EXHIBIT 10.33
AMENDMENT NO. 6 TO AMENDED AND RESTATED CREDIT AGREEMENT
as of May 4, 2001
Congress Financial Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Congress Financial Corporation ("Lender") has entered into financing
arrangements with ▇▇▇▇▇*s Group Inc. ("▇▇▇▇▇*s"), the undersigned subsidiaries
of ▇▇▇▇▇*s, ▇▇▇▇▇*s Corp. ("Parent") and iTurf Finance Company ("IFC", and
together with ▇▇▇▇▇*s, its undersigned subsidiaries, Parent and IFC,
collectively "Borrowers") pursuant to which Lender may make loans and advances
and provide other financial accommodations to Borrowers as set forth in the
Amended and Restated Credit Agreement, dated as of April 28, 2000, by and among
Lender and Borrowers (as the same now exists or may hereafter be amended,
modified, supplemented, extended, renewed, restated or replaced, the "Credit
Agreement"), and other agreements, documents and instruments referred to therein
or at any time executed and/or delivered in connection therewith or related
thereto, including, but not limited to, this letter agreement (all of the
foregoing, together with the Credit Agreement, as the same now exist or may
hereafter be amended, modified, supplemented, extended, renewed, restated or
replaced, being collectively referred to herein as the "Financing Agreements").
Capitalized terms not otherwise defined herein shall have the respective
meanings ascribed thereto in the Credit Agreement.
▇▇▇▇▇*s and ▇▇▇▇▇*s Distribution Company ("dDC") have entered into certain
financing arrangements with Allfirst Bank ("Allfirst") to finance the
construction and acquisition of the real property and improvements located at
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Hanover Facility") which
financing arrangements are set forth in the Hanover Facility Loan Agreements and
are permitted to the extent set forth in the Credit Agreement.
Borrowers have informed Lender that ▇▇▇▇▇*s and dDC have agreed to make a
prepayment with respect to the Indebtedness of dDC to Allfirst and to amend the
financing arrangements with Allfirst as set forth in the Modification Agreement,
effective as of May 1, 2001, by and among Allfirst, ▇▇▇▇▇*s and dDC ("Allfirst
Modification Agreement"), a copy of which is attached hereto as Exhibit A so
that (i) a $2,000,000 principal prepayment is made in respect of the Mortgage
Note, dated August 6, 1999, issued by dDC and payable to Allfirst in the
original principal amount of $5,320,000 ("Allfirst Note"); (ii) the maturity
date of the Allfirst Note is amended to be August 6, 2003; (iii) the covenant
with respect to the minimum fixed
charge coverage ratio set forth in Section 3(q) of the Construction Loan
Agreement, dated August 6, 1999, by and between Allfirst and dDC is amended; and
(iv) a $75,000 fee is paid to Allfirst in exchange for its willingness to agree
to the foregoing.
In accordance with Section 3 of the Pledged Collateral Account Agreement,
dated November 20, 2000, by and among Chase Securities, Inc. ("Chase H&Q"),
iTurf Finance Company and Lender, Borrowers have requested that Lender agree to
acknowledge a letter, dated May 4, 2001, from iTurf Finance Company instructing
Chase H&Q to wire a total amount of $2,500,000 ("Chase H&Q Instruction Letter")
to the Congress payment account, a copy of which is attached hereto as Exhibit
B.
As set forth in the letter, dated of even date herewith, from Borrowers to
Lender ("Pay Proceeds Authorization Letter"), Borrowers have requested that
Lender wire $2,525,000 in loan proceeds to Allfirst as a payment in respect of:
(i) the principal prepayment of the Allfirst Note and fee described in
subsection (i) above, (ii) the $75,000 fee described in subsection (iv) above,
and (iii) the $450,000 termination payment payable to Allfirst under the terms
of the Swap Confirmation, dated May 4, 2001, by and between dDC and Allfirst to
terminate the ISDA Master Agreement, dated August 5, 1999, by and between dDC
and Allfirst ("Swap Termination"). A copy of the Swap Termination is attached
hereto as Exhibit C.
1. CONSENTS. Notwithstanding anything to the contrary set forth in
Sections 7.1(b) of the Credit Agreement, subject to the terms and conditions
herein:
(a) Lender consents to the following transactions as set forth in the
Allfirst Modification Agreement (as in effect on the date hereof):
(i) a principal prepayment by dDC to Allfirst in an amount not to
exceed $2,000,000 in respect of the Allfirst Note and a reduction in the
maturity date of the Allfirst Note to August 6, 2003;
(ii) the amendment to the minimum fixed charge coverage ratio as
described in Section 8 of the Allfirst Modification Agreement (as in effect on
the date hereof); and
(iii) a payment by dDC to Allfirst not to exceed $75,000 as set
forth in Section 10 of the Allfirst Modification Agreement (as in effect on the
date hereof) plus reasonable attorneys' fees and expenses not to exceed $15,000.
