AMENDMENT NO. 1 AND CONSENT TO CREDIT AGREEMENT
Exhibit 10.1
AMENDMENT NO. 1 AND CONSENT TO CREDIT AGREEMENT dated as of May 5, 2010 (this
“Agreement”), among XXXXX APPAREL GROUP, INC. (the “Company”), XXXXX APPAREL GROUP
HOLDINGS, INC., XXXXX APPAREL GROUP USA, INC., JAG FOOTWEAR, ACCESSORIES AND RETAIL CORPORATION,
XXXXX INVESTMENT CO. INC., XXXXX JEANSWEAR GROUP, INC., NINE WEST DEVELOPMENT CORPORATION and XXXXX
JEWELRY GROUP, INC., as the U.S. Borrowers, XXXXX APPAREL GROUP CANADA, LP, as the Canadian
Borrower, and, together with the U.S. Borrowers, the “Borrowers”, the various Subsidiaries
(such capitalized term and all other capitalized terms used but not defined herein shall have the
meanings provided for in Section 1.2) of the Company parties hereto, the Lenders parties
hereto, JPMORGAN CHASE BANK, N.A., as administrative agent for the Lenders (in such capacity, the
“Administrative Agent”), and JPMORGAN CHASE BANK, N.A., TORONTO BRANCH, as administrative
agent for the Canadian Lenders (in such capacity, the “Canadian Administrative Agent”).
WITNESSETH:
WHEREAS, the Borrowers, the Lenders, the Administrative Agent and the Canadian Administrative
Agent are parties to the Credit Agreement dated as of May 13, 2009 (the “Credit
Agreement”);
WHEREAS, JAG Footwear, Accessories and Retail Corporation, a New Jersey corporation and a
wholly owned Subsidiary of the Company (the “Acquiring Company”), proposes to acquire (such
acquisition being the “Initial Acquisition”) a majority interest equal to approximately 55%
of the Equity Interests in Xxxxxx Xxxxxxxx Holdings, LLC, a Delaware limited liability company (the
“Acquired Company”), for an aggregate purchase price (including fees and expenses) not to
exceed an amount that has been specified by the Company to the Administrative Agent;
WHEREAS, the Acquiring Company proposes that, notwithstanding Section 5.14(a) of the Credit
Agreement, neither the Acquired Company nor any of its subsidiaries shall be required to become a
U.S. Loan Party or a U.S. Loan Guarantor, or to execute a Joinder Agreement in connection
therewith, until such time (if any) that a U.S. Loan Party shall own 100% of the Equity Interests
in the Acquired Company;
WHEREAS, the Acquiring Company proposes that, notwithstanding Section 5.14(b) of the Credit
Agreement, none of the Equity Interests in the Acquired Company or any of its subsidiaries owned by
the Acquiring Company or the Subsidiaries shall be subject to a security interest in favor of the
Administrative Agent, until such time (if any) that a U.S. Loan Party shall own 100% of the Equity
Interests in the Acquired Company;
WHEREAS, the Acquiring Company proposes that, notwithstanding sub-clause (d) of the definition
of “Permitted Acquisition” in the Credit Agreement, the Acquiring Company be permitted to
consummate the Initial Acquisition as a “Permitted Acquisition” under the Credit
Agreement on the terms described in the preceding three recitals, and subject to the other
terms of this Agreement;
WHEREAS, the Acquiring Company proposes that following consummation of the Initial
Acquisition, but in no event later than three years thereafter, it shall acquire (such acquisition
being the “Final Acquisition” and, together with the Initial Acquisition, the
“Acquisition”) the remaining approximately 45% of the Equity Interests in the Acquired
Company, it being recognized that such acquisition shall constitute a “Permitted Acquisition” under
the Credit Agreement;
WHEREAS, the Borrowers have requested that, as of the Effective Date, the Required Lenders
consent to the consummation of the Initial Acquisition on the terms provided for in the foregoing
recitals;
WHEREAS, the Borrowers have further requested certain amendments to the Credit Agreement as
set forth herein; and
WHEREAS, the Lenders are willing, subject to the terms and conditions hereinafter set forth,
to grant such consent and agree to such amendments;
NOW, THEREFORE, in consideration of the agreements herein contained, the parties hereto hereby
agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Certain Definitions. The following terms (whether or not underscored)
when used in this Agreement shall have the following meanings:
“Acquisition” is defined in the sixth recital.
“Administrative Agent” is defined in the preamble.
