EXHIBIT 4-C-5
HARTMARX CORPORATION
FIFTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
AND CERTAIN COLLATERAL DOCUMENTS
This FIFTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
AND CERTAIN COLLATERAL DOCUMENTS (this "Amendment") is dated as of August
31, 2001 and entered into by and among HARTMARX CORPORATION, a Delaware
corporation ("Borrower"), the LENDERS LISTED ON THE SIGNATURE PAGES HEREOF
(each individually referred to as a "Lender" and collectively as
"Lenders"), GENERAL ELECTRIC CAPITAL CORPORATION, as Managing Agent and
Collateral Agent for Lenders ("Managing Agent"), and THE BANK OF NEW YORK
and BANK OF AMERICA, N.A., as co-agents (collectively, the "Co-Agents"),
and, for purposes of Section 4 hereof, the GUARANTORS IDENTIFIED ON THE
SIGNATURE PAGES HEREOF (collectively the "Guarantors"), and is made with
reference to that certain Amended and Restated Credit Agreement dated as of
August 18, 1999 among Borrower, Lenders, Managing Agent and Co-Agents (as
amended, the "Credit Agreement"; capitalized terms used herein without
definition shall have the same meanings herein as set forth in the Credit
Agreement). Unless otherwise indicated, Section and subsection references
contained herein shall be to the corresponding Sections and subsections of
the Credit Agreement.
RECITALS
WHEREAS, Borrower has requested that Requisite Lenders amend
certain provisions of the Credit Agreement to add a new Tranche C Term Loan
facility in the aggregate original principal amount of $15,000,000 under
the Credit Agreement to be made available to Borrower as provided herein;
WHEREAS, Borrower and Requisite Lenders desire, subject to the
terms and conditions set forth herein, to amend the Credit Agreement to (i)
provide an additional Tranche C Term Loan facility to be maintained as
Tranche C Term Loans available to Borrower as provided herein, (ii) amend
certain definitions, provisions and covenants related thereto, and (iii)
make certain other amendments as set forth below;
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, the parties hereto
agree as follows:
Section 1. AMENDMENTS TO THE CREDIT AGREEMENT AND CERTAIN
COLLATERAL DOCUMENTS AND RELATED MATTERS
1.1 Amendments to Section 1 of the Credit Agreement: Definitions
-------------------------------------------------------------
A. Subsection 1.1 of the Credit Agreement is hereby amended by adding
thereto the following definitions, which shall be inserted in proper
alphabetical order:
"Fifth Amendment" shall mean that certain Fifth Amendment to
Amended and Restated Credit Agreement and Certain Collateral Documents
dated as of August 31, 2001 by and among Borrower, Managing Agent,
Co-Agents and Lenders.
"Fifth Amendment Effective Date" shall have the meaning set
forth in the Fifth Amendment.
"Initial Tranche C Term Lender" means General Electric Capital
Corporation.
"Non-Tranche C Term Lenders" means each Lender other than a
Tranche C Term Lender.
"Tranche C Term Lenders" means, on the Fifth Amendment
Effective Date, the Initial Tranche C Term Lender, together with its
successors and permitted assigns pursuant to subsection 10.1.
"Tranche C Term Loans" means the Loans made by Tranche C Term
Lenders to Borrower pursuant to subsection 2.1A(iv).
"Tranche C Term Notes" means (i) the promissory notes of
Borrower issued pursuant to subsection 2.1D(iv) on the Fifth Amendment
Effective Date and (ii) any promissory notes issued by Borrower pursuant to
the last sentence of subsection 10.1B(i) in connection with assignments of
the Tranche C Term Loans of any Tranche C Term Lenders, in each case
substantially in the form of Exhibit IV-C annexed hereto.
B. Subsection 1.1 of the Credit Agreement is hereby further amended
by deleting the definitions of "Asset Sale," "Loans," and "Notes" in their
entirety and substituting the following therefor:
"Asset Sale" means the sale by Borrower or any of its
Subsidiaries to any Person other than Borrower or any of its wholly-owned
Subsidiaries of (i) any of the capital stock of any of their respective
Subsidiaries, (ii) substantially all of the assets of any division or line
of business or product brands of Borrower or any of its Subsidiaries, or
(iii) any other assets (whether tangible or intangible) of Borrower or any
of its Subsidiaries outside of the ordinary course of business, including
the sale of machinery or equipment which is obsolete or is no longer useful
in its business.
"Loans" means (i) with respect to the period prior to the
Restatement Effective Date, the Existing Loans, (ii) thereafter but prior
to the Fifth Amendment Effective Date, one or more of the Tranche A
Revolving Loans, the Tranche B Revolving Loans or Swing Line Loans or any
combination thereof, and (iii) as of and after the Fifth Amendment
Effective Date, one or more of the Tranche A Revolving Loans, the Tranche B
Revolving Loans, Swing Line Loans or Tranche C Term Loans or any
combination thereof.
"Notes" means one or more of the Tranche A Revolving Notes, the
Tranche B Revolving Notes, the Swing Line Notes or the Tranche C Term Notes
or any combination thereof.
C. Subsection 1.1 of the Credit Agreement is hereby further amended
by deleting the definition of "Refinancing Surplus" in its entirety.
1.2 Amendment to Subsection 2.1 of the Credit Agreement:
Commitments; Loans; Notes
---------------------------------------------------
A. Subsection 2.1A of the Credit Agreement is hereby amended deleting
the "." at the end of the first paragraph and substituting therefor the
following phrase "and each Tranche C Term Lender hereby agrees to make the
Tranche C Term Loans described in subsection 2.1A(iv)."
B. Subsection 2.1A of the Credit Agreement is hereby further amended
by adding the following clause (iv) at the end thereof:
"(iv) The Initial Tranche C Term Lender hereby agrees to
lend to Borrower on the Fifth Amendment Effective Date
the Tranche C Term Loans, to be used for the purposes set
forth in subsection 2.5A. The aggregate principal amount
of the Tranche C Term Loans is $15,000,000. The Tranche C
Term Loans of the Initial Tranche C Term Lender shall be
adjusted to give effect to any assignments of the Tranche
C Term Loans pursuant to subsection 10.1B. Borrower may
make only one borrowing of Tranche C Term Loans pursuant
to this subsection 2.1A(iv), which shall be made on the
Fifth Amendment Effective Date. Amounts borrowed under
this subsection 2.1A(iv) and subsequently repaid or
prepaid may not be reborrowed. No amendment,
modification, termination or waiver of any provision of
this Agreement which: (i) reduces the principal amount of
any of the Tranche C Term Loans, (ii) changes in any
manner this subsection 2.1A(iv), (iii) postpones the
scheduled final maturity date of any of the Tranche C
Term Loans, (iv) postpones the date on which any interest
is payable with respect to the Tranche C Term Loans, or
(v) decreases the interest rate borne by any of the
Tranche C Term Loans (other than any waiver of any
increase in the interest rate applicable to any of the
Tranche C Term Loans pursuant to subsection 2.2E) shall
be effective unless evidenced by a writing signed by or
on behalf of each Lender and by each Tranche C Term
Lender adversely affected thereby. Borrower agrees to pay
to each Tranche C Term Lender such fees in the amounts
and at the times separately agreed upon in a side letter
between Borrower and the Initial Tranche C Term Lender in
connection with the prepayment of the Tranche C Term
Loans."
