EXHIBIT 10.26
FIRST AMENDMENT TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
This First Amendment to Amended and Restated Loan and Security
Agreement (the "First Amendment") is made as of this 22nd day of April, 2005 by
and among
Fleet Retail Group, Inc. f/k/a Fleet Retail Finance Inc. (the
"Lender"), a Delaware corporation with its principal executive offices at ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and
Aeropostale, Inc., (the "Borrower"), a Delaware corporation with its
principal executive offices at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
in consideration of the mutual covenants herein contained and benefits to be
derived here from.
W I T N E S S E T H:
WHEREAS, on October 7, 2003 the Lender and the Borrower entered into a
certain Amended and Restated Loan and Security Agreement (as amended and in
effect, the "Agreement"); and
WHEREAS, the Lender and the Borrower desire to modify certain
provisions of the Agreement as set forth herein.
NOW, THEREFORE, it is hereby agreed among the Lender and the Borrower
as follows:
1. Capitalized Terms. All capitalized terms used herein and not otherwise
defined shall have the same meaning herein as in the Agreement.
2. Amendments to Article 1. The provisions of Article 1 of the Agreement
are hereby amended as follows:
(a) by inserting the following new definitions in the appropriate
alphabetical order:
(i) "COMMITMENT INCREASE" is defined in Section 2-2.
(ii) "COMMITMENT INCREASE FEE" is defined in Section 2-12.
(iii) "FIRST AMENDMENT EFFECTIVE DATE" shall mean April 22,
2005.
(iv) "LENDER'S FEE" is defined in Section 2-24.
(b) the definition of "COMMITMENT" is hereby deleted in its
entirety, and the following substituted in its stead:
"COMMITMENT": Subject to the provisions of Sections 2-2 and
2-23 hereof, as of the First Amendment Effective Date, as
follows:
LENDER DOLLAR COMMITMENT COMMITMENT
PERCENTAGE
Fleet Retail Group, Inc. $50,000,000.00 100%
(c) The definition of "EURODOLLAR MARGIN" is hereby deleted in its
entirety, and the following substituted in its stead:
""EURODOLLAR MARGIN": Shall mean the following percentages
based upon the following performance criteria:
Level Trailing Twelve Month EBITDA Eurodollar Margin
I Greater than or equal to $90,000,000 0.75%
II Greater than or equal to $60,000,000 1.00%
and less than $90,000,000
III Less than $60,000,000 1.25%
The Eurodollar Margin shall be established at Level I, as of
the First Amendment Effective Date. Thereafter, the Eurodollar
Margin shall be adjusted quarterly after the Lender's receipt
and review of the financial statements required pursuant to
Section 5-7 and 5-8 hereof, such adjustment to take
retroactive effect as of the first day of each February, May,
August, and November, commencing May 1, 2005, based upon the
Borrower's trailing twelve month EBITDA calculated as of the
most recent quarter then ended. Upon the occurrence of an
Event of Default, at the option of the Lender, interest shall
be determined in the manner set forth in Section 2.10(f)."
(d) the definition of "LOAN CEILING" is hereby deleted in its
entirety, and the following substituted in its stead:
""LOAN CEILING": $50,000,000.00, subject to the provisions of
Section 2-2."
(e) the definition of "MATURITY DATE" is hereby deleted in its
entirety, and the following substituted in its stead:
""MATURITY DATE": April 22, 2010."
3. Amendment to Article 2. The provisions of Article 2 of the Agreement
are hereby amended as follows:
(a) Amendment to Section 2-2. The provisions of Section 2-2 are
hereby deleted in their entirety, and the following
substituted in their stead:
"2-2. Increase in Commitment
(a) The Borrower shall have the right at any
time, to request that the Lender increase the existing
Commitment by $5,000,000.00 increments, not exceeding in
the aggregate $25,000,000.00, provided, however, that after
giving effect to any and all such increases, the total
Commitment shall not exceed $75,000,000.00. Subject to the
satisfaction of the conditions set forth below, the Lender
shall increase its Commitment and the Loan Ceiling by the
amount so requested (any increase, singly, and in the
aggregate, the "Commitment Increase").
(b) Any Commitment Increase shall not become
effective unless and until each of the following conditions
have been satisfied:
(i) As of the date of the Borrower's
request for any Commitment Increase and as of
the effective date of any Commitment Increase,
no Event of Default shall exist or shall
thereafter arise as a result of the Commitment
Increase;
(ii) The Borrower shall have paid such
reasonable fees and expenses actually incurred
by the Lender in connection with any Commitment
Increase, including, without limitation, the
Commitment Increase Fee, and reasonable
attorneys' fees and expenses;
(iii) The Borrower shall have delivered
to the Lender an opinion, in form previously
delivered to the Lender, from counsel to the
Borrower reasonably satisfactory to the Lender
and dated such date;
(iv) The Borrower shall have delivered
to Lender a blocked account agreement with
Citibank, N.A., or any subsequent financial
institution in which the Borrower's credit card
receipts are concentrated, in form and substance
reasonably satisfactory to Lender; and
(v) The Borrower shall have delivered
such other instruments, documents and agreements
as the Lender may reasonably have requested in
order to effectuate any Commitment Increase and
to ratify and confirm the security interests
granted to the Lender pursuant to the Loan
Documents.
