the following text from clause (b) of the definition
of "Fixed Charge Coverage Ratio":
, plus cash payments made in connection with the redemption,
retirement, purchase or acquisition of any of the Borrower's
capital stock,
and substituting the following in its stead:
, plus cash payments made in connection with the redemption,
retirement, purchase or acquisition of any of the Borrower's
capital stock (except that there shall be excluded from the
calculation of Fixed Charge Coverage Ratio any cash payments
made by the Borrower at any time after the date of that certain
Fifth Amendment to Loan and Security Agreement dated as of July
17, 2000 to repurchase shares of its capital stock as
contemplated by, and to the extent permitted by, the June 2000
Resolution),
3. LOAN TO XXXXX. The Borrower has advised the Lenders that the
Borrower has made a loan to one of its officers, Xxxxx Xxxxx, in the
amount of $196,875.00 (the "Xxxxx Loan"). The terms and conditions
of the Xxxxx Loan, provide for, among other things, that the Xxxxx
Loan shall mature on a date which exceeds ninety (90) days from the
date such loan was made by the Borrower. The foregoing provision
will result in the violation of Section 4-20(c) of the Agreement and
the occurrence of an Event of Default. Notwithstanding the
foregoing, the Agent and the Lenders have agreed to waive the Event
of Default which would arise as a result of the breach of Section
4-20(c) on account of the making of the Xxxxx Loan. The within
waiver of the Event of Default described herein is a one-time waiver
and shall not be deemed to constitute a waiver of the provisions of
Section 4-20(c) of the Agreement on any future or occasion or with
respect to any other defaults arising under the Agreement.
4. RATIFICATION OF LOAN DOCUMENTS. Except as provided herein, all
terms and conditions of the Agreement on the other Loan Documents
remain in full force and effect. The Borrower hereby ratifies,
confirms, and reaffirms all representations, warranties, and
covenants contained therein and acknowledges and agrees that the
Liabilities, as modified hereby are and continue to be secured
by the Collateral pledged to the Lender by the Borrower. The
Borrower acknowledges and agrees that Collateral includes all
amounts due and owing to the Borrower pursuant to the Xxxxx Loan.
5. MISCELLANEOUS
(a) This Fifth Amendment may be executed in several
counterparts and by each party on a separate counterpart, each
of which when so executed and delivered shall be an original,
and all of which together shall constitute one instrument.
(b) This Fifth Amendment expresses the entire
understanding of the parties with respect to the transactions
contemplated hereby. No prior negotiations or discussions
shall limit, modify, or otherwise affect the provisions
hereof.
(c) Any determination that any provision of this
Fifth Amendment or any application hereof is invalid, illegal
or unenforceable in any respect and in any instance shall not
affect the validity, legality, or enforceability of such
provision in any other instance, or the validity, legality or
enforceability of any other provisions of this Fifth
Amendment.
(d) The Borrower shall pay on demand all costs and
expenses of the Agent and each Lender, including, without
limitation, reasonable attorneys' fees in connection with the
preparation, negotiation, execution and delivery of this Fifth
Amendment.
(e) The Borrower warrants and represents that the
Borrower has consulted with independent legal counsel of the
Borrower's selection in connection with this Fifth Amendment
and is not relying on any representations or warranties of the
Agent or any Lender or their respective counsel in entering
into this Fifth Amendment.
IN WITNESS WHEREOF, the parties have hereunto caused this Fifth
Amendment to be executed and their seals to be hereto affixed as of the date
first above written.
AGENT
FLEET RETAIL FINANCE INC.
By: /S/ XX XXXXXXX
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Name: X.X. XXXXXX
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Title: Mg. Dir
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LENDERS
FLEET RETAIL FINANCE INC.
By: /S/ XX XXXXXXX
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Name: X.X. XXXXXX
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Title: Mg. Dir
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XXXXX FARGO BUSINESS CREDIT, INC.
By: /S/ XXXXX XXXXX
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Name: XXXXX XXXXX
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Title: Vice President
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BORROWER
DESIGNS, INC.
By: /S/ XXXXX X. XXXXX
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Name: XXXXX X. XXXXX
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Title: President, Chief Executive Officer
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580424.3
