Exhibit 10.3(d)
THIRD AMENDMENT TO THE CREDIT AGREEMENT
THIRD AMENDMENT, dated as of March 2, 1998, among THE BON-TON
DEPARTMENT STORES, INC., XXXX, XXXXXXX & XXXXXXXX CO., INC. and THE BON-TON
STORES OF LANCASTER, INC. (collectively, the "Borrowers"), the other Credit
Parties party to the Credit Agreement referred to below, the Lenders party to
such Credit Agreement, BANKBOSTON, N.A. as Collateral Agent and Lender and
GENERAL ELECTRIC CAPITAL CORPORATION as Administrative Agent and Lender.
W I T N E S S E T H :
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WHEREAS, the parties hereto have entered into that certain Credit
Agreement, dated as of April 15, 1997 (such Agreement, as amended, supplemented
or otherwise modified from time to time, being hereinafter referred to as the
"Credit Agreement," and capitalized terms defined therein and not otherwise
defined herein are used herein as therein defined); and
WHEREAS, the Borrowers desire to have the Lenders amend certain
provisions of the Credit Agreement; and
WHEREAS, the Lenders have agreed to such amendment upon the terms and
subject to the conditions provided herein;
NOW, THEREFORE, in consideration of the premises, covenants and
agreements contained herein, and for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
SECTION 1. Amendments. The Lenders, the Agents, the Borrowers and
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the other Credit Parties hereby agree to the following amendments to the Credit
Agreement:
(a) Section 1.5 is hereby amended by adding a Level 0 to the
Applicable Margin grids and amending the Interest Coverage Ratio to which Level
I is applicable as follows:
IF INTEREST LEVEL OF
COVERAGE RATIO IS: APPLICABLE MARGINS:
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greater than 4.0:1.0 Level 0
greater than 3.5:1.0 but less than or equal to 4.0:1 Level I
and
APPLICABLE MARGINS
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LEVEL 0
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Applicable Revolver 0.00%
Index Margin
Applicable Revolver LIBOR 1.50%
Index Margin
(b) Section 1.9(b) is hereby amended to read as follows: "As
additional compensation for the Lenders, Borrowers agree to pay to
Administrative Agent, for the ratable benefit of such Lenders, in arrears, on
the first Business Day of each month prior to the Commitment Termination Date
and on the Commitment Termination Date, a fee in respect of the Lenders'
Commitments in an amount equal to (i) three-eighths of one percent (0.375%) per
annum (calculated on the basis of a 360 day year for actual days elapsed) or
(ii) if the Interest Coverage Ratio is greater than 4.0:1:0, one quarter of one
percent (0.25%) per annum (calculated on the basis of a 360 day year for actual
days elapsed), in each case of the difference between (x) the Maximum Amount and
(y) the average for the period of the daily closing balances of the aggregate
Revolving Loan and Swing Line Loan outstanding during the period for which such
fee is due."
(c) Section 6.3 is hereby amended by (i) inserting after clause (vi)
the following: ", (vii) Indebtedness consisting of interest rate swap contracts
outstanding at any one time to fix up to $50 million of Borrowers' floating rate
debt on terms acceptable to the Administrative Agent" and (ii) by replacing
"(vii)" with "(viii)".
(d) The definition of "Fixed Charges" in Annex A is hereby amended by
inserting after "Capital Expenditures" the parenthetical "(other than Special
Capital Expenditures)".
(e) Annex A is hereby amended by (i) inserting before the definition
of "Specified Properties" the following definition: ""Special Capital
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Expenditures" shall mean capital expenditures made with net proceeds derived
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from a public offering of common stock by Parent and which is transferred to a
Borrower as equity. Special Capital Expenditures shall be designated by
Borrower Representative and generally will include store expansions and new
stores."
(f) Paragraph (b) of Annex E is hereby amended by (i) placing a comma
at the end clause (i) of the first sentence and deleting the word "and" and (ii)
inserting at the end of clause (ii) of the first sentence the following: "and
(iii) a summary of Special Capital Expenditures made during that Fiscal Quarter
and
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the proceeds available for Special Capital Expenditures as of the last day of
that Fiscal Quarter".
(g) Paragraphs 2 and 3 of Annex F are hereby amended to read as
follows:
"2. During any calendar year Borrowers shall pay for all costs and
expenses of (i) up to two commercial finance field audits conducted by Agents,
(ii) up to one limited-scope Inventory appraisal, conducted by an appraiser
selected by Agents and in form and substance satisfactory to Agents, and (iii)
up to one full-scope Inventory appraisal, conducted by an appraiser selected by
Agents, and in form and substance satisfactory to Agents.
3. At any time (i) after the occurrence and during the continuance of
a Default or an Event of Default, (ii) Net Borrowing Availability is less than
$12,500,000, or (iii) the appraised net recovery value is less than 90% of
Inventory valued at cost, Borrowers shall pay all costs and expenses in
connection with all additional Inventory and commercial field audits conducted
by Agents."
