EXHIBIT 10.1
JOINDER AND THIRD AMENDMENT TO LOAN AND SECURITY AGREEMENT
This Joinder and Third Amendment to Loan and Security Agreement (the
"THIRD AMENDMENT") is made as of this 29th day of December, 2004 by and among
National City Business Credit, Inc. (f/k/a National City Commercial
Finance, Inc.), an Ohio corporation with offices at 0000 X. Xxxxx Xxxxxx,
Xxxxxxxxx, Xxxx 00000, as administrative agent (in such capacity, herein
the "ADMINISTRATIVE AGENT"), for the ratable benefit of the "REVOLVING
CREDIT LENDERS", who are, at present, those financial institutions
identified on the signature pages of this Third Amendment and who in the
future are those Persons (if any) who become "Revolving Credit Lenders" in
accordance with the provisions of the Loan Agreement (as defined below);
National City Business Credit, Inc. (f/k/a National City Commercial
Finance, Inc.), and Fleet Retail Group, Inc. (f/k/a Fleet Retail Finance
Inc.), a Delaware corporation with offices at 00 Xxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, as collateral agents (collectively, in such capacity,
herein the "COLLATERAL AGENTS"), for the ratable benefit of the Revolving
Credit Lenders;
and
National City Bank, as L/C Issuer (the "ISSUER");
and
The Revolving Credit Lenders;
and
Value City Department Stores LLC (in such capacity, the "LEAD
BORROWER"), an Ohio limited liability company with its principal executive
offices at 0000 Xxxxxxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000-0000, as agent for
the following (individually, a "BORROWER" and collectively, the
"BORROWERS"):
Said Value City Department Stores LLC ("VCDS LLC"); and
Shonac Corporation ("SHONAC"), an Ohio corporation with its
principal executive offices at 0000 Xxxx Xxxxx Xxxxxx, Xxxxxxxx,
Xxxx 00000;
DSW Shoe Warehouse, Inc. ("DSW"), a Missouri corporation with its
principal executive offices at 0000 Xxxx Xxxxx Xxxxxx, Xxxxxxxx,
Xxxx 00000; and
Gramex Retail Stores, Inc. ("GRAMEX"), a Delaware corporation with
its principal executive offices at 0000 Xxxxxxxxxxx Xxxx, Xxxxxxxx,
Xxxx 00000; and
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Filene's Basement, Inc. ("FILENE'S"), a Delaware corporation with
its principal executive offices at 0000 Xxxxxxxxxxx Xxxx, Xxxxxxxx,
Xxxx 00000-0000; and
Value City of Michigan, Inc. ("VC MICHIGAN"), a Michigan corporation
with its principal executive offices at 00000 Xxxxxx Xxxx, Xxxxxxxx,
Xxxxxxxx 00000;
GB Retailers, Inc. ("GBR"), a Delaware corporation with its
principal executive offices at 0000 Xxxxxxxxxxx Xxxx, Xxxxxxxx, Xxxx
00000; and
Retail Ventures Jewelry, Inc. ("JEWELRY"), an Ohio corporation with
its principal executive offices at 0000 Xxxxxxxxxxx Xxxx, Xxxxxxxx,
Xxxx 00000;
in consideration of the mutual covenants contained herein and benefits to be
derived herefrom,
WITNESSETH:
A. Reference is hereby made to that certain Loan and Security Agreement
dated as of June 11, 2002 (as the same has been, and may hereafter
be, amended, modified, supplemented or restated, the "LOAN
AGREEMENT") among (i) Value City Department Stores, Inc., an Ohio
corporation (the "EXISTING LEAD BORROWER"), (ii) the other Borrowers
(other than the Lead Borrower), (iii) the Revolving Credit Lenders,
(iv) the Administrative Agent, (v) the Collateral Agents, and (vi)
the Issuer.
B. The Borrowers have advised the Agent that a corporate reorganization
(the "2004 REORGANIZATION"), as more particularly described on the
supplement to EXHIBIT 4.20 to the Loan Agreement attached hereto,
has been approved by the directors of Retail Ventures, Inc., an Ohio
corporation (the "PARENT") and the Existing Lead Borrower and has
been implemented subject to the consent of the Revolving Credit
Lenders.
C. The following actions, among others, have been taken pursuant to the
2004 Reorganization:
1. Westerville Road GP, Inc. and Westerville Road LP, Inc.,
each a Delaware corporation, have merged into Value City
Department Stores, Inc., with Value City Department
Stores, Inc. being the surviving entity.
