EXECUTION
COPY
SIXTH AMENDMENT dated as of July 1, 2000 (the "Amendment") to
REVOLVING CREDIT AGREEMENT dated as of June 2, 1997 ( as amended through the
date hereof, the "Credit Agreement") between ▇▇▇▇▇▇ ▇▇▇ MARKETING, INC. (the
"Borrower") and THE CIT GROUP/COMMERCIAL SERVICES, INC. ("CIT"). Terms which are
capitalized in this Amendment and not otherwise defined shall have the meanings
ascribed to them in the Credit Agreement.
WHEREAS, the Borrower and Liz Claiborne, Inc., a Delaware
corporation ("Claiborne") entered into a Purchase Agreement dated as of February
15, 2000 (the "Claiborne Purchase Agreement"), pursuant to which (i) Claiborne
sold to the Borrower certain assets of Claiborne and (ii) the Borrower assumed
certain obligations of Claiborne, all on the terms and subject to the conditions
contained in the Claiborne Purchase Agreement;
WHEREAS, the Borrower, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc., a New York
corporation ("Steffe"), and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, each
individually, entered into an Asset Purchase Agreement dated April 18, 2000 (the
"Steffe Purchase Agreement"), pursuant to which: (i) Steffe sold to the Borrower
substantially all of the assets of Steffe used in its business of manufacturing
womens' apparel and (ii) the Borrower assumed certain of the obligations of
Steffe, all on the terms and subject to the conditions contained in the Steffe
Purchase Agreement;
WHEREAS, in connection with the transactions hereinabove
described, the Borrower has requested CIT's consent to an increase in the amount
of the Revolving Credit Commitment and to the modification of various terms and
provisions contained in the Credit Agreement;
WHEREAS, CIT has agreed to increase the amount of the
Revolving Credit Commitment and to make such modifications to the Credit
Agreement, all on the terms and subject to the satisfaction of the conditions
contained in this Amendment;
NOW, THEREFORE, in consideration of the mutual promises
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
SECTION ONE AMENDMENT OF CREDIT AGREEMENT. Upon the satisfaction of the
conditions contained in Section Two hereof, effective as of the date hereof, the
Credit Agreement is hereby amended to provide as follows:
(A) Section 1.01. Certain Definitions.
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(i) The definition of the term Revolving Credit Commitment is
deleted in its entirety, the following is substituted in lieu thereof, and the
terms set forth below, and the definitions thereof, are added to Section 1.01 in
the appropriate alphabetical order, as follows:
"Claiborne" shall mean Liz Claiborne, Inc., a Delaware
corporation, and its successors and assigns.
"Claiborne Licensed Marks" shall mean, collectively, the
following trademarks: "Liz Claiborne Dresses," "Liz
Claiborne Petites Dresses," "Elisabeth Dresses" and
"Elisabeth Petites Dresses" and such additional
trademarks and trade names as may be used by the Borrower
from time to time pursuant to a license from ▇▇▇▇▇▇▇▇▇,
▇.▇. Licensing or any of their Affiliates.
"Claiborne Purchase Agreement" shall mean the Purchase
Agreement, dated as of February 15, 2000, between the
Borrower and Liz Claiborne, Inc.
"Steffe Acquisition" shall mean the acquisition by the
Borrower of substantially all of the assets of Steffe
used in its business of manufacturing womens' apparel,
all as more fully set forth in the Steffe Purchase
Agreement.
"Steffe Purchase Agreement" shall mean the Asset Purchase
Agreement, dated April 18, 2000, among the Borrower,
Steffe, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇.
"L.C. Licensing" shall mean L.C. Licensing, Inc., a
Delaware corporation, and its successors and assigns.
"Revolving Credit Commitment" shall mean the commitment
of CIT to make Loans to the Borrower pursuant to Section
2.01(a) hereof in an aggregate principal amount not to
exceed $52,000,000 at any time, as such amount may be
reduced pursuant to the terms of this Agreement.
"Steffe" shall mean ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc., a New York
corporation, and its successors and assigns.
