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EXHIBIT 10.1
SIXTH AMENDMENT TO
SECOND AMENDED AND RESTATED CREDIT AGREEMENT AND GUARANTY
SIXTH AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT
AGREEMENT AND GUARANTY (the "SIXTH AMENDMENT") dated as of June 30, 1998 among
BISCAYNE APPAREL, INC., BISCAYNE APPAREL INTERNATIONAL, INC. MACKINTOSH OF NEW
ENGLAND CO. AND M & L INTERNATIONAL, INC. (individually, each a "BORROWER" and
collectively, the "BORROWERS" and individually, each a "GUARANTOR" and
collectively, the "GUARANTORS"), THE CHASE MANHATTAN BANK, CORESTATES BANK,
N.A., BANKBOSTON, N.A. (formerly known as The First National Bank of Boston),
FLEET BANK N.A. and XXXXXXX FACTORS, INC. (individually, each a "LENDER" and
collectively, the "LENDERS"), THE CHASE MANHATTAN BANK, as agent for the
Lenders (in such capacity, together with its successors in such capacity, the
"AGENT") and XXXXXXX FACTORS, INC., as servicing agent for the Lenders (in such
capacity, together with its successors in such capacity, the "SERVICING AGENT"
and together with the Agent, the "AGENTS").
PRELIMINARY STATEMENTS:
WHEREAS, the Borrowers, the Guarantors, the Lenders and the
Agents have entered into a Second Amended and Restated Credit Agreement and
Guaranty dated as of March 24, 1997, as amended by a First Amendment, dated as
of May 22, 1997, a Second Amendment, dated as of February 18, 1998, a Third
Amendment, dated as of March 6, 1998, a Fourth Amendment, dated as of March 25,
1998 and a Fifth Amendment and Waiver dated as of June 8, 1998 (as so amended,
the "CREDIT AGREEMENT"); and
WHEREAS, the terms defined in the Credit Agreement are used
in this Sixth Amendment as in the Credit Agreement unless otherwise defined
herein;
WHEREAS, the Borrowers and the Guarantors have requested that
certain provisions of the Credit Agreement be amended as hereinafter set forth;
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. AMENDMENT TO CREDIT AGREEMENT. The Credit
Agreement is hereby amended as follows:
(a) Section 1.01 of the Credit Agreement is hereby amended by
inserting the following new definition in the appropriate alphabetical order:
"Arlington Net Proceeds" shall mean the net cash
proceeds received by the Borrowers from the sale of the Xxxxx
plant located in Arlington, Georgia after deducting all
reasonable and customary expenses incurred by the Borrowers
in connection with such sale.
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(b) Section 1.01 of the Credit Agreement is hereby further
amended by amending and restating the following definitions in their entirety
as follows:
"Revolving Credit Loans Maximum Outstanding" means
during the period specified below the amounts specified below
for such period:
PERIOD AMOUNT
------ ------
Fourth Closing Date to and
including April 30, 1998 $13,750,000
May 1, 1998 to and
including May 31, 1998 $16,750,000
June 1, 1998 to and
including June 30, 1998 $25,000,000
July 1, 1998 to and
including July 31, 1998 $32,000,000
August 1, 1998 to and
including August 31, 1998 $35,000,000
September 1, 1998 to and
including October 20, 1998 $28,750,000
October 21, 1998 to and
including October 30, 1998 $23,000,000
October 31, 1998 to and
including November 19, 1998 $20,500,000
November 20, 1998 to and
including November 30, 1998 $10,750,000
December 1, 1998 to and
including December 20, 1998 $ 8,000,000
December 21, 1998 to and
including December 31, 1998 $ 5,000,000
January 1, 1999 to and
including February 28, 1999 $ 7,000,000
March 1, 1999 to and
including March 31, 1999 $ 9,000,000
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"Revolving Credit Loans Permitted Overadvance (During the
Month)" means the amount specified below for each day during the month
specified below other than the last day of the applicable month:
MONTH AMOUNT
----- ------
March, 1998 $ 5,000,000
April, 1998 $ 9,500,000
May, 1998 $ 11,500,000
June, 1998 $ 12,500,000
July, 1998 $ 16,000,000
August, 1998 $ 12,250,000
September, 1998 $ 7,750,000
October, 1998 $ 500,000
November, 1998 $ (4,000,000)
December, 1998 $ (8,000,000)
January, 1999 $ (4,000,000)
February, 1999 $ (2,500,000)
March, 1999 $ (1,000,000)
PROVIDED, that, to the extent any Arlington Net Proceeds are received by the
Borrowers during the months of July 1998 or August 1998, the amounts set forth
opposite such months shall be reduced on a prospective basis by such amount of
proceeds received.