C. Subsection 2.1B of the Credit Agreement is hereby amended by
deleting the first paragraph therefrom in its entirety and substituting the
following paragraph therefor:
"B. Borrowing Mechanics. Loans made on any Funding Date
(other than Tranche A Revolving Loans made pursuant to a request
by Swing Line Lender pursuant to subsection 2.1A(iii) for the
purpose of repaying any Refunded Swing Line Loans or Loans made
pursuant to subsection 3.3B for the purpose of reimbursing Issuing
Lender for the amount of a drawing under a Letter of Credit issued
by it and other than for Revolving Loans which constitute Rollover
Borrowings in accordance with subsection 4.4) shall be in an
aggregate minimum amount of $1,000,000 and integral multiples of
$1,000,000 in excess of that amount; provided that (a) Loans made
on any Funding Date as LIBOR Rate Loans with a particular Interest
Period shall be in an aggregate minimum amount of $5,000,000 and
integral multiples of $1,000,000 in excess of that amount, (b)
Swing Line Loans made on any Funding Date (other than Swing Line
Loans made in accordance with the final sentence of the first
paragraph of subsection 2.1A(iii)) shall be in an aggregate
minimum amount of $100,000 and integral multiples of $1,000 in
excess of that amount and (c) Tranche C Term Loans made on the
Fifth Amendment Effective Date shall be in an aggregate amount of
$15,000,000. Rollover Borrowings may be in any amount up to the
maximum amount permitted pursuant to subsection 4.4 as of the
applicable Funding Date. Whenever Borrower desires that Swing Line
Lender make a Swing Line Loan, it shall deliver to Managing Agent
a Notice of Borrowing no later than 12:00 Noon (New York time) on
the proposed Funding Date which may be delivered by courier or
telecopy. Whenever Borrower desires that Lenders make Revolving
Loans it shall deliver a Notice of Borrowing to Managing Agent
which may be delivered by courier or telecopy no later than 12:00
Noon (New York time) at least three Business Days in advance of
the proposed Funding Date (in the case of a LIBOR Rate Loan), or
at least one Business Day in advance of the proposed Funding Date
(in the case of an Index Rate Loan in excess of $10,000,000 in the
aggregate) or no later than 11:00 A.M. (New York time) on the
proposed Funding Date (in the case of an Index Rate Loan of
$10,000,000 or less in the aggregate and, in such case, Borrower
shall concurrently deliver a copy of such Notice of Borrowing to
each Lender which copy may be delivered by courier or telecopy).
Whenever Borrower desires that Lenders make Revolving Loans
constituting Rollover Borrowings, it shall deliver to Managing
Agent (and shall deliver to Lenders concurrently, a copy, which
may be delivered by courier or telecopy), of a Notice of Borrowing
(with appropriate insertions) no later than 11:00 A.M. (New York
time) on the proposed Funding Date. Tranche C Term Loans may only
be made on the Fifth Amendment Effective Date. If Borrower desires
that Tranche C Term Lenders make Tranche C Term Loans, it shall
deliver to Managing Agent a Notice of Borrowing no later than one
Business Day in advance of the Fifth Amendment Effective Date (or
at such later time as the Initial Tranche C Lender may agree). The
Notice of Borrowing shall specify (i) the proposed Funding Date
(which shall be a Business Day, and in the case of Tranche C Term
Loans, shall be the Fifth Amendment Effective Date), (ii) the
amount of Loans requested (which shall be, with respect to Tranche
C Term Loans, equal to $15,000,000), (iii) in the case of Swing
Line Loans, Revolving Loans made on the Restatement Effective
Date, Revolving Loans which are Rollover Borrowings and Tranche C
Term Loans, that such Loans shall be Index Rate Loans, (iv) in the
case of Revolving Loans not made on the Restatement Effective Date
or which are not Rollover Borrowings, whether such Loans shall be
Index Rate Loans or LIBOR Rate Loans, and (v) in the case of any
Loans requested to be made as LIBOR Rate Loans, the initial
Interest Period requested therefor. Revolving Loans (which are not
Rollover Borrowings) may be continued as or converted into Index
Rate Loans and LIBOR Rate Loans in the manner provided in
subsection 2.2D. In lieu of delivering the above-described Notice
of Borrowing, Borrower may give Managing Agent telephonic notice
by the required time of any proposed borrowing under this
subsection 2.1B; provided that such notice shall be promptly
confirmed in writing by delivery of a Notice of Borrowing to
Managing Agent which may be delivered by courier or telecopy."
D. Subsection 2.1C of the Credit Agreement is hereby amended by
adding the following paragraph immediately after the end of the first
paragraph thereof:
"The Tranche C Term Loans under this Agreement shall be
made by the Initial Tranche C Term Lender. Promptly after receipt
by Managing Agent of a Notice of Borrowing pursuant to subsection
2.1B (or telephonic notice in lieu thereof), Managing Agent shall
notify the Initial Tranche C Term Lender of the proposed
borrowing. The Initial Tranche C Term Lender shall make the
aggregate amount of the Tranche C Term Loans available to Managing
Agent not later than 2:00 P.M. (New York time) on the Fifth
Amendment Effective Date, in immediately available funds, at the
Payment Office. Immediately upon receipt of such proceeds of the
Tranche C Term Loans, Managing Agent shall apply such proceeds in
accordance with subsections 2.4A(i) and 2.5A."
E. Subsection 2.1D of the Credit Agreement is hereby amended by
adding the following sentence after the second sentence thereof:
"On the Fifth Amendment Effective Date, Borrower shall
execute and deliver to the Initial Tranche C Term Lender
(or to Managing Agent for that Lender) a Tranche C Term
Note, substantially in the form of Exhibit IV-C annexed
hereto, to evidence that Tranche C Term Lender's Tranche
C Term Loans."
1.3 Amendments to Subsection 2.2 of the Credit Agreement:
Interest on the Loans
----------------------------------------------------
A. Subsection 2.2A of the Credit Agreement is hereby amended by
adding the following paragraph at the end thereof:
"Each Tranche C Term Loan shall bear interest on the unpaid
principal amount thereof from the date made through maturity (whether
by acceleration or otherwise) at a rate determined by reference to
the Index Rate plus 5.00% per annum. The basis for determining the
interest rate with respect to any Tranche C Term Loan may not be
changed at any time, and in no event shall any Tranche C Term Loan
bear interest at a rate determined by reference to the Adjusted LIBOR
Rate."
B. Subsection 2.2D of the Credit Agreement is hereby amended by
deleting all references to "Loans" therein (other than references to "LIBOR
Rate Loans" and "Index Rate Loans" contained therein) and substituting
"Revolving Loans" therefor.
1.4 Amendment to Subsection 2.4 of the Credit Agreement: Prepayments and
Reductions in Commitments; General Provisions Regarding Payments
--------------------------------------------------------------------
A. Subsection 2.4A(iii) of the Credit Agreement is hereby amended by
deleting clauses (a) and (b) in their entirety and substituting the
following therefor:
"(a) Prepayments and Reductions from Asset Sales. Subject to
subsection 2.4A(iii)(d), immediately upon receipt by Borrower or any
of its Subsidiaries of Cash Proceeds of Net Cash Proceeds of any
Asset Sale equal to or greater than $100,000 in the aggregate and
allocable to Accounts, Inventory, cash or other current assets, (i)
Borrower shall prepay first the Swing Line Loans and the Revolving
Loans, and second the Tranche C Term Loans in an amount equal to the
amount of such Net Cash Proceeds which is the highest integral
multiple of $25,000 and (ii) the Revolving Loan Commitments shall be
permanently reduced to the extent required by Managing Agent in an
amount not to exceed the amount of such Net Cash Proceeds (excluding
Net Cash Proceeds actually applied to repay Tranche C Term Loans).
