THE INDEBTEDNESS COVERED BY THIS AMENDMENT IS SUBORDINATED TO THE PRIOR PAYMENT IN FULL OF THE SENIOR INDEBTEDNESS (AS DEFINED IN THE REVOLVING INTERCREDITOR AGREEMENT HEREINAFTER REFERRED TO) PURSUANT TO, AND TO THE EXTENT PROVIDED IN, THE...
THE
INDEBTEDNESS COVERED BY THIS AMENDMENT IS SUBORDINATED TO THE PRIOR PAYMENT IN
FULL OF THE SENIOR INDEBTEDNESS (AS DEFINED IN THE REVOLVING INTERCREDITOR
AGREEMENT HEREINAFTER REFERRED TO) PURSUANT TO, AND TO THE EXTENT PROVIDED IN,
THE INTERCREDITOR AND SUBORDINATION AGREEMENT, DATED AS OF JANUARY 7, 2003
(AS AMENDED OR OTHERWISE MODIFIED FROM TIME TO TIME, THE "REVOLVING INTERCREDITOR
AGREEMENT"), AMONG FOH HOLDINGS, INC., FREDERICK'S OF HOLLYWOOD, INC.,
AND THE SUBSIDIARIES OF FREDERICK'S OF HOLLYWOOD, INC. LISTED THEREIN, ▇▇▇▇▇
FARGO RETAIL FINANCE, LLC, AS AGENT, MELLON HBV SPV LLC, AS AGENT, AND THE
SUBORDINATED CREDITORS LISTED THEREIN.
THE
INDEBTEDNESS COVERED BY THIS AMENDMENT IS SUBJECT TO THE INTERCREDITOR AND
SUBORDINATION AGREEMENT, DATED AS OF JANUARY 7, 2003 (AS AMENDED OR
OTHERWISE MODIFIED FROM TIME TO TIME, THE "INTERCREDITOR AGREEMENT"),
AMONG THE TRANCHE A/B LENDERS (AS DEFINED THEREIN), THE TRANCHE C LENDERS (AS
DEFINED THEREIN) AND MELLON HBV SPV LLC, AS AGENT AND COLLATERAL
AGENT. BY ITS ACCEPTANCE OF THIS AMENDMENT, THE HOLDER HEREOF AGREES
TO BE BOUND BY THE PROVISIONS OF SUCH INTERCREDITOR AGREEMENT TO THE SAME EXTENT
THAT THE PARTIES (AS DEFINED THEREIN) ARE BOUND.
AMENDMENT
NO. 1 (the "Amendment"), effective as of July 20, 2005, to the Amended and
Restated Tranche A/B, Tranche B and Tranche C Term Loan Agreement, dated as of
June 30, 2005 (the "Term Loan Agreement"), among Frederick's of Hollywood, Inc.,
a California corporation (the "Borrower"), FOH Holdings, Inc., a Delaware
corporation ("Holdings"), the Subsidiaries of the Credit Parties listed in Annex I (each a
"Frederick's Subsidiary" and collectively, the "Frederick's Subsidiaries"), the
lending institutions listed in Annex II as
Tranche A/B lenders (each a "Tranche A/B Lender" and collectively, the "Tranche
A/B Lenders"), the lending institutions listed on Annex III as
Tranche C lenders (each a "Tranche C Lender" and collectively, the "Tranche C
Lenders"; the Tranche A/B Lenders and Tranche C Lenders each being a "Lender"
and collectively, the "Lenders") and Mellon HBV SPV LLC, as agent for the
Lenders (in such capacity, the "Agent") and as collateral agent for the Lenders
(in such capacity, the "Collateral Agent").
The
parties to the Term Loan Agreement wish to make certain amendments to the Term
Loan Agreement, and to consent to certain payments as set forth
herein.
Accordingly,
each of the Credit Parties, the Agent and the Lenders agree as
follows:
1. Definitions. Section
1.1 of the Term Loan Agreement is hereby amended to add the following
definitions:
"Class
Action Suit" means that certain litigation filed in the Superior Court of the
State of California alleging violations of wage and hour provisions of the
California Labor Code entitled JUDICIAL COUNCIL COORDINATION
PROCEEDING NO. 4397, Coordination Proceeding Special Title (Rule 1550(b)),
FREDERICK'S OF HOLLYWOOD OVERTIME CASES – included actions: ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇'▇ of Hollywood Stores, Inc.; ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇'▇ of Hollywood
Stores, Inc.; ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇'▇ of Hollywood Stores,
Inc.