“Agreement” is defined in the preamble.
“Amended Credit Agreement” means the Credit Agreement as amended by this Agreement as
of the Effective Date.
“Acquired Company” is defined in the second recital.
“Acquiring Company” is defined in the second recital.
“Borrowers” is defined in the preamble.
“Canadian Administrative Agent” is defined in the preamble.
“Company” is defined in the preamble.
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“Credit Agreement” is defined in the first recital.
“Effective Date” is defined in Section 6.1.
“Final Acquisition” is defined in the sixth recital.
“Initial Acquisition” is defined in the second recital.
SECTION 1.2 Other Definitions. Unless otherwise defined or the context otherwise
requires, terms used herein (including in the preamble and recitals hereto) have the meanings
provided for in the Credit Agreement.
ARTICLE II
CONSENT
Effective on (and subject to the occurrence of) the Effective Date, the Lenders consent to the
consummation of the Initial Acquisition on the terms described in the second through fifth
recitals.
ARTICLE III
AMENDMENTS
Effective on (and subject to the occurrence of) the Effective Date and the consummation of the
Initial Acquisition on the terms described in the second through fifth recitals, the Credit
Agreement is amended as follows:
SECTION 3.1 Additions to Section 1.01. The following new definitions are added to
Section 1.1 of the Credit Agreement in the appropriate alphabetical order:
(a) “Amendment No. 1 to Credit Agreement” means Amendment No. 1 and Consent to Credit
Agreement, dated as of May 5, 2010, among the Borrowers, the Subsidiaries party thereto, the
Administrative Agent, the Canadian Administrative Agent and the Lenders party thereto.
(b) “SW Holdings” means Xxxxxx Xxxxxxxx Holdings, LLC, a Delaware limited liability
company.
SECTION 3.2 Amendments to Section 1.01.
The definition of “U.S. Loan Parties” in the Credit Agreement is amended and restated in its
entirety as follows:
“U.S. Loan Parties” means the U.S. Borrowers, the U.S. Borrowers’ Domestic
Subsidiaries and the First-Tier Foreign DREs (other than those Persons in which Investments are
made pursuant to Sections 6.04(c)(ii) and (iii)) and any other Person who becomes a party to this
Agreement in its capacity as a U.S. Loan Party pursuant to a Joinder Agreement and their successors
and assigns; provided that none of Xxxxxx Xxx IP Company LLC, GRI or SW
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Holdings shall be a U.S. Loan Party unless, in each case, 100% of the Equity Interests of such
entity is owned by a U.S. Loan Party.
SECTION 3.3 Amendments to Section 3.15.
Section 3.15 of the Credit Agreement is hereby amended as follows: (a) the words “Except with
respect to SW Holdings and its subsidiaries,” are added at the beginning of Section 3.15 and (b)
the following new sentences are added at the end of Section 3.15:
“As of the effective date of Amendment No. 1 to Credit Agreement, (i) JAG Footwear,
Accessories and Retail Corporation owns approximately 55% of the Equity Interests in SW Holdings,
(ii) STEPAHEAD, LLC owns the remaining approximately 45% of the Equity Interests in SW Holdings and
(iii) SW Holdings owns, directly or indirectly, 100% of the Equity Interests in each of Xxxxxx
Xxxxxxxx, LLC, Xxxxxx Xxxxxxxx Spain, LLC, Xxxxxx Xxxxxxxx Retail Stores, LLC and Xxxxxx Xxxxxxxx
IP, LLC.”
SECTION 3.4 Amendments to Section 5.14(b).
The proviso contained in the first sentence of Section 5.14(b) of the Credit Agreement is
amended and restated in the entirety as follows:
“provided, however, that (i) if the Canadian Borrower issues additional Equity
Interests that are entitled to vote, Xxxxx Canada LP agrees to promptly pledge to the
Administrative Agent such additional number of whole limited partnership units of the Canadian
Borrower equal to approximately (but not in excess of) 65% of such additional limited partnership
units that are so issued and (ii) none of the Equity Interests of Xxxxxx Xxx IP Company LLC or SW
Holdings shall be subject to such Lien so long as 100% of the Equity Interests of Xxxxxx Xxx IP
Company LLC or SW Holdings, as the case may be, are not owned by one or more U.S. Loan Parties.”
SECTION 3.5 Amendments to Section 6.08(a).