Subject to subsection 2.4A(iii)(d), immediately upon receipt by
Borrower or any of its Subsidiaries of Cash Proceeds of (i) Net Cash
Proceeds of any Asset Sale equal to or greater than $100,000 in the
aggregate and not allocable to Accounts, Inventory, cash or other
current assets, Borrower shall prepay first the Tranche C Term Loans,
and second the Swing Line Loans and the Revolving Loans in an amount
equal to the amount of such Net Cash Proceeds which is the highest
integral multiple of $25,000 and the Revolving Loan Commitments shall
be permanently reduced to the extent required by Managing Agent in an
amount not to exceed such Net Cash Proceeds (excluding Net Cash
Proceeds actually applied to repay Tranche C Term Loans).
Concurrently with any prepayment of the Loans and/or reduction of the
Revolving Loan Commitments pursuant to this subsection 2.4A(iii)(a),
Borrower shall deliver to Managing Agent an Officer's Certificate
demonstrating the derivation of the Net Cash Proceeds of the
correlative Asset Sale from the gross sales price thereof and whether
or not such Net Cash Proceeds are allocable to Accounts, Inventory or
other current assets. In the event that Borrower shall, at any time
after receipt of Cash Proceeds of any Asset Sale requiring a
prepayment of Loans and/or a reduction of the Revolving Loan
Commitments pursuant to this subsection 2.4A(iii)(a), determine that
the prepayments and/or reductions of the Loans and/or the Revolving
Loan Commitments previously made in respect of such Asset Sale were
in an aggregate amount less than that required by the terms of this
subsection 2.4A(iii)(a), Borrower shall promptly make an additional
prepayment of the Loans, and the Revolving Loan Commitments shall be
permanently reduced, in the manner described above in an amount equal
to the amount of any such deficit, and Borrower shall concurrently
therewith deliver to Managing Agent an Officer's Certificate
demonstrating the derivation of the additional Net Cash Proceeds
resulting in such deficit. Any mandatory prepayments or reductions of
the Loans and/or the Revolving Loan Commitments pursuant to this
subsection 2.4A(iii)(a) shall be applied as specified in subsection
2.4A(iv).
(b) Prepayments Due to Refinancing Indebtedness. On any date on
or after the Fifth Amendment Effective Date of receipt by Borrower or
any of its Subsidiaries of the proceeds of Refinancing Indebtedness
(other than Refinancing Indebtedness constituting Liquidity Proceeds
or constituting Subordinated Indebtedness the proceeds of which are
used to refinance the Senior Subordinated Notes), Borrower shall
repay first the Swing Line Loans and the Revolving Loans, and second
the Tranche C Term Loans in an amount equal to the amount of such
proceeds, as specified in subsection 2.4A(iv), and the Commitments
shall be permanently reduced in an amount equal to the amount of such
proceeds, as specified in subsection 2.4A(iv)."
B. Subsection 2.4A(iii) of the Credit Agreement is hereby amended
further by adding the following clauses (d) and (e) at the end thereof:
"(d) Prepayments from Liquidity Proceeds. Immediately upon
receipt by Borrower of Liquidity Proceeds described in clauses (i),
(ii) or (iii) of subsection 6.15 prior to January 15, 2002, Borrower
shall prepay first the Swing Line Loans and the Revolving Loans in an
amount equal to the lesser of the amount of such Liquidity Proceeds
and $10,000,000, and second to the Tranche C Term Loans to the extent
the amount of such Liquidity Proceeds exceeds $10,000,000; provided
that, Borrower shall not be required to repay Swing Line Loans or
Revolving Loans pursuant to clause first of this sentence to the
extent Borrower applies such Liquidity Proceeds that would otherwise
be required to pay Swing Line Loans and Revolving Loans within three
(3) Business Days after receipt to redeem or repurchase and retire
Senior Subordinated Notes. Any mandatory prepayments of the Loans
pursuant to this subsection 2.4A(iii)(d) shall be applied as provided
in subsection 2.4A(iv), except that the Revolving Loan Commitments
will not be reduced as a result of such prepayments."
(e) Scheduled Payment of Tranche C Term Loans. Borrower shall
make a principal payment on the Tranche C Term Loans on the date of
their maturity which shall be the Commitment Termination Date in an
amount equal to the principal amount of the Tranche C Term Loans
outstanding at such time."
C. Subsection 2.4A(iv) of the Credit Agreement is hereby amended by
deleting clause (iv) in its entirety and substituting the following
therefor:
"(iv) Application of Reduction of Commitments and
Prepayments. Any reduction of the Revolving Loan Commitments
pursuant to subsection 2.4A(ii) or (iii) shall be applied to
reduce the Tranche A Revolving Loan Commitments and the Tranche B
Revolving Loan Commitments on a pro rata basis based on the
aggregate amount of each such Commitment at such time, except to
the extent otherwise expressly provided therein. Notwithstanding
anything contained in subsection 2.4A(iii) to the contrary, if an
Event of Default has occurred and is continuing and Agent has
received written notice from Borrower or a Lender to such effect,
any amount required to be applied as a mandatory prepayment of the
Term C Term Loans shall instead be applied first to repay Swing
Line Loans and Revolving Loans, second to cash collateralize
Letters of Credit in accordance with subsection 8.13 and third to
repay Tranche C Term Loans. Any prepayment of the Swing Line Loans
and the Revolving Loans shall be applied first to repay any Swing
Line Loans to the full extent thereof and second to repay Tranche
A Revolving Loans and Tranche B Revolving Loans which are Index
Rate Loans on a pro rata basis in accordance with the respective
outstanding principal amounts thereof at such time, to the full
extent thereof, and then to repay Tranche A Revolving Loans and
Tranche B Revolving Loans which are LIBOR Rate Loans on a pro rata
basis in accordance with the respective outstanding principal
amounts thereof at such time, in each case in a manner which
minimizes the amount of any payments required to be made by
Borrower pursuant to subsection 2.6D."
D. Subsection 2.4B(iii) of the Credit Agreement is hereby amended by
deleting it in its entirety and substituting the following therefor:
"(iii) Apportionment of Payments. Aggregate principal and
interest payments shall be apportioned among all outstanding Swing
Line Loans and Revolving Loans to which such payments relate, in
each case proportionately to applicable Lenders' respective Pro
Rata Shares. Aggregate principal and interest payments shall be
apportioned among all outstanding Tranche C Term Loans to which
such payments relate, in each case proportionately to applicable
Tranche C Term Lenders' respective percentage shares of the
Tranche C Term Loans. Managing Agent shall promptly distribute to
each applicable Lender, at its primary address set forth below its
name on the appropriate signature page hereof or at such other
address as such Lender may request, its Pro Rata Share or share of
the Tranche C Term Loans, as the case may be, of all such payments
received by Managing Agent and the commitment fees of such Lender,
if applicable, when received by Managing Agent pursuant to
subsection 2.3. Notwithstanding the foregoing provisions of this
subsection 2.4B(iii), if, pursuant to the provisions of subsection
2.6C, any Notice of Conversion/Continuation is withdrawn as to any
Affected Lender or if any Affected Lender makes Index Rate Loans
in lieu of its Pro Rata Share of any LIBOR Rate Loans, Managing
Agent shall give effect thereto in apportioning payments received
thereafter."
1.5 Amendment to Subsection 2.5 of the Credit Agreement: Use of Proceeds
--------------------------------------------------------------------
Subsection 2.5A of the Credit Agreement is hereby amended by
adding the following sentence at the end thereof:
"The proceeds of the Tranche C Term Loans shall be
applied by Borrower to repay Revolving Loans without any
reduction of the Revolving Loan Commitments."