"Loan
Sale" means the acquisition of the Credit Documents, and the obligations
evidenced thereby, by Mellon HBV SPV LLC pursuant to the Assignment and
Assumption Agreements, dated on or about March 3, 2005, between Mellon HBV SPV
LLC and each of Calyon, Smoky River CDO, L.P., Indosuez Capital Funding IIA,
Ltd. and ML CLO XV Pilgrim America (Cayman), Ltd.
2. Amendments.
(a) Section
8.11. Section 8.11 of the Term Loan Agreement is hereby
amended by deleting sub-clause (v) thereof, including the provisos contained
therein, and substituting therefor the following:
"(v) pay
any management fees or any other fees or expenses (including the reimbursement
thereof by any Credit Party or any of its Subsidiaries) pursuant to any
management, consulting or other services agreement to any of the shareholders or
other equity holders of any Credit Party or any of its Subsidiaries or other
Affiliates, or to any other Subsidiaries or Affiliates of any Credit Party,
provided that this Section 8.11 shall not prohibit payments of
(a) management fees to any shareholder or other equity holder in an
aggregate amount not to exceed $50,000 each calendar quarter and
(b) payments not to exceed $30,000 annually to each independent member of
the Board of Directors of Holdings, $1,000 for each member of the Board of
Directors of Holdings for each in-person meeting of the Board of Directors of
Holdings attended by such director and $500 for each member of the Board of
Directors of Holdings for each telephonic meeting of the Board of Directors of
Holdings attended by such director."
(b) Section
8.22. The Term Loan Agreement is hereby amended to add Section
8.22 as follows:
"8.22 Class Action
Suit. The Credit Parties shall not make any payment in
connection with any settlement, compromise, judgment, or other resolution on
account of the claims which are the subject matter of the Class Action Suit
unless the aggregate of such payments do not exceed $750,000 at any
time."
(c) Financial
Statements. The Credit Parties shall deliver copies of
the Borrowers' business plan, in form and substance (including as to scope and
underlying assumptions) satisfactory to Agent, pursuant to
its Permitted Discretion, for fiscal year 2006 in accordance with Section
7.1(b)(iii) of the Term Loan Agreement on or before the 7th day
following the effective date of this Amendment.
3. Consent. Notwithstanding
the provisions of Section 8.11(v) of the Term Loan Agreement, the Agent and
Required Lenders hereby consent to the payment by the Borrower of reasonable,
actual out-of-pocket fees and expenses (including reasonable attorneys' fees)
incurred by Lenders and current shareholders of Holdings in connection with the
restructuring of the Credit Documents pursuant to the Term Loan Agreement as
amended and restated on June 30, 2005, the Capital Infusion, the Loan Sale and
the transaction contemplated by the Stock Purchase Agreements; provided that,
such fees and expenses do not exceed $250,000 in the aggregate.
4. Waiver of
Defaults. Pursuant to the request of the Credit
Parties and in accordance with Section 11.11 of the Term Loan Agreement, the
Agent and the Required Lenders hereby consent to, and waive any Event of Default
that exists as of the date hereof. The waivers in this Section 3
shall be effective only in this specific instance and for the specific purposes
set forth herein and do not allow for any other or further departure from the
terms and conditions of the Term Loan Agreement or any other Credit Document,
which terms and conditions shall remain in full force and effect. Without
limiting the generality of the foregoing, it is understood and agreed that
nothing in this Amendment shall be deemed a waiver of any other Event of Default
or Default hereafter arising.
5. Conditions
to Effectiveness. This
Amendment shall become effective only upon satisfaction in full, in a manner
satisfactory to the Agent, of the following conditions precedent (the first date
upon which all such conditions shall have been satisfied being herein called the
"Amendment Effective
Date"):
(a) Payment of Fees,
Etc. The Credit Parties shall have paid all fees, costs,
expenses and taxes payable to the Agent and the Lenders on the Amendment
Effective Date by the Credit Parties pursuant to Section 11.2 of the Term Loan
Agreement and the Revolving Credit Agent shall have consented to the payment of
such fees, costs, expenses and taxes payable to the Agent and the
Lenders.
(b) Representations and
Warranties; No Event of Default. The representations and
warranties contained herein, in Article VI of the Term Loan Agreement and in
each other Credit Document, certificate or other writing delivered to the Agent
or a Lender pursuant hereto or pursuant to the Term Loan Agreement shall be true
and correct on and as of the Amendment Effective Date as though made on and as
of such date, and no Default or Event of Default shall have occurred and be
continuing on the Amendment Effective Date or would result from this Amendment
becoming effective in accordance with its terms.
(c) Delivery of
Documents. The Agent shall have received on or before the
Amendment Effective Date the following, each in form and substance satisfactory
to the Agent and, unless indicated otherwise, dated the Amendment Effective
Date:
(i) a
copy of this Amendment, duly executed by each Credit Party;
(ii) a
fully executed copy of the Eighth Amendment to Financing Agreement in the form
attached hereto as Exhibit A, amending
the Revolving Credit Agreement.
