AMENDMENT No. 3
AMENDMENT AGREEMENT dated as of January 31, 1997 among FINLAY ENTERPRISES,
INC. a Delaware corporation (the "Parent"), FINLAY FINE JEWELRY CORPORATION, a
Delaware corporation (the "Company"), the lenders named herein and signatory
hereto (the "Lenders") and GENERAL ELECTRIC CAPITAL CORPORATION, as agent (the
"Agent") for the Lenders.
WHEREAS, the Parent, the Company, the Lenders and Agent are parties to an
Amended and Restated Credit Agreement dated as of March 28, 1995 (as heretofore
and hereafter amended, modified or supplemented from time to time in accordance
with its terms, the "Credit Agreement");
WHEREAS, the Company desires to open and operate up to fifty-five (55) fine
jewelry departments in Monoprix and related stores; and
WHEREAS, subject to the terms and conditions hereof the parties hereto
desire to amend certain provisions of the Credit Agreement and of the Security
Agreement.
NOW THEREFORE, for good and valuable consideration, the receipt of which is
hereby acknowledged, and subject to the fulfillment of the conditions set forth
below, the parties hereto agree as follows:
1. Defined Terms. Unless otherwise specifically defined herein, all capitalized
terms used herein shall have the respective meanings ascribed to such terms in
the Credit Agreement.
2. Amendments to Credit Agreement. Upon the Effective Date (as defined herein),
the Credit Agreement shall be amended as follows:
(a) Section 3.1(c)(A)(iii) of the Credit Agreement is hereby amended by
deleting the amount "$12,000,000" appearing therein and substituting
"$20,000,000" therefor.
(b) Section 7 of the Credit Agreement is hereby amended by adding the
following as paragraph (e) thereof:
(e) Notwithstanding anything to the contrary set forth in (b) above,
no more than $13,000,000 in the aggregate may be expended in connection
with the opening and operation of fine jewelry departments in Monoprix and
related stores to the extent the operation of such fine jewelry departments
is permitted hereunder.
(c) Section 7(b) of the Credit Agreement is hereby amended by deleting the
first parenthetical of such section in its entirety and substituting
"(including, without limitation, for the purpose of (i) opening and maintaining
not more than twenty-two factory outlet stores operated by the Company to the
extent set forth in Section 9.1 hereof, (ii) operating fine jewelry departments
in not more than ten Debenhams stores to the extent set forth in Section 9.23
hereof and (iii) operating fine jewelry departments in (x) not more than
fifty-five (55) Monoprix and related stores and (y) a store in Berlin, Germany,
each to the extent set forth in Section 9.25 hereof)" therefor.
(d) Section 9.1(iv) of the Credit Agreement is hereby amended by deleting
the parenthetical in such section in its entirety and substituting "(it being
agreed that of such amount, (A) no more than $4,000,000 may be expended for the
purpose of opening and maintaining factory outlet stores operated by the Company
and permitted to be opened under Section 9.24 hereof, (B) no more than
$2,000,000 may be expended for the purpose of opening and maintaining fine
jewelry departments in Debenhams stores permitted to be operated under Section
9.23 hereof and (C) no more than $2,000,000 may be expended for the purpose of
opening and maintaining fine jewelry departments in Monoprix and related stores
and a store in Berlin, Germany, to the extent stores are permitted to be
operated under Section 9.25 hereof)" therefor.
(e) Section 9.1(v) of the Credit Agreement is hereby amended by deleting
such section in its entirety and substituting therefor "(v) $18,500,000 for the
Fiscal Year ending in 1998, and (vi) $12,100,000 in any subsequent Fiscal Year
thereafter."
(f) Section 9.4(q) of the Credit Agreement is hereby amended in its
entirety to read as follows:
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(q) Investments by the Company in Sonab in the form of intercompany
Indebtedness for Borrowed Money existing after the Fourth Amendment
Effective Date as evidenced by an amended and restated Second Sonab
Intercompany Note; provided that the aggregate unpaid amount of the
Indebtedness for Borrowed Money evidenced by the Second Sonab Intercompany
Note shall not at any time exceed $33,000,000.
(g) Section 9 of the Credit Agreement is hereby amended by adding the
following as Section 9.25 thereof:
ss. 9.25 MONOPRIX LICENSE AGREEMENTS. Enter into License Agreements to
operate fine jewelry departments in more than (x) fifty-five (55) Monoprix
and related stores and (y) one store in Berlin, Germany.
(h) The provisions of Section 9.4 and 9.9 of the Credit Agreement are
waived to the extent necessary to permit the Company to (a) employ ▇▇▇▇▇▇ ▇▇▇▇▇▇
as President and Chief Operating Officer on substantially the terms set forth in
Exhibit A annexed hereto and (b) in connection with such employment, provide (i)
payment of up to $200,000 of relocation expenses for ▇▇. ▇▇▇▇▇▇ and (ii) a
bridge loan to ▇▇. ▇▇▇▇▇▇ of up to $300,000 for the purchase of a residence in
the New York metropolitan area, such amounts referred to in this clause (b) not
to be applied against the Investment amounts permitted under Section 9.4(i).
