CONFORMED COPY
CONSENT, WAIVER AND AMENDMENT No. 2 dated as
of February 23, 1999 (this "Amendment"), to
the Credit Agreement dated as of April 22,
1998, as amended (the "Credit Agreement"),
among Xxxxxxxx-Van Heusen Corporation, a
Delaware corporation (the "Borrower"), the
lenders party thereto (the "Lenders"), The
Chase Manhattan Bank, a New York banking
corporation, as administrative agent (in such
capacity, the "Administrative Agent") and
collateral agent (in such capacity, the
"Collateral Agent"), and Citicorp USA, Inc.,
as documentation agent (in such capacity, the
"Documentation Agent").
A. Pursuant to the Credit Agreement, the Lenders
and the Issuing Bank (such term and all other terms used but
not defined herein having the meanings assigned to such
terms in the Credit Agreement) have extended credit to the
Borrower, and have agreed to extend credit to the Borrower,
in each case pursuant to the terms and subject to the
conditions set forth therein.
B. The Borrower has advised the Lenders that the
Borrower intends to enter into the Asset Purchase Agreement
dated as of or about February 20, 1999 (the "Asset Purchase
Agreement"), with Pyramid Sportswear AB, a Swedish
corporation and wholly owned subsidiary of Pyramid Partners
AB, a Swedish corporation (the "Buyer"), the Assignment and
Assumption Agreement dated as of or about February 20, 1999
(the "Lease Assignment and Assumption Agreement"), between
the Borrower and Pyramid Sportswear Acquisition Corporation,
a Delaware corporation (the "Assignee"), and the related
Assignment and Assumption of Lease (the "Assignment and
Assumption Instrument" and, together with the Asset Purchase
Agreement and the Lease Assignment and Assumption Agreement,
the "Gant Sale Agreement"), between the Borrower and the
Assignee, pursuant to which the Borrower will sell, assign,
transfer and deliver to the Buyer or the Assignee, as the
case may be, for not less than $70,000,000 in cash proceeds
(the "Gant Sale") all the Borrower's right, title and
interest in (a) the trademarks "Gant", "Hugger" and
"Rugger", and all trademark rights, logos and designs
associated therewith (the "Trademarks"), and all Trademark
registrations and Trademark application files and records,
(b) certain license and distribution agreements associated
with the Trademarks (the "Assumed Contracts"), and all
rights, privileges and entitlements of the Borrower
thereunder, (c) certain inventory and pending orders for
inventory, (d) all equipment, telephones, telefax machines,
fixed assets, trade fixtures, leasehold improvements, cash
registers and furniture (excluding inventory) located in or
utilized in connection with or otherwise needed to operate
the "flagship" Gant Store located on Fifth Avenue in New
York City (the "Gant Store"), (e) the existing telephone and
telefax numbers of the Xxxx Store, including any "800"
numbers, the domain names "Xxxx.xxx" and "XxxxXXX.xxx", and
the computer software constituting the web sites designated
by such domain names, (f) the Agreement of Lease dated
March 5, 1997, relating to the Gant Store, (g) copies of all
books and records relating to the assets of the Borrower
being sold thereunder, (h) all goodwill associated with such
assets, (i) all guarantees, warranties, indemnities and
similar rights of the Borrower with respect to any such
assets, (j) all rights, claims, credits, causes of action or
rights of set-off of the Borrower against third parties
relating to the assets being sold thereunder and (k) all
displays, shipping supplies, boxes and like materials and
promotional, advertising and sales materials located in the
Gant Store on the closing date of the Gant Sale.
C. The Borrower has requested that the Lenders
(a) consent to the consummation of the Gant Sale, (b) amend
certain provisions of the Credit Agreement and (c) grant
certain limited waivers of compliance by the Borrower with
certain provisions of the Credit Agreement.
D. The Required Lenders are willing to grant such
a consent, agree to such amendments and grant such waivers,
in each case pursuant to the terms and subject to the
conditions set forth herein.
Accordingly, in consideration of the mutual
agreements contained in this Amendment and other good and
valuable consideration, the sufficiency and receipt of which
are hereby acknowledged, the parties hereto agree as
follows:
SECTION 1. Consent. The Lenders hereby consent
to the consummation by the Borrower of the Gant Sale in
accordance with the Gant Sale Agreement with such changes
with respect to the Gant Sale as are not adverse to the
Lenders in any material respect.
SECTION 2. Waiver. The Lenders hereby (a) waive
compliance by the Borrower with Section 6.05(d) of the
Credit Agreement to the extent, but only to the extent,
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necessary to permit the Gant Sale as consented to in
Section 1 above and (b) waive compliance with Section 6.09
of the Credit Agreement to the extent, but only to the
extent, necessary to permit the Gant Sale as consented to
in Section 1 above.