Section 6.08(a) of the Credit Agreement is amended as follows:
(a) deleting the word “and” appearing immediately before clause (iv);
(b) inserting the word “and” at the end of clause (iv); and
(c) adding a new clause (v) at the end of the paragraph as follows:
“(v) SW Holdings may make, in each case in accordance with its limited liability company
agreement, (A) no more frequently than once each calendar quarter, tax distributions to its members
in order for each such member to pay its reasonably estimated federal, state and local income
taxes, if any, resulting solely from the inclusion of the income of SW Holdings in the taxable
income of each such member, (B) no more frequently than once each calendar year, true up
distributions to its members in respect of the tax distributions referred to in clause (A) above,
in the event that any actual income taxes paid or payable by any such member shall be in excess of
the estimated amount thereof, (C) dividends and distributions from time to time to the Loan Parties
or their Subsidiaries and (D) distributions consisting of closing date balance sheet
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settlement payments in respect of the Initial Acquisition provided for by the purchase
agreement relating to the Acquisition (as such terms are defined in Amendment No. 1 to Credit
Agreement).”
SECTION 3.6 Amendments to Section 6.09.
Section 6.09 of the Credit Agreement is amended as follows:
(a) replacing the word “and” appearing immediately before clause (h) with a comma;
(b) inserting the word “and” at the end of clause (h); and
(c) adding a new clause (i) at the end of Section 6.09 as follows:
“and (i) (i) any intellectual property licenses or similar agreements entered into by a U.S.
Borrower in connection with the acquisition of SW Holdings and (ii) the limited liability company
agreement of SW Holdings.”
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders to grant the consent provided for in Article II and the
amendments provided for in Article III, each Borrower hereby (a) represents and warrants
that after giving effect to the consent provided in Article II (i) each of the
representations and warranties of the Loan Parties contained in the Credit Agreement and in the
other Loan Documents is true and correct in all material respects as of the date hereof as if made
on the date hereof (except, if any such representation and warranty relates to an earlier date,
such representation and warranty is true and correct in all material respects as of such earlier
date); (ii) both immediately before and after giving effect to the provisions of this Agreement no
Default or Event of Default has occurred and is continuing; and (iii) the consummation of the
Initial Acquisition satisfies all the requirements set forth in sub-clauses (a), (b) and (c) of the
definition of “Permitted Acquisition in the Credit Agreement; and (b) agrees that the incorrectness
in any material respect of any representation and warranty contained in the preceding clause
(a) shall constitute an immediate Event of Default. Without limiting the foregoing, each
Borrower hereby (i) ratifies and confirms all of the terms, covenants and conditions set forth in
the Loan Documents and hereby agrees that it remains liable to the Administrative Agent and the
Lenders in accordance with the terms, covenants and conditions set forth in the Loan Documents, and
all Liens on the Collateral created pursuant to the Collateral Documents continue unimpaired and in
full force and effect, and (ii) waives all defenses, claims, counterclaims, rights of recoupment or
set-off against any of its Obligations as provided in the Loan Documents.
ARTICLE V
ACKNOWLEDGMENT OF LOAN GUARANTORS
By executing this Agreement, each Loan Guarantor hereby confirms and agrees that each Loan
Document to which it is a party is, and shall continue to be, in full force and effect and is
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hereby ratified and confirmed in all respects, except that on and after the Effective Date
each reference therein to the Credit Agreement shall refer to the Credit Agreement after giving
effect to this Agreement. Without limiting the foregoing, each such Loan Guarantor waives all
defenses, claims, counterclaims, rights of recoupment or set-off with respect to any of such Loan
Guarantor’s Obligations as provided in the Loan Documents.
ARTICLE VI
CONDITIONS TO EFFECTIVENESS; EXPIRATION; CONDITION SUBSEQUENT
SECTION 6.1 Effective Date. This Agreement shall become effective on such date
(herein called the “Effective Date”) when the conditions set forth in this Section have
been satisfied.
SECTION 6.1.1 Execution of Agreement. The Administrative Agent shall have received
counterparts of this Agreement duly executed and delivered on behalf of the Borrowers, the Loan
Guarantors, the Administrative Agent and the Required Lenders.
SECTION 6.1.2 Representations and Warranties. The representations and warranties made
by the Borrowers pursuant to Article IV shall be true and correct as of the Effective Date.