2. Value City Limited Partnership, an Ohio limited
partnership, has merged into Value City Department
Stores, Inc., with Value City Department Stores, Inc.
being the surviving entity. Therefore, Value City
Limited
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Partnership is no longer a Borrower party to the Loan
Agreement.
3. The Parent has formed a new wholly-owned subsidiary in
Ohio named "Value City Department Stores LLC". The
Existing Lead Borrower has merged into Value City
Department Stores LLC, with Value City Department Stores
LLC being the surviving entity.
4. Value City Department Stores LLC has transferred all of
the issued and outstanding shares of each class of
capital stock of Shonac and Filene's to the Parent.
C. The Borrowers have requested that the Revolving Credit Lenders
consent to the 2004 Reorganization and modify and amend certain
provisions of the Loan Agreement.
D. The Revolving Credit Lenders have agreed to consent to the 2004
Reorganization, and to modify and amend certain provisions of the
Loan Agreement as provided herein, provided that, among other
things, the Borrowers execute and deliver this Third Amendment.
Accordingly, the parties hereto agree as follows:
1. Definitions. Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the Loan
Agreement.
2. Joinder and Assumption of Liabilities by VCDS LLC. Effective as of the
date of this Third Amendment, VCDS LLC hereby acknowledges that it has
received and reviewed a copy of the Loan Agreement, and acknowledges and
agrees to:
a. join in the execution of, and become a party to, the Loan Agreement
as the Lead Borrower and as a Borrower, as indicated with its
signature below;
b. be bound by all representations, warranties, covenants, agreements,
liabilities and acknowledgments of the Lead Borrower and the
Borrowers in the Loan Agreement, with the same force and effect as
if VCDS LLC was a signatory to the Loan Agreement and was expressly
named as the Lead Borrower and as a Borrower therein; and
c. assume and perform all duties and Liabilities of the Existing Lead
Borrower and the Borrowers under the Loan Agreement.
3. Grant of Security Interest by VCDS LLC. To secure the prompt, punctual,
and faithful performance of all and each of the Liabilities, VCDS LLC
hereby grants to the Collateral Agents, for the ratable benefit of the
Secured Parties, a continuing security interest in and to, and assigns to
the Collateral Agents, for the ratable benefit of the Secured Parties, all
right, title and interest of VCDS LLC in
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and to the Collateral, and each item thereof, whether now owned or now
due, or in which VCDS LLC has an interest, or hereafter acquired, arising,
or to become due, or in which VCDS LLC obtains an interest, and all
products, Proceeds, substitutions, and accessions of or to any of the
following, but excluding the Excluded Property.
4. Amendments to Loan Agreement.
a. General.
i. VCDS LLC shall be the Lead Borrower and a Borrower under the
Loan Agreement and, in furtherance thereof, (i) all references
in the Loan Agreement to the "Lead Borrower" shall hereafter
be deemed to refer to VCDS LLC, (ii) all references in the
Loan Agreement to the "Borrowers" shall hereafter be deemed to
include VCDS LLC, and (iii) all references in the Loan
Agreement to "Value City" shall hereafter be deemed to refer
to VCDS LLC.
ii. All references in the Loan Agreement to the "Reorganization"
shall hereafter be deemed to include the 2004 Reorganization.
b. Amendments to Article 1 of Loan Agreement. The provisions of Article
1 of the Loan Agreement are hereby revised as follows:
i. The definition of "CCM Term Loan Facilities" is hereby deleted
in its entirety and the following substituted in its stead:
"CCM TERM LOAN FACILITIES": The term loan facilities entered
into amongst the Borrowers and CCM, as agent, pursuant to a
Financing Agreement dated June 11, 2002, in the aggregate
principal amount of $100,000,000.00, as most recently amended
on December 29, 2004.
ii. The definition of "Senior Convertible Facility" is hereby
deleted in its entirety and the following substituted in its
stead:
"SENIOR CONVERTIBLE FACILITY": The credit facility set forth
in the Senior Subordinated Convertible Loan Agreement dated as
of March 15, 2000, amended from time to time prior to the
Closing Date and as amended and restated June 11, 2002, in the
present principal amount of $75,000,000.00, and as most
recently amended on December 29, 2004.
iii. The definition of "Value City Entities" is hereby deleted in
its entirety and the following substituted in its stead:
""VALUE CITY ENTITIES": VCDS LLC, Gramex, VC Michigan, GBR and
Jewelry."