"Steffe Licensed Marks" shall mean, collectively, all of
the "Licensed Marks" as defined in the Licensing
Agreement, dated as of May 10, 2000, by and between
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and the Borrower, and such additional
trademarks and tradenames as may be used by the Borrower
from time to time pursuant to a license from ▇▇▇▇▇▇▇
▇▇▇▇▇▇, Steffe or any of their Affiliates.
(ii) Clause (x) of the definition of Eligible Accounts Receivable
is deleted in its entirety, and the following is substituted in lieu thereof:
"(x) the Account Debtor with respect thereto is not (A)
also a supplier to or creditor of the Borrower or any
other Obligor (excluding Account Debtors that are
creditors solely as a result of
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chargebacks in the ordinary course of business), or (B)
▇▇▇▇▇▇▇▇▇, ▇.▇. Licensing, or any of their respective
Affiliates, unless any such Account Debtor described in
clause (A) or (B) hereof has duly executed and delivered
to CIT a letter, satisfactory to CIT, pursuant to which
such Account Debtor waives its rights of set-off;"
(iii) The definition of Eligible Accounts Receivable is further
amended by (A) deleting the word "and" after clause (xii) thereof, (B) deleting
the period at the end of clause (xiii) thereof and substituting in lieu thereof
a semi-colon and the word "and" and (C) inserting the following clause (xiv)
immediately after clause (xiii) thereof:
"(iv) such Account Receivable did not arise in connection
with the sale of Inventory (A) containing any of the
Claiborne Licensed Marks or Steffe Licensed Marks or (B)
shipped from a location leased and/or controlled by
▇▇▇▇▇▇▇▇▇, ▇.▇. Licensing, Steffe or any of their
respective Affiliates, unless ▇▇▇▇▇▇▇▇▇, ▇.▇. Licensing
or Steffe, as the case may be, has duly executed and
delivered to CIT a letter, satisfactory to CIT, pursuant
to which such Person has agreed that, in the event such
Person receives any proceeds of such Accounts Receivable,
such Person will promptly remit such proceeds to CIT."
(iv) Clause (vii) of the definition of Eligible Inventory is
deleted in its entirety, and the following is substituted in lieu thereof:
"(vii) in the case of finished goods Inventory sold under
or containing a licensed trademark (including, without
limitation, the Claiborne Licensed Marks and the Steffe
Licensed Marks), CIT and the licensor of such trademark
(including, without limitation, L.C. Licensing, in the
case of the Claiborne Licensed Marks, and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
in the case of the Steffe Licensed Marks) shall have
entered into an agreement, in form and substance
satisfactory to CIT, with respect to the rights of CIT to
sell or otherwise dispose of such Inventory;"
(v) The definition of Eligible Inventory is further amended by (A)
deleting the word "and" after clause (viii) thereof, (B) deleting the period at
the end of clause (ix) thereof and substituting in lieu thereof a semi-colon and
the word "and" and (C) inserting the following clause (x) immediately after
clause (ix) thereof:
"(x) in the case of Inventory located at any premises
leased and/or controlled by Claiborne or Steffe or any of
their respective agents or Affiliates, CIT and Claiborne
or Steffe, or such agent or Affiliate, as the case may
be, and, if such premises are leased or sub-leased to
Claiborne or Steffe, or such agent or Affiliate, CIT and
the lessor of such premises, shall have entered into one
or
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more agreements, in form and substance satisfactory to
CIT, pursuant to which Claiborne, Steffe, such agent,
such Affiliate, and/or such lessor, as the case may be,
acknowledges the first priority security interest of CIT
in such Inventory, agrees to waive or subordinate to
CIT's security interest (which subordination shall
include provisions for a prohibition on the exercise by
Claiborne, Steffe, such agent, such Affiliate, and/or
such lessor, as the case may be, of its remedies and a
waiver of its right to require marshaling) any and all
claims such Person may, at any time, have against such
Inventory, whether for processing, storage or otherwise,
agrees to permit CIT access to, and the right to remain
on, such premises, for such period of time as CIT
determines is necessary or desirable, so as to exercise
CIT's rights and remedies and otherwise deal with such
Inventory, agrees not to commingle such Inventory with
any other property, and in the case of any Person who at
any time has custody, control or possession of any bills
of lading or other documents of title with respect to
such Inventory, agrees to hold such bills of lading or
other documents as bailee for CIT and to follow all
instructions of CIT with respect thereto."