1.6 Amendment to Subsection 2.9 of the Credit Agreement: Affected Lenders
---------------------------------------------------------------------
A. Subsection 2.9 of the Credit Agreement is hereby amended by
deleting clauses (b), (c) and (f) in their entirety and substituting the
following therefor:
"(b) The replacement Lender shall be a bank or other
financial institution that is not subject to such increased costs
which caused Borrower's election to replace any Lender hereunder,
and each such replacement Lender shall execute and deliver to the
Managing Agent an Assignment and Acceptance and such other
documentation satisfactory to the Managing Agent pursuant to which
such replacement Lender is to become a party hereto, with a
Commitment (if any), equal to that of the Lender being replaced
and shall make Loans in the aggregate principal amount equal to
the aggregate outstanding principal amount of the Loans of the
Lender being replaced;
(c) Upon such execution of such documents referred to in
clause (b) and repayment of the amount referred to in clause (a),
the replacement Lender shall be a "Lender" with a Commitment (if
any), as specified hereinabove and the Lender being replaced shall
cease to be a "Lender" hereunder, except with respect to such
provisions under this Agreement, which expressly survive the
termination of this Agreement as to such replaced Lender;"
"(f) If Borrower proposes to replace any Lender pursuant
to this subsection 2.9 because the Lender seeks reimbursement
under either subsection 2.6 or 2.7, then it must also replace any
other Lender who seeks similar levels of reimbursement (as a
percentage of such Lender's Commitment or share of the Tranche C
Term Loans, as the case may be) under such subsections; provided
however that if the amount of the Commitment or applicable share
of the Tranche C Term Loans, as the case may be, any replacement
Lender is willing to commit to or assume does not exceed the
aggregate of the Commitments or share of the Tranche C Term Loans,
as the case may be, of each such Lender seeking such
reimbursement, the Commitment or share of the Tranche C Term
Loans, as the case may be, of each such Lender seeking
reimbursement shall be reduced pro rata to the extent of the
Commitment or share of the Tranche C Term Loans, as the case may
be, of such replacement Lender."
1.7 Amendments to Section 6 of the Credit Agreement:
Borrower's Affirmative Covenants
-----------------------------------------------
A. Subsection 6.8(i) of the Credit Agreement is hereby amended by
deleting it in its entirety and substituting the following therefor:
"(i) Borrowing Base Certificates. Borrower shall deliver
to Collateral Agent (with a copy to Lenders promptly thereafter),
a Borrowing Base Certificate on the second Business Day of every
week reflecting the Borrowing Base as of the last Business Day of
the previous week. In addition, Borrower shall deliver to
Collateral Agent (with a copy to Lenders promptly thereafter), a
Borrowing Base Certificate on the fifteenth day of each month
reflecting the Borrowing Base as of the last Business Day of the
previous month."
B. Subsection 6.8(ii) of the Credit Agreement is hereby amended by
deleting "Schedule 6.8" therein and substituting "Schedule
6.8(ii)" therefor.
C. Subsection 6.8(iv)(b) of the Credit Agreement is hereby amended by
deleting it in its entirety and substituting the following therefor:
"(b) Collateral Agent, in its reasonable discretion, may review
or have an outside consultant selected by Collateral Agent review,
upon reasonable notice and at reasonable times, the quality and
amount of Inventory; provided that so long as Excess Availability has
been no less than $35,000,000 for the prior 12 months, such reviews
shall not occur more frequently than twice in each 12 month period,
at Borrower's expense; and provided further that in the event that
Excess Availability has been less than $35,000,000 at any time during
the prior 12 months, then the amount of reviews allowable in any such
12 month period shall be increased to four, and the two additional
reviews, if conducted, shall be at the expense of the Collateral
Agent."
D. Subsection 6.8 of the Credit Agreement is hereby amended by adding
the following clause (v) at the end thereof:
"(v) Borrower shall deliver to Collateral Agent, in form and
detail satisfactory to Collateral Agent, each daily report listed on
Schedule 6.8(v), in the manner described on such schedule, and each
other daily report reasonably requested by Collateral Agent."
E. Subsection 6.10(B)(iii) of the Credit Agreement is hereby amended
by deleting it in its entirety and substituting the following therefor:
"(iii) Any payments received by Collateral Agent under this
subsection 6.10 shall be applied in the following order unless
Requisite Lenders and Tranche C Term Lenders holding more than 50% of
the Tranche C Term Loans otherwise elect: (i) any due and payable
fees, expenses or other charges in respect of the Obligations; (ii)
any due and payable interest payments on the Loans (with application
to Swing Line Loans first, Tranche B Revolving Loans, second, Tranche
A Revolving Loans third and Tranche C Term Loans fourth); (iii)
principal payments on the Loans (whether or not due and payable (with
application to Swing Line Loans first, Tranche B Revolving Loans
second, Tranche A Revolving Loans third and Tranche C Term Loans
fourth); and (iv) other due and payable Obligations or to
collateralize Letters of Credit to the extent required hereunder;
provided, however, that principal and interest on any LIBOR Rate
Loans shall not be required to be paid to the extent that any such
payment will result in the incurrence of any increased costs pursuant
to subsection 2.6, as long as at such time, no Event of Default or
Potential Event of Default shall have occurred or be continuing and
Borrower would be entitled to borrow LIBOR Rate Loans hereunder upon
submission of an appropriate Notice of Borrowing therefor; provided
further that to the extent that Borrower is not able to borrow LIBOR
Rate Loans at such time as set forth above, any such amounts shall be
applied to pay outstanding LIBOR Rate Loans in accordance with this
subsection 6.10 but, unless an Acceleration shall have occurred,
Borrower shall not be required to pay any increased costs pursuant to
subsection 2.6 which may result therefrom."
F. Subsection 6.14A(iv) of the Credit Agreement is hereby amended by
deleting "clause (iv) or (v) above" and substituting "clause (ii) or (iii)
above" therefor.
G. Subsection 6.15 of the Credit Agreement is hereby amended by
deleting it in its entirety and substituting the following therefor:
"On or prior to October 15, 2001, Borrower shall have received
$15,000,000 in Tranche C Term Loans and not less than $10,000,000 of
net cash proceeds from any of the following transactions in the
aggregate (such proceeds in the aggregate, received from such
sources, whether received on, prior to or after such date and prior
to January 15, 2002, being the "Liquidity Proceeds"): (i)
Indebtedness secured by Liens on any of the properties listed in
Exhibit B to the Third Amendment permitted under subsection 7.1(xv)
hereof, (ii) the sale of the capital stock of Xxxxxx Xxxx or other
Asset Sales permitted under subsection 7.7 hereof, (iii) the issuance
by Borrower of its common or preferred equity securities; provided
that any transactions described in clause (i) above be consummated on
or prior to September 30, 2001, and all net cash proceeds from all
transactions described in this subsection 6.15 shall be immediately
applied to repay Loans in accordance with this Agreement or to
repurchase or redeem the Senior Subordinated Notes in accordance with
subsection 7.5(viii) and subsection 2.4A(iii) of this Agreement."