SECTION 6.2 Condition Subsequent. The Administrative Agent shall have received, no
later than five Business Days following consummation of the Initial Acquisition, a certificate from
a Financial Officer of the Company (in the case of clauses (a) and (c)) and the
Secretary or Assistant Secretary of the Acquiring Company (in the case of clause (b)), in
each case on terms reasonably satisfactory to the Administrative Agent, that (a) evidences, with
respect to the Initial Acquisition, compliance with Section 6.04(l) of the Credit Agreement,
together with such detailed information relating thereto as the Administrative Agent may reasonably
request to demonstrate such compliance; (b) attaches final copies of the certificate of formation
of SW Holdings, certified by the relevant authority of the jurisdiction of formation of SW
Holdings, and the limited liability company agreement of SW Holdings; and (c) attaches final
intellectual property licenses or similar agreements entered into by the Loan Parties in connection
with the acquisition of SW Holdings. Delivery of such certificate in accordance with the terms of
this Section shall be deemed to satisfy the obligations of the Company with respect to the Initial
Acquisition under, and to be in compliance with, sub-clause (e) of the definition of “Permitted
Acquisition”, notwithstanding anything to the contrary set forth therein; provided that
failure by the Company to comply with this Section shall result in an immediate Event of Default.
ARTICLE VII
MISCELLANEOUS
SECTION 7.1 Cross-References. References in this Agreement to any Article or section
are, unless otherwise specified, to such Article or Section of this Agreement.
SECTION 7.2 Loan Document Pursuant to Amended Credit Agreement. This Agreement is a
Loan Document executed pursuant to the Amended Credit Agreement. Except as expressly provided for
herein, all of the representations, warranties, terms, covenants and
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conditions contained in the Amended Credit Agreement and each other Loan Document shall remain
unamended or otherwise unmodified and in full force and effect.
SECTION 7.3 Limitation of Consent and Amendments. The consent set forth in
Article II and the amendments set forth in Article III shall be limited precisely
as provided for herein and shall not be deemed to be a waiver of, amendment of, consent to or
modification of any other term or provision of the Credit Agreement or of any term or provision of
any other Loan Document or of any transaction or further or future action on the part of any
Borrower or any other Loan Party which would require the consent of any of the Lenders under the
Credit Agreement or any other Loan Document.
SECTION 7.4 Counterparts. This Agreement may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an original and all of which shall
constitute together but one and the same agreement.
SECTION 7.5 Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns.
SECTION 7.6 Further Assurances. Each Borrower shall execute and deliver, and shall
cause each other Loan Party to execute and deliver, from time to time in favor of the
Administrative Agent and the Lenders such documents, agreements, certificates and other instruments
as shall be necessary or advisable to effect the purposes of this Agreement.
SECTION 7.7 Costs and Expenses. The Borrowers agree to pay all reasonable costs and
expenses of the Administrative Agent (including the reasonable fees and out-of-pocket expenses of
legal counsel of the Administrative Agent) that are incurred in connection with the execution and
delivery of this Agreement and the other agreements and documents entered into in connection
herewith.
SECTION 7.8 GOVERNING LAW; WAIVER OF JURY TRIAL; ENTIRE AGREEMENT. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. EACH
PERSON A PARTY HERETO KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY AGREEMENT OR
DOCUMENT ENTERED INTO IN CONNECTION HEREWITH. THIS AGREEMENT CONSTITUTES THE ENTIRE UNDERSTANDING
AMONG THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDES ANY PRIOR
AGREEMENT, WRITTEN OR ORAL, WITH RESPECT HERETO.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their
respective officers hereunto duly authorized as of the day and year first above written.
