Exhibit 10.25(e)
AMENDMENT Xx. 0
XXXXXXXXX XXXXXXXXX Xx. 0 dated as of October 28, 1998 among FINLAY
ENTERPRISES, INC. a Delaware corporation (the "Parent"), FINLAY FINE JEWELRY
CORPORATION, a Delaware corporation (the "Company"), the lenders named herein
and signatory hereto (the "Lenders") and GENERAL ELECTRIC CAPITAL CORPORATION,
as agent (the "Agent") for the Lenders.
W I T N E S S E T H :
WHEREAS, the Parent, the Company, the Lenders and the Agent are parties to
an Amended and Restated Credit Agreement dated as of September 11, 1997 (as
heretofore and hereafter amended, modified or supplemented from time to time in
accordance with its terms, the "Credit Agreement") and;
WHEREAS, in order to improve the operating efficiency of the Company, the
Company desires to restructure ownership of its intellectual property and
certain of its merchandising and buying operations (the "Restructuring Plan");
and
WHEREAS, the Company desires to establish a Domestic Subsidiary in
Delaware, Finlay Merchandising & Buying, Inc. ("Finlay Merchandising") in order
to transfer certain intellectual property and certain merchandising and buying
operations owned by the Company to Finlay Merchandising in accordance with a
Contribution Agreement dated as of October 28, 1998 between the Company and
Finlay Merchandising (the "Contribution Agreement"), which intellectual property
will simultaneously be licensed by Finlay Merchandising back to the Company
pursuant to a Trade Name License Agreement dated as of October 28, 1998 among
Finlay Merchandising, the Company and the Parent (the "Trade Name License
Agreement") and which merchandising and buying operations will subsequently be
performed for the Company by Finlay Merchandising pursuant to a Services
Agreement dated as of October 28, 1998 between the Company and Finlay
Merchandising (the "Services Agreement"); and
WHEREAS, as of the date hereof, the Company shall own 100% of the capital
stock of Finlay Merchandising, beneficially and of record; and
WHEREAS, subject to the terms and conditions contained herein the parties
hereto desire to amend certain provisions of the Credit Agreement.
NOW THEREFORE, for good and valuable consideration, the receipt of which is
hereby acknowledged, and subject to the fulfillment of the conditions set forth
below, the parties hereto agree as follows:
1. Defined Terms. Unless otherwise specifically defined herein, all
capitalized terms used herein shall have the respective meanings ascribed to
such terms in the Credit Agreement.
2. Consent to the Restructuring Plan. Provided that the assets set forth on
Schedule 9.5 remain subject to Liens of the Agent and the Lenders'in existence
in the date hereof, the Majority Lenders hereby consent to (a) the establishment
of Finlay Merchandising as a wholly owned subsidiary of the Company; (b) the
transactions contemplated by the Contribution Agreement, as in effect on the
date hereof, without any waivers or modifications materially adverse to the
Lenders, not consented to by the Majority Lenders; (c) the transactions
contemplated by the Trade Name License Agreement, as in effect on the date
hereof, without any waivers or modifications materially adverse to the Lenders,
not consented to by the Majority Lenders; (d) the transactions contemplated by
the Services Agreement, as in effect on the date hereof, without any waivers or
modifications materially adverse to the Lenders not consented to by the Majority
Lenders. In connection with the Contribution Agreement, the Trade Name License
Agreement and the Services Agreement, the Company agrees to execute, deliver and
file at the Company's expense all financing statements requested by the Agent to
be filed to perfect the Agent's and the Lenders' Liens on the assets set forth
on Schedule 9.5 hereto.
3. Amendments to Credit Agreement. Upon the Effective Date (as defined
herein), the Credit Agreement shall be amended as follows:
(a) Section 1.1 of the Credit Agreement is hereby amended to add the
following definition in its proper alphabetical sequence:
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"Finlay Merchandising" shall mean Finlay Merchandising & Buying, Inc., a
Delaware corporation and wholly owned Subsidiary of the Company."
(b) The following Section 8.28 shall be added immediately following the
last full sentence of Section 8.27 of the Credit Agreement:
"Section 8.28 Intercompany Charges and Mandatory Dividends relating to
Finlay Merchandising. The Company shall cause all payments (net of amounts
(which may be paid in cash) equal to the reasonable, ordinary course operating
expenses of Finlay Merchandising including, without limitation, payroll expenses
for employees of Finlay Merchandising) to be made by the Company to Finlay
Merchandising in respect of amounts owed under the Trade Name License Agreement
and the Services Agreement to be made by means of appropriate intercompany
charges. Finlay Merchandising shall within thirty days (30) following the end of
each fiscal quarter during which payments to Finlay Merchandising are made by
the Company by means of intercompany charges, declare and distribute to the
Company as a dividend an amount equal to the amount of such payments (net of
reasonable operating expenses for the then current and immediately succeeding
calendar month (which may be paid in cash) of Finlay Merchandising including,
without limitation, payroll expenses for employees of Finlay Merchandising).