3. Representations and Warranties. Each of the Parent and the Company
represents and warrants as follows (which representations and warranties shall
survive the execution and delivery of this Agreement) as of the date hereof
that:
(a) Each of the Parent, the Company and each Subsidiary thereof has taken
all necessary action to authorize the execution, delivery and performance of
this Agreement and each other agreement, instrument or document executed in
connection herewith or therewith to which such Person is a party (collectively,
the "Amendment Documents").
(b) Each of the Amendment Documents has been duly executed and delivered
and each of the Amendment Documents constitutes the valid and legally binding
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obligation of the Parent and/or the Company, as the case may be, enforceable in
accordance with their respective terms, subject to applicable bankruptcy,
reorganization, insolvency, moratorium and similar laws affecting the
enforcement of creditors' rights generally and by general equity principles.
(c) No consent or approval of any person, firm, corporation or entity, and
no consent, license, approval or authorization of any governmental authority is
or will be required in connection with the execution, delivery, performance,
validity or enforcement of the Amendment Documents other than any such consent,
approval, license or authorization which has been obtained and remains in full
force and effect or where the failure to obtain such consent, approval, license
or authorization would not result in a Material Adverse Effect.
(d) After giving effect to this Agreement and the other Amendment
Documents, each of the Company and the Parent is in compliance with all of the
various covenants and agreements set forth in the Credit Agreement and each of
the other Loan Documents.
(e) No event has occurred and is continuing which constitutes or would
constitute, with the giving of notice or lapse of time or both, an Event of
Default under the Credit Agreement or any of the other Loan Documents.
(f) All representations and warranties contained in the Credit Agreement,
and each of the other Loan Documents are true and correct in all material
respects as of the date hereof, except to the extent that any representation or
warranty relates to a specified date, in which case such are true and correct in
all material respects as of the specific date to which such representations and
warranties relate.
4. Conditions Precedent. Notwithstanding any term or provision of this
Agreement to the contrary, the amendments contained herein shall not become
effective until the date and time on which the Agent and the Lenders shall have
determined (as evidenced by delivery of a counterpart of this Agreement executed
by the Agent and each Lender) that each of the following conditions precedent
shall have been satisfied (the "Effective Date"):
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(a) Counterparts of this Agreement shall have been duly executed and
delivered on behalf of the Company, the Parent and each of the Lenders.
(b) All required corporate action and proceedings in connection with the
execution and delivery of the Amendment Documents shall have been taken, and
each shall be satisfactory in form and substance to the Agent and the Lenders,
and the Agent and the Lenders shall have received all information and copies of
all documents, including without limitation, records of requisite corporate
action and proceedings that the Agent or any Lender may reasonably request, to
be certified by the appropriate corporate person or government authorities.
5. Continued Effectiveness. The term "Agreement", "hereof", "herein" and
similar terms as used in the Credit Agreement, and references in the other Loan
Documents to the Credit Agreement, shall mean and refer to, from and after the
Effective Date, the Credit Agreement as amended by this Agreement. Each of the
Company and the Parent hereby agrees that all of the covenants and agreements
contained in the Credit Agreement and the Loan Documents are hereby ratified and
confirmed in all respects.
6. Gold Consignment Agreement. The Lenders hereby consent to the execution
and delivery by the Company of Amendment No. 2 and Limited Consent to the Gold
Consignment Agreement, such Amendment No. 2 and Limited Consent being
substantially in the form attached hereto as Exhibit B.
7. Counterparts. This Agreement may be executed in counterparts, each of
which shall be an original, and all of which, taken together, shall constitute a
single instrument. Delivery of an executed counterpart of a signature page to
this Agreement by telecopier shall be effective as delivery of a manually
executed counterpart of this Agreement.
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8. Governing Law. This Agreement shall be governed by, and construed in
accordance with,the laws of the State of New York without giving effect to the
conflict of laws provisions thereof.
FINLAY ENTERPRISES, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
FINLAY FINE JEWELRY CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
GENERAL ELECTRIC CAPITAL CORPORATION,
Individually and as Agent
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Its Duly Authorized Signatory
FLEET NATIONAL BANK (Assignee and successor in
interest to FLEET NATIONAL BANK OF MASSACHUSETTS
formerly known as Shawmut Bank, N.A.)
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Assistant Vice President
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
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Each of the Guarantors, by signing below, confirms in favor of the Agent and the
Lenders that it consents to the terms and conditions of the foregoing Amendment
No. 3 to this Amended and Restated Credit Agreement and agrees that it has no
defense, offset, claim, counterclaim or recoupment with respect to any of its
obligations or liabilities under its respective Guaranty and that all terms of
such Guaranty shall continue in full force and effect, subject to the terms
thereof.
FINLAY JEWELRY, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
SONAB HOLDINGS, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
SONAB INTERNATIONAL, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
SOCIETE NOUVELLE D'ACHAT DE BIJOUTERIE - S.O.N.A.B.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Attorney-in-Fact
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