H. Subsection 6.15 of the Credit Agreement is hereby amended by
adding the following paragraph after the second paragraph thereof:
"On or prior to September 17, 2001, Borrower shall, and
shall cause its Subsidiaries that are Credit Parties to, (i) enter
into a security agreement that amends and restates the Pledge and
Security Agreement and Equipment Security Agreement and which is
in form and substance satisfactory to Collateral Agent (the
"Amended and Restated Security Agreement"); (ii) enter into an
intercompany note security agreement that amends and restates the
Intercompany Note and Security Agreement and the Intercompany Note
Equipment Security Agreement and which is in form and substance
satisfactory to the Collateral Agent (the "Amended and Restated
Intercompany Note Security Agreement"), (iii) deliver satisfactory
evidence that each Credit Party shall have taken or caused to be
taken such actions in such a manner so that Collateral Agent has a
valid and perfected first priority security interest (subject to
the Liens permitted under the Credit Agreement) as of such date in
the entire Collateral granted by such Credit Parties located in
the United States (to the extent required by the Amended and
Restated Security Agreement, the Amended and Restated Intercompany
Note Security Agreement and Collateral Documents related thereto)
and Borrower shall have (or shall have upon the filing of the
financing statements delivered to Collateral Agent on or prior to
such date) a valid and perfected second priority security interest
(subject to the Liens permitted hereunder) in the entire
Collateral granted by such Credit Parties located in the United
States (to the extent required by the Amended and Restated
Security Agreement, the Amended and Restated Intercompany Note
Security Agreement and the Collateral Documents related thereto);
and (iv) deliver to Collateral Agent an opinion of counsel (which
counsel shall be satisfactory to Collateral Agent) with respect to
the execution, delivery and enforceability of, and the creation
and perfection of such security interests contemplated by, the
Amended and Restated Security Agreement and the Amended and
Restated Intercompany Note Security Agreement and such other
matters as the Collateral Agent may reasonably request, in each
case in form and substance reasonably satisfactory to the
Collateral Agent."
1.8 Amendments to Section 7 of the Credit Agreement:
Borrower's Negative Covenants
-----------------------------------------------
Subsection 7.1(xii) of the Credit Agreement is hereby amended
by deleting "Refinancing Surplus" appearing in the second proviso therein
and substituting "Refinancing Indebtedness" therefor.
1.9 Amendments to Section 8 of the Credit Agreement: Events of Default
------------------------------------------------------------------
The paragraph after subsection 8.13 of the Credit Agreement is
hereby amended by (i) deleting the "." at the end of clause (ii) thereof
and substituting therefor ", and"; and (ii) adding a new clause (iii) at
the end thereof as follows:
"(iii) if (a) all or any portion of the amounts described
in clause (ii) above has been declared due and payable or any
obligation of any Lender described in clause (ii) has terminated
or (b) if no Swing Line Loans or Revolving Loans are then
outstanding and no Letters of Credit are then issued but undrawn,
then Agent shall, upon the written request of any Tranche C Term
Lender, by written notice to Borrower, declare all or any portion
of the unpaid principal amount of and accrued interest on its
Tranche C Term Loans to be, and the same shall forthwith become,
immediately due and payable to the extent that such amounts have
not already been declared due and payable under clause (ii) above,
and the obligation of each Lender to make any Loan, the obligation
of Issuing Lender to issue any Letter of Credit and the right of
Issuing Lender to issue any Letter of Credit shall thereupon
terminate; provided that the foregoing shall not affect in any way
the obligations of Lenders under subsection 3.3C(i) to purchase
participations in any unreimbursed Letters of Credit or the
obligations of Lenders to purchase participations in any unpaid
Swing Line Loans as provided in subsection 2.1A(iii)."
1.10 Amendments to Section 9 of the Credit Agreement: Agent
------------------------------------------------------
A. Subsection 9.4 of the Credit Agreement is hereby amended by
deleting it in its entirety and substituting the following therefor:
"9.4 Right to Indemnity.
------------------
Each Non-Tranche C Term Lender, in proportion to its Pro
Rata Share, severally agrees to indemnify each Agent, to the
extent that such Agent shall not have been reimbursed by Borrower,
for and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses
(including, without limitation, counsel fees and disbursements) or
disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against such Agent in
performing its duties hereunder or under the other Loan Documents
or otherwise in its capacity as Agent in any way relating to or
arising out of this Agreement or the other Loan Documents;
provided that no Non-Tranche C Term Lender shall be liable for any
portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from such Agent's gross negligence or
willful misconduct or allocable to the Tranche C Term Loans based
on the Obligations allocable to the Tranche C Term Loans as
compared with the Obligations allocable to the Credit Exposure. If
any indemnity furnished to any Agent for any purpose shall, in the
opinion of such Agent, be insufficient or become impaired, Agent
may call for additional indemnity and cease, or not commence, to
do the acts indemnified against until such additional indemnity is
furnished.
Each Tranche C Term Lender, in proportion to its share of
the Tranche C Term Loans, severally agrees to indemnify each
Agent, to the extent that such Agent shall not have been
reimbursed by Borrower, for and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses (including, without limitation, counsel
fees and disbursements) or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted
against such Agent in performing its duties hereunder or under the
other Loan Documents or otherwise in its capacity as Agent in any
way relating to or arising out of this Agreement or the other Loan
Documents; provided that no Tranche C Term Lender shall be liable
for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from such Agent's gross negligence or
willful misconduct or allocable to the Credit Exposure based on
the Obligations allocable to the Credit Exposure as compared with
the Obligations allocable to the Tranche C Term Loans. If any
indemnity furnished to any Agent for any purpose shall, in the
opinion of such Agent, be insufficient or become impaired, Agent
may call for additional indemnity and cease, or not commence, to
do the acts indemnified against until such additional indemnity is
furnished."
B. Subsection 9.7 of the Credit Agreement is hereby amended by adding
the following subsection C. at the end thereof as follows:
"C. Acknowledgement and Agreement. Borrower, Collateral
Agent, Requisite Lenders and, by execution of the Fifth Amendment,
each other Credit Party hereby confirms and agrees that each of
the Collateral Documents to which it is a party secures, and the
terms "Secured Obligations," "Guarantied Obligations" (as defined
in such Collateral Document) or comparable terms contained in such
Collateral Document that secures or guaranties any Obligations
shall include all Obligations with respect to the Tranche C Term
Loans from and after the Fifth Amendment Effective Date. To the
extent required, each of the Collateral Documents to which any
party hereto is a party is hereby amended to include said
obligations within the meaning of the term "Secured Obligations,"
"Guarantied Obligations" or other comparable terms contained in
such Collateral Document that secures or guaranties any
Obligations. Borrower, Collateral Agent, Requisite Lenders and, by
execution of the Fifth Amendment, each other Credit Party hereby
confirms that each Collateral Document to which it is a party or
otherwise bound that secures or guaranties any Obligations and all
Collateral encumbered thereby and all UCC financing statements
filed in connection therewith guaranties or secures or otherwise
supports, as the case may be, to the fullest extent possible the
payment and performance of all Obligations of every nature with
respect to the Tranche C Term Notes. Without limiting the
generality of the foregoing, Borrower, Collateral Agent, Requisite
Lenders and, by execution of the Fifth Amendment, each other
Credit Party hereby acknowledges and confirms the understanding
and intent of such party that, upon the Fifth Amendment Effective
Date, the definition of "Obligations" includes the obligations of
Borrower under the Tranche C Term Notes. Borrower, Collateral
Agent, Requisite Lenders and, by execution of the Fifth Amendment,
each other Credit Party acknowledges and agrees that each of the
Loan Documents to which it is a party or otherwise bound shall
continue in full force and effect and that all of its obligations
thereunder (as confirmed and/or amended herein) shall be valid and
enforceable and shall not be impaired or limited by the execution
or effectiveness of the Fifth Amendment or any future amendment or
modification of this Agreement or any other Loan Document.