| BORROWERS: XXXXX APPAREL GROUP, INC., a Pennsylvania corporation XXXXX APPAREL GROUP HOLDINGS, INC., a Delaware corporation XXXXX APPAREL GROUP USA, INC., a Delaware corporation JAG FOOTWEAR, ACCESSORIES AND RETAIL CORPORATION, a New Jersey corporation XXXXX INVESTMENT CO. INC., a Delaware corporation NINE WEST DEVELOPMENT CORPORATION, a Delaware corporation |
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| By | /s/ Xxxxxx X. Xxxxxxxxx | |||
| Name: | Xxxxxx X. Xxxxxxxxx | |||
| In his capacity as officer for each aforenamed Borrower as set forth opposite such Borrower on Schedule I to the Credit Agreement. | ||||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| XXXXX JEANSWEAR GROUP, INC., a New York corporation |
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| By | /s/ Xxxxxx X. Xxxxxxxxx | |||
| Name: | Xxxxxx X. Xxxxxxxxx | |||
| Title: | Vice President and Assistant Secretary | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| XXXXX JEWELRY GROUP, INC., a Rhode Island corporation |
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| By | /s/ Xxxxxx Xxxxxx | |||
| Name: | Xxxxxx Xxxxxx | |||
| In his capacity as officer for such aforenamed Borrower as set forth opposite such Borrower on Schedule I to the Credit Agreement. |
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[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| XXXXX APPAREL GROUP CANADA, LP, an Ontario Limited Partnership |
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| By: | XXXXX CANADA, INC., its General Partner | |||
| By | /s/ Xxx X. Xxxxxx | |||
| Name: | Xxx X. Xxxxxx | |||
| Title: | Secretary | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| LOAN GUARANTORS: APPAREL TESTING SERVICES, INC., a New Jersey corporation XXXXX DISTRIBUTION CORPORATION, a Delaware corporation XXXXX MANAGEMENT SERVICE COMPANY, a Delaware corporation XXXXX HOLDING, INC., a Delaware corporation |
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| By | /s/ Xxxxxx X. Xxxxxxxxx | |||
| Name: | Xxxxxx X. Xxxxxxxxx | |||
| In his capacity as officer for each aforenamed Guarantor as set forth opposite such Guarantor on Schedule I to the Credit Agreement. | ||||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| JPMORGAN CHASE BANK, N.A., as Lender and Administrative Agent |
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| By | /s/ Xxxxx X. XxXxxxx | |||
| Name: | Xxxxx X. XxXxxxx | |||
| Title: | Vice President | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| JPMORGAN CHASE BANK, N.A., TORONTO BRANCH, as
Canadian Lender and Canadian Administrative Agent |
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| By | /s/ Xxxxxxxx X. Xxxxxxxxx | |||
| Name: | Xxxxxxxx X. Xxxxxxxxx | |||
| Title: | SVP | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| GENERAL ELECTRIC CAPITAL CORPORATION, as Lender |
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| By | /s/ Xxxxxx X. Xxxxxxx | |||
| Name: | Xxxxxx X. Xxxxxxx | |||
| Title: | Duly Authorized Signatory | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| CITIBANK, N.A., as Lender |
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| By | /s/ Xxxxx XxXxxxx | |||
| Name: | Xxxxx XxXxxxx | |||
| Title: | Vice President | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| BANK OF AMERICA, N.A., as Lender |
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| By | /s/ Xxxxx Xxxx | |||
| Name: | Xxxxx Xxxx | |||
| Title: | Managing Director | |||
| BANK OF AMERICA, NATIONAL ASSOCIATION, CANADA BRANCH, as Canadian Lender |
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| By | /s/ Xxxxxx Sales xx Xxxxxxx | |||
| Name: | Xxxxxx Sales xx Xxxxxxx | |||
| Title: | Vice President | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| WACHOVIA BANK, NATIONAL ASSOCIATION, as Lender |
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| By | /s/ Xxxxxx Xxxxxxx | |||
| Name: | Xxxxxx Xxxxxxx | |||
| Title: | Vice President | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| SUNTRUST BANK, as Lender |
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| By | /s/ Xxxxxxx X Xxxxx Xx. | |||
| Name: | Xxxxxxx X Xxxxx Xx. | |||
| Title: | Director | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| CIT BANK, as Lender |
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| By | /s/ Xxxxxxxx Xxxxxx | |||
| Name: | Xxxxxxxx Xxxxxx | |||
| Title: | Authorized Signatory | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| PNC BANK, NATIONAL ASSOCIATION, as Lender |
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| By | /s/ Xxxxxx Xxxxxxxxxxx | |||
| Name: | Xxxxxx Xxxxxxxxxxx | |||
| Title: | Vice President | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| US BANK NATIONAL ASSOCIATION, as Lender |
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| By | /s/ Xxxxxxx X. Xxxxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxxxx | |||
| Title: | Vice President | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| CAPITAL ONE LEVERAGE FINANCE CORP., as Lender |
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| By | /s/ Xxx Xxxxxx | |||
| Name: | Xxx Xxxxxx | |||
| Title: | Senior Vice President | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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| XXXXXXX SACHS LENDING PARTNERS LLC, as Lender |
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| By | /s/ Xxxxxx Xxxxxx | |||
| Name: | Xxxxxx Xxxxxx | |||
| Title: | Authorized Signatory | |||
[SIGNATURE PAGE TO CONSENT TO CREDIT AGREEMENT]
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