EXHIBIT 4.3
AMENDMENT NO. 2 TO FINANCING AGREEMENTS
AMENDMENT No. 2, dated as of May 17, 2002, by and among Congress Financial
Corporation, a Delaware corporation, in its capacity as Administrative Agent,
Collateral Agent, Joint Lead Arranger and Joint Bookrunner (in such capacity,
"Agent") for the financial institutions from time to time party to the Loan
Agreement (as hereinafter defined) as lenders (each individually, a "Lender" and
collectively, "Lenders"), and Charming Shoppes, Inc., a Pennsylvania corporation
("Parent"), Charming Shoppes of Delaware, Inc., a Pennsylvania corporation ("CS
Delaware"), CSI Industries, Inc., a Delaware corporation ("CSI"), FB Apparel,
Inc., an Indiana corporation ("FB Apparel"), Catherines Stores Corporation, a
Tennessee corporation ("Catherines") and Lane Xxxxxx, Inc., a Delaware
corporation ("LB", and, together with Parent, CS Delaware, CSI, FB Apparel and
Catherines hereinafter referred to each individually, as a "Borrower" and
collectively, as "Borrowers"), CS Delaware, in its capacity as agent for itself
as a Borrower and for the other Borrowers ("Borrowers' Agent").
W I T N E S S E T H :
WHEREAS, Agent, X.X. Xxxxxx Business Credit Corp, a Delaware corporation,
in its capacity as Co-Agent, Joint Lead Arranger and Joint Bookrunner under the
Loan Agreement (in such capacity, "Co-Agent"), Lenders, Borrowers and Borrowers'
Agent have entered into financing arrangements pursuant to which Lenders have
made and may make loans and advances and provide other financial accommodations
to Borrowers as set forth in the Loan and Security Agreement, dated August 16,
2001, by and among Lenders, Agent, Co-Agent, Borrowers and Borrowers' Agent (as
the same was Amended by Amendment No. 1 dated as of January 12, 2002 and may
hereafter be further amended, modified, supplemented, extended, renewed,
restated or replaced, the "Loan Agreement", and together with all agreements,
documents and instruments at any time executed and/or delivered in connection
therewith or related thereto, as from time to time amended, modified,
supplemented, extended, renewed, restated or replaced, collectively, the
"Financing Agreements");
WHEREAS, Borrowers and Borrowers' Agent have requested that Agent, Required
Lenders and Required Term Loan Lenders agree to make certain amendments to the
Financing Agreements and Agent on behalf of itself, the Required Lenders and the
Required Term Loan Lenders are willing to agree to such amendments, subject to
the terms and conditions contained herein; and
WHEREAS, by this Amendment No. 2, Agent, and Borrowers and Borrowers' Agent
desire and intend to evidence such amendments.
NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
and covenants contained herein, and subject to the satisfaction of the
conditions set forth in Section 8 hereof, the parties hereto agree as follows:
1. Definitions.
(a) Additional Definitions. As used herein, the following terms shall have
the respective meanings given to them below and the Loan Agreement shall be
deemed and is hereby amended to include, in addition and not in limitation of,
each of the following definitions:
(i) "Amendment No. 2" shall mean this Amendment No. 2 to Financing
Agreements by and among Agent, the Required Lenders, Required Term Loan
Lenders and Borrowers, as the same now exists or may hereafter be amended,
modified, supplemented, extended, renewed, restated, or replaced, and the
Loan Agreement shall be deemed and is hereby amended to include, in
addition and not in limitation, such definition.
(ii) "Convertible 2002 Senior Note Agreements" shall mean,
individually and collectively, the Convertible 2002 Senior Notes, the
Convertible 2002 Senior Note Indenture and all other agreements, documents
and instruments now or at any time hereafter executed and/or delivered by
Parent or any other Borrower or any other person in connection with the
issuance of the Convertible 2002 Senior Notes, as the same exists when
executed or may thereafter be amended, modified, supplemented, extended,
renewed, restated or replaced.
