EXHIBIT 4.01.3
THIRD AMENDMENT TO REVOLVING CREDIT
AND SECURITY AGREEMENT
THIS THIRD AMENDMENT TO REVOLVIING CREDIT AND SECURITY
AGREEMENT (this "Amendment") is made as of December 31, 1999,
among SWANK, INC., a corporation organized under the laws of the
State of Delaware (the "Borrower), and PNC BANK, NATIONAL
ASSOCIATION, a national banking association ("PNC"), as agent for
the Lenders described below (in such capacity, the "Agent") and
as a Lender.
WITNESSETH:
A. Pursuant to the Revolving Credit and Security
Agreement dated as of July 27, 1998, as amended by the Amendment
to Revolving Credit and Security Agreement dated as of July 12,
1999 and the Second Amendment to Loan Documents dated as of
October 29, 1999 (as further amended, supplemented or modified
from time to time, the "Credit Agreement"), by and among the
Borrower, the financial institutions and insurance companies
which are now or which hereafter become a party thereto
(collectively, the "Lenders" and individually a "Lender"), and
the Agent, as agent for the Lenders, the Lenders agreed to make
revolving credit loans to, and issue letters of credit for the
account of the Borrower upon the terms and conditions set forth
therein.
B. PNC is currently the sole Lender.
C. The Borrower, the sole Lender and the Agent have agreed
to amend the Credit Agreement upon the terms and conditions set
forth herein.
NOW, THEREFORE, in consideration of the premises and for
other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Borrower, the
sole Lender and the Agent agree as follows:
1. Capitalized terms used in this Amendment shall have the
same meanings given them in the Credit Agreement, unless
otherwise defined herein.
2. The definition of "Revolving Interest Rate" in Section
1.2 of the Credit Agreement is hereby amended to read in its
entirety as follows:
"Revolving Interest Rate" shall mean an interest
rate per annum equal to (a) the sum of (i) the Base Rate
plus (ii) the Applicable Margin with respect to Domestic
Rate Loans, or (b) the sum of (i) the Eurodollar Rate plus
(ii) the Applicable Margin with respect to Eurodollar Rate
Loans, as applicable."
3. The definition of "Seasonal Advance Period" in Section
1.2 of the Credit Agreement is hereby amended to read in its
entirety as follows:
"Seasonal Advance Period" shall mean (a) the period
commencing on June l, 1999 and ending on October 31, 1999,
(b) the period commencing on June 1, 2000 and ending on
October 31, 2000, and (c) with respect to each other year
during the Term, the period commencing on July 1 of such
year and ending on September 30 of such year."
4. A new definition of "Applicable Margin" is hereby added
to Section 1.2 of the Credit Agreement read in its entirety as
follows:
"Applicable Margin" shall mean with respect to the
unpaid balance of Revolving Advances, (a) during the period
prior to receipt by Agent of Borrower's audited financial
statements for the fiscal year ending December 3l, 2000
pursuant to Section 9.7 of this Agreement, (i)
three-quarters of one percent (0.75%), for Domestic Rate
Loans, and (ii) two and one-half percent (2.50%), for
Eurodollar Rate Loans, and (b) thereafter, the applicable
percentages set forth below:
Fixed Charge Applicable Margin Applicable Xxxxxx
Coverage Ratio For Domestic Rate for Eurodollar Rate
Loans Loans
greater than or 0% 1.75%
equal to 1.1:1.0
0.50% 2.25%
less than 1.1:1.0
but greater than or
equal to .05:1.0
0.75% 2.50%
less than 0.5:1.0
but greater than or
equal to 0:1.0
1.00% 2.75%
less than 0:1.0
The foregoing shall not be deemed to be a modification or
waiver of Borrower's obligations under Section 6.5 of this
Agreement."
5. A new definition of "Tangible Net Worth" is hereby
added to Section 1.2 of the Credit Agreement read in its entirety
as follows:
"Tangible Net Worth" shall mean, at a particular
date,(a) the aggregate amount of all assets of Borrower on a
consolidated basis as may be properly classified as such in
accordance with GAAP consistently applied excluding such
other assets as are properly classified as intangible assets
under GAAP, less (b) the aggregate amount of all liabilities
of Borrower on a consolidated basis.