(c) Section 9.4 of the Credit Agreement shall be amended to delete the
"and" immediately following Section 9.4(r), to delete the period at the end of
Section 9.4(s) and to insert a semi-colon followed by the word "and" immediately
thereafter, and to add the following immediately thereafter:
"(t) Investments by the Company in Finlay Merchandising as set forth on
Schedule 9.5 hereto."
(d) Section 9.5 of the Credit Agreement shall be amended to delete the
"and" immediately following Section 9.5(f), to delete the period at the end of
Section 9.5(g) and to insert a semi-colon followed by the word "and" immediately
thereafter, and to add the following immediately thereafter:
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" 9.5(h) the sale, transfer and assignment by the Company to Finlay
Merchandising of the assets set forth on Schedule 9.5 hereto, provided, however,
that the Company shall not transfer, sell, assign, lease or otherwise dispose of
all or any part of its Accounts or Inventory to Finlay Merchandising."
(e) Section 9.6 of the Credit Agreement shall be amended to delete the
"and" immediately following Section 9.6(a)(iii), to delete the period at the end
of Section 9.6(a)(iv) and to insert a semi-colon followed by the word "and"
immediately thereafter, and to add the following immediately thereafter:
"(v) The Company may purchase all, but not less than all of the issued and
outstanding capital stock of Finlay Merchandising."
(f) Section 9.17 of the Credit Agreement shall be amended to add the
following immediately following the last sentence thereof:
"Notwithstanding the foregoing, the Company may transfer, sell, or assign
to Finlay Merchandising the assets set forth on Schedule 9.5 hereto, and enter
into the Trade Name License Agreement and enter into the Services Agreement with
Finlay Merchandising.
(g) Section 9.18 of the Credit Agreement shall be amended to add the
following immediately following the last sentence thereof:
"Notwithstanding the foregoing, the Company may subscribe for and Finlay
Merchandising may sell to the Company, all, but not less than all, of the issued
and outstanding capital stock of Finlay Merchandising."
4. Representations and Warranties. Each of the Parent and the Company
represents and warrants as follows (which representations and warranties shall
survive the execution and delivery of this Amendment):
(a) Each of the Parent and the Company has taken all necessary action to
authorize the execution, delivery and performance of this Amendment.
(b) This Amendment has been duly executed and delivered by the Parent and
the Company and the
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acknowledgement attached hereto has been duly executed and delivered by each
Subsidiary. This Amendment and the Credit Agreement as amended hereby constitute
the legal, valid and binding obligation of the Parent and the Company,
enforceable against them in accordance with their respective terms, subject to
applicable bankruptcy, reorganization, insolvency, fraudulent conveyance or
transfer, moratorium and similar laws affecting the enforcement of creditors'
rights generally and by general equity principles.
(c) No consent or approval of any person, firm, corporation or entity, and
no consent, license, approval or authorization of any governmental authority is
or will be required in connection with the execution, delivery, performance,
validity or enforcement of this Amendment other than any such consent, approval,
license or authorization which has been obtained and remains in full force and
effect or where the failure to obtain such consent, approval, license or
authorization would not result in a Material Adverse Effect.
(d) After giving effect to this Amendment, each of the Company and the
Parent is in compliance with all covenants and agreements applicable to it set
forth in the Credit Agreement and each of the other Loan Documents.
(e) After giving effect to this Amendment, no event has occurred and is
continuing which constitutes a Default or an Event of Default.
(f) All representations and warranties contained in the Credit Agreement
and each of the other Loan Documents are true and correct in all material
respects as of the date hereof, except to the extent that any representation or
warranty relates to a specified date, in which case such are true and correct in
all material respects as of the specific date to which such representations and
warranties relate.
5. Effective Date. The amendments to the Credit Agreement contained herein
shall not become effective (the "Effective Date") until (i) this Amendment has
been duly executed and delivered by the Company, the Parent and the Majority
Lenders; (ii) the acknowledgement attached hereto shall have been executed and
delivered by each of the Subsidiaries; (iii) the certificate of incorporation of
Finlay Merchandising shall have been filed with the Delaware Secretary of State;
(iv) the transactions contemplated by the Contribution Agreement, the Trade Name
License
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Agreement, and the Services Agreement shall have been entered into by no later
than October 28, 1998 and a letter from the Company to that effect shall have
been delivered to the Agent; (v) Finlay Merchandising shall have executed and
delivered Amendment No. 1 to the Security Agreement and related UCC filings
satisfactory to the Agent shall have been made; (vi) Finlay Merchandising shall
have executed and delivered Amendment No.1 to Security Agreement and Mortgage -
Trademark, Patents and Copyrights and related UCC filings satisfactory to the
Agent shall have been made; (vii) the Company shall have executed and delivered
Amendment No. 1 to the Pledge Agreement and the stock of Finlay Merchandising
shall have been delivered in pledge thereunder and (viii) the Agent shall have
received the opinion of Xxxxxx Xxxxxxxxxx LLP, counsel to the Credit Parties,
substantially in the form attached hereto as Exhibit A hereto.
6. Gold Consignment Agreement. The Majority Lenders hereby consent to the
execution and delivery by the Company of Amendment No. 7 and Limited Consent to
the Gold Consignment Agreement, such Amendment No. 7 and Limited Consent being
substantially in the form attached hereto as Exhibit B.
