EXHIBIT 10.1
NINTH AMENDMENT TO LOAN AND SECURITY AGREEMENT
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THIS NINTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this "Amendment") is
made and entered into this 12th day of April, 2001, by and among TROPICAL
SPORSTWEAR INT'L CORPORATION, a Florida corporation ("Tropical"), TROPICAL
SPORTSWEAR COMPANY, INC., a Delaware corporation ("TSCI"), SAVANE INTERNATIONAL
CORP., a Texas corporation (formerly known as Farah Incorporated) ("Savane"),
APPAREL NETWORK CORPORATION, a Florida corporation ("Apparel"), TSI BRANDS,
INC., a Delaware corporation ("TSI"), and TSIL, INC., a Delaware corporation
("TSIL") (Tropical, TSCI, Savane, Apparel, TSI and TSIL collectively referred to
hereinafter as "Borrowers" and individually as a "Borrower"), each with its
chief executive office and principal place of business at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇; the various financial institutions listed on
the signature pages hereof and their respective successors and permitted assigns
which become "Lenders" as provided in the Loan Agreement (as defined below); and
FLEET CAPITAL CORPORATION, a Rhode Island corporation, in its capacity as
collateral and administrative agent for the Lenders (together with its
successors in such capacity, "Agent") with an office at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
▇.▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇.
Recitals:
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Borrowers, Agent and Lenders, are parties to a certain Loan and Security
Agreement dated June 10, 1998, as amended by that certain First Amendment to
Loan and Security Agreement dated July 9, 1998, that certain Second Amendment to
Loan and Security Agreement dated August 27, 1998, that certain Third Amendment
to Loan and Security Agreement dated December 31, 1998, that certain Fourth
Amendment to Loan and Security Agreement dated May 21, 1999, that certain Fifth
Amendment to Loan and Security Agreement dated July 16, 1999, that certain Sixth
Amendment to Loan and Security Agreement dated October 28, 1999, that certain
Seventh Amendment to Loan and Security Agreement dated November 12, 1999, and
that certain Eighth Amendment to Loan and Security Agreement dated January 19,
1999 (as at any time amended, the "Loan Agreement"), pursuant to which Lenders
have made certain revolving credit loans and letter of credit accommodations to
Borrowers.
Borrowers have requested that Agent and Lenders amend the terms of the Loan
Agreement to, among other things, modify the applicable interest rate. Agent and
Lenders are willing to amend the Loan Agreement on the terms and conditions as
hereinafter set forth.
NOW, THEREFORE, for TEN DOLLARS ($10.00) in hand paid and other good and
valuable consideration, the receipt and sufficiency of which are hereby
severally acknowledged, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. Definitions. All capitalized terms used in this Amendment, unless
otherwise defined herein, shall have the meaning ascribed to such terms in the
Loan Agreement.
2. Amendments to Loan Agreement. The Loan Agreement is hereby amended as
follows:
(a) By deleting in Section 1 of the Loan Agreement the definitions of
"Applicable Margin," "Consolidated Fixed Charge Coverage" and "Funded Debt" and
by substituting the following new definitions in lieu thereof:
Applicable Margin - a percentage equal to (i) 1.25% with respect to LIBOR
Loans, (ii) 0% with respect to Base Rate Loans and (iii) .250% with respect to
the Unused Line Fee; provided that, commencing March 31, 2001, if there exists
no Default or Event of Default, then the Applicable Margin shall be increased or
decreased, based upon the Consolidated Funded Debt/Consolidated EBITDA ratio, as
follows:
Applicable
Margin for
Applicable Margin Applicable Margin Unused Line
Ratio for Base Rate Loans for LIBOR Loans Fee
----- ------------------- --------------- ------------
(i) If the Consolidated Funded .75% 2.25% .375%
Debt/Consolidated EBITDA
ratio is greater than 4.50 to 1
(ii) If the Consolidated Funded .50% 2.00% .375%
Debt/ Consolidated EBITDA
ratio is greater than or equal
to 4.0 to 1 but less than
4.50 to 1
(iii) If the Consolidated Funded .25% 1.75% .375%
Debt/ Consolidated EBITDA
ratio is greater than or equal
to 3.50 to 1 but less than
4.0 to 1
(iv) If the Consolidated Funded 0% 1.50% .250%
Debt/ Consolidated EBITDA
ratio is greater than or equal
to 3.0 to 1 but less than
3.50 to 1
(v) If the Consolidated Funded 0% 1.25% .250%
Debt/ Consolidated EBITDA
ratio is less than 3.0 to 1
The Applicable Margin shall be subject to reduction or increase, as
applicable and as set forth in the table above, on a quarterly basis according
to the performance of Borrowers as measured by the Consolidated Funded
Debt/Consolidated EBITDA ratio based upon the immediately preceding 4 Fiscal
Quarters of Borrowers. Except as set forth in the last sentence hereof, any such
increase or reduction in the Applicable Margin provided for herein shall be
effective 3 Business Days after receipt by Agent of the applicable financial
statements and corresponding Compliance Certificate. If the financial statements
and the Compliance Certificate of Borrowers setting forth the Consolidated
Funded Debt/Consolidated EBITDA ratio are not received by Agent by the date
required pursuant to Section 10.1.3 of this Agreement, the Applicable Margin
shall be deemed to be increased to the next highest Applicable Margin, until
such time as such financial statements and Compliance Certificate are received
and any Event of Default resulting from a failure timely to deliver such
financial statements or Compliance Certificate is waived in writing by Agent and
Lenders; provided, however, that nothing herein shall be deemed to prevent Agent
and Lenders from charging interest at the Default Rate for so long as an Event
of Default exists. For example, if the Applicable Margin in effect on such date
is as set forth in item (iii) above, then the Applicable Margin arising from
Borrowers' failure to deliver financial statements and the Compliance
Certificate shall be deemed to be the Applicable Margin set forth in item (ii)
above. For the final Fiscal Quarter of any Fiscal Year of Borrowers, Borrowers
may provide the unaudited financial statements of Borrowers, subject only to
year-end adjustments, for the purpose of determining the Applicable Margin;
provided, however, that if, upon delivery of the annual audited financial
statements required to be submitted by Borrowers to Agent pursuant to Section
10.1.3(i) of this Agreement, Borrowers have not met the criteria for reduction
of the Applicable Margin pursuant to the terms hereinabove for the final Fiscal
Quarter of the Fiscal Year of Borrowers then ended, then (a) such Applicable
Margin reduction shall be terminated and, effective on the first day of the
month following receipt by Agent of such audited financial statements, the
Applicable Margin shall be the Applicable Margin that would have been in effect
if such reduction had not been implemented based upon the unaudited financial
statements of Borrowers for the final Fiscal Quarter of the Fiscal Year of
Borrowers then ended, and (b) Borrowers shall pay to Agent, for the Pro Rata
benefit of the Lenders, on the first day of the month following receipt by Agent
of such audited financial statements, an amount equal to the difference between
the amount of interest that would have been paid on the principal amount of the
Obligations using the Applicable Margin determined based upon such audited
financial statements and the amount of interest actually paid during the period
in which the reduction of the Applicable Margin was in effect based upon the
unaudited financial statements for the final Fiscal Quarter of the Fiscal Year
of Borrowers then ended.
Consolidated Fixed Charge Coverage - with respect to any fiscal period, the
ratio of (a) Consolidated EBITDA minus income taxes for such period to (b) the
sum of all Consolidated Fixed Charges for such period.
Funded Debt - all Debt for Money Borrowed which would, in accordance with
GAAP, constitute long term debt, including (a) any Debt with a maturity more
than one year after the creation thereof and (b) any Debt for Money Borrowed
which is renewable or extendable at the option of a Borrower for a period of
more than one year from the date of creation of such Debt for Money Borrowed,
including the Revolver Loans.
(b) By deleting Section 10.3.1 of the Loan Agreement in its entirety and by
substituting the following new Section 10.3.1 in lieu thereof:
10.3.1. Reserved.
3. Reserved.
4. Acknowledgments and Stipulations. Each Borrower acknowledges and
stipulates that the Loan Agreement and the other Loan Documents executed by such
Borrower are legal, valid and binding obligations of such Borrower that are
enforceable against such Borrower in accordance with the terms thereof; all of
the Obligations are owing and payable without defense, offset or counterclaim
(and to the extent there exists any such defense, offset or counterclaim on the
date hereof, the same is hereby waived by each Borrower); the security interests
and liens granted by each Borrower in favor of Agent are duly perfected, first
priority security interests and liens.
5. Representations and Warranties. Each Borrower represents and warrants to
Agent and Lenders, to induce Agent and Lenders to enter into this Amendment,
that no Default or Event of Default exists on the date hereof; the execution,
delivery and performance of this Amendment have been duly authorized by all
requisite corporate action on the part of such Borrower and this Amendment has
been duly executed and delivered by such Borrowers; and all of the
representations and warranties made by Borrowers in the Loan Agreement are true
and correct on and as of the date hereof, except to the extent any
representation or warranty specifically relates to an earlier date.
6. Reference to Loan Agreement. Upon the effectiveness of this Amendment,
each reference in the Loan Agreement to "this Agreement," "hereunder," or words
of like import shall mean and be a reference to the Loan Agreement, as amended
by this Amendment.
7. Breach of Amendment. This Amendment shall be part of the Loan Agreement
and a breach of any of any representation, warranty or covenant herein shall
constitute an Event of Default.
8. Expenses of Agent. Borrowers jointly and severally agree to pay, on
demand, all costs and expenses incurred by Agent in connection with the
preparation, negotiation and execution of this Amendment and any other Loan
Documents executed pursuant hereto and any and all amendments, modifications,
and supplements thereto, including, without limitation, the reasonable costs and
fees of Agent's legal counsel and any taxes or expenses associated with or
incurred in connection with any instrument or agreement referred to herein or
contemplated hereby.
9. Effectiveness; Governing Law. This Amendment shall be effective upon
acceptance by Agent and Lenders in Atlanta, Georgia (notice of which acceptance
is hereby waived), whereupon the same shall be governed by and construed in
accordance with the internal laws of the State of Georgia.
10. Successors and Assigns. This Amendment shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
assigns.
11. No Novation, etc.. Except as otherwise expressly provided in this
Amendment, nothing herein shall be deemed to amend or modify any provision of
the Loan Agreement or any of the other Loan Documents, each of which shall
remain in full force and effect. This Amendment is not intended to be, nor shall
it be construed to create, a novation or accord and satisfaction, and the Loan
Agreement as herein modified shall continue in full force and effect.
12. Counterparts; Telecopied Signatures. This Amendment may be executed in
any number of counterparts and by different parties to this Agreement on
separate counterparts, each of which, when so executed, shall be deemed an
original, but all such counterparts shall constitute one and the same agreement.
Any signature delivered by a party by facsimile transmission shall be deemed to
be an original signature hereto.
13. Further Assurances. Each Borrower agrees to take such further actions
as Agent and Lenders shall reasonably request from time to time in connection
herewith to evidence or give effect to the amendments set forth herein or any of
the transactions contemplated hereby.
14. Section Titles. Section titles and references used in this Amendment
shall be without substantive meaning or content of any kind whatsoever and are
not a part of the agreements among the parties hereto.
15. Release of Claims. To induce Agent and Lenders to enter into this
Amendment, each Borrower hereby release, acquits and forever discharges Agent
and Lenders, and all officers, directors, agents, employees, successors and
assigns of Agent and Lenders, from any and all liabilities, claims, demands,
actions or causes or actions of any kind or nature (if there be any), whether
absolute or contingent, disputed or undisputed, at law or in equity, or known or
unknown, that such Borrower now has or ever had against Agent and Lenders
arising under or in connection with any of the Loan Documents or otherwise.
16. Waiver of Jury Trial. To the fullest extent permitted by applicable
law, the parties hereto each hereby waives the right to trial by jury in any
action, suit, counterclaim or proceeding arising out of or related to this
Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed under seal and delivered by their respective duly authorized
officers on the date first written above.
BORROWERS:
ATTEST: TROPICAL SPORTSWEAR INT'L CORPORATION
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ N. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Assistant Secretary Title: Executive Vice President
[CORPORATE SEAL]
ATTEST: TROPICAL SPORTSWEAR COMPANY, INC.
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ N. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Assistant Secretary Title: Vice President
[CORPORATE SEAL]
ATTEST: SAVANE INTERNATIONAL CORP.
(f/k/a Farah Incorporated)
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ N. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Assistant Secretary Title: Executive Vice President
[CORPORATE SEAL]
ATTEST: APPAREL NETWORK CORPORATION
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ N. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Assistant Secretary Title: Executive Vice President
[CORPORATE SEAL]
ATTEST: TSI BRANDS, INC.
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ N. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Assistant Secretary Title: Vice President
[CORPORATE SEAL]
ATTEST: TSIL, INC.
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ N. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Assistant Secretary Title: Vice President
[CORPORATE SEAL]
LENDERS:
FLEET CAPITAL CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
GMAC COMMERCIAL CREDIT LLC
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Executive Vice President
FIRST UNION NATIONAL BANK
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
BANK OF AMERICA, N.A.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
AGENT:
FLEET CAPITAL CORPORATION, as Agent
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