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iv. The definition of "VCLP" is hereby deleted in its entirety.
v. The following definitions are hereby added to Article 1 in
appropriate alphabetical order:
"VCDS LLC": Value City Department Stores LLC, an Ohio limited
liability company.
vi. The fifth sentence in Section 4.10 is hereby amended by the
addition thereto of the phrase "except where such default or
violation is not reasonably likely to have a Material Adverse
Change" after the word "Reorganization."
c. Amendments to Exhibits to Loan Agreement. The Exhibits to the Loan
Agreement are revised as follows:
i. Exhibit 1.3 [Intercompany Notes] is hereby amended and
restated in its entirety in the form of Exhibit 1.3 attached
hereto and incorporated by reference herein.
ii. Exhibit 4.2 [Corporate Information] is hereby amended and
restated in its entirety in the form of Exhibit 4.2 attached
hereto and incorporated by reference herein.
iii. Exhibit 4.20 [Reorganization] is hereby supplemented as set
forth on Exhibit 4.20 attached hereto and incorporated by
reference herein.
5. Representations and Warranties. Each of the Borrowers hereby represents
and warrants to the Agent and the Revolving Credit Lenders as follows:
a. 2004 Reorganization. The 2004 Reorganization has been or will be
consummated in accordance with Applicable Law.
b. Representations and Warranties in Loan Agreement. The Borrowers
(including VCDS LLC) hereby restate all representations, warranties,
and covenants set forth in the Loan Agreement as of the date hereof.
To the extent that any changes in any representations, warranties,
and covenants require any amendments to the Exhibits to the Loan
Agreement, such Exhibits are amended and restated, as evidenced by
any replacement Exhibits annexed to this Third Amendment.
6. Conditions Precedent to Effectiveness. This Third Amendment shall not be
effective until each of the following conditions precedent have been
fulfilled to the satisfaction of the Administrative Agent:
a. This Third Amendment shall have been duly executed and delivered by
the Majority Lenders and the other parties hereto, and shall be in
full force
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and effect and shall be in form and substance satisfactory to the
Administrative Agent and the Majority Lenders.
b. All action on the part of the Borrowers necessary for the valid
execution, delivery and performance by the Borrowers of this Third
Amendment and all other documentation, instruments, and agreements
to be executed in connection herewith shall have been duly and
effectively taken and evidence thereof satisfactory to the
Administrative Agent shall have been provided to the Administrative
Agent.
c. The Lead Borrower and each other Loan Party (to the extent requested
by the Administrative Agent) shall each have delivered the following
to the Administrative Agent, in form and substance satisfactory to
the Administrative Agent:
i. Certificate of Legal Existence and Good Standing issued by the
Secretary of the State of the Lead Borrower's and the Parent's
organization or incorporation.
ii. Certificate of the Lead Borrower's and the Parent's Secretary
of the due adoption, continued effectiveness, and setting
forth the text of each corporate resolution adopted in
connection with the loan arrangement, as modified by the Third
Amendment, and the 2004 Reorganization and attesting to the
true signatures of each Person authorized as a signatory to
any of the Loan Documents.
iii. Execution and delivery by the Lead Borrower and each other
Loan Party (to the extent requested by the Administrative
Agent) of the following Loan Documents:
a) Joinder, Confirmation and Amendment to Ancillary Loan
Documents;
b) Joinder to Copyright and Copyright Applications Security
Agreement; and
c) Such other documents and agreements as the Agent may
reasonably require.
iv. Execution and delivery by the Borrowers of the following Loan
Documents:
a) Endorsement to Amended and Restated Swingline Note; and
b) Endorsements to Amended and Restated Revolving Credit
Notes.
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v. Opinion of counsel to the Loan Parties.
d. Execution and delivery of all documents, instruments and agreements
in connection with the Term Loans, including, without limitation, a
Second Amendment to Intercreditor and Lien Subordination Agreement,
as may be deemed necessary by the Administrative Agent in connection
with the matters contemplated by this Third Amendment.
e. The 2004 Reorganization shall be finalized to the satisfaction of
the Administrative Agent.
f. All fees due under the Loan Agreement, and all costs and expenses
incurred by the Agent in connection with the preparation and
negotiation of this Third Amendment and related documents (including
the fees and expenses of counsel to the Agent), shall have been paid
in full.
g. No Default or Event of Default shall be then occurring.
h. The Loan Parties shall have executed and delivered to the
Administrative Agent such other documents, instruments, and
agreements as may be required by the Administrative Agent.