In addition, the proceeds of Revolving Credit Loans made to
BAI which are used to finance Xxxxx shall for each day during the period
specified below other than the last day of the applicable month be equal to or
less than the sum of (1) the Eligible Accounts of Xxxxx relied on in computing
the Collateral Borrowing Base as set forth on the Reconciliation Report and (2)
the amounts specified below for each day during the period specified below
other than the last day of the applicable month:
PERIOD AMOUNT
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March 1, 1998 to and
including May 31, 1998 $3,750,000
June 1, 1998 to and
including June 30, 1998 $4,500,000
July 1, 1998 to and
including July 31, 1998 $4,500,000
August 1, 1998 to and
including August 31, 1998 $4,000,000
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September 1, 1998 to and
including September 29, 1998 $ 750,000
October 1, 1998 to and
including October 30, 1998 $ (750,000)
November 1, 1998 to and
including November 29, 1998 $(1,750,000)
December 1, 1998 to and
including December 30, 1998 $(2,250,000)
January 1, 1999 to and
including January 30, 1999 $(2,000,000)
February 1, 1999 to and
including February 27, 1999 $ (750,000)
March 1, 1999 to and
including March 30, 1999 $ 0
PROVIDED, that, to the extent any Arlington Net Proceeds are received by the
Borrowers during the months ended July 31, 1998 or August 31, 1998, the amounts
set forth opposite such months shall be reduced on a prospective basis by such
amount of proceeds received.
For purposes of this definition, the numbers set forth in
parenthesis are negative numbers.
"Revolving Credit Loans Permitted Overadvance (Month End)"
means the amounts specified below for the last day of each month specified
below:
MONTH AMOUNT
----- ------
March, 1998 $ 4,000,000
April, 1998 $ 9,500,000
May, 1998 $ 7,500,000
June, 1998 $ 11,000,000
July, 1998 $ 10,250,000
August, 1998 $ 3,500,000
September, 1998 $ (750,000)
October, 1998 $ (8,000,000)
November, 1998 $ (9,500,000)
December, 1998 $ (10,500,000)
January, 1999 $ (6,000,000)
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February, 1999 $ (4,000,000)
March, 1999 $ (1,500,000)
PROVIDED, that, to the extent any Arlington Net Proceeds are received by the
Borrowers during the months July 1998 or August 1998, the amounts set forth
opposite such months shall be reduced on a prospective basis by such amount of
proceeds received.
Notwithstanding the foregoing, the proceeds of the Revolving
Credit Loans made to Mackintosh shall as of the last day of each month
specified below be equal to or less than the sum of (1) the Eligible Accounts
of Mackintosh relied on in computing the Collateral Borrowing Base as set forth
on the Reconciliation Report and (2) the amounts specified below for each month
specified below:
MONTH AMOUNT
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March, 1998 $ 3,250,000
April, 1998 $ 4,000,000
May, 1998 $ 4,750,000
June, 1998 $ 6,000,000
July, 1998 $ 6,250,000
August, 1998 $ 6,250,000
September, 1998 $ 5,250,000
October, 1998 $ 1,500,000
November, 1998 $ (750,000)
December, 1998 $ (1,800,000)
January, 1999 $ 0
February, 1999 $ 0
March, 1999 $ 0
In addition, the proceeds of Revolving Credit Loans made to
BAI which are used to finance Xxxxx shall as of the last day of each month
specified below be equal to or less than the sum of (1) the Eligible Accounts
of Xxxxx relied on in computing the Collateral Borrowing Base as set forth on
the Reconciliation Report and (2) the amounts specified below for each month
specified below:
MONTH AMOUNT
----- ------
March, 1998 $ 3,000,000
April, 1998 $ 3,000,000
May, 1998 $ 3,000,000
June, 1998 $ 4,000,000
July, 1998 $ 3,750,000
August, 1998 $ 1,000,000
September, 1998 $ (1,500,000)
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October, 1998 $(2,500,000)
November, 1998 $(3,000,000)
December, 1998 $(2,750,000)
January, 1999 $(1,500,000)
February, 1999 $ (750,000)
March, 1999 $ 0
In addition, each of the Borrowers agree that no further
intercompany loans or advances shall be made by any Borrower or Subsidiary from
and after the Fourth Closing Date and that intercompany loans and advances by
and among the Borrowers outstanding as of the Fourth Closing Date shall not be
repaid or reduced by any amounts, other than reductions or repayments arising
from non-cash offsets of federal income tax provisions and allocations of
Apparel's corporate overhead and management fee expenses among Apparel, BAI,
Mackintosh and M&L conducted in the ordinary course of business in accordance
with GAAP.
For purposes of this definition, the numbers set forth in
parenthesis are negative numbers.
(c) Section 10.02 of the Credit Agreement is hereby amended
by amending and restating the PROVISO appearing at the end of such section in
its entirely as follows:
; PROVIDED, that any guaranty by Apparel shall be limited to
orders for the purchase of raw materials which are placed
during the calendar year 1998.