7. Employment Agreement of Xxxxx Shuffeld. The Majority Lenders hereby
consent to the form, terms and provisions of that certain Employment Agreement
between the Company and Xxxxx Shuffeld and the ancillary agreements related
thereto in respects to Xxxxx Shuffeld, such Employment Agreement and ancillary
agreements in the form attached hereto as Exhibit C.
8. Expenses. The Company agrees to pay on demand all costs and expenses,
including reasonable attorneys' fees, of the Agent incurred in connection with
this Amendment.
9. Continued Effectiveness. The term "Agreement", "hereof", "herein" and
similar terms as used in the Credit Agreement, and references in the other Loan
Documents to the Credit Agreement, shall mean and refer to, from and after the
Effective Date, the Credit Agreement as amended by this Amendment. Each of the
Company and the Parent hereby agrees that all of the covenants and agreements
contained in the Credit Agreement and the Loan Documents are hereby ratified and
confirmed in all respects.
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10. Counterparts. This Amendment may be executed in counterparts, each of
which shall be an original, and all of which, taken together, shall constitute a
single instrument. Delivery of an executed counterpart of a signature page to
this Amendment by telecopier shall be effective as delivery of a manually
executed counterpart of this Amendment.
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11. Governing Law. This Amendment shall be governed by, and construed in
accordance with, the laws of the State of New York without giving effect to the
conflict of laws provisions thereof.
IN WITNESS WHEREOF the parties hereto have caused this Amendment to be duly
executed by their respective officers as of the date first written above.
FINLAY ENTERPRISES, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
FINLAY FINE JEWELRY CORPORATION
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
FINLAY MERCHANDISING & BUYING, INC.
as Guarantor
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
GENERAL ELECTRIC CAPITAL CORPORATION,
Individually and as Agent
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: Duly Authorized Signatory
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FLEET PRECIOUS METALS INC.
By: /s/ Xxxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President
THE CHASE MANHATTAN BANK
By: /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President
XXXXXXX XXXXX CREDIT PARTNERS L.P.
By: /s/ Authorized signatory
------------------------------------
Name:
Title:
ABN AMRO BANK N.V.
By: /s/ Xxx Xxxxxxxxx
------------------------------------
Name: Xxx Xxxxxxxxx
Title: Vice President
By: /s/ Xxxxxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxxxxx Xxxxxxx
Title: Vice President
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BANK LEUMI
By: /s/ Xxxxx Xxxxxx
------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
By: /s/ Xxxxxxx Xxxxx
------------------------------------
Name: Xxxxxxx Xxxxx
Title: Vice President
TRANSAMERICA BUSINESS CREDIT CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
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Each of the Guarantors, by signing below, confirms in favor of the Agent and the
Lenders that it consents to the terms and conditions of the foregoing Amendment
No. 4 to the Amended and Restated Credit Agreement and agrees that it has no
defense, offset, claim, counterclaim or recoupment with respect to any of its
obligations or liabilities under its respective Guaranty and that all terms of
such Guaranty shall continue in full force and effect, subject to the terms
thereof.
FINLAY JEWELRY, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
SONAB HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
SONAB INTERNATIONAL, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
SOCIETE NOUVELLE D'ACHAT DE BIJOUTERIE - S.O.N.A.B.
By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Attorney-in-fact
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EXHIBIT A
LENDERS, COMMITMENTS AND INITIAL EURODOLLAR OFFICES
Revolving
Lender and Initial Commitment
Eurodollar Office Amount %
----------------- ------------ -------
General Electric $91,666,667 33.333%
Capital
Corporation
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000
Fleet Precious Metals Inc. $61,111,111 22.222%
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
Xxxxxxx Xxxxx Credit Partners, L.P. $20,000,000 7.272%
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
The Chase Manhattan Bank $30,555,556 11.111%
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Bank Leumi USA $12,222,222 4.444%
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
ABN AMRO Bank, N.V. $30,555,556 11.111%
(New York Branch)
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Transamerica Business Credit $28,888,889 10.505%
Corporation
000 Xxxxxxxx Xxxxxx Xxxxxx
Xxxxx X-000
Xxx, Xxx Xxxx 00000
Revolving
Sublimit
Commitment1 %
------------ -------
General Electric $8,333,333 33.333%
Capital
Corporation
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000
Fleet Precious Metals Inc. $5,555,556 22.222%
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
Xxxxxxx Sachs Credit Partners L.P. $1,818,182 7.272%
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
The Chase Manhattan Bank $2,777,778 11.111%
000 Xxxx 00xx Xxxxxx
Xxxx Xxxxx XXX $1,111,111 4.444%
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
ABN AMRO Bank, N.V. $2,777,778 11.111%
(New York Branch)
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Transamerica Business Credit $2,626,263 10.505%
Corporation
000 Xxxxxxxx Xxxxxx Xxxxxx
Xxxxx X-000
Xxx, Xxx Xxxx 00000
________________________
1. As such amount may vary pursuant to the definition of Parent Revolving Credit
Facility Sublimit Commitment.
