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EXHIBIT 10.1
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AMENDMENT TO DOCUMENTS
AMENDMENT NO. 3 TO BUSINESS LOAN AGREEMENT
This Amendment No. 3 (the "Amendment") dated as of November 20, 2001, is
between Bank of America, N.A. (the "Bank"), formerly Bank of America National
Trust and Savings Association, and Sport Chalet, Inc. (the "Borrower").
RECITALS
A. The Bank and the Borrower entered into a certain Business Loan
Agreement dated as of June 19, 1998, as previously amended (the "Agreement").
B. The Bank and the Borrower desire to further amend the Agreement.
AGREEMENT
1. DEFINITIONS. Capitalized terms used but not defined in this Amendment
shall have the meaning given to them in the Agreement.
2. AMENDMENTS. The Agreement is hereby amended as follows:
2.1 Paragraph 1.1 of the Agreement is deleted in its entirety.
2.2 In Paragraph 2.1(a) of the Agreement, the amount "Twenty Million
Dollars ($20,000,000)" is substituted for the amount "Ten Million
Dollars ($10,000,000)".
2.3 Paragraph 2.3(a) of the Agreement is amended to read in its
entirety as follows:
(a) Unless the Borrower elects an optional interest rate as
described below, the interest rate is the Bank's Prime Rate."
2.4 Paragraph 2.6(a) of the Agreement is amended to read in its
entirety as follows:
(a) The "Short Term Fixed Rate" means the Short Term Fixed Rate
plus 1.75 percentage points."
2.5 Paragraphs 2.6(d) and 2.6(e) of the Agreement are amended to read
in their entirety as follows:
(d) The interest periods during which the Short Term Fixed Rate
will be in effect will be no shorter than 7 days and no
longer than one year.
(e) Each Short Term Fixed Rate Portion will be for an amount not
less than the following:
(i) for interest periods of 91 days or longer, Five Hundred
Thousand Dollars ($500,000).
(ii) for interest periods of between 30 days and 90 days,
One Million Dollars ($1,000,000).
(iii) for interest periods of between 7 days and 29 days, an
amount which, when multiplied by the number of days in
the applicable interest period, is not less than thirty
million (30,000,000) dollar-days.
2.6 In Paragraph 2.7 of the Agreement, the first sentence is amended
to read in full as follows:
"The Borrower may elect to have all or portions of the principal
balance of the line of credit bear interest at the Offshore Rate
plus 1.75 percentage points."
2.7 Paragraphs 2.7(a) and 2.7(b) of the Agreement are amended to read
in their entirety as follows: "(a) The interest period during
which the Offshore Rate will be in effect will be no shorter than
7 days
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and no longer than one year. The last day of the interest period
will be determined by the Bank using the practices of the
offshore dollar inter-bank market.
(b) each IBOR Rate Portion will be for an amount not less than
the following:
(i) for interest periods of 91 days or longer, Five
Hundred Thousand Dollars ($500,000).
(ii) for interest periods of between 30 days and 90 days,
One Million Dollars ($1,000,000).
(iii) for interest periods of between 7 days and 29 days, an
amount which, when multiplied by the number of days in
the applicable interest period, is not less than
thirty million (30,000,000) dollar- days.
2.8 In Paragraph 2.8 of the Agreement, the first sentence is amended
to read in full as follows:
"The Borrower may elect to have all or portions of the principal
balance bear interest at the LIBOR Rate plus 1.75 percentage
points."
2.9 Paragraph 2.8(b) of the Agreement is amended to read in its
entirety as follows:
"(b) Each LIBOR Rate Portion will be for an amount not less than
the following:
(i) for interest periods of four months or longer, Five
Hundred Thousand Dollars ($500,000).
(ii) for interest periods of one, two or three months, One
Million Dollars ($1,000,000).
(iii) for interest periods of one, two or three weeks, an
amount which, when multiplied by the number of days
in the applicable interest period, is not less than
thirty million (30,000,000) dollar-days."
2.10 Paragraph 8.5 of the Agreement is amended to read in its
entirety as follows:
"8.5 FIXED CHARGE COVERAGE RATIO. To maintain a Fixed Charge
Coverage ratio of the amounts indicated for each period
specified below:
Period Ratio
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From the date of this Amendment No. 3
through December 31, 2001 90:1.0
From January 1, 2002 and thereafter 1.0:1.0
"Fixed Charge Coverage Ratio" is defined as net profit
after taxes plus interest expense, depreciation,
amortization, less dividends, loans and advances to
parents, affiliates and officers divided by current portion
long term debt, interest expense, and non-financed capital
expenditures. This ratio will be calculated at the end of
each fiscal quarter, using the results of that quarter and
each of the 3 immediately preceding quarters. The current
portion of long term debt will be measured as of the last
day of the preceding fiscal year."
2.11 Paragraph 8.10 of the Agreement is amended to read in its
entirety as follows:
"8.10 PAYDOWN PERIOD. To reduce the amount of advances
outstanding under this Agreement to zero for a period of at
least 30 consecutive days between January 1, 2002 and August 31,
2002."
3. REPRESENTATIONS AND WARRANTIES. When the Borrower signs this
Amendment, the Borrower represents and warrants to the Bank that: (a)there is no
event which is, or with notice or lapse of time or both would be, a default
under the Agreement except those events, if any, that have been disclosed in
writing to the Bank or waived in writing by the Bank, (b) the representations
and warranties in the Agreement are true as of the date of this Amendment as if
made on the date of this Amendment, (c) this Amendment is within the Borrower's
powers, has been duly authorized,
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and does not conflict with any of the Borrower's organizational papers, and (d)
this Amendment does not conflict with any law, agreement, or obligation by which
the Borrower is bound.
4. CONDITIONS. This Amendment will be effective when the Bank receives
the following items, in form and content acceptable to the Bank:
4.1 A fee in the amount of Ten Thousand Dollars ($10,000).
5. EFFECT OF AMENDMENT. Except as provided in this Amendment, all of the
terms and conditions of the Agreement shall remain in full force and effect.
This Amendment is executed as of the date stated at the beginning of
this Amendment.
BANK OF AMERICA, N.A. SPORT CHALET, INC.
/s/ Xxxxxxx X. Xxxx /s/ Xxxxxx Xxxxxxxx
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By: Xxxxxxx X. Xxxx, By: Xxxxxx Xxxxxxxx,
Vice President Chief Financial Officer
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