EXHIBIT 10.16
AMENDMENT AGREEMENT NO. 6 TO
AMENDED AND RESTATED REVOLVING CREDIT
AND REIMBURSEMENT AGREEMENT
THIS AMENDMENT AGREEMENT is made and entered into as of this 3rd day of
December, 1997, by and among SUNGLASS HUT INTERNATIONAL, INC., a Florida
corporation (herein called the "Borrower"), NATIONSBANK NATIONAL ASSOCIATION
(the "Agent"), as Agent for the lenders (the "Lenders") party to the Amended and
Restated Revolving Credit and Reimbursement Agreement dated December 14, 1995,
as amended, among such Lenders, Borrower and the Agent (the "Agreement") and
each of the Lenders party to the Agreement.
W I T N E S S E T H:
WHEREAS, the Borrower, the Agent and the Lenders have entered into the
Agreement pursuant to which the Lenders have agreed to make revolving loans to
the Borrower in the principal amount of up to $60,000,000 as evidenced by the
Notes (as defined in the Agreement); and
WHEREAS, as a condition to the making of the revolving loans pursuant
to the Agreement the Lenders have required that all Material Subsidiaries of the
Borrower guaranty payment of all Obligations of the Borrower arising under the
Agreement; and
WHEREAS, in order to induce the Lenders to enter into this Amendment
Agreement the Borrower has agreed to permanently reduce the Total Revolving
Credit Commitment from $60,000,000 to $40,000,000 pursuant to Section 2.08 of
the Agreement;
WHEREAS, the Borrower has requested that the Lenders further amend the
Agreement and the Agent and the Lenders have agreed subject to the terms of this
Amendment Agreement, to further amend the Agreement in the manner set forth
herein;
NOW, THEREFORE, the Borrower, the Agent and the Lenders do hereby agree
as follows:
a. Definitions. The term "Agreement" as used herein and in the Loan
Documents (as defined in the Agreement) shall mean the Agreement as hereby
amended and modified. Unless the context otherwise requires, all terms used
herein without definition shall have the definition provided therefor in the
Agreement.
b. Amendments. Subject to the conditions hereof, the Agreement is
hereby amended, effective as of October 30, 1997, as follows:
(i) New definitions "Borrowing Base" and "Borrowing Base
Certificate" are added to Section 1.01 immediately following the definition
"Borrower's Account" which
definitions shall read as follows:
"'Borrowing Base' means an amount equal to 50% of Eligible
Inventory;"
"'Borrowing Base Certificate' means a certificate in the form
of Exhibit K hereto with appropriate insertions of date and
amounts, duly executed by an Authorized Representative;"
(ii) A new definition "Eligible Inventory" is added to Section
1.01 immediately following the definition "Dollars" which definition shall read
as follows:
"'Eligible Inventory' means all finished inventory, goods and
products owned by the Borrower or a material Subsidiary and
located within a retail or distribution facility located
within the United States or a territory thereof, which
facility is owned or leased by the Borrower or a Material
Subsidiary;"
(iii) A new definition "Reduction Period" is added to Section
1.01 immediately following the definition "Required Lenders" which definition
shall read as follows:
"'Reduction Period' means a period of 45 consecutive days
during which the Revolving Credit Debit Balance shall not
exceed $20,000,000 which period shall begin upon the giving of
written notice to the Agent by an Authorized Representative
not less than one Business Day prior to the beginning of such
Reduction Period;"
(iv) The definition of "Revolving Credit Termination Date" in
Section 1.01 is hereby amended by deleting the date "December 14, 1998"
appearing in clause (i) and inserting in lieu thereof the date "June 30, 1998."
(v) The definition of "Total Revolving Credit Commitment" in
Section 1.01 is amended in its entirety so that as amended it shall read as
follows:
"'Total Revolving Credit Commitment' means an amount equal to
$40,000,000, as reduced from time to time in accordance with
Section 2.10; provided, however, if the Agent shall not have
received notice of the commencement of the Reduction Period by
May 15, 1998, the Total Revolving Credit Commitment on and
after May 15, 1995 shall mean $20,000,000, as reduced from
time to time in accordance with Section 2.10;"
(vi) The second proviso of the first sentence of Section 2.01
is hereby amended in its entirety to read as follows:
"provided, further, however, that immediately after giving
effect to each Advance, the Dollar Value of outstanding Loans
shall not exceed the lesser of the Borrowing Base or the Total
Revolving Credit Commitment."
(vii) The last sentence of Section 2.01 is hereby amended in
its entirety so that as amended it shall read as follows:
"The Borrower agrees that if at any time the Revolving Credit
Debit Balance shall exceed either the Borrowing Base or the
Total Revolving Credit Commitment, the Borrower shall
immediately reduce the outstanding principal amount of the
Loans such that, as a result of such reduction, both the
Borrowing Base and the Total Revolving Credit Commitment shall
equal or exceed the Revolving Credit Debit Balance."
(viii) A new sentence is hereby added to the end of Section
2.03(i) which sentence shall read as follows:
"Each request for an Advance shall be accompanied by a
Borrowing Base Certificate containing information as of a date
not earlier than five (5) days preceding the date of such
Advance."