(B) SECTION 3.01. LETTERS OF CREDIT. Section 3.01 (a)(i) is amended
by deleting the first two sentences thereof, and by substituting the following
in lieu thereof:
"No documentary Letter of Credit may have a tenor of more
than 90 days from the date of issuance, and no standby
Letter of Credit may have a tenor of more than 365 days
from date of issuance, provided, however, that no Letter
of Credit may have a final expiry date which is later
than five Business Days before the applicable Maturity
Date, unless it is cash collateralized in a manner
satisfactory to CIT, and provided, further, that one or
more documentary Letters of Credit, to be issued in
connection with transactions between the Borrower and
suppliers, vendors or contractors that deal with
inventory which bears a Claiborne Licensed ▇▇▇▇, having
an aggregate maximum amount available to be drawn
thereunder not in excess of $5,000,000 at any time, may
be issued with tenors of more than 90 days, but in no
event more than 180 days. The aggregate Letter of Credit
Exposure shall not exceed $30,000,000, of which not more
than $5,000,000 may be Letter of Credit Exposure with
respect to Standby Letters of Credit; provided, however,
that the calculation of such $5,000,000 limit shall
exclude the Letter of Credit Exposure with respect to the
"▇▇▇▇▇▇ Apparel Stand-by L/C", as such term is defined in
Section Three of the Third Amendment, dated as of October
27, 1998, to this Agreement."
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(C) SECTION 10.05. LOANS, ADVANCES AND INVESTMENTS. Section 10.05
is amended by (A) deleting clause (a) thereof and substituting the following in
lieu thereof, (B) deleting the word "and" after clause (d) thereof, (C) deleting
the period at the end of clause (e) thereof and substituting in lieu thereof a
semi-colon and the word "and" and (D) inserting the following clause (f)
immediately after clause (e) thereof:
"(a) loans to the Parent, all of the proceeds of which
are lent simultaneously by the Parent to ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ and to each of the Designated Officers (each,
including ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, a "senior manager") in the
following original principal amounts: (I) ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
- $1,176,666, (II) ▇▇▇▇ ▇▇▇▇ - $1,115,521, (III) ▇▇▇▇▇▇
▇▇▇▇▇▇▇ - $675,963 and (IV) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ -
$675,963, provided that (i) the proceeds of such loans by
the Parent to each of the Designated Officers (each a
"stock acquisition loan") are used to fund the
acquisition of shares of capital stock of the Parent,
(ii) such shares shall be owned or controlled,
beneficially and of record, by the senior manager to whom
such stock acquisition loan shall be made, (iii) on the
date any such stock acquisition loan is made, no Event of
Default, or event which with notice and/or passage of
time would constitute an Event of Default, shall have
occurred and be continuing, and (iv) concurrently with
the making of such stock acquisition loan, the shares of
capital stock of the Parent acquired with the proceeds
thereof shall be pledged and assigned to the Parent as
collateral security for the repayment of such stock
acquisition loan, and the Parent shall pledge and assign
to CIT, and deliver to CIT, the promissory note
evidencing the indebtedness incurred by the applicable
senior manager in connection with such stock acquisition
loan, together with the stock certificates evidencing
such shares of stock, as collateral security for all
obligations, liabilities and indebtedness of the Parent
to CIT arising under the Guaranty executed by the Parent,
dated as of June 2, 1997, as amended, in favor of CIT (it
being understood that to the extent that the shares of
capital stock so acquired are subsequently sold or
transferred for cash and a portion of the proceeds of
such stock are remitted to the Borrower in accordance
with the applicable stock acquisition loan to repay the
principal of the loan from the Borrower to the Parent,
the proceeds of which were used to fund such stock
acquisition loan, CIT shall promptly release its lien on
and security interest in the Parent's security interest
in the shares of capital stock so sold or transferred);"