(iii) "Convertible 2002 Senior Note Indenture" shall mean the
Indenture, dated as of the Effective Date, between Parent and Wachovia
Bank, National Association, as the Convertible 2002 Senior Note Trustee
with respect to the Convertible 2002 Senior Notes, as the same exists when
executed or may thereafter be amended, modified, supplemented, extended,
renewed, restated or replaced.
(iv) "Convertible 2002 Senior Notes" shall mean, the Convertible
Senior Notes due 2012, issued by Parent pursuant to the Convertible 2002
Senior Note Indenture up to a maximum aggregate original principal amount
not to exceed $180,000,000.
(v) "Convertible 2002 Senior Note Trustee" shall mean, Wachovia Bank,
National Association, and its successors and assigns, and any replacement
trustee permitted pursuant to the terms and conditions of the Convertible
2002 Senior Note Indenture.
(b) Amendment to Definitions. All references to the term "Financing
Agreements" in the Loan Agreement shall be deemed and each such reference is
hereby amended to include, in addition and not in limitation, this Amendment No.
2 and all other agreements, documents and instruments at any time executed
and/or delivered by any Borrower, Borrowers' Agent or any other person in
connection herewith, as the same now exist or may hereafter be amended,
modified, supplemented, extended, renewed, restated or replaced.
(c) Interpretation. All capitalized terms used herein shall have the
meanings assigned thereto in the other Financing Agreements, unless otherwise
defined herein. All references to the plural herein shall also mean the singular
and all references to the singular herein shall also mean the plural, in each
case unless otherwise required by the context of the use thereof.
2. Consents. Notwithstanding anything to the contrary set forth in Section
9.9(f), 9.9 (k), 9.9(h), 9.10, and 9.11 of the Loan Agreement and subject to the
occurrence of the Effective Date (as defined below) and terms and conditions
contained herein, Agent, Required Term Loan Lenders and Required Lenders hereby
consent to (a) the issuance by Parent of the Convertible 2002 Senior Notes, in
accordance with the terms of this Amendment No. 2, provided, that, the Term Loan
and all Obligations relating to the Term Loan together with the principal amount
of the Revolving Loans outstanding on the date of issuance of the Convertible
2002 Senior Notes are paid in full with the proceeds of the Convertible 2002
Senior Notes (amounts repaid in respect of the outstanding Revolving Loans may
be reborrowed in accordance with the terms of the Loan Agreement), (b) the
repurchase or redemption by Parent, at Parent's option, of all or any of the
Subordinated Notes outstanding as of this Amendment No.2, using a portion of the
proceeds of the Convertible 2002 Senior Notes and the proceeds of Revolving
Loans, and (c) the repurchase by Parent of its Capital Stock using a portion of
the proceeds received by Parent from the issuance of the Convertible 2002 Senior
Notes, and the proceeds of Revolving Loans, provided, that, the maximum
aggregate amount paid to repurchase Capital Stock of Parent and retire the
Subordinated Notes (including amounts paid with the proceeds of Revolving Loans)
shall not exceed $100,000,000, and, provided, that, at the time of each such
purchase of any Capital Stock or any Subordinated Note, and after giving effect
thereto, no Event of Default, or act, condition or event which with notice or
passage of time or both would constitute an Event of Default shall exist or have
occurred and be continuing.
3. Use of Proceeds. Section 6.7 of the Loan Agreement is hereby amended by
adding the following clause at the end thereof, immediately after the phrase "as
amended":
", except, that, Borrowers may use proceeds of Revolving Loans to purchase
shares of the Capital Stock of Parent so long as any such purchase (a) does
not constitute or otherwise cause a violation of Regulation U and (b) is
otherwise is in compliance with Section 2 of Amendment No. 2."
4. Indiana Real Property. Section 9.8(l) of the Loan Agreement is hereby
amended by deleting the reference to "two hundred seventy (270) days" in clause
(i)(A) thereof and substituting "three hundred ninety (390) days" therefor.