(ix) Section 2.13 is hereby amended by deleting the date
"February 1, 1998" appearing in clause (iii) thereof and inserting in lieu
thereof the date December 1, 1997.
(x) Sections 8.03 and 8.04 are hereby amended in their
entirety so that as amended they shall read as follows:
"8.03 Consolidated Interest Coverage Ratio. Permit at any time
during the periods set forth below the Consolidated Interest
Coverage Ratio to be less than that set forth opposite the
period:
Period Ratio
3rd Quarter 1997 1.90 to 1.00
4th Quarter 1997 2.25 to 1.00
1st Quarter 1998 and Thereafter 2.50 to 1.00"
"8.04 Consolidated Fixed Charge Ratio. Permit at any time
during the periods set forth below the Consolidated Fixed
Charge Ratio to be less than that set forth opposite such
period:
Period Ratio
4th Quarter 1997 1.05 to 1.00
1st Quarter 1998 and Thereafter 1.10 to 1.00"
(xi) Section 8.05 is hereby amended by deleting the date
February 2, 1998 appearing in clause (ii) thereof and inserting in lieu thereof
the date December 2, 1997.
(xii) Section 8.06 is hereby amended in its entirety so that
as amended it shall read as follows:
"8.06 Consolidated Leverage Ratio. Permit at any time during
the periods set forth below the Consolidated Leverage Ratio to
be less than that set forth opposite the period:
Period Ratio
4th Quarter 1997 2.50 to 1.00
1st Quarter 1998 and Thereafter 2.10 to 1.00"
(xiii) A new Section 8.19 is hereby added to the Agreement,
which Section shall read as follows:
"8.19. Negative Pledge Clauses. Enter into or cause,
suffer or permit to exist any agreement with any Person other
than the Agent and the Lenders pursuant to this Agreement or
any other Loan Documents which prohibits or limits the ability
of any of the Borrower or any Subsidiary to create, incur,
assume or suffer to exist any Lien upon any of its property,
assets or revenues, whether now owned or hereafter acquired,
provided that the Borrower and any Subsidiary may enter into
such an agreement in connection with property subject to any
Lien permitted by this Agreement and not released after the
date hereof, when such prohibition or limitation is by its
terms effective only against the assets subject to such Lien."
3. Each Material Subsidiary of the Borrower has joined in the execution
of this Amendment Agreement for the purpose of (i) agreeing to the other
amendments to the Agreement and the other Loan Documents effected hereby and
(ii) confirming its guarantee of payment of all the Obligations.
4. Representations and Warranties. The Borrower hereby certifies
that:
(a) The representations and warranties made by Borrower in
Article VI of the Agreement are true and correct in all material
respects on and as of the date hereof except to the extent that such
representations and warranties expressly relate to an earlier date and
except that the financial statements referred to in Section 6.01(f)
shall be those most recently furnished to each Lender pursuant to
Section 7.01(a) and (b);
(b) There has been no material change in the condition,
financial or otherwise, of the Borrower and its Subsidiaries since the
date of the most recent financial reports of the Borrower received by
each Lender under Section 7.01 thereof, other than changes in the
ordinary course of business or as described in paragraph 2(b) of this
Amendment Agreement, none of which has been a material adverse change;
(c) The business and properties of the Borrower and its
Subsidiaries are not, and since the date of the most recent financial
report of the Borrower and its Subsidiaries received by each Lender
under Section 7.01 thereof have not been, adversely affected in any
substantial way as the result of any fire, explosion, earthquake,
accident, strike, lockout, combination of workers, flood, embargo,
riot, activities of armed forces, war or acts of God or the public
enemy, or cancellation or loss of any major contracts; and
(d) No event has occurred and no condition exists which, upon
the consummation of the transaction contemplated hereby, constitutes a
Default or an Event of Default on the part of the Borrower under the
Agreement, the Notes or any other Loan Document either immediately or
with the lapse of time or the giving of notice, or both.
5. Conditions. As a condition to the effectiveness of this
Amendment Agreement,
(a) the Borrower shall deliver, or cause to be delivered to the
Agent, the following:
(i) eight (8) counterparts of this Amendment Agreement duly
executed by the Borrower and the Material Subsidiaries;
(ii) an amendment fee of 5 basis points times the Revolving
Credit Commitment of each Lender executing this Amendment
Agreement; and
(iii) such other instruments and documents as the Agent may
reasonably request.
(b) pursuant to Section 2.08 of the Agreement, the Total Revolving
Credit Commitment of the Borrower shall be and hereby is permanently reduced by
$20,000,000 so that after giving effect to such reduction the Total Revolving
Credit Commitment does not exceed $40,000,000.
6. Other Documents. All instruments and documents incident to the
consummation of the transactions contemplated hereby shall be satisfactory in
form and substance to the Agent and its counsel; the Agent shall have received
copies of all additional agreements, instruments and documents which it may
reasonably request in connection therewith, including evidence of the authority
of Borrower and the Material Subsidiaries to enter into the transactions
contemplated by this Amendment Agreement, such documents, when appropriate, to
be certified by appropriate corporate or governmental authorities; and all
proceedings of the Borrower and the Material Subsidiaries relating to the
matters provided for herein shall be satisfactory to the Agent and its counsel.