"(f) a loan made to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, or to her and her
husband, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, jointly, in a principal amount
not to exceed the original principal amount of that
certain promissory note payable to the order of the
Borrower executed by one or both of such individuals,
dated on or about May 10, 2000 (the "Steffe Closing
5
Date"), provided, that (i) the interest rate applicable
to such loan shall at all times be equal to the
applicable federal funds rate; (ii) the payment of all
outstanding principal of, and interest accrued on, such
loan shall become due no later than the tenth (10th)
anniversary of the Steffe Closing Date; (iii) amounts
repaid with respect to such loan may not be reborrowed,
(iv) the terms of such loan shall provide that it shall
be immediately due and payable upon the termination of
▇▇▇▇▇▇▇ ▇▇▇▇▇▇'▇ employment with the Borrower; (v) on the
date such loan is made, no Event of Default, or event
which with notice and/or passage of time would constitute
an Event of Default, shall have occurred and be
continuing; and (vi) the terms of such loan shall require
that (A) the entire amount of any severance payment due
under any employment agreements or contracts entered into
between the Borrower and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and/or ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ or (B) the amount of any distribution (to the
extent required pursuant to the applicable document or
agreement executed in connection with the Steffe Purchase
Agreement, as in effect on the date of execution thereof)
from any profit-sharing or other retirement or similar
benefit plans of the Borrower or any of its Affiliates,
in which ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ or ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ participates,
or to which either of them is entitled to the benefits,
be applied first, to pay in full all then outstanding
principal and interest on such loan."
(D) SECTION 10.06. DIVIDENDS AND RELATED DISTRIBUTIONS. Section
10.06 is deleted in its entirety, and the following is substituted in lieu
thereof:
"10.06. The Borrower shall not declare, make, pay or
agree to pay, any dividend or other distribution of any
nature (whether in cash, property, securities or
otherwise) on account of or in respect of shares of its
capital stock or on account of the purchase, redemption,
retirement or acquisition of any shares of capital stock
(or warrants, options or rights therefor), provided,
however, that, in addition to amounts paid by the
Borrower on or prior to the Fifth Amendment Closing Date
as dividends or to repurchase stock, the Borrower shall
be permitted to declare and pay dividends or repurchase
stock so long as the amount to be declared and paid as a
dividend or the amount to be paid to repurchase stock, as
the case may be, together with all such amounts
theretofore paid after the Fifth Amendment Closing Date,
shall not exceed, in the aggregate, the sum of $2,000,000
plus, if and to the extent that the Net Income of the
Parent, calculated on a cumulative basis for the period
commencing with the fiscal quarter during which the Fifth
Amendment Closing Date occurs and ending with the fiscal
quarter preceding any date of determination, exceeds
$1,000,000, an amount equal to (x) one-half of such
cumulative Net Income in excess of $1,000,000 minus (y)
all amounts after the Fifth
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Amendment Closing Date and prior to such date of
determination distributed as dividends or paid to
repurchase stock (including amounts so distributed or
paid pursuant to the $2,000,000 basket hereinabove
provided), provided further that (a) at the time of, and
after giving effect to, any such payment of dividends or
repurchase of stock, no Event of Default shall have
occurred and be continuing and (b) solely for purposes of
determining the Borrower's compliance with this covenant,
the calculation of such Net Income shall exclude negative
goodwill, and provided further that any amounts which the
Borrower may loan or advance to the Parent pursuant to
Section 10.05 (a) may instead be distributed to the
Parent, or otherwise paid to the Parent as a dividend,
but without duplication of any amounts so loaned or
advanced."