(h) Paragraph (a) of Annex G is hereby amended by (i) inserting the
parenthetical "(other than Special Capital Expenditures)" after the phrase
"shall not make Capital Expenditures", (ii) changing the reference to
"$18,000,000" therein to "$23,000,000" and (iii) changing the reference to
"$21,000,000" therein to "$31,000,000".
SECTION 2. Conditions to Effectiveness. This Amendment shall become
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effective as of the date hereof when the Agents shall have received counterparts
of this Amendment executed by each Borrower, Credit Party, Agent and Lender or,
as to the Lenders, advice satisfactory to the Agents that such Lenders have
executed this Amendment.
SECTION 3. Representations and Warranties. The Borrowers and other
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Credit Parties hereby jointly and severally represent and warrant to the Lenders
and the Agents as follows:
(a) After giving effect to this Amendment, each of the representations
and warranties in Section 3 of the Credit Agreement and in the other Loan
Documents are true and correct in all material respects on and as of the date
hereof as though made on and as of such date, except to the extent that any such
representation or warranty expressly relates to an earlier date and except for
changes therein not prohibited by the Credit Agreement.
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(b) After giving effect to this Amendment, no Default or Event of
Default has occurred and is continuing as of the date hereof.
(c) The execution, delivery and performance by the Credit Parties of
this Amendment have been duly authorized by all necessary or proper corporate
action and do not require the consent or approval of any Person which has not
been obtained.
(d) This Amendment has been duly executed and delivered by each Credit
Party and each of this Amendment and the Credit Agreement as amended hereby
constitutes the legal, valid and binding obligation of the Credit Parties,
enforceable against them in accordance with its terms.
SECTION 4. Reference to and Effect on the Loan Documents. (a) Upon
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the effectiveness of this Amendment, on and after the date hereof, each
reference in the Credit Agreement and the other Loan Documents to "this
Agreement," "hereunder," "hereof," "herein," or words of like import, shall mean
and be a reference to the Credit Agreement as amended hereby.
(b) Except to the extent amended hereby, the provisions of the
Credit Agreement and all of the other Loan Documents shall remain in full force
and effect and are hereby ratified and confirmed.
(c) The execution, delivery and effectiveness of this Amendment shall
not, except as expressly provided herein, operate as a waiver of any right,
power or remedy of the Lenders or the Agents under any of the Loan Documents,
nor constitute a waiver of any provision of any of the Loan Documents.
SECTION 5. Costs and Expenses. The Borrowers agree to pay on demand
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all costs, fees and expenses of the Agents in connection with the preparation,
execution and delivery of this Amendment and the other instruments and documents
to be delivered pursuant hereto, including the reasonable fees and out-of-pocket
expenses of counsel for the Agents with respect thereto.
SECTION 6. Execution in Counterparts. This Amendment may be
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executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
instrument.
SECTION 7. Governing Law. This Amendment shall be governed by and
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construed and enforced in accordance with the laws of the State of New York
applicable to contracts made and performed in such state, without regard to the
principles thereof regarding conflict of laws.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Amendment as of the date first above written.
Borrowers:
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THE BON-TON DEPARTMENT STORES, INC.
By: /s/ X X Xxxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxxx
Title: Senior Vice President and CFO
XXXX, XXXXXXX & XXXXXXXX CO., INC.
By: /s/ X X Xxxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxxx
Title: Senior Vice President
THE BON-TON STORES OF LANCASTER, INC.
By: /s/ X X Xxxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxxx
Title: Senior Vice President
Other Credit Parties:
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THE BON-TON STORES, INC.
By: /s/ X X Xxxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxxx
Title: Senior Vice President and CFO
THE BON-TON CORP.
By: /s/ X X Xxxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxxx
Title: Treasurer
THE BON-TON NATIONAL CORP.
By: /s/ X X Xxxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxxx
Title: Treasurer
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THE BON-TON TRADE CORP.
By: /s/ X X Xxxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxxx
Title: Treasurer
Agents and Lenders:
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GENERAL ELECTRIC CAPITAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
Title: Duly Authorized Signatory
BANKBOSTON, N.A.
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: Director
THE CIT GROUP/BUSINESS CREDIT, INC.
By: /s/ Xxxxxx Xxxxxxxxx
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Name: Xxxxxx Xxxxxxxxx
Title: Assistant Secretary
XXXXXX FINANCIAL, INC.
By: /s/ X. Xxxxxxxx
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Name: X. Xxxxxxxx
Title: Senior Vice President
CORESTATES BANK, N.A.
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
Title: Commercial Officer
MANUFACTURERS AND TRADERS TRUST COMPANY
By: /s/ C. Xxxxxxx Xxxxxxxxx
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Name: C. Xxxxxxx Xxxxxxxxx
Title: Assistant Vice President
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FOOTHILL CAPITAL CORPORATION
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
Title: AVP
SANWA BUSINESS CREDIT CORPORATION
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Vice President
UNION BANK OF CALIFORNIA, N.A.
By: /s/ Xxxx Xxxxx
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Name: Xxxx Xxxxx
Title: Assistant Vice President
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