1.11 Amendments to Section 10 of the Credit Agreement: Miscellaneous
---------------------------------------------------------------
A. Subsection 10.1(B) of the Credit Agreement is hereby amended by
deleting the last sentence of clause (i) thereto and substituting the
following therefor:
"The Commitments and Loans hereunder shall be modified to
reflect the Commitment and Loan of such assignee and any remaining
Commitment or Loan of such assigning Lender and, if any such
assignment occurs after the issuance of the Notes hereunder, new
Notes shall, upon surrender of the assigning Lender's Note, be
issued to the assignee and to the assigning Lender, substantially
in the form of Exhibit IV, Exhibit IV-A, Exhibit IV-B or Exhibit
IV-C annexed hereto, as the case may be, with appropriate
insertions, to reflect the new Commitments and Loans of the
assignee and the assigning Lender."
B. Subsection 10.5 of the Credit Agreement is hereby amended by
deleting it in its entirety and
substituting the following therefor:
"10.5 Ratable Sharing.
---------------
Non-Tranche C Term Lenders hereby agree among themselves
that if any of them shall, whether by voluntary payment, by
realization upon security, through the exercise of any right of
set-off or banker's lien, by counterclaim or cross action or by
the enforcement of any right under the Loan Documents (excluding,
for this purpose, the Canadian Loan Documents and the Tranche C
Term Notes) or otherwise, or as adequate protection of a deposit
treated as cash collateral under the Bankruptcy Code, receive
payment or reduction of a proportion of the aggregate amount of
principal, interest, amounts payable in respect of Letters of
Credit, fees and other amounts then due and owing to that
Non-Tranche C Term Lender hereunder or under the other Loan
Documents (excluding, for this purpose, the Canadian Loan
Documents and the Tranche C Term Notes) (collectively, the
"Aggregate Revolving Amounts Due" to such Non-Tranche C Term
Lender) which is greater than the proportion received by any other
Non-Tranche C Term Lender in respect of the Aggregate Revolving
Amounts Due to such other Non-Tranche C Term Lender, then the
Non-Tranche C Term Lender receiving such proportionately greater
payment shall (i) notify each Agent and each other Non-Tranche C
Term Lender of the receipt of such payment and (ii) apply a
portion of such payment to purchase participations without
recourse except as provided below (which it shall be deemed to
have purchased from each seller of a participation simultaneously
upon the receipt by such seller of its portion of such payment) in
the Aggregate Revolving Amounts Due to the other Non-Tranche C
Term Lenders so that all such recoveries of Aggregate Revolving
Amounts Due shall be shared by all Non-Tranche C Term Lenders in
proportion to the Aggregate Revolving Amounts Due to them;
provided that if all or part of such proportionately greater
payment received by such purchasing Non-Tranche C Term Lender is
thereafter recovered from such Non-Tranche C Term Lender upon the
bankruptcy or reorganization of Borrower or otherwise, those
purchases shall be rescinded and the purchase prices paid for such
participations shall be returned to such purchasing Non-Tranche C
Term Lender ratably to the extent of such recovery, but without
interest. Borrower expressly consents to the foregoing arrangement
and agrees that any holder of a participation so purchased may
exercise any and all rights of banker's lien, set-off or
counterclaim with respect to any and all monies owing by Borrower
to that holder with respect thereto as fully as if that holder
were owed the amount of the participation held by that holder.
Tranche C Term Lenders hereby agree among themselves that
if any of them shall, whether by voluntary payment, by realization
upon security, through the exercise of any right of set-off or
banker's lien, by counterclaim or cross action or by the
enforcement of any right under the Loan Documents (excluding, for
this purpose, the Canadian Loan Documents, the Tranche A Revolving
Notes, the Tranche B Revolving Notes, the Swing Line Notes and the
Letters of Credit) or otherwise, or as adequate protection of a
deposit treated as cash collateral under the Bankruptcy Code,
receive payment or reduction of a proportion of the aggregate
amount of principal, interest, fees and other amounts then due and
owing to that Tranche C Term Lender hereunder or under the other
Loan Documents (excluding, for this purpose, the Canadian Loan
Documents, the Tranche A Revolving Notes, the Tranche B Revolving
Notes, the Swing Line Notes and the Letters of Credit)
(collectively, the "Aggregate Term Amounts Due" to such Tranche C
Term Lender) which is greater than the proportion received by any
other Tranche C Term Lender in respect of the Aggregate Term
Amounts Due to such other Tranche C Term Lender, then the Tranche
C Term Lender receiving such proportionately greater payment shall
(i) notify each Agent and each other Tranche C Term Lender of the
receipt of such payment and (ii) apply a portion of such payment
to purchase participations without recourse except as provided
below (which it shall be deemed to have purchased from each seller
of a participation simultaneously upon the receipt by such seller
of its portion of such payment) in the Aggregate Term Amounts Due
to the other Tranche C Term Lenders so that all such recoveries of
Aggregate Term Amounts Due shall be shared by all Tranche C Term
Lenders in proportion to the Aggregate Term Amounts Due to them;
provided that if all or part of such proportionately greater
payment received by such purchasing Tranche C Term Lender is
thereafter recovered from such Tranche C Term Lender upon the
bankruptcy or reorganization of Borrower or otherwise, those
purchases shall be rescinded and the purchase prices paid for such
participations shall be returned to such purchasing Tranche C Term
Lender ratably to the extent of such recovery, but without
interest. Borrower expressly consents to the foregoing arrangement
and agrees that any holder of a participation so purchased may
exercise any and all rights of banker's lien, set-off or
counterclaim with respect to any and all monies owing by Borrower
to that holder with respect thereto as fully as if that holder
were owed the amount of the participation held by that holder."
1.12 Amendments to Exhibits to the Credit Agreement
----------------------------------------------
A. Exhibit I to the Credit Agreement is hereby amended by deleting
said Exhibit I in its entirety and substituting therefor an amended and
restated Exhibit I, Form of Notice of Borrowing, in the form of Annex I
attached hereto.
B. The Credit Agreement is hereby amended by adding thereto a new
Exhibit IV-C, Form of Tranche C Term Note, in the form of
Annex II attached hereto.
C. Exhibit V to the Credit Agreement is hereby amended by deleting
said Exhibit V in its entirety and substituting therefor an amended and
restated Exhibit V, Form of Covenant Compliance Certificate, in the form of
Annex III attached hereto.
D. Exhibit VIII to the Credit Agreement is hereby amended by deleting
said Exhibit VIII in its entirety and substituting therefor an amended and
restated Exhibit VIII, Form of Assignment and Acceptance, in the form of
Annex IV attached hereto.
1.13 Amendments to Schedules to the Credit Agreement
-----------------------------------------------
A. Schedule 6.8 to the Credit Agreement is hereby amended by deleting
said Schedule 6.8 in its entirety and substituting therefor Schedule
6.8(ii), Operating Reports, in the form of Annex V attached hereto.
B. The Credit Agreement is hereby amended by adding thereto a new
Schedule 6.8(v), Daily Reports, in the form of Annex VI attached hereto.
1.14 Approval of Certain Collateral Documents
----------------------------------------
By their execution and delivery of this Amendment, Requisite
Lenders hereby consent to the form of the Stock Pledge Agreement and the
Intercompany Note Stock Pledge Agreement attached hereto as Annexes VII and
VIII, respectively.
1.15 Intentionally Omitted
---------------------
1.16 Daily Inventory Reserve
-----------------------
On and after September 15, 2001, Borrower acknowledges and
agrees that the Borrowing Base shall be reduced by a cumulative daily
reserve imposed against Eligible Inventory for each Business Day during the
months of February, March, August, September and October as provided in
this Section 1.16 prior to giving effect to the calculation contemplated by
clause (ii) of the definition of Borrowing Base (the "Daily Inventory
Reserve"). Nothing contained herein shall limit the Collateral Agent's
right, in its reasonable business discretion, to elect to establish
additional or other reserves against Inventory or other Collateral from
time to time pursuant to the Loan Documents or to adjust or otherwise
modify or terminate the reserve described in this Section 1.16.