SECTION 3. Amendment to Section 1.01. The
definition of the term "Consolidated EBITDA" in
Section 1.01 of the Credit Agreement is hereby amended to
read in its entirety as follows:
"Consolidated EBITDA" means, for any four-fiscal-
quarter period, Consolidated Net Income for such
period, plus, without duplication and to the extent
deducted from revenues in determining Consolidated Net
Income for such period, the sum of (a) the aggregate
amount of Consolidated Net Interest Expense for such
period, (b) the aggregate amount of income tax expense
for such period, (c) all amounts attributable to
depreciation and amortization for such period, (d) a
one-time, non-recurring restructuring charge of
$132,700,000 taken in 1997, (e) one-time,
non-recurring charges not to exceed $8,500,000,
$10,000,000 and $1,500,000 taken or to be taken in
fiscal years 1998, 1999 and 2000, respectively, in
connection with the Borrower's "Year 2000 Project" (as
such term is defined in the confidential offering
memorandum prepared in connection with the private
placement of the Subordinated Debt) and (f) premiums
not to exceed $1,100,000 paid in connection with the
redemption by the Borrower of its 7.85% Series A
Senior Notes Due 2002, 7.02% Series B Senior Notes Due
1999 and 7.75% Series C Senior Notes Due 2002, all as
determined on a consolidated basis with respect to the
Borrower and the Subsidiaries in accordance with GAAP.
SECTION 4. Amendment to Section 6.04.
(a) Paragraph (a) of Section 6.04 of the Credit
Agreement is hereby amended to read in its entirety as
follows:
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"(a) investments by the Borrower in all or a
portion of the share capital of Pyramid Partners
not owned by the Borrower on the date hereof,
provided that (i) such share capital shall be
purchased (A) free of all Liens and encumbrances,
(B) in the exercise of the Borrower's preemptive
rights, rights of first refusal or similar rights
under the Shareholder Agreement dated as of or
about February 20, 1999, among Xxxxxxx Xxxxx,
Xxxx Xxxx, Staffan Wittmark, the Borrower and
LV Capital S.A., and (C) at a price corresponding
to a bona fide offer from a third party potential
purchaser, (ii) at the time of such investment
and after giving pro forma effect thereto, (A) no
Default or Event of Default shall have occurred
or be continuing and (B) the Borrower shall be in
compliance with Section 6.13, Section 6.14 and
Section 6.15 and (iii) the Borrower shall comply
with the applicable provisions of Section 5.11;".
(b) Paragraph (i) of Section 6.04 of the Credit
Agreement is hereby amended by deleting the word "and" at
the end thereof.
(c) Paragraph (j) of Section 6.04 of the Credit
Agreement is hereby amended to read in its entirety as
follows:
"(j) the Guarantee by the Borrower of the
obligations of Pyramid Sportswear Acquisition
Corporation under the Agreement of Lease dated
March 5, 1997, between Olympic Tower Associates, as
Landlord, and the Borrower, as Tenant, pursuant to the
Assignment and Assumption Agreement dated as of or
about February 20, 1999, between the Borrower and
Pyramid Sportswear Acquisition Corporation, and the
related Assignment and Assumption of Lease between the
Borrower and Pyramid Sportswear Acquisition
Corporation, provided that (i) the Borrower's
obligations with respect to such Guarantee shall not
exceed $12,000,000 at any time and (ii) such
Guarantee, unless otherwise terminated, shall
terminate upon the earlier of (A) April 30, 2009, and
(B) the date of any other termination of such lease;
and".
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(d) Section 6.04 of the Credit Agreement is
hereby further amended by adding a paragraph (k) as
follows:
"(k) investments (other than those permitted by
paragraphs (a) through (j) above) in an aggregate
amount not to exceed $15,000,000 at any time
outstanding."
SECTION 5. Representations and Warranties. The
Borrower represents and warrants to the Administrative
Agent, to the Issuing Bank and to each of the Lenders that:
(a) This Amendment has been duly authorized,
executed and delivered by the Borrower and constitutes its
legal, valid and binding obligation, enforceable in
accordance with its terms except as such enforceability may
be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors'
rights generally and by general principles of equity
(regardless of whether such enforceability is considered in
a proceeding at law or in equity).
(b) Before and after giving effect to this
Amendment, the representations and warranties set forth in
Article III of the Credit Agreement are true and correct in
all material respects with the same effect as if made on
the date hereof, except to the extent such representations
and warranties expressly relate to an earlier date.
(c) The execution, delivery and performance by
the Borrower of this Amendment and the performance by the
Borrower of the Gant Sale Agreement (i) have been duly
authorized by all requisite corporate and, if required,
stockholder action and (ii) will not, and the use of the
cash proceeds from the Gant Sale will not, (A) violate
(x) any provision of law, statute, rule or regulation, or
of the certificate or articles of incorporation or other
constitutive documents or by-laws of the Borrower or any
Subsidiary, (y) any order of any Governmental Authority or
(z) any provision of any indenture, agreement or other
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instrument to which the Borrower or any Subsidiary is a
party or by which any of them or any of their property is
or may be bound or (B) be in conflict with, result in a
breach of or constitute (alone or with notice or lapse of
time or both) a default under, or give rise to any right to
accelerate or to require the prepayment, repurchase or
redemption of any obligation under any such indenture,
agreement or other instrument (other than certain repayment
or repurchase obligations that may arise pursuant to
Section 1014 of the Indenture dated April 22, 1998, under
which the Subordinated Debt was issued, in the event that
all net available proceeds from the Gant Sale are not
invested or committed to be invested within 365 days in
assets related to the business of the Borrower or applied
to permanently repay senior debt of the Borrower).