(b) The consents contained in Section 1(a) hereof are conditioned on
the satisfaction of each of the following conditions precedent as determined by
Lender: (i) all of the transactions contemplated by the Allfirst Modification
Agreement (as in effect on the date hereof) occur on or before May 15, 2001,
(ii) Lender shall received a true, correct and complete copy of the Allfirst
Modification Agreement, Chase H&Q Instruction Letter, Pay Proceeds Authorization
Letter, Swap Termination and any other information, documents or instruments
related thereto, duly authorized executed and delivered by the parties thereto,
(iii) Lender has received, in form and substance satisfactory to Lender, an
original of this Amendment, duly
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authorized, executed and delivered by Borrowers, (iv) Lender shall have received
the fee referred to in Section 4 hereof, and (v) no Event of Default, or act,
condition or event which with notice or passage of time or both would constitute
an Event of Default, shall exist or have occurred and be continuing on date of
the consummation of the transactions contemplated by the Allfirst Modification
Agreement.
2. AMENDMENTS.
(a) INTEREST RATE. The definition of "Interest Rate" set forth in the
Credit Agreement shall be deleted and replaced with the following:
"Interest Rate" means:
(a) Subject to clauses (b) below, (i) as to Prime Rate Loans, a
rate equal to one and one-quarter percent (1 1/4%) per annum in excess
of the Prime Rate and (ii) as to Libor Loans, a rate equal to three
and one-quarter percent (3 1/4%) per annum in excess of the Adjusted
Libor Rate (based on the Adjusted Libor Rate applicable for the
Interest Period selected by ▇▇▇▇▇*s on behalf of Borrowers as in
effect three (3) Business Days after the date of receipt by Lender of
the request of ▇▇▇▇▇*s for such Libor Loans in accordance with the
terms hereof, whether such rate is higher or lower than any rate
previously quoted to ▇▇▇▇▇*s or any other Borrower).
(b) Notwithstanding anything to the contrary contained in clause
(a) above, the Interest Rate shall mean, at Lender's option, as to
Prime Rate Loans, the rate of three and one-quarter percent (3 1/4%)
per annum in excess of the Prime Rate, and as to Libor Loans, the rate
of five and one-quarter percent (5 1/4%) per annum in excess of the
Adjusted Libor Rate, without notice, (i) for the period (A) from and
after the date of termination or non-renewal hereof until Lender has
received full and final payment of all Obligations (notwithstanding
entry of a judgment against any Borrower) and (B) from and after the
date of the occurrence of an Event of Default for so long as such
Event of Default is continuing, and (ii) on the Loans to any Borrower
at any time outstanding in excess of the Borrowing Base (whether or
not such excess(es), arise or are made with or without Lender's
knowledge or consent and whether made before or after an Event of
Default)."
(b) LETTER OF CREDIT ACCOMMODATIONS. Section 2.2(b) of the Credit
Agreement is hereby deleted and replaced with the following:
"(b) In addition to any charges, fees or expenses charged by any bank
or issuer in connection with the Letter of Credit Accommodations,
Borrowers shall pay to Lender a letter of credit fee at a rate equal
to one and three-quarters percent (1 3/4%) per annum on the daily
outstanding balance of the Letter of Credit Accommodations for the
immediately preceding month (or part thereof), payable in arrears as
of the first day of each succeeding month, except that Borrowers shall
pay to Lender such letter of credit fee, at Lender's option, without
notice, at a rate
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equal to three and three-quarters percent (3 3/4%) per annum on such
daily outstanding balance for: (i) the period from and after the date
of termination or non-renewal hereof until Lender has received full
and final payment of all Obligations (notwithstanding entry of a
judgment against any Borrower) and (ii) the period from and after the
date of the occurrence of an Event of Default for so long as such
Event of Default is continuing as determined by Lender. Such letter of
credit fee shall be calculated on the basis of a three hundred sixty
(360) day year and actual days elapsed and the obligation of Borrowers
to pay such fee shall survive the termination or non-renewal of this
Agreement."
(c) SPECIAL AVAILABILITY RESERVE.