7. Consent to 2004 Reorganization. Upon the determination of the
Administrative Agent that all conditions precedent to the effectiveness of
this Third Amendment have been satisfied, consent to the 2004
Reorganization shall be deemed to have been given by the Revolving Credit
Lenders, provided however, that nothing contained herein shall be deemed a
consent to any transactions regarding the public issuance of stock
described in Paragraphs 11, 12, and 13 of the amendment to EXHIBIT 4.20 to
the extent that the consummation of any such transactions described
therein would constitute or result in the occurrence of an Event of
Default.
8. Miscellaneous.
a. This Third Amendment may be executed in several counterparts and by
each party on a separate counterpart, each of which, when so
executed and delivered, shall be an original, and all of which
together shall constitute one instrument.
b. This Third Amendment expresses the entire understanding of the
parties with respect to the transactions contemplated hereby. No
prior negotiations or discussions shall limit, modify, or otherwise
affect the provisions hereof.
c. Any determination that any provision of this Third Amendment or any
application hereof is invalid, illegal or unenforceable in any
respect and in any instance shall not effect the validity, legality,
or enforceability of such
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provision in any other instance, or the validity, legality or
enforceability of any other provisions of this Third Amendment.
d. The Loan Parties shall pay on demand all costs and expenses of the
Agent, including, without limitation, reasonable attorneys' fees in
connection with the preparation, negotiation, execution and delivery
of this Third Amendment.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties have duly executed this Third Amendment as
of the day and year first above written.
BORROWERS: VALUE CITY DEPARTMENT STORES LLC
By:________________________________
Name: Xxxxx X. XxXxxxx
Title: Vice President
SHONAC CORPORATION
By:________________________________
Name: Xxxxx X. XxXxxxx
Title: Chief Financial Officer
DSW SHOE WAREHOUSE, INC.
By:________________________________
Name: Xxxxx X. XxXxxxx
Title: Chief Financial Officer
GRAMEX RETAIL STORES, INC.
By:________________________________
Name: Xxxxx X. XxXxxxx
Title: Chief Financial Officer
FILENE'S BASEMENT, INC.
By:________________________________
Name: Xxxxx X. XxXxxxx
Title: Chief Financial Officer
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VALUE CITY OF MICHIGAN, INC.
By:________________________________
Name: Xxxxx X. XxXxxxx
Title: Chief Financial Officer
GB RETAILERS, INC.
By:________________________________
Name: Xxxxx X. XxXxxxx
Title: Chief Financial Officer
RETAIL VENTURES JEWELRY, INC.
By:________________________________
Name: Xxxxx X. XxXxxxx
Title: Chief Financial Officer
NATIONAL CITY BUSINESS CREDIT, INC.
(f/k/a National City Commercial
Finance, Inc.) (ADMINISTRATIVE
AGENT, COLLATERAL AGENT AND
REVOLVING CREDIT LENDER)
By:________________________________
Name: _____________________________
Title: ____________________________
NATIONAL CITY BANK
(ISSUER)
By:________________________________
Name: _____________________________
Title: ____________________________
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FLEET RETAIL GROUP, INC. (f/k/a
Fleet Retail Finance Inc.)
(COLLATERAL AGENT AND REVOLVING
CREDIT LENDER)
By:________________________________
Name: _____________________________
Title: ____________________________
XXXXX FARGO RETAIL FINANCE II, LLC
By:________________________________
Name:______________________________
Title:_____________________________
THE CIT GROUP/BUSINESS CREDIT,
INC.
By:________________________________
Name:______________________________
Title:_____________________________
AMSOUTH BANK
By:________________________________
Name:______________________________
Title:_____________________________
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GENERAL ELECTRIC CAPITAL
CORPORATION
By:________________________________
Name:______________________________
Title:_____________________________
HSBC BUSINESS CREDIT (USA), INC.
By:________________________________
Name:______________________________
Title:_____________________________
XXXXXXX BUSINESS CREDIT
CORPORATION
By:________________________________
Name:______________________________
Title:_____________________________
LASALLE BANK NATIONAL
ASSOCIATION
By:________________________________
Name:______________________________
Title:_____________________________
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PNC BANK, National
Association
By:________________________________
Name:______________________________
Title:_____________________________
SIEMENS FINANCIAL SERVICES, INC.
By:________________________________
Name:______________________________
Title:_____________________________
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