EXHIBIT 10.2
FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT
As of November 12, 2001
THIS FIRST AMENDMENT TO THE LOAN AND SECURITY AGREEMENT dated as of
October 1, 2001 (the "Amendment") is entered into as of November 12, 2001 by and
among Xxxxxxx Jewelers, Inc. as Borrower (the "Borrower"), the lenders party
thereto (the "Lenders") and DDJ Capital Management LLC as agent for the Lenders
(the "Agent"). All capitalized terms used in this Amendment shall have the
meanings given to them in the Loan and Security Agreement (as defined below)
unless specifically defined herein.
WHEREAS, Borrower, Lenders and Agent are parties to that certain Loan
and Security Agreement, dated as of October 1, 2001 (the "Loan and Security
Agreement"), pursuant to which Lenders have made certain credit available to and
on behalf of the Borrower and to secure the obligations outstanding under the
Loan Agreement and the documents and instruments executed in connection
therewith (collectively, the "Loan Documents");
WHEREAS, Borrower, Lenders and Agent are also parties to that certain
Loan Agreement dated as of April 30, 2001 (the "Subordinated Loan Agreement"),
pursuant to which Lenders have made certain credit available to and on behalf of
Borrower;
WHEREAS, Lenders executed that certain Intercreditor and Subordination
Agreement, dated as of October 1, 2001 (the "Subordination Agreement"), whereby
Lenders agreed that the obligations incurred pursuant to the Subordinated Loan
Agreement are subordinate in right of payment to the prior payment in full of
all of the obligations incurred pursuant to the Loan and Security Agreement;
WHEREAS, Borrower intends to enter into supply agreements (the "Supply
Agreements") with certain of suppliers of inventory and their affiliates (the
"Suppliers");
WHEREAS, in consideration for the Supply Agreements, Borrower intends
to grant the Suppliers a security interest in substantially all of the assets of
Borrower;
WHEREAS, the Suppliers and Lenders intend to enter into an
Intercreditor and Subordination Agreement dated as of November 12, 2001, which
will govern the priorities of Lenders and the Suppliers;
WHEREAS, Section 16.1 permits any term of the Loan and Security
Agreement or of any other Loan Document to be amended upon the written consent
of the Borrower and the Required Lenders, except as otherwise expressly set
forth in the Loan Agreement which exception or exceptions do not exist as it
relates to this Amendment;
WHEREAS, Borrower, Lenders and Agent wish to amend the Loan and
Security Agreement to authorize Borrower to enter into Supply Agreements and
Security Agreements with the Suppliers, substantially in the form of the
agreements attached hereto as Exhibits A and B, respectively, and any other
documents related thereto;
NOW, THEREFORE, in consideration of the promises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereby amend the Loan and Security Agreement as
follows:
1. AMENDMENTS
1.1 Schedule P-1 of the Loan and Security Agreement is hereby amended
and restated in its entirety to read as set forth on Schedule P-1, attached
hereto as Exhibit C, to include the Liens granted to the Suppliers.
1.2. The definition of "Tangible Net Worth" set forth in Section 1.1 of
the Senior Loan Agreement is hereby amended to delete the punctuation from the
end of the last clause of that definition and add the following:
"; plus (iv) the amount of any and all Indebtedness
outstanding under the Subordinated Credit Facility"
1.3 The first clause of Section 7.8 of the Loan and Security Agreement
is hereby deleted and replaced with the following:
"Except in connection with a refinancing permitted by Section
7.1(d) or as may be consented to by Agent:"
1.4 Section 7.16 of the Loan and Security Agreement is hereby amended
to delete the punctuation from the end of the last clause of that section and
add the following:
", except to the extent that the Agent consents to such liens
or claims"
2. REPRESENTATIONS AND WARRANTIES. Borrower hereby affirms to Lenders
and Agent that all of Borrower's representations and warranties set forth in the
Loan and Security Agreement are true, complete and accurate in all respects as
of the date hereof (except to the extent such representations and warranties
relate solely to an earlier date).
3. DEFAULTS. Borrower hereby affirms to Lenders and Agent that no
Default or Event of Default exists as of the date hereof.
4. COSTS AND EXPENSES. Borrower shall pay to Agent all of Agent's
out-of-pocket costs and expenses (including, without limitation, the reasonable
fees and expenses of its counsel, which counsel may include any local counsel
reasonably deemed necessary, search fees, filing and recording fees,
documentation fees, appraisal fees, travel expenses, and other fees) arising in
connection with the preparation, execution, and delivery of this Amendment and
any related documents.
2
5. EFFECTIVENESS; CONDITION TO EFFECTIVENESS. This Amendment shall
become effective as of the date first set forth above, upon execution hereof by
the Lenders, the Agent and the Borrower.
6. OBLIGATIONS IN FULL FORCE AND EFFECT. Except as herein amended and
modified, the Loan and Security Agreement and the Subordination Agreement shall
remain in full force and effect.
7. COUNTERPARTS. This Amendment may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same document.
3
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date and year first written above.
XXXXXXX JEWELERS, INC.
By: /s/ Xxxxx XxXxxxxxxx
-------------------------------------------
Name: Xxxxx XxXxxxxxxx
Title: President & CEO
DDJ CAPITAL MANAGEMENT, LLC
By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Member
B III CAPITAL PARTNERS:
By: DDJ Capital III, LLC, its General Partner
By: DDJ Capital Management, LLC, Manager
By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Member
B III-A CAPITAL PARTNERS, L.P.
By: GP III-A, LLC, its General Partner
By: DDJ Capital Management, LLC, Manager
By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Member
4