(d) Before and after giving effect to this
Amendment, no Event of Default or Default has occurred and
is continuing.
SECTION 6. Conditions to Effectiveness. This
Amendment shall become effective as of the date first above
written when (a) the Administrative Agent shall have
received counterparts of this Amendment that, when taken
together, bear the signatures of the Borrower and the
Required Lenders and (b) the representations and warranties
set forth in Section 5 of this Amendment shall be true and
correct.
SECTION 7. Credit Agreement. Except as
specifically amended hereby, the Credit Agreement shall
continue in full force and effect in accordance with the
provisions thereof as in existence on the date hereof.
After the date hereof, any reference to the Credit
Agreement shall mean the Credit Agreement as amended
hereby.
SECTION 8. Loan Document. This Amendment shall
be a Loan Document for all purposes.
SECTION 9. Applicable Law. THIS AMENDMENT SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK.
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SECTION 10. Counterparts. This Amendment may be
executed in counterparts (and by different parties hereto
on different counterparts), each of which shall constitute
an original but all of which when taken together shall
constitute a single contract. Delivery of an executed
counterpart of a signature page of this Amendment by
telecopy shall be effective as delivery of a manually
executed counterpart of this Amendment.
SECTION 11. Expenses. The Borrower agrees to
reimburse the Administrative Agent for its out-of-pocket
expenses in connection with this Amendment, including the
reasonable fees, charges and disbursements of Cravath,
Swaine & Xxxxx, counsel for the Administrative Agent.
IN WITNESS WHEREOF, the parties hereto have
caused this Amendment to be duly executed by their
respective authorized officers as of the day and year first
written above.
XXXXXXXX-VAN HEUSEN CORPORATION,
by
/s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: V.P. Treas & Secty
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THE CHASE MANHATTAN BANK,
individually and as Administrative
Agent and Collateral Agent,
by
/s/ Xxxxxxxx X. Xxxx
Name: Xxxxxxxx X. Xxxx
Title: Vice President
CITICORP USA, INC., individually
and as Documentation Agent,
by
/s/ Xxxxx Xxxxxx
Name: Xxxxx Xxxxxx
Title: Managing Director
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Name of Institution The Chase Manhattan Bank
by
/s/ Xxxxxxxx X. Xxxx
Name: Xxxxxxxx X. Xxxx
Title: Vice President
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Name of Institution Citicorp USA
by
/s/ Xxxxx Xxxxxx
Name: Xxxxx Xxxxxx
Title: Managing Director
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Name of Institution Bank Leumi USA
by
/s/ Xxxx Xxxxxxxxxxx
Name: Xxxx Xxxxxxxxxxx
Title: Vice President
by
/s/ Xxxxxxx Xxxxxxxxxxx
Name: Xxxxxxx Xxxxxxxxxxx
Title: Senior Vice President
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Name of Institution The Bank of New York
by
/s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Name of Institution BankBoston, N.A.
by
/s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Director
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Name of Institution DG BANK Deutsche Genossenschaftsbank AG
by
/s/ Xxxxx X. X'Xxxxxxx
Name: Xxxxx X. X'Xxxxxxx
Title: Vice President
by
/s/ Xxx X. Xxxxxx
Name: Xxx X. Xxxxxx
Title: Assistant Vice President
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Name of Institution Fleet Bank, N.A.
by
/s/ Xxxxxxx X. Xxxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Vice President
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Xxxxxxx National Life Insurance Company
By: PPM Finance, Inc.
Name of Institution Attorney-in-Fact
by
/s/ Xxxxx Xxxxxxx
Name: Xxxxx Xxxxxxx
Title: Vice President
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Name of Institution Nationsbank, N.A.
by
/s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Name of Institution PNC Bank, National Association
by
/s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Vice President
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Name of Institution Standard Chartered Bank
by
/s/ Xxxxx X.X. Xxxxx
Name: Xxxxx X.X. Xxxxx
Title: Senior Credit Officer
by
/s/ Shafiq Ur Rahman
Name: Shafiq Ur Rahman
Title: Senior Vice President &
Global Account Manager
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SIGNATURE PAGE TO
CONSENT, WAIVER AND
AMENDMENT NO. 2, DATED AS OF
February 23, 1999
To Approve the Amendment:
Name of Institution Union Bank of California, N.A.
by
/s/ Xxxxx Xxxxx
Name: Xxxxx Xxxxx
Title: Vice President
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