AMENDMENT XX. 0
XXXXXXXXX XXXXXXXXX Xx. 0 dated as of October 6, 1997 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, 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. Amendments to Credit Agreement. The Credit
Agreement shall be amended as follows upon the Effective Date (as defined
herein):
(a) Section 1.1 of the Credit Agreement is hereby
amended to add the following definitions in their proper alphabetical sequence:
"Diamond Park Asset Purchase Agreement" shall mean that certain
Asset Purchase Agreement dated as of September 3, 1997 by and among the Parent,
the Company, Xxxx Corporation and Zale Delaware Inc., as in effect on the date
hereof."
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"Diamond Park Division" shall mean the business and assets
acquired by the Company pursuant to the Diamond Park Asset Purchase Agreement."
(b) Section 2.6(f) of the Credit Agreement is hereby amended to
add the following sentence immediately following the Applicable Margin grid:
"Notwithstanding the foregoing, if the Leverage Ratio for the fiscal quarter
ending October 31, 1998 is 4.60 or less, the Applicable Eurodollar Margin shall
be set at 1.50% per annum for the immediately succeeding fiscal quarter and the
Applicable Index Margin shall be set at 0.50 per annum for the immediately
succeeding fiscal quarter."
(c) Section 8.17 of the Credit Agreement is hereby amended
in its entirety to read as follows:
Section 8.17 (a) FINANCIAL COVENANTS. Leverage Ratio. The
Parent shall maintain, or cause to be maintained, a Leverage Ratio, as of the
end of each period of four consecutive quarters of the Parent ending on or about
the dates set forth below, of not more than the ratio set forth below opposite
such date; provided that, solely for the purposes of calculating the Leverage
Ratio for the fiscal quarter ending October 31, 1997 only, the calculation of
Indebtedness for Borrowed Money and EBITDA of the Parent and its Subsidiaries
for such fiscal quarter shall not include any Indebtedness for Borrowed Money or
EBITDA otherwise attributable to the Parent or its Subsidiaries in connection
with the consummation of the transactions contemplated by the Diamond Park Asset
Purchase Agreement, and provided, further, that solely for the purposes of the
calculation of the Leverage Ratio for the fiscal quarters ending January 31,
1998, April 30, 1998, and July 31, 1998, the Parent may utilize the actual
historical earnings information (provided to the Company by Xxxx Corporation
pursuant to the Diamond Park Asset Purchase Agreement) in respect of the
operation of the Diamond Park Division by Xxxx Corporation prior to the
Company's acquisition of the Diamond Park Division to calculate EBITDA for such
fiscal quarters:
Four Fiscal Quarters
Ending On or About Ratio
------------------ -----
October 31, 1997 5.75
January 31, 1998 4.30
April 30, 1998 5.95
July 31, 1998 5.95
October 31, 1998 5.75
January 31, 1999 3.90
April 30, 1999 5.60
July 31, 1999 5.60
October 31, 1999 5.40
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January 31, 2000 3.85
April 30, 2000 5.00
July 31, 2000 5.00
October 31, 2000 4.80
January 31, 2001 3.50
April 30, 2001 4.50
July 31, 2001 4.50
October 31, 2001 4.30
January 31, 2002 3.20
April 30, 2002 4.50
July 31, 2002 4.50
October 31, 2002 4.30
January 31, 2003 3.20
April 30, 2003 and each Fiscal 4.50
Quarter thereafter
(b) Fixed Charge Coverage Ratio. The Parent shall maintain, or
cause to be maintained, as of the end of each period of four consecutive fiscal
quarters of the Parent ending on or about the dates set forth below, a Fixed
Charge Coverage Ratio of not less than:
Four Fiscal Quarters
Ending On or About Ratio
------------------ -----
October 31, 1997 1.20
January 31, 1998 1.30
April 30, 1998 1.30
July 31, 1998 1.30
October 31, 1998 1.30
January 31, 1999 1.40
April 30, 1999 1.40
July 31, 1999 1.40
October 31, 1999 1.45
January 31, 2000 and Each Fiscal 1.50
Quarter Thereafter
(c) EBITDA. The Parent shall maintain, or cause to be
maintained, EBITDA for each period of four consecutive fiscal quarters of the
Parent ending on or about the dates set forth below of not less than the amount
set forth below opposite such date, provided, that solely for the purposes of
the calculation of EBITDA for the fiscal quarters ending October 31, 1997,
January 31, 1998, April 30, 1998, and July
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31, 1998, the Parent may utilize the actual historical earnings information