5. Indebtedness. Section 9.9 of the Loan Agreement is hereby amended by
adding a new Section 9.9(o) as follows:
"(o) Indebtedness of Parent of up to the maximum principal amount of
$180,000,000 less the aggregate amount of all repayments or repurchases or
redemptions, optional or mandatory, of principal in respect thereof,
evidenced by the Convertible 2002 Senior Notes, plus interest thereon at
the rate provided for in the
Convertible 2002 Senior Notes (as in effect on the date of issuance);
provided, that:
(i) Parent shall only make regularly scheduled payments of interest
and premium, if any, or other mandatory payments in respect of such
Indebtedness in accordance with the terms of the Convertible 2002 Senior
Notes or the Convertible 2002 Senior Note Indenture (as in effect on the
date of issuance);
(ii) Parent shall not, directly or indirectly, (A) amend, modify,
alter or change the terms of the Convertible 2002 Senior Notes or any of
the other Convertible 2002 Senior Note Agreements (as in effect on the date
of issuance), except, that, Parent may, after prior written notice to
Agent, amend, modify, alter or change the terms thereof so as to extend the
maturity thereof or defer the timing of any payments in respect thereof, or
to forgive or cancel any portion of such Indebtedness other than pursuant
to payments thereof, or to reduce the interest rate or any fees in
connection therewith, of the Convertible 2002 Senior Indenture as in effect
on the date hereof, (B) make optional prepayments of principal or redeem,
retire, defease, purchase or otherwise acquire such Indebtedness, or set
aside or otherwise deposit or invest any sums for such purpose in any
sinking fund, or otherwise, except, for mandatory redemptions of the
Convertible 2002 Senior Notes (as in effect on the date of issuance)
required by the Convertible 2002 Senior Note Indenture (as in effect on the
date of issuance) in the event of the occurrence of a "Repurchase Event"
(as defined in the Convertible 2002 Senior Note Indenture as in effect on
the date of issuance); and
(iii) Borrowers shall furnish to Agent all material notices or demands
in connection with such Indebtedness as to which non-payment thereof (A)
would result in a material adverse change in the consolidated assets, or
business or prospects of the Apparel Group or (B) would impede the ability
of any Borrower to perform its obligations hereunder or under any of the
other Financing Agreements or Lender to enforce any Obligations or realize
upon any Collateral, which such notices or demands are either received by
Parent or any other Borrower from any of the holders of the Convertible
2002 Senior Notes or the Convertible 2002 Senior Note Trustee, or on their
behalf, promptly after receipt thereof, or sent by Parent or any other
Borrower, or on their behalf, to any of the holders of the Convertible 2002
Senior Notes or the Convertible 2002 Senior Note Trustee, concurrently with
the sending thereof, as the case may be."
6. Representations, Warranties and Covenants. In addition to the continuing
representations, warranties and covenants heretofore or hereafter made by
Borrowers and Borrowers' Agent to Agent, Co-Agent and Lenders pursuant to the
Financing Agreements, Borrowers and Obligors hereby jointly and severally
represent, warrant and covenant with and to
Agent, and Lenders as follows (which representations, warranties and covenants
are continuing and shall survive the execution and delivery hereof and shall be
incorporated into and made a part of the Financing Agreements):
(a) No Event of Default exists on the date of this Amendment No. 2
(after giving effect to the amendments to the Financing Agreements made by
this Amendment No. 2);
(b) This Amendment No. 2 has been duly executed and delivered by
Borrowers, Obligors and Borrowers' Agent and this Amendment No. 2 and the
other Financing Agreements are in full force and effect as of the date
hereof, and the agreements and obligations of Borrowers, Obligors and
Borrowers' Agent contained herein and therein constitute legal, valid and
binding obligations of Borrowers and Borrowers' Agent enforceable against
Borrowers, Obligors and Borrowers' Agent in accordance with their
respective terms;
(c) Neither the execution and delivery of the Convertible 2002 Senior
Notes, any of the other Convertible 2002 Senior Note Agreements or any of
the instruments and documents to be delivered pursuant thereto, nor the
consummation of the transactions therein contemplated, nor compliance with
the provisions therein contemplated, has violated or will violate any law
or regulation or any order or decree of any court or governmental
instrumentality in any respect or does or will conflict with or result in
the breach of, or constitute a default in any respect under, any indenture,
mortgage, deed of trust, agreement or instrument to which either any
Borrower or Obligor is a party or may be bound, or result in the creation
or imposition of any lien, charge or encumbrance upon any of the property
of any Borrower or Obligor (except as specifically consented to or
contemplated hereunder or under the other Financing Agreements) or violate
any provision of the Certificate of Incorporation or By-Laws of any
Borrower or Obligor; and
(d) Parent has delivered, or caused to be delivered, to Agent true,
correct and complete copies of the latest drafts of the Convertible 2002
Senior Note Agreements and all other agreements, documents and instruments
existing as of the date hereof relating thereto.