(i) Without limiting any rights or remedies of Lender under the
Credit Agreement or any of the other Financing Agreements with respect to the
establishment of Reserves or otherwise, but subject to the terms and conditions
thereof, and in addition to any other Reserves, as of the date hereof, a Reserve
has been established in the amount equal to $3,000,000 (the "Special
Availability Reserve").
(ii) For so long as the Special Availability Reserve shall be in
effect, the term Reserves as used in the Credit Agreement and the other
Financing Agreements shall be deemed to include, in addition and not in
limitation, the Special Availability Reserve.
3. REPRESENTATIONS, WARRANTIES AND COVENANTS. In addition to the
continuing representations, warranties and covenants at any time made by
Borrowers to Lender pursuant to the other Financing Agreements, Borrowers hereby
represent, warrant and covenant with and to the Lender as follows (which
representations, warranties and covenants are continuing and shall survive the
execution and delivery hereof and shall be incorporated into and made a part of
the Financing Agreements):
(a) by no later than June 5, 2001, Borrowers shall use their best
efforts so that Lender shall have received the following: (i) a mortgage with
respect to the real property, improvements, fixtures and related assets of
Borrowers located at the Hanover Facility, in form and substance satisfactory to
Lender, duly authorized, executed and delivered by Borrowers and (ii) an
estoppel and consent agreement, in form and substance satisfactory to Lender,
consenting to the mortgage in favor of Lender, duly authorized executed and
delivered by Allfirst; PROVIDED, THAT, in the event that Lender does not receive
the foregoing documents by the date set forth above, Borrowers shall continue to
use best efforts so that Lender shall receive the foregoing documents;
(b) without limiting any of Lender's other rights under the Financing
Agreements or otherwise, in the event that Lender does not receive the
$2,525,000 as set forth in the Chase H&Q Instruction Letter by 2:00 p.m. on May
7, 2001, Borrowers hereby agree that Lender may, at its option, determine not to
honor the Pay Proceeds Authorization Letter; and
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(c) true, correct and complete copies of the following are attached
hereto: (i) the Allfirst Modification Agreement, (ii) the Chase H&Q Instruction
Letter and (iii) the Swap Termination.
4. FEE. In consideration of the Agreement set forth herein, Borrowers
shall on the date hereof, pay to Lender, and Lender may, at its option, charge
the account of Borrowers maintained by Lender, a fee in the amount of $50,000,
which fee is fully earned and payable as of the date hereof and shall constitute
part of the Obligations.
5. ADDITIONAL EVENTS OF DEFAULT. The parties hereto acknowledge, confirm
and agree that the failure of Borrowers to comply with the covenants, conditions
and agreements contained herein, shall in each case constitute an Event of
Default under the Financing Agreements, subject to the applicable cure period,
if any, with respect thereto provided for in the Credit Agreement.
6. GOVERNING LAW. The rights and obligations hereunder of each of the
parties hereto shall be governed by and interpreted and determined in accordance
with the laws of the State of New York.
7. BINDING AGREEMENT. Without limiting any other provision in this
Amendment, this agreement shall be binding upon and inure to the benefit of each
of the parties hereto and their respective successors and assigns.
8. EFFECT OF THIS AGREEMENT. Except as modified pursuant hereto, no other
changes or modifications to the Financing Agreements are intended or implied and
in all other respects the Financing Agreements are hereby specifically ratified,
restated and confirmed by all parties hereto as of the date hereof. To the
extent of conflict between the terms of this Amendment and the Financing
Agreements, the terms of this Amendment shall control.
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10. COUNTERPARTS. This Amendment may be executed in counterparts, but all
of such counterparts shall together constitute but one and the same agreement.
In making proof of this Amendment, it shall not be necessary to produce or
account for more than one counterpart thereof signed by each of the parties
thereto.
Very truly yours,
▇▇▇▇▇*s GROUP INC., formerly known as
▇▇▇▇▇*s Inc.
▇▇▇▇▇*s DISTRIBUTION COMPANY
▇▇▇▇▇*s FOREIGN SALES CORPORATION
▇▇▇▇▇*s OPERATING COMPANY
▇▇▇▇▇*s PROPERTIES INC.
▇▇▇▇▇*s RETAIL COMPANY
SCREEEM! INC.
STORYBOOK INC.
TSI SOCCER CORPORATION
TSI RETAIL COMPANY
▇▇▇▇▇*s CORP., formerly known as iTURF, INC.
iTURF FINANCE COMPANY
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: Senior Vice President
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AGREED TO:
CONGRESS FINANCIAL CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Title: Assistant Vice President
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102605-2
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