7. Entire Agreement. This Amendment Agreement sets forth the entire
understanding and agreement of the parties hereto in relation to the subject
matter hereof and supersedes any prior negotiations and agreements among the
parties relative to such subject matter. No promise, conditions, representation
or warranty, express or implied, not herein set forth shall bind any party
hereto, and no one of them has relied on any such promise, condition,
representation or warranty. Each of the parties hereto acknowledges that, except
as in this Amendment Agreement otherwise expressly stated, no representations,
warranties or commitments, express or implied, have been made by any other party
to the other. None of the terms or conditions of this Amendment Agreement may be
changed, modified, waived or canceled orally or otherwise, except by writing,
signed by all the parties hereto, specifying such change, modification, waiver
or cancellation of such terms or conditions, or of any proceeding or succeeding
breach thereof.
8. Full Force and Effect of Agreement. Except as hereby specifically
amended, modified or supplemented, the Agreement and all of the other Loan
Documents are hereby confirmed and ratified in all respects and shall remain in
full force and effect according to their respective terms.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment
Agreement to be duly executed by their duly authorized officers, all as of the
day and year first above written.
BORROWER:
SUNGLASS HUT INTERNATIONAL, INC.
WITNESS:
___________________________ By: ______________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
___________________________ Title: Senior Vice President-Finance
Chief Financial Officer and
Treasurer
GUARANTORS:
SUNGLASS HUT CORPORATION
SUNGLASS HUT TRADING CORPORATION
SUNSATIONS SUNGLASS COMPANY
SUNGLASS HUT REALTY CORPORATION
SUNGLASS HUT OF FLORIDA, INC.
SUNGLASS HUT ACQUISITION CORP.
IHS DISTRIBUTION CORP.
IHS PROCUREMENT CORP.
SUNGLASS HUT EYE X COMPANY
SHI SALES CORP.
SUNGLASS HUT HOLDINGS OF FRANCE, INC.
SUNGLASS HUT OF NORTHERN FRANCE, INC.
SUNGLASS HUT OF SOUTHERN FRANCE, INC.
By:
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
SUNGLASS HUT (U.K.) LIMITED
SUNGLASS WORLD HOLDING PTY LIMITED
SUNGLASS HUT OF FRANCE, S.A.
By:
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Director
SUNGLASS HUT AUSTRALIA PTY LIMITED
By:
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Authorized Signatory
NATIONSBANK, NATIONAL ASSOCIATION,
AS AGENT FOR THE LENDERS
By:
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
NATIONSBANK, NATIONAL ASSOCIATION,
as Lender
By:
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
ABN AMRO BANK N.V.
By:
Name:
Title:
By:
Name:
Title:
THE BANK OF NOVA SCOTIA
By:
Name:
Title:
CREDIT LYONNAIS NEW YORK BRANCH
By:
Name:
Title:
U.S. BANK, NATIONAL ASSOCIATION
(successor by merger to UNITED STATES
NATIONAL BANK
OF OREGON)
By:
Name:
Title:
LTCB TRUST COMPANY
By:
Name:
Title:
ACKNOWLEDGEMENT OF EXECUTION ON BEHALF OF
SUNGLASS HUT INTERNATIONAL, INC.
STATE OF GEORGIA
COUNTY OF ▇▇▇▇▇▇
Before me, the undersigned, a Notary Public in and for said County and
State on this 4th day of December, 1997 A.D., personally appeared ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, known to be the Senior Vice President-Finance, Chief Financial Officer
and Treasurer of Sunglass Hut International, Inc. (the "Borrower"), who, being
by me duly sworn, says he works at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇, and that by authority duly given by, and as the act of, the Borrower, the
foregoing and annexed Amendment Agreement dated December 3, 1997, was signed by
him as said Senior Vice President-Finance, Chief Financial Officer and Treasurer
on behalf of the Borrower.
Witness my hand and official seal this 4th day of December, 1997.
----------------------------------
Notary Public
(SEAL)
My commission expires: _______________
AFFIDAVIT OF _______________________
(Name of Affiant)
The undersigned, being first duly sworn, deposes and says that:
1. He is a _____ Vice President of NationsBank, National Association
and works at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇.
2. The Amendment Agreement of Sunglass Hut International, Inc. dated
December 3, 1997 was executed before him and delivered to him on behalf of the
Lenders on December 4, 1997.
This the 4th day of December, 1997.
-----------------------------------
(Signature of Affiant)
Acknowledgement of Execution
STATE OF GEORGIA
COUNTY OF ▇▇▇▇▇▇
Before me, the undersigned, a Notary Public in and for said County and
State on this 4th day of December, 1997 A.D., personally appeared
_______________________ who before me affixed his signature to the above
Affidavit.
Witness my hand and official seal this 4th day of December, 1997.
-----------------------------------
Notary Public
(SEAL)
My Commission Expires: ________________