EXHIBIT 10.1
September 16, 1997
Hi-Lo Auto Supply, L.P.
0000 X. Xxxxxxxx
Xxxxxxx, Xxxxx 00000
Gentlemen:
Reference is made to (i) the Financing Agreement between us dated October 23,
1996, as amended, including but not limited to the amendment letters between us
dated December 20, 1996 (herein the "Financing Agreement") and (ii) the various
letter agreements between us granting to the Company additional time to satisfy
the Condition Precedent set forth in Section 2, paragraph v), subparagraph i)
relating to the Blocked Account Agreements required by the Agent (herein the
"Waiver Letters"). Capitalized terms used herein shall have the meanings
ascribed to them in the Financing Agreement unless otherwise specifically
defined herein.
Pursuant to the mutual understanding of the undersigned parties, the Financing
Agreement is hereby amended as follows:
1.) The definition of "Availability Reserve" appearing in Section 1 of the
Financing Agreement is hereby amended as follows: (i) by deleting clause
(c) at the end of such definition and deleting the word ";and" immediately
preceding (c) and adding a period in lieu thereof.
2.) The definition of "Eligible Accounts Receivable" appearing in Section
1 of the Financing Agreement is hereby amended by deleting clause (c) at
the end of such definition and by deleting the word ", and" immediately
preceding (c) and adding a period in lieu thereof.
3.) The definition of "Eligible Inventory" appearing in Section 1 of the
Financing Agreement is hereby amended by a) deleting clause viii) at the
end of such definition, b) adding the Standard Reserve Component and c)
deleting the word "and" immediately preceding clause viii) and
substituting a period in lieu thereof.
4.) Section 7, paragraph 10(B) of the Financing Agreement is hereby
amended by deleting the two full paragraphs at the end of such paragraph
10(B) commencing with the language "Within 30 days after the Agent's
receipt of the Company's Consolidated Financial Statements" through the
end of the last line in such paragraph 10 (B).
5.) The Company has advised the Agent and the Lenders that it has been
unable to obtain Blocked Account Agreements with the sixteen banks where
it has bank accounts, as listed on Exhibit A attached hereto, and,
therefore, such sixteen
Depository Accounts have not yet become Blocked Accounts.
6.) The Company has advised the Agent that its Concentration Account shall
be changed from NationsBank to Bank One, and therefore, the Company hereby
confirms that it shall obtain fully executed amendments to i) the Blocked
Account Agreements and ii) the credit card remittance letters providing
for instructions to each bank and credit card company/clearing house to
remit the collections to the new Concentration Account, such amendments to
be delivered to the Agent no later than October 31, 1997 or such failure
to deliver any of the foregoing on or before October 31, 1997 shall be
deemed an Event of Default under the Financing Agreement.
Notwithstanding anything to the contrary contained in the Financing Agreement or
the Waiver Letters, the undersigned parties hereby agree that with respect to
such sixteen Depository Accounts listed on Exhibit A attached hereto, the
requirements of Section 2, paragraph v), subparagraph i) of the Financing
Agreement are hereby permanently waived provided, however, that upon any change
to another bank, the Company shall then deliver to the Agent Blocked Account
Agreements for the new Depository Accounts and provided further that,
notwithstanding the foregoing, all collections must be remitted to the
Concentration Account pursuant to paragraph 4 of Section 3 of the Financing
Agreement.
No other change, amendment or waiver in the terms or conditions of the Financing
Agreement is intended or implied. If the foregoing is in accordance with your
understanding please so indicate by signing and returning the enclosed copy of
this letter.
Very truly yours,
THE CIT GROUP/BUSINESS CREDIT,
INC., as Agent
By: /S/ XXX XXXXXX
Title: Vice President
Read and Agreed to:
HI-LO AUTO SUPPLY, L.P.
By: /s/ XXXX X. XXXXXXX
Title: Vice President
Read and Confirmed:
FLEET CAPITAL CORP.
By: /s/ XXXXX XXXXX
Title: Vice President
LASALLE NATIONAL BANK
By: /s/ XXX FUDAZZ
Title: Sr. Vice President
EXHIBIT A
STORE CITY BANK
----- ---- ----
33 Xxxxx First National Bank of Alvin
37 Clute Texas Xxxx Xxxx
00 Xxx Xxxxx XxxxxXxxx
4 Beaumont Community Bank
56 Xxxxx First National Bank
69 Slidell, L.A. First National Bank of Commerce
77 Houma, L.A. Hibernia Bank
108 Xxxxxxxxx CitizensStateBank
109 League City League City Bank Trust
110 Orange Prime Bank
123 Crowley, L.A. First Bank
126 Jennings, L.A. American Bank
139 Xxxxx First Valley Bank
168 Del Rio Del Rio Bank & Trust
205 Elgin Elgin Bank
206 New Caney Prime Bank
EXHIBIT 11.1
HI-LO AUTOMOTIVE, INC. AND SUBSIDIARIES
SCHEDULE OF COMPUTATION OF EARNINGS PER SHARE
(IN THOUSANDS, EXCEPT SHARE DATA)
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
COLUMN A COLUMN B
----------------------------------------------------------------------------------------------------
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
------------------- -----------------
1997 1996 1997 1996
---- ---- ---- ----
AVERAGE COMMON SHARES OUTSTANDING ....... 10,775,109 10,756,350 10,775,109 10,756,350
COMMON EQUIVALENT SHARES RESULTING FROM
STOCK OPTIONS ISSUED .................. 0 0 0 0
----------- ------------ ----------- ------------
AVERAGE COMMON AND COMMON EQUIVALENT
SHARES OUTSTANDING .................... 10,775,109 10,756,350 10,775,109 10,756,350
NET INCOME (LOSS) ....................... $ 1,313 $ (51,659) $ 1,933 $ (51,905)
=========== ============ =========== ============
EARNINGS PER COMMON SHARE:
NET INCOME (LOSS) PER COMMON AND COMMON
EQUIVALENT SHARE ...................... $ 0.12 $ (4.80) $ 0.18 $ (4.83)
=========== ============ =========== ============
Earnings per share have been computed by dividing net income by the
average number of common and common equivalent shares outstanding. Common
equivalent shares outstanding were computed using the treasury stock method. The
difference between shares for primary and fully diluted earnings per share was
not significant in any period. On November 1, 1994, a note was issued that is
convertible, effective November 1, 1996, into 93,859 shares of the Company's
Common Stock. Since September 30, 1997, this note had no significant effect on
earnings per share.