The Daily Inventory Reserve imposed in February (the "February
Daily Reserve") shall commence on the earlier of (a) February 15th or (b)
the date on which Borrower delivers the monthly Borrowing Base Certificate
pursuant to subsection 6.8(i) of the Credit Agreement that certifies the
Borrowing Base as of the last day of January (such date, the "February
Start Date") and, as of the February Start Date, shall be equal to the
number of Business Days from and including February 1, through and
including the February Start Date multiplied by $800,000. On each Business
Day from (but excluding) the February Start Date through and including the
last Business Day in February, the February Daily Reserve shall increase by
an additional $800,000, it being understood that the February Daily Reserve
shall also continue to be imposed thereafter (without increasing) until the
date on which Borrower delivers the monthly Borrowing Base Certificate
pursuant to subsection 6.8(i) of the Credit Agreement that certifies the
Borrowing Base as of the last day of February.
The Daily Inventory Reserve imposed in March (the "March Daily
Reserve") shall commence on the first Business Day in March (such date, the
"March Start Date") and, as of the March Start Date, shall be equal to
$235,000. On each Business Day from (but excluding) the March Start Date
through and including the last Business Day in March, the March Daily
Reserve shall increase by an additional $235,000, it being understood that
the March Daily Reserve shall also continue to be imposed thereafter
(without increasing) until the date on which Borrower delivers the monthly
Borrowing Base Certificate pursuant to subsection 6.8(i) of the Credit
Agreement that certifies the Borrowing Base as of the last day of March.
The Daily Inventory Reserve imposed in August (the "August
Daily Reserve") shall commence on the earlier of (a) August 15th or (b) the
date on which Borrower delivers the monthly Borrowing Base Certificate
pursuant to subsection 6.8(i) of the Credit Agreement that certifies the
Borrowing Base as of the last day of July (such date, the "August Start
Date") and, as of the August Start Date, shall be equal to the number of
Business Days from and including August 1, through and including the August
Start Date multiplied by $775,000. On each Business Day from (but
excluding) the August Start Date through and including the last Business
Day in August, the August Daily Reserve shall increase by an additional
$775,000, it being understood that the August Daily Reserve shall also
continue to be imposed thereafter (without increasing) until the date on
which Borrower delivers the monthly Borrowing Base Certificate pursuant to
subsection 6.8(i) of the Credit Agreement that certifies the Borrowing Base
as of the last day of August.
The Daily Inventory Reserve imposed in September (the
"September Daily Reserve") shall commence on the first Business Day in
September (such date, the "September Start Date") except, in the case of
September, 2001 in which case the September Start Date shall be September
15, 2001, and, as of the September Start Date, shall be equal to $300,000,
except that, in the case of September, 2001, as of the September Start
Date, the September Daily Reserve shall be equal to the number of Business
Days from and including September 1, 2001 through and including September
15, 2001 multiplied by $300,000. On each Business Day from (but excluding)
the September Start Date through and including the last Business Day in
September, the September Daily Reserve shall increase by an additional
$300,000, it being understood that the September Daily Reserve shall also
continue to be imposed thereafter (without increasing) until the date on
which Borrower delivers the monthly Borrowing Base Certificate pursuant to
subsection 6.8(i) of the Credit Agreement that certifies the Borrowing Base
as of the last day of September.
The Daily Inventory Reserve imposed in October (the "October
Daily Reserve") shall commence on the first Business Day in October (such
date, the "October Start Date") and, as of the October Start Date, shall be
equal to $200,000. On each Business Day from (but excluding) the October
Start Date through and including the last Business Day in October, the
October Daily Reserve shall increase by an additional $200,000, it being
understood that the October Daily Reserve shall also continue to be imposed
thereafter (without increasing) until the date on which Borrower delivers
the monthly Borrowing Base Certificate pursuant to subsection 6.8(i) of the
Credit Agreement that certifies the Borrowing Base as of the last day of
October.
Section 2. CONDITIONS TO EFFECTIVENESS
Section 1 of this Amendment shall become effective only upon
the satisfaction of all of the following conditions precedent (the date of
satisfaction of such conditions being referred to herein as the "Fifth
Amendment Effective Date"):
A. On or before the Fifth Amendment Effective Date, Borrower shall
deliver to Lenders (or to Managing Agent for Lenders with sufficient
originally executed copies, where appropriate, for each Lender and its
counsel) the following, each, unless otherwise noted, dated the Fifth
Amendment Effective Date:
1. Resolutions of the Board of Directors of each Credit Party
approving and authorizing the execution, delivery, and performance of this
Amendment and the Loan Documents executed by such Credit Party in
connection herewith, certified as of the Fifth Amendment Effective Date by
its corporate secretary or an assistant secretary as being in full force
and effect without modification or amendment;
2. Signature and incumbency certificates of its officers
executing this Amendment and the Loan Documents executed by each Credit
Party in connection herewith; and
3. Executed copies of this Amendment.
B. Lenders and their respective counsel shall have received
originally executed copies of one or more favorable written opinions of
Skadden, Arps, Slate, Xxxxxxx & Xxxx (Illinois), counsel for Borrower, in
form and substance reasonably satisfactory to Managing Agent and its
counsel, dated as of the Fifth Amendment Effective Date and setting forth
substantially the matters in the opinions designated in Annex IX to this
Amendment, with respect to the enforceability of this Agreement (as
hereinafter defined) and as to such other matters as Managing Agent acting
on behalf of Lenders may reasonably request.
C. On or before the Fifth Amendment Effective Date, all corporate and
other proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously
found acceptable by Managing Agent, acting on behalf of Lenders, and its
counsel shall be satisfactory in form and substance to Managing Agent and
such counsel, and Managing Agent and such counsel shall have received all
such counterpart originals or certified copies of such documents as
Managing Agent may reasonably request.
D. On or before the Fifth Amendment Effective Date, Managing Agent
and Requisite Lenders shall have delivered to Managing Agent an executed
original or telefacsimile of a counterpart of this Amendment and the Loan
Documents executed by Managing Agent in connection herewith.
E. On or before the Fifth Amendment Effective Date, Borrower shall
have paid to the Initial Tranche C Term Lender such fees in the amounts and
at the times separately agreed upon in a side letter between Borrower and
the Initial Tranche C Term Lender in connection with the making of the
Tranche C Term Loans.
Section 3. REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Amendment,
Borrower represents and warrants to Lenders that after giving effect to
this Amendment in the manner contemplated by Section 2 of this Amendment,
each of the following is true and correct:
(a) no event has occurred and is continuing which constitutes
an Event of Default or Potential Event of Default;
(b) the representations and warranties of Borrower and the
other Credit Parties contained in the Credit Agreement and the other
Loan Documents are true and correct in all material respects on and
as of the date hereof and as of the Fifth Amendment Effective Date to
the same extent as though made on and as of the date hereof and as of
the Fifth Amendment Effective Date except to the extent such
representations and warranties specifically relate to an earlier
date, in which case they are true and correct in all material
respects as of such earlier date;
(c) Borrower and the Guarantors have all requisite corporate
power and authority to enter into this Amendment, to consummate the
transactions contemplated by this Amendment and the transactions
contemplated by, and perform its obligations under, the Credit
Agreement and the other Loan Documents;
(d) the execution of this Amendment, and the consummation of
the transactions contemplated by this Amendment, have been duly
authorized by all necessary corporate action on the part of Borrower
and the Guarantors; and
(f) the execution and delivery by Borrower and the Guarantors
of this Amendment, and the consummation of the transactions
contemplated by this Amendment by Borrower and the Guarantor, does
not and will not (i) violate any provision of any law or any
governmental rule or regulation applicable to Borrower, the
Guarantors or any of their respective Subsidiaries, any constating
documents of Borrower, the Guarantors or any order, judgment or
decree of any court or other agency of government binding on
Borrower, the Guarantors or any or their respective Subsidiaries,
(ii) conflict with, result in a breach of or constitute (with due
notice or lapse of time or both) a default under any Contractual
Obligation of Borrower, the Guarantors or any of their respective
Subsidiaries, (iii) result in or require the creation or imposition
of any Lien upon any of the properties or assets of Borrower, the
Guarantors or any of their respective Subsidiaries (other than any
Liens created under any of the Loan Documents in favor of Collateral
Agent on behalf of Lenders), or (iv) require any approval of
stockholders or any approval or consent of any Person under any
Contractual Obligation of Borrower, the Guarantors or any of their
respective Subsidiaries.
