EXHIBIT 10.1
AMENDMENT NUMBER SIX TO LOAN AND SECURITY AGREEMENT
This Amendment Number Six to Loan and Security Agreement
("Amendment") is entered into as of April 30, 2001, among XXXXXXX JEWELERS,
INC., a Delaware corporation (the "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 ("Agent"), on the other
hand.
RECITALS
A. Borrower, Lenders and Agent have previously entered into that
certain Loan and Security Agreement, dated as of October 2, 1998, as amended as
of April 15, 1999, August 30, 1999, November 24, 1999, January 25, 2000, and
June 2, 2000 (as amended, the "Agreement").
B. Borrower, Lenders and Agent desire to amend the Agreement as
provided for and on the conditions herein.
NOW, THEREFORE, Borrower, Lenders and Agent hereby amend certain
provisions of 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.
2.1 The following new definitions are hereby added to Section 1.1 of
the Loan Agreement:
"DDJ" means DDJ Capital Management, LLC.
"DDJ Indebtedness" means the Indebtedness of
Borrower owing to DDJ and certain other lenders under the DDJ Loan
Agreement, which Indebtedness shall not exceed at any one time
$29,000,000.
"DDJ Intercreditor Agreement" means that certain
Intercreditor and Subordination Agreement dated as of April 30, 2001,
between Agent and DDJ as agent for the lenders under the DDJ Loan
Agreement.
"DDJ Loan Agreement" means that certain Loan
Agreement dated as of April 30, 2001, among Borrower, various lenders
now or in the future party thereto, and DDJ as agent for such
lenders.
"DDJ Security Agreement" means that certain
Junior Security Agreement, dated as of April 30, 2001, between
Borrower and DDJ as agent for the lenders under the DDJ Loan
Agreement.
2.2 Clause (j) of the definition of "Permitted Liens" is hereby
amended to read as follows:
(j) the Liens on the Collateral in favor of DDJ
to secure the DDJ Indebtedness, but only to the extent that such
Liens are subordinated pursuant to the DDJ Intercreditor Agreement.
2.3 The first sentence of the definition of "Tangible Net Worth" is
hereby amended by adding the following to the end thereof:
; plus (c) the outstanding amount of any DDJ Indebtedness to the
extent subordinated pursuant to the Intercreditor Agreement.
2.4 The third sentence of Section 6.10(d) of the Agreement is hereby
amended by inserting the following immediately after the words "sole loss payee"
contained therein:
(provided that such endorsement(s) may also show DDJ as a secondary
loss payee entitled to proceeds at such time as Agent has notified
the relevant insurer(s) that the Obligations have been paid in full,
with DDJ's rights to insurance proceeds further subject to the terms
of the Intercreditor Agreement)
2.5 Section 7.1(b) of the Agreement is hereby amended to read as
follows:
(b) Indebtedness set forth on Schedule 7.1, the Xxxxx
Notes, and the DDJ Indebtedness to the extent
subordinated pursuant to the DDJ Intercreditor
Agreement;
2.6 Section 7.11 of the Agreement is amended by adding the following
to the end thereof:
"; provided, however, that Borrower may
repurchase up to an aggregate amount of 15,000 shares of its common
stock from Xxxx Xxxxxxx and Xxxxxx Xxxxxx (collectively the
"Holders"), so long as the only consideration for such repurchase is
the cancellation of any deferred purchase price remaining to be paid
by the Holders to Borrower."
2.7 Section 7.20(b) of the Agreement is amended in its entirety to
read as follows:
"(b) Tangible Net Worth. A Tangible Net Worth
of at least the following amounts as of the last day of the fiscal
quarters of Borrower ending on or about the last day of the
following months:
Month Minimum Tangible Net Worth
----- --------------------------
May 2001 $22,122,000
August 2001 $18,502,000
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3. CONSENT. Agent and Required Lenders hereby consent to Borrower's
incurrence of the DDJ Indebtedness, and the payment of interest and fees in
respect of the DDJ Indebtedness, pursuant to the terms of the DDJ Loan Agreement
as in effect on April 30, 2001, and Borrower's granting of subordinated liens on
the Collateral pursuant to the terms of the DDJ Security Agreement, as in effect
on April 30, 2001, in each case subject to the terms of the Intercreditor
Agreement.
4. REPRESENTATIONS AND WARRANTIES. Borrower hereby affirms to Lenders
and Agent that all of Borrower's representations and warranties set forth in the
Agreement are true, complete and accurate in all material respects as of the
date hereof (except to the extent such representations and warranties relate
solely to an earlier date).
5. WAIVERS; DEFAULTS. Agent and the Required Lenders hereby
acknowledge that any Events of Default arising out of Borrower's failure (i) to
meet the requirements of Section 6.5 (minimum Availability) at any time or times
from January 1, 2001 through the date of this Amendment, or (ii) to meet the
requirements of Section 7.20(b) (minimum Tangible Net Worth) as of November 30,
2000 and February 28, 2001 are hereby waived. The foregoing waivers are only for
the dates specified, and Borrower at all times shall be required to comply with
the other terms of the Loan Agreement, and shall be required to comply with the
terms of Sections 6.5 and 7.20 (b) (as amended hereby) of the Loan Agreement at
all other times. Borrower hereby affirms to Lenders and Agent that no Default or
Event of Default exists as of the date hereof that has not been waived in the
preceding sentence.
6. CONDITIONS PRECEDENT. The effectiveness of this Amendment is
expressly conditioned upon the following:
(a) Receipt by Agent of fully executed copies of this Amendment;
(b) Receipt by Agent of fully executed copies of the DDJ
Intercreditor Agreement and copies of the documents evidencing the DDJ
Indebtedness, in each case satisfactory in form and content to Agent; and
(c) Payment of an amendment fee to Agent, for the pro rata account of
Lenders, in the amount of $50,000.
7. COSTS AND EXPENSES. Borrower shall pay to Agent all of Agent's
out-of-pocket costs and expenses (including, without limitation, the reasonable
fees and expenses of its counsel, which counsel may include any local counsel
reasonably deemed necessary, search fees, filing and recording fees,
documentation fees, appraisal fees, travel expenses, and other fees) arising in
connection with the preparation, execution, and delivery of this Amendment and
any related documents.
8. 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, modified, and supplemented hereby, shall remain in full
force and effect.
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9. 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.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
as of the date first set forth above.
XXXXXXX JEWELERS, INC.,
a Delaware corporation
By: /s/ Xxxxx XxXxxxxxxx
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Title: President and CEO
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FOOTHILL CAPITAL CORPORATION,
a California corporation, as Agent and as a Lender
By: /s/ Xxxxxx Xxxxxxx
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Title: Vice President
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LASALLE BUSINESS CREDIT, INC.,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxx, XX
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Title: SVP
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SUNROCK CAPITAL CORP.,
a Delaware corporation
By: /s/ Xxxx X. Xxxxx
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Title: S.V.P.
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