(E) SECTION 10.20. CAPITAL EXPENDITURES. Section 10.20 is deleted
in its entirety, and the following is substituted in lieu thereof:
"10.20 Capital Expenditures. The Borrower shall not make
Capital Expenditures in an amount greater than (a)
$4,000,000 in the aggregate for the fiscal year ending in
December 2000 and (b) $2,500,000 in the aggregate for the
fiscal year ending in December 2001, and for each fiscal
year thereafter, provided, however, that if the aggregate
amount of Capital Expenditures actually made during any
such fiscal year (or lesser period, if applicable) shall
be less than the limit with respect thereto set forth
above (such limit, without giving effect to any increase
therein pursuant to this proviso, the "base amount"),
then the amount of such short fall (the "rollover
amount") may be added to the amount of Capital
Expenditures permitted to be made for the immediately
succeeding fiscal year, provided, further, that any
Capital Expenditures made during any fiscal year for
which any rollover amount shall have been so added shall
be applied first, to the base amount for such year and
second, to the rollover amount added to such fiscal
year."
(F) SCHEDULE 1.01 A. Schedule 1.01 A to the Credit Agreement is
deleted in its entirety and Schedule 1.01 A to this Amendment is substituted in
lieu thereof.
SECTION TWO --CONDITIONS PRECEDENT. This Amendment shall become
effective on the date when all of the following conditions, the satisfaction of
each of which is a condition precedent to the effectiveness of this Amendment,
shall have occurred:
(A) CIT shall have received a fully executed counterpart or
original of this Amendment, including revised Schedule 1.01 A to the Credit
Agreement;
(B) CIT shall have received the Second Amended and Restated
Promissory Note, substantially in the form annexed hereto as Exhibit A, executed
by the Borrower;
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(C) CIT shall have received a fully executed counterpart or
original of a Confirmation of Continuing Secured Guaranties, executed in favor
of CIT by each Guarantor, substantially in the form annexed hereto as Exhibit B;
(D) CIT shall have received a Certificate of the Secretary of the
Borrower (1) relating to the adoption of the resolutions of the Board of
Directors of the Borrower, approving this Amendment and the other documents
executed or to be executed by the Borrower in connection herewith and in
connection with the Claiborne Purchase Agreement and the Steffe Purchase
Agreement and (2) certifying that since June 4, 1997, no amendment or
modification to the certificate of incorporation and by-laws of the Borrower has
been made, and further certifying the names and incumbency of officers of the
Borrower authorized to sign this Amendment and the other documents to be
executed in connection herewith and the validity of the signatures of such
officers;
(E) CIT shall have received a Solvency Certificate from the chief
financial officer of the Parent and the Borrower;
(F) CIT and its counsel shall have received copies of the
definitive Claiborne Purchase Agreement and the Steffe Purchase Agreement and
all ancillary documents relating thereto, each as executed;
(G) CIT shall have received, in form and substance satisfactory to
CIT, a collateral assignment of all of the Borrower's rights under each of the
Steffe Purchase Agreement and the Claiborne Purchase Agreement;
(H) Upon the effectiveness of this Amendment, all representations
and warranties set forth in this Amendment and in the Credit Agreement (except
for such inducing representations and warranties that were only required to be
true and correct as of a prior date) shall be true and correct in all material
respects on and as of the effective date hereof;
(I) No event or development shall have occurred since the date of
delivery to CIT of the most recent financial statements of the Parent and its
Subsidiaries which event or development has had or is reasonably likely to have
a Material Adverse Effect;
(J) All corporate and legal proceedings and all documents and
instruments executed or delivered in connection with this Amendment shall be
satisfactory in form and substance to CIT and its counsel;
(K) There shall be no action, suit or proceeding pending or
threatened against the Borrower before any court (including any bankruptcy
court), arbitrator or governmental or administrative body or agency which
challenges or relates to the consummation of the transactions contemplated by
the Steffe Purchase Agreement or the other transactions contemplated herein;
(L) CIT shall have received payment for its own account of a
closing fee in the amount of $200,000, which shall be payable in cash and which,
when paid, shall be deemed to be fully earned and non-refundable;
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(M) CIT shall have received a legal opinion from the firm of ▇▇▇▇▇▇
▇▇▇▇▇▇ LLP, in form and substance satisfactory to CIT and its counsel, and such
further agreements, consents, instruments and documents as may be necessary or
proper in the reasonable opinion of CIT and its counsel to carry out the
provisions and purposes of this Amendment;
(N) CIT and its counsel shall have received and reviewed to their
satisfaction results of UCC searches performed with respect to (i) any new
locations set forth in revised Schedule 1.01A to the Credit Amendment,(ii) the
assets of Steffe purchased by the Borrower pursuant to the Steffe Purchase
Agreement; and (iii) the assets of Claiborne purchased by the Borrower pursuant
to the Claiborne Purchase Agreement;
(O) CIT shall have received evidence, satisfactory to it, that the
Borrower has obtained adequate insurance, in accordance with the terms of the
Credit Agreement, for each of the locations set forth in revised Schedule 1.01 A
to the Credit Agreement; and
(P) CIT shall have received such further agreements, consents,
instruments and documents as may be necessary or proper in the reasonable
opinion of CIT and its counsel to carry out the provisions and purposes of this
Amendment.