Section 4. GUARANTORS
Each of the Guarantors, Collateral Agent and Requisite Lenders
confirms and agrees that each of the Collateral Documents to which it is a
party and the terms "Secured Obligations," "Guarantied Obligations" (as
defined in such Collateral Document) or comparable terms contained in such
Collateral Document that secures or guaranties any Obligations shall
include all Obligations with respect to the Tranche C Term Loans from and
after the Fifth Amendment Effective Date. To the extent required, each of
the Collateral Documents to which any Guarantor is a party is hereby
amended to include said obligations within the meaning of the term "Secured
Obligations," "Guarantied Obligations" or other comparable terms contained
in such Collateral Document that secures or guaranties any Obligations.
Each of the Guarantors, Collateral Agent and Requisite Lenders confirms
that each Collateral Document to which it is a party or otherwise bound
that secures or guaranties any Obligations and all Collateral encumbered
thereby and all UCC financing statements filed in connection therewith
guaranties or secures or otherwise supports, as the case may be, to the
fullest extent possible the payment and performance of all Obligations of
every nature with respect to the Tranche C Term Notes. Without limiting the
generality of the foregoing, each of the Guarantors acknowledges and
confirms the understanding and intent of such Guarantor that, upon the
Fifth Amendment Effective Date, the definition of "Obligations" includes
the obligations of Borrower under the Tranche C Term Notes. Each of the
Guarantors, Collateral Agent and Requisite Lenders consents to this
Amendment and acknowledges and agrees that each of the Loan Documents to
which it is a party or otherwise bound shall continue in full force and
effect and that all of its obligations thereunder (as confirmed and/or
amended herein) shall be valid and enforceable and shall not be impaired or
limited by the execution or effectiveness of this Amendment or any future
amendment or modification of this Agreement or any other Loan Document.
Section 5. MISCELLANEOUS
References to and Effect on the Credit Agreement and Other Loan Documents
-------------------------------------------------------------------------
A. On and after the Fifth Amendment Effective Date, each reference in
the Credit Agreement to "this Agreement", "hereunder", "hereof" , "herein"
or words of like import referring to the Credit Agreement, and each
reference in the other Loan Documents to the "Credit Agreement",
"thereunder", "thereof", or words of like import referring to the Credit
Agreement, shall mean and be a reference to the Credit Agreement as amended
hereby;
B. Except as specifically amended by this Amendment, the Credit
Agreement and the other Loan Documents shall remain in full force and
effect and are hereby ratified and confirmed; and
C. The execution, delivery and performance of this Amendment shall
not, except as expressly provided herein, constitute a waiver of any
provision of, or operate as a waiver of any right, power or remedy of any
Agent or any Lender under, the Credit Agreement or any of the other Loan
Documents.
5.2 Fees and Expenses
-----------------
Borrower acknowledges that all costs, fees and expenses as
described in subsection 10.2 of the Credit Agreement incurred by Managing
Agent and its counsel with respect to this Amendment and the documents and
transactions contemplated hereby shall be for the account of Borrower.
5.3 Headings
--------
Section and subsection headings in this Amendment are included
herein for convenience of reference only and shall not constitute a part of
this Amendment for any other purpose or be given any substantive effect.
5.4 Applicable Law
--------------
THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE
STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES
5.5 Counterparts
--------------
This Amendment may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which
when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and
attached to a single counterpart so that all signature pages are physically
attached to the same document.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
BORROWER:
HARTMARX CORPORATION
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Xxxxx X. Xxxxxx, Executive Vice President
and Chief Financial Officer
GUARANTORS:
HMX Sportswear, Inc. (formerly known as
American Apparel Brands, Inc.)
Anniston Sportswear Corporation
Biltwell Company, Inc.
Briar, Inc.
Consolidated Apparel Group, Inc.
C.M. Clothing, Inc.
C.M. Outlet Corp.
Chicago Trouser Company, Ltd.
Country Miss, Inc.
Country Suburbans, Inc.
Direct Route Marketing Corporation
E-Town Sportswear Corporation
Xxxxxxxx-Xxxxx, Inc.
Gleneagles, Inc.
Handmacher Fashions Factory Outlet, Inc.
Xxxxxxxxxx-Xxxxx, Inc.
Hartmarx International, Inc.
Xxxx Xxxxxxxxx & Xxxx
Xxxx Services, Inc.
Xxxx. Xxxxx Clothes, Inc.
TAG Licensing, Inc.
Xxxxxx-Xxxxxxx Co., Inc.
Xxxxxxx, Xxxxx & Xxxx, Inc.
Hoosier Factories, Incorporated
HSM University, Inc.
Intercontinental Apparel, Inc.
International Women's Apparel, Inc.
Xxxxxx-Xxxx, Inc.
JRSS, Inc.
Kuppenheimer Men's Clothiers
Dadeville, Inc.
Men's Quality Brands, Inc.
National Clothing Company, Inc.
106 Real Estate Corp.
Plaid Clothing Company, Inc.
Xxxxxx Sportswear Corporation
Robert's International Corporation
SALHOLD, Inc.
Seaford Clothing Co.
Society Brand, Ltd.
Xxxxxx Surrey, Inc.
Tailored Trend, Inc.
Thorngate Uniforms, Inc.
Trade Finance International Limited
Universal Design Group, Ltd.
X. Xxxx & Company, Inc.
Winchester Clothing Company
Yorke Shirt Corporation
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------------
Xxxxx X. Xxxxxx
Vice President of each of the foregoing
LENDERS:
GENERAL ELECTRIC CAPITAL CORPORATION,
individually, as Managing Agent and as Collateral Agent
By: /s/ Xxxxxxx X. XxXxx
----------------------------------------
Name: Xxxxxxx X. XxXxx
Title: Its Duly Authorized Signatory
THE BANK OF NEW YORK,
individually, as Co-Agent and as Issuing Lender
for the Letters of Credit
By: /s/ Xxxxxxxxx Xxxx Xxxxx
----------------------------------------
Name: Xxxxxxxxx Xxxx Xxxxx
Title: Vice President
BANK OF AMERICA, N.A.,
individually and as Co-Agent
By:
----------------------------------------
Name:
Title:
MANUFACTURERS AND TRADERS TRUST COMPANY
By: /s/ Xxxxxxxxxxx Xxxxx
----------------------------------------
Name: Xxxxxxxxxxx Xxxxx
Title: Vice President
XXXXXX TRUST AND SAVINGS BANK
By: /s/ Xxxxxx X. Xxxx
----------------------------------------
Name: Xxxxxx X. Xxxx
Title: Vice President
THE NORTHERN TRUST COMPANY
By: /s/ Xxxxxx X. Xxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Second Vice President