6. Continued
Effectiveness of Term Loan Agreement. Each
of the Credit Parties hereby (i) confirms and agrees that each Credit Document
to which it is a party is, and shall continue to be, in full force and effect
and is hereby ratified and confirmed in all respects except that on and after
the Amendment Effective Date (A) all references in the Term Loan Agreement to
"this Agreement", "hereto", "hereof", "hereunder" or words of like import
referring to the Term Loan Agreement shall mean the Term Loan Agreement as
amended by this Amendment, and (B) all references in any other Credit Document
to "the Term Loan Agreement", "thereto", "thereof', "thereunder" or words of
like import referring to the Term Loan Agreement shall mean the Term Loan
Agreement as amended by this Amendment, and (ii) confirms and agrees that to the
extent that any such Credit Document purports to assign or pledge to the Agent,
or to grant to the Agent a security interest in or lien on, any collateral as
security for the Obligations of the Credit Parties from time to time existing in
respect of the Term Loan Agreement and the Credit Documents, each such pledge,
assignment and grant of the security interest or lien is hereby ratified and
confirmed in all respects.. Except as expressly set forth herein, the
amendments, waivers and consents set forth herein shall not by implication or
otherwise limit, impair, constitute an amendment, waiver or consent of, or
otherwise affect the rights or remedies of the Lenders or the Agent under the
Term Loan Agreement or any other Credit Document, and shall not alter, modify,
amend or in any way affect any of the terms, conditions, obligations, covenants
or agreements contained in the Term Loan Agreement or any other Credit Document,
all of which are ratified and affirmed in all respects and shall continue in
full force and effect. Nothing herein shall be deemed to entitle any Credit
Party to a consent to, or a waiver, amendment, modification or other change of,
any of the terms, conditions, obligations, covenants or agreements contained in
the Term Loan Agreement or any other Credit Document in similar or different
circumstances. The amendment, waiver and consent herein shall apply and be
effective only with respect to the matters expressly covered thereby. This
Amendment, including the waivers and consents set forth herein, shall constitute
a Credit Document for all purposes of the Term Loan Agreement and the other
Credit Documents.
7. Miscellaneous
(a) This
Amendment may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which shall be deemed to be an
original, but all of which taken together shall constitute one and the same
agreement.
(b) Section
and paragraph headings herein are included for convenience of reference only and
shall not constitute a part of this Amendment for any other
purpose.
(c) THIS
AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS.
(d) The
Credit Parties jointly and severally agree to pay on demand all fees, costs and
expenses of the Agent in connection with the preparation, execution and delivery
of this Amendment and the other related agreements, instruments and documents,
including, without limitation, the reasonable fees, disbursements and other
charges of ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel to the Agent.
IN
WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this
Amendment to be duly executed and delivered as of the date first above
written.
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FREDERICK'S
OF HOLLYWOOD, INC.
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By:
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/s/
▇▇▇▇▇ ▇▇▇▇
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Name:
▇▇▇▇▇ ▇▇▇▇
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Title:
President and CEO
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FOH
HOLDINGS, INC.
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By:
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/s/
▇▇▇▇▇ ▇▇▇▇
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Name:
▇▇▇▇▇ ▇▇▇▇
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Title:
President and CEO
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FREDERICK'S
OF HOLLYWOOD STORES, INC.
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By:
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/s/
▇▇▇▇▇ ▇▇▇▇
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Name:
▇▇▇▇▇ ▇▇▇▇
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Title:
President and CEO
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HOLLYWOOD
MAIL ORDER, LLC
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By:
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FOH
Holdings, Inc. its Manager
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By:
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/s/
▇▇▇▇▇ ▇▇▇▇
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Name: ▇▇▇▇▇
▇▇▇▇
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Title:
President and CEO
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▇▇▇▇▇▇▇▇▇▇.▇▇▇,
INC.
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By:
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/s/
▇▇▇▇▇ ▇▇▇▇
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Name:
▇▇▇▇▇ ▇▇▇▇
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Title:
President and
CEO
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MELLON
HBV SPV LLC,
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as
Agent and Collateral Agent and as a Lender
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By:
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MELLON
HBV ALTERNATIVE
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STRATEGIES
LLC, in its capacity as Managing Member of Mellon HBV SPV
LLC
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By:
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/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Title:
Chief Administrative Officer
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MELLON
HBV MASTER REDISCOVERED OPPORTUNITIES FUND L.P.
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By:
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MELLON
HBV COMPANY LTD.,
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Its
General Partner
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By:
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/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Title: Director
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