(provided to the Company by Xxxx Corporation pursuant to the Diamond Park Asset
Purchase Agreement) in respect of the operation of the Diamond Park Division by
Xxxx Corporation prior to the Company's acquisition of the Diamond Park Division
to calculate EBITDA for such fiscal quarters:
Four Fiscal Quarters
Ending On or About Amount
------------------ ------
October 31, 1997 $62,000,000
January 31, 1998 $62,000,000
April 30, 1998 $65,000,000
July 31, 1998 $65,000,000
October 31, 1998 $67,000,000
January 31, 1999 $70,000,000
April 30, 1999 $70,000,000
July 31, 1999 $70,000,000
October 31, 1999 $70,000,000
January 31, 2000 $75,000,000
April 30, 2000 $75,000,000
July 31, 2000 $75,000,000
October 31, 2000 $75,000,000
January 31, 2001 $80,000,000
April 30, 2001 $82,000,000
July 31, 2001 $82,000,000
October 31, 2001 $82,000,000
January 31, 2002 and each Fiscal $87,000,000
Quarter thereafter
(d) Sonab EBITDA. Sonab shall maintain, or cause to be
maintained EBITDA for each period of four consecutive fiscal quarters of Sonab
ending on or about the dates set forth below of not less than the amount set
forth below opposite such dates.
Four Fiscal Quarters
Ending On or About Amount
------------------ ------
October 31, 1997 $2,700,000
January 31, 1998 $2,700,000
April 30, 1998 $2,700,000
July 31, 1998 $2,700,000
October 31, 1998 $2,700,000
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January 31, 1999 $2,800,000
April 30, 1999 $2,800,000
July 31, 1999 $2,800,000
October 31, 1999 $2,800,000
January 31, 2000 $3,000,000
April 30, 2000 $3,000,000
July 31, 2000 $3,000,000
October 31, 2000 $3,000,000
January 31, 2001 $3,200,000
April 30, 2001 $3,200,000
July 31, 2001 $3,200,000
October 31, 2001 $3,200,000
January 31, 2002 and each Fiscal $3,400,000
Quarter thereafter
3. 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 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,
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 of the various covenants and
agreements set forth in the Credit Agreement and each of the other Loan
Documents.
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(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.
4. 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 each of the Lenders and (ii) the acknowledgement attached hereto shall
have been executed and delivered by each of the Subsidiaries.
5. 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.
6. 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.
7. Gold Consignment Agreement. The Lenders hereby consent
to the execution and delivery by the Company of Amendment No. 4 and Limited
Consent to the Gold Consignment Agreement, such Amendment No. 4 and Limited
Consent being substantially in the form attached hereto as Exhibit A.
8. 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.
9. 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.
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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 Xxxxxxxxx
-----------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
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FINLAY FINE JEWELRY CORPORATION
By:/s/Xxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
GENERAL ELECTRIC CAPITAL CORPORATION,
Individually and as Agent
By:/s/Xxxx Luck
-----------------------------------
Name: Xxxx Luck
Title: Being Duly Authorized
FLEET PRECIOUS METALS, INC.
By:/s/Xxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxx
Title: AVP
By:/s/Xxxxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: SVP
THE CHASE MANHATTAN BANK
By:/s/Xxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxx
Title: VP
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XXXXXXX XXXXX CREDIT PARTNERS L.P.
By:/s/Xxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxx
Title: Auth. Signatory
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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. 2 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 Xxxxxxxxx
-----------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
SONAB HOLDINGS, INC.
By:/s/Xxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
SONAB INTERNATIONAL, INC.
By:/s/Xxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
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SOCIETE NOUVELLE D'ACHAT DE BIJOUTERIE - S.O.N.A.B.
By:/s/Xxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Attorney-In-Fact
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