SECTION THREE -REPRESENTATIONS AND WARRANTIES. The Borrower
represents and warrants (which representations and warranties shall survive the
execution and delivery hereof) to CIT that:
(A) The Borrower has the corporate power, authority and legal right
to execute, deliver and perform this Amendment, and the instruments, agreements,
documents and transactions contemplated hereby, and has taken all actions
necessary to authorize the execution, delivery and performance of this
Amendment, and the instruments, agreements, documents and transactions
contemplated hereby;
(B) No consent of any Person (including, without limitation,
stockholders or creditors of the Borrower or creditors of the Parent, as the
case may be) other than CIT, and no consent, permit, approval or authorization
of, exemption by, notice or report to, or registration, filing or declaration
with any governmental authority, is required in connection with the execution,
delivery, performance, validity or enforceability of this Amendment, and the
instruments, agreements, documents and transactions contemplated hereby, except
for such consents which have been obtained;
(C) This Amendment has been duly executed and delivered on behalf
of the Borrower by its duly authorized officer, and constitutes the legal, valid
and binding obligation of the Borrower, enforceable in accordance with its
terms;
(D) The Borrower is not in default under any indenture, mortgage,
deed of trust, or other material agreement or material instrument to which it is
a party or by which it may be bound. Neither the execution and delivery of this
Amendment, nor the consummation of the transactions herein contemplated, nor
compliance with the provisions hereof will (i) violate any law or regulation
applicable to the Borrower, or (ii) cause a violation by the Borrower, of any
order or decree of any court or government instrumentality applicable to it, or
(iii) conflict with, or result in the breach of, or constitute a default under,
any indenture, mortgage, deed of trust, or
9
other material agreement or material instrument to which the Borrower is a party
or by which it may be bound, or (iv) result in the creation or imposition of any
lien, charge, or encumbrance upon any of the property of the Borrower, except in
favor of CIT, to secure the Obligations, or (v) violate any provision of the
Certificate of Incorporation, By-Laws or any capital stock provisions of the
Borrower;
(E) No Event of Default, or event which with notice and/or passage
of time would constitute an Event of Default, has occurred and is continuing;
and
(F) Since the date of CIT's receipt of the financial statements of
the Parent and its Subsidiaries on a consolidated and consolidating basis for
the annual period ended on January 1, 2000, no change or event has occurred
which has had or is reasonably likely to have a Material Adverse Effect.
SECTION FOUR -GENERAL PROVISIONS.
(A) Except as herein expressly amended, the Credit Agreement and
all other agreements, documents, instruments and certificates executed in
connection therewith, are ratified and confirmed in all respects and shall
remain in full force and effect in accordance with their respective terms.
(B) All references in the Related Documents and Loan Documents to
the Credit Agreement shall mean the Credit Agreement as amended as of the
effective date hereof, and as amended hereby and as hereafter amended,
supplemented or modified from time to time. From and after the date hereof, all
references in the Credit Agreement to "this Agreement," "hereof," "herein," or
similar terms