The Lender shall promptly notify the Borrower as to
the effectiveness of each Commitment Increase, and at such
time (i) the Commitment and Loan Ceiling hereunder, and for
all purposes of, this Agreement shall be increased by the
amount of the Commitment Increase, (ii) the definitions of
Commitment and Loan Ceiling shall be deemed modified, without
further action, to reflect the Commitment Increase, and (iii)
this Agreement shall be deemed amended, without further
action, to the extent necessary to reflect the Commitment
Increase."
(b) Amendment to Section 2-9(c). The reference in Section 2-9(c)
to Section 7-5(b)(v) is hereby deleted and the following
section reference is inserted in lieu thereof:
"Section 7-5(c)"
(c) Amendment to Section 2-12. The provisions of Section 2-12 are
hereby deleted in their entirety, and the following
substituted in their stead:
"2-12. Commitment Increase Fee. As compensation for
the Lender to make a Commitment Increase pursuant to the
provisions of Section 2-2 above, and as compensation for the
Lender's maintenance of sufficient funds available for such
purpose, the Lender shall have earned a COMMITMENT INCREASE
FEE (so referred to herein) in an amount equal to 0.10% of
each Commitment Increase."
(d) Amendment to Section 2-13. The provisions of Section 2-13 are
hereby deleted in their entirety, and the following
substituted in their stead:
"2-13. Line (Unused) Fee. Upon the effectiveness of
any Commitment Increase pursuant to the provisions of Section
2-2 above, and in addition to any other fee paid by Borrower
on account of the Revolving Credit, the Borrower shall pay the
Lender an LINE (UNUSED) FEE (so referred to herein) in
arrears, on the first day of each month, commencing with the
first month immediately following the month in which any
Commitment Increase became effective (and on the Termination
Date). The Line (Unused) Fee shall be equal to 0.20% per annum
of the difference during the month just
ended (or relevant period with respect to the payment being
made on the Termination Date) between the Commitment Increase
and the average unused portion of the Commitment Increase
(including, for purposes hereof, the average Stated Amount of
Outstanding L/Cs issued pursuant to the Commitment Increase
during such period) during such period."
(e) Amendment to Section 2-15. The provisions of Section 2-15 are
hereby deleted in their entirety, and the following
substituted in their stead:
"2-15. Concerning Fees. The Borrower shall not be
entitled to any credit, rebate or repayment of the
Commitment Fee, Line (Unused) Fee, Early Termination
Fee, Lender's Fee, Commitment Increase Fee, or other
fee previously earned by the Lender pursuant to this
Agreement notwithstanding any termination of this
Agreement or suspension or termination of the
Lender's obligation to make loans and advances
hereunder."
(f) Insertion of Section 2-24. Section 2-24 is hereby deleted in
its entirety, and the following substituted in its stead:
"2-24. Lender's Fee. The Borrower shall pay Lender a
LENDER'S FEE (so referred to herein) in the amount of
$25,000.00 per annum, which shall be payable by the
Borrower annually in advance on the First Amendment
Effective Date, and on each anniversary of the First
Amendment Effective Date thereafter until the
Termination Date. Each such Lender's Fee shall be
fully earned as of the date paid."
4. Amendment to Article 5. The provisions of Article 5 of the Agreement
are hereby amended as follows:
(a) Amendment to Section 5-6. The provisions of Section 5-6 are
hereby deleted in their entirety, and the following is
inserted in their place:
"5-6. Intentionally Omitted."
(b) Amendment to Section 5-7. The provisions of Section 5-7 are
hereby deleted in their entirety, and the following is
inserted in their place:
"5-7. Quarterly Reports. Within forty-five (45)
days following the end of each of the Borrower's fiscal quarters, the Borrower
shall provide the Lender with original counterparts of an internally prepared
financial statement of the Borrower's and AWI's financial condition and the
results of their respective operations for, the period ending with the end of
the subject quarter, which financial statement shall include, at a minimum, a
balance sheet, income statement (on a "consolidated" basis), cash flow and
comparison of same store sales for the corresponding quarter of the then
immediately previous year, as well as to the Business Plan, and Management's
analysis and discussion of the operating results reflected therein. The delivery
to the Lender of the Borrower's Form 10Q or Form 10K, as the case may be, which
is filed with the Securities and Exchange Commission shall satisfy the
Borrower's obligations under this Section 5-7."