7. Additional Covenants. In addition to the continuing representations,
warranties and covenants heretofore or hereafter made by Borrowers and
Borrowers' Agent to Agent and Lenders pursuant to the Financing Agreements,
Borrowers hereby, jointly and severally, agree in favor of Agent, and Lenders
that the proceeds of the issuance of the Convertible 2002 Senior Notes (less the
amount necessary to repay the Term Loan, and Obligations relating to the Term
Loan in full and reduce to zero the outstanding amount of the Revolving Loans on
the date of the issuance of such Convertible 2002 Senior Notes) shall, be
immediately deposited in either an investment account or a deposit account and,
upon the earlier to occur of (a) an Event of Default or (b) sixty (60) days
after Parent's issuance of the Convertible 2002 Senior Notes, such account shall
be subject to either an Investment Property Control Agreement executed and
delivered by Parent and the securities intermediary in favor of Agent, for the
benefit of Lenders, or a Deposit Account Control Agreement by and among Parent,
the bank at which such deposit account is maintained and Agent, for the benefit
of Lenders, and Borrowers shall take any other action
requested by Agent to perfect Agent's and Lenders' security interest in and lien
upon such proceeds. Borrowers hereby additionally confirm that the proceeds of
the Convertible 2002 Senior Notes constitute Collateral for the Obligations,
subject to Borrower's right to use such proceeds as set forth above and for such
other proper corporate purposes prior to the occurrence of an Event of Default.
Borrowers' failure to comply with the foregoing covenant shall constitute an
additional Event of Default.
8. Conditions to Effectiveness. The consents set forth in Section 2 hereof
and the amendments to the Loan Agreement set forth in Sections 3, 4, and 5
hereof shall be effective only upon the satisfaction of each of the following
conditions in a manner satisfactory to Agent (the "Effective Date"):
(a) Agent shall have received an original of this Amendment No.2, duly
authorized, executed and delivered by Borrowers, Obligors and Borrowers'
Agent;
(b) The Convertible 2002 Senior Notes shall have been duly authorized,
issued and delivered by Parent and all agreements, documents and
instruments related thereto, including, but not limited to, the Convertible
2002 Senior Note Indenture, shall have been duly authorized, executed and
delivered by Parent;
(c) No court of competent jurisdiction has issued any injunction,
restraining order or other order which prohibits consummation of the
issuance of the Convertible 2002 Senior Notes and the transactions
described therein and no governmental or other action or proceeding has
been threatened or commenced, seeking any injunction, restraining order or
other order which seeks to void or otherwise modify the issuance of the
Convertible 2002 Senior Notes;
(d) Agent shall have received true, correct and complete copies of the
Convertible 2002 Senior Note Agreements, immediately after the same are
executed and all other agreements, documents and instruments existing as of
the date of such issuance relating thereto, and such documents shall be
substantially the same as the drafts of such documents delivered to Agent
on the date hereof (with blanks appropriately completed and the interest
rate applicable to the Convertible 2002 Senior Notes not in excess of the
interest rate applicable to the Subordinated Notes); and
(e) as of the date hereof, and after giving effect to the provisions
of this Amendment No.2, no Event of Default or act, condition or event
which with notice or passage of time or both, would constitute an Event of
Default, shall exist or have occurred and be continuing.
9. Effect of this Amendment No.2. This Amendment No.2 and the instruments
and agreements delivered pursuant hereto constitute the entire agreement of the
parties with respect to the subject matter hereof and thereof, and supersede all
prior oral or written communications, memoranda, proposals, negotiations,
discussions, term sheets and commitments with respect to the subject matter
hereof and thereof. Except as expressly consented to and amended pursuant
hereto, no other changes or modifications to the Financing Agreements or waivers
of or consents under any provisions thereof are intended or implied, and in all
other respects the Financing
Agreements are hereby specifically ratified, restated and confirmed by all
parties hereto as of the effective date hereof. Without limiting the generality
of the foregoing, the execution and delivery of this Amendment No. 2 shall not
be deemed, in any manner, to constitute a waiver of, or otherwise affect the
obligations of Borrowers under the letter agreement with respect to certain
post-closing items, dated August 16, 2001, by Borrowers in favor of Agent, as
amended. To the extent that any provision of the Loan Agreement or any of the
other Financing Agreements are inconsistent with the provisions of this
Amendment No.2, the provisions of this Amendment No.2 shall control.
10. Further Assurances. Borrowers and Borrowers' Agent shall execute and
deliver such additional documents and take such additional action as may be
reasonably requested by Agent to effectuate the provisions and purposes of this
Amendment No.2.
11. Governing Law. The rights and obligations hereunder of each of the
parties hereto shall be governed by and interpreted and determined in accordance
with the internal laws of the State of New York (without giving effect to
principles of conflicts of laws that would apply any other law).
12. Binding Effect. This Amendment No.2 shall be binding upon and inure to
the benefit of each of the parties hereto and their respective successors and
assigns.
13. Counterparts. This Amendment No.2 may be executed in any number of
counterparts, but all of such counterparts shall together constitute but one and
the same agreement. In making proof of this Amendment No.2, it shall not be
necessary to produce or account for more than one counterpart thereof signed by
each of the parties hereto. Delivery of an executed counterpart of this
Amendment No.2 by telefacsimile shall have the same force and effect as delivery
of an original executed counterpart of this Amendment No.2. Any party delivering
an executed counterpart of this Amendment No.2 by telefacsimile also shall
deliver an original executed counterpart of this Amendment No.2, but the failure
to deliver an original executed counterpart shall not affect the validity,
enforceability, and binding effect of this Amendment No.2 as to such party or
any other party.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2 to
be duly executed and delivered by their authorized officers as of the date and
year first above written.
BORROWERS
CHARMING SHOPPES, INC.
By: ____________________
Xxxx X. Xxxxxxx
Executive Vice President
CHARMING SHOPPES OF DELAWARE, INC.
By: ____________________
Xxxx X. Xxxxxxx
Vice President
CSI INDUSTRIES, INC.
By: _____________________
Xxxx X. Xxxxxxx
Vice President
FB APPAREL, INC.
By: ____________________
Xxxx X. Xxxxxxx
Vice President
LANE XXXXXX, INC.
By: _____________________
Xxxx X. Xxxxxxx
Executive Vice President
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CATHERINES STORES CORPORATION
By: _____________________
Xxxx X. Xxxxxxx
Executive Vice President
BORROWERS' AGENT
CHARMING SHOPPES OF DELAWARE, INC.,
as Borrowers' Agent
By: _____________________
Xxxx X. Xxxxxxx
Vice President
AGENT
CONGRESS FINANCIAL CORPORATION,
as Administrative Agent, on behalf of the Required Lenders
and Required Term Loan Lenders
By: _______________________________
Title:______________________________
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CONSENTED TO:
By Each of the Obligors
on Exhibit A Annexed Hereto
----------------------------
Its:________________________
By Each of the Obligors
on Exhibit B Annexed Hereto
----------------------------
Its:_________________________