(d) Section 11.02 of the Credit Agreement is hereby amended
and restated in its entirety as follows:
Section 11.01. MINIMUM TANGIBLE NET WORTH.
Consolidated Tangible Net Worth shall not be less than the
amounts specified below for the dates specified below:
DATE AMOUNT
---- ------
March 31, 1998 $5,250,000
June 30, 1998 $3,250,000
July 31, 1998 $4,000,000
August 31, 1998 $4,750,000
September 30, 1998 $7,750,000
December 31, 1998 $9,000,000
March 31, 1999 $7,750,000
In addition, Consolidated Tangible Net Worth shall
not be less than $7,750,000 for the period from October 1,
1998 through and including December 30, 1998 and at no time
may Consolidated Tangible Net Worth be less than $3,250,000.
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SECTION 2. CONDITIONS OF EFFECTIVENESS TO THIS SIXTH
AMENDMENT. This Sixth Amendment shall become effective on the date on which
each of the following conditions have been satisfied or waived:
(i) the Borrowers, the Lenders and the Agents shall each
have executed and delivered this Sixth Amendment;
(ii) payment by the Borrowers of all costs and expenses
of the Agents and the Lenders (including, without
limitation, reasonable attorneys' fees and expenses)
incurred in connection with this Sixth Amendment and
the Credit Agreement;
(iii) payment by the Borrowers to the Agent for the
account of the Lenders a non-refundable amendment
fee equal to $50,000. Each Lender shall be entitled
to twenty percent (20%) of such amendment fee; and
(iv) receipt of such other documents, opinions or
agreements as either of the Agents or any of the
Lenders may reasonably request.
SECTION 3. REFERENCE TO AND EFFECT ON THE FACILITY DOCUMENTS.
Upon the effectiveness of Section 2 hereof, on and after the date hereof each
reference in the Credit Agreement to "this Agreement", "hereunder", "hereof",
"herein" or words of like import, and each reference in the other Facility
Documents to the Credit Agreement, shall mean and be a reference to the Credit
Agreement as amended hereby. Except as specifically amended above, the Credit
Agreement and all other Facility Documents shall remain in full force and
effect and are hereby ratified and confirmed. Except as specifically waived
herein, the execution, delivery and effectiveness of this Sixth Amendment shall
not operate as a waiver of any right, power or remedy of any Lender or Agent
under any of the Facility Documents, nor constitute a waiver of any provision
of the Facility Documents.
SECTION 4. REPRESENTATIONS AND WARRANTIES. The Borrowers
hereby represent and warrant that each of the representations and warranties
contained in Article 8 of the Credit Agreement and in each of the other
Facility Documents is true and correct as of the date hereof (provided that any
representations and warranties which speak to a specific date shall remain true
and correct as of such date).
SECTION 5. COSTS AND EXPENSES. The Borrowers agree to pay the
Agent, the Servicing Agent, and the Lenders on demand all costs, expenses and
charges, in connection with the preparation, reproduction, execution, delivery,
filing, recording and administration of this Sixth Amendment and any other
instruments and documents to be delivered hereunder, including, without
limitation, the fees and out-of-pocket expenses of counsel for the Agent, the
Servicing Agent, and each Lender with respect thereto and with respect to
advising the Agent, the Servicing Agent, and each Lender as to its rights and
responsibilities under such documents, and all costs and expenses, if any, in
connection with the enforcement of any such documents.
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SECTION 6. GOVERNING LAW. This Sixth Amendment shall be
governed by and construed in accordance with the laws of the State of New York
applicable to contracts made and to be performed wholly within such State.
SECTION 7. HEADINGS. Section headings in this Sixth Amendment
are included herein for convenience of reference only and shall not constitute
a part of this Sixth Amendment for any other purpose.
SECTION 8. COUNTERPARTS. This Sixth Amendment may be executed
in any number of counterparts, all of which taken together shall constitute one
and the same instrument, and any party hereto may execute this Sixth Amendment
by signing any such counterpart.
IN WITNESS WHEREOF, the parties hereto have caused this Sixth
Amendment to be duly executed as of the day and year first above written.
BISCAYNE APPAREL, INC.
By: /s/ Xxxxx Xxxxxxxxxx
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Name: Xxxxx Xxxxxxxxxx
Title: President
BISCAYNE APPAREL INTERNATIONAL, INC.
By: /s/ Xxxxx Xxxxxxxxxx
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Name: Xxxxx Xxxxxxxxxx
Title: President
MACKINTOSH OF NEW ENGLAND CO.
By: /s/ Xxxxx Xxxxxxxxxx
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Name: Xxxxx Xxxxxxxxxx
Title: President
M & L INTERNATIONAL, INC.
By: /s/ Xxxxx Xxxxxxxxxx
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Name: Xxxxx Xxxxxxxxxx
Title: Vice President
THE CHASE MANHATTAN BANK,
as Lender
By:
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Name:
Title:
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