(c) Amendment to Section 5-9. The provisions of Section 5-9 are
hereby deleted in their entirety, and the following is
inserted in their place:
"5-9. Intentionally Omitted."
5. Amendment to Article 7. The reference in Section 7-5(c) to
Section 2-8(e) is hereby deleted and the following section reference is
inserted in lieu thereof:
"Section 2-7(e)"
6. Amendment to Article 12. The notice address of the Borrower and its
counsel in Section 12-1 is hereby deleted and the following is inserted
in lieu thereof:
"If to the Borrower:
Aeropostale, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, VP and
Treasurer
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esquire
General Counsel
Aeropostale, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇"
7. Ratification of Loan Documents. Except as provided herein, all terms
and conditions of the Agreement and the other Loan Documents remain in
full force and effect. The Borrower hereby ratifies, confirms, and
reaffirms all representations, warranties, and covenants contained
therein and hereby represents that no Events of Default exist under the
Loan Documents. The Borrower hereby represents and confirms that there
has been no change to Exhibit 4-6 and Exhibit 4-7 of the Agreement. The
Borrower further ratifies and confirms that any and all Collateral
previously granted to the Lender continues to secure the existing
Liabilities as well as the Liabilities as amended hereby, and any
future Liabilities.
8. Ratification of the Exhibits. The Borrower shall ratify, confirm, and
reaffirm all representations, warranties, and covenants contained in
any and all exhibits within ninety (90) days of the First Amendment
Effective Date. At that time, should any of the information on any of
the exhibits to the Agreement have become inaccurate in any respect,
the Borrower shall promptly advise the Lender in writing with such
revisions or updates as may be necessary or appropriate to update or
correct the same and, subject to the proviso hereto, such exhibits and
the corresponding representations, warranties and covenants shall be
deemed to be amended to reflect such revisions or updates; provided
however that no such exhibit shall be deemed to have been amended,
modified or superseded by any such correction or update, nor shall any
breach of representation or warranty resulting from any inaccuracy or
incompleteness of such exhibit be deemed to have been cured or waived,
unless and until the Lender, in its sole discretion, shall have
accepted in writing such revisions.
9. Conditions to Effectiveness. This First Amendment shall become
effective upon the satisfaction of the following conditions precedent:
(a) This First Amendment shall have been duly executed and delivered
by the Borrower and the Lender and shall be in full force and
effect. The Lender shall have received a fully executed copy of
this Amendment.
(b) All proceedings in connection with the transactions contemplated
by this First Amendment and all documents incident thereto shall
be reasonably satisfactory in substance and form to the Lender,
and the Lender shall have received all information and such
counterpart originals or certified or other copies of such
documents as the Lender may reasonably request.
(c) The Borrower shall have paid all reasonable costs and expenses
of the Lender including, without limitation, all reasonable
attorneys' fees and expenses actually incurred by the Lender in
connection with the preparation, negotiation and execution of
this First Amendment.
10. Miscellaneous.
(a) This First Amendment may be executed in several
counterparts and by each party on a separate counterpart, each
of which when so executed and delivered shall be an original,
and all of which together shall constitute one instrument.
(b) This First Amendment expresses the entire
understanding of the parties with respect to the transactions
contemplated hereby. No prior negotiations or discussions shall
limit, modify, or otherwise affect the provisions hereof.
(c) Any determination that any provision of this First
Amendment or any application hereof is invalid, illegal or
unenforceable in any respect and in any instance shall not
effect the validity, legality, or enforceability of such
provision in any other instance, or the validity, legality or
enforceability of any other provisions of this First Amendment.
(d) The Borrower warrants and represents that the
Borrower has consulted with independent legal counsel of the
Borrower's selection in connection with this First Amendment and
is not relying on any representations or warranties of the
Lender or its counsel in entering into this First Amendment.
(e) The Borrower acknowledges and agrees that the
Borrower does not have any claims, counterclaims, offsets, or
defenses against the Lender directly or indirectly relating to
the Borrower's relationship with the Lender, and/or the
Borrower's Liabilities, and to the extent that the Borrower has
or ever had any such claims, counterclaims, offsets, or defenses
against the Lender, the Borrower affirmatively WAIVES the same.
The Borrower, and for its representatives, successors and
assigns, hereby RELEASES, and forever discharges the Lender and
its officers, directors, agents, servants, attorneys, and
employees, and its respective representatives, successors and
assigns, of, to, and from all known debts, demands, actions,
suits, accounts, covenants, contracts, agreements, damages, and
any and all claims, demands, or liabilities whatsoever, of every
name and nature, both at law and in equity through the date
hereof.
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IN WITNESS WHEREOF, the parties have hereunto caused this First
Amendment to be executed and their seals to be hereto affixed as of the date
first above written.
AEROPOSTALE, INC.
("Borrower")
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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Title: EVP and Chief Financial Officer
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FLEET RETAIL GROUP, INC.
("Lender")
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title: Vice President
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