6. Section 3.2 of, the Credit Agreement is hereby amended
to read in its entirety as follows:
"3.2 Letters of Credit Fees. Borrower shall pay
(a) to Agent, for the benefit of Lenders, fees for each
Lender of Credit for the period from and excluding the date
of issuance of same to and including the date of expiration
or termination, equal to the average daily face amount of
each outstanding Letter of Credit multiplied by the
Applicable Margin for Revolving Advances that are Eurodollar
Rate Loans as in effect on the date of issuance thereof or
on the date of any renewal thereof, as the case may be, such
fees to be calculated on the basis of a 360-day year for the
actual number of day elapsed and to be payable monthly in
arrears on the first day of each month and on the last day
of the Term and (b) to the Issuer, any and all fees and
expenses as agreed upon by the Issuer and Borrower in
connection with any Letter of Credit, including, without
limitation, in connection with the opening, amendment or
renewal of any such Letter of Credit and any acceptances
created thereunder and shall reimburse Agent for any and all
fees and expenses, if any, paid by Agent to the Issuer (all
of the foregoing fees, the "Letter of Credit Fees"). Any
such charge in effect at the time of a particular
transaction shall be the charge for that transaction,
notwithstanding any subsequent change in the Issuer's
prevailing charges for that type of transaction. All Letter
of Credit Fees payable hereunder shall be deemed earned in
full on the date when the same are due and payable hereunder
and shall not be subject to rebate or proration upon the
termination of this Agreement for any reason."
7. Section 6.5 of the Credit Agreement is hereby amended
to read in its entirety as follows:
"6.5 Fixed Charge Coverage Ratio. Maintain a Fixed
Charge Coverage Ratio of not less than (a) .30 to 1.00 at
the end of the fiscal quarter of Borrower ending on December
31, 2000, for the period of twelve (12) consecutive calendar
months then ending, and (b) 1.10 to 1.00 at the end of each
fiscal quarter of Borrower thereafter, for the period of
twelve (12) consecutive calendar months then ending."
8. A new Section 6.10 and a new Section 6.11 are hereby
added to the Credit Agreement to read in their entirety as
follows:
"6.10 Minimum Tangible Net Worth. Maintain a Tangible
Net Worth at all times during the quarters set forth below
in the amounts set forth below:
Quarter Ending Minimum Tangible
Net Worth
December 31, 1999 $33,000,000
March 31, 2000 $31,000,000
June 30, 2000 $29,000,000
September 30, 2000 $30,000,000
December 31, 2000 $34,000,000
and each quarter
thereafter
6.11 Minimum EBITDA. Maintain EBITDA for the fiscal
year of Borrower ending December 31, 2000 of not less than four
million dollars ($4,000,000)."
9. In order to induce the sole Lender and the Agent to
enter into this Amendment, the Borrower hereby represents and
warrants that:
(a) after giving effect to paragraph 7 of this
Amendment, no Default or Event of Default has occurred and is
continuing;
(b) 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;
(c) the Credit Agreement and each of the Other
Documents to which the Borrower is a party, after giving effect
to this Amendment and the transactions contemplated hereby,
continue so be in full force and effect and to constitute the
legal, valid and binding obligations of the Borrower, enforceable
against the Borrower in accordance with their respective terms;
and
(d) the representations and warranties made by the
Borrower in or pursuant to the Credit Agreement or any Other
Document, or which are contained in any certificate, document or
financial or other statement furnished at any time under or in
connection herewith or therewith, are each true and correct in
all material respects on and as of the date hereof, as though
made on and as of such date.
10. This Amendment shall become effective as of the date
above upon receipt the Agent of (a) two (2) copies of this
Amendment executed by the Borrower, and (b) a modification fee of
twenty-five thousand dollars ($25,000) in immediately available
funds.
11. The borrower hereby confirms that all liens granted on
the Collateral shall continue unimpaired and in full force and
effect.
12. This Amendment may be executed in several counterparts,
each of which, when executed and delivered, shall be deemed an
original, and all of which together shall constitute one
agreement. Any signature delivered by a party by facsimile
transmission shall be deemed to be original signature hereto.
13. This Amendment shall be governed by and construed in
accordance with the laws of the State of New York applied to
contracts to be performed wholly within the State of New York,
without giving effect to the principles of conflicts of law. This
Amendment shall be binding upon and inure to the benefit of the
Borrower, the Lenders and the Agent, and their respective
successors and permitted assigns
14. From and after the effectiveness hereof, all references
to the Credit Agreement in the Other Documents shall mean the
Credit Agreement as amended and modified by this Amendment.
15. Except as amended and otherwise modified by this
Amendment, the Credit Agreement and the Other Documents shall
remain in full force and effect in accordance with their
respective terms. Except as expressly provided herein, this
Amendment shall not constitute an amendment, waiver, consent or
release with respect to any provision of thc Credit Agreement or
any Other Document, a waiver of any Default or Event of Default
thereunder, or a waiver or release of any of the Agent's or any
Lender's rights or remedies (all of which are hereby reserved).
Thc Borrower expressly ratifies and confirms the waiver of jury
trial and other provisions of Section 12.3 of the Credit
Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their proper and
duly authorized officers as of the day and year first above
written.
ATTEST: SWANK, INC.
/s/ Xxxxx X. Cambridge By: /s/ Xxxxxx X. Xxxxxxx
Xxxxx X. Cambridge Name: Xxxxxx X. Xxxxxxx
Controller Title: Sr. Vice President
PNC BANK, NATIONAL ASSOCIATION
as Lender and as Agent
By: /s/ Xxxxx Xxxxxxxx
Name: Xxxxx Xxxxxxxx
Title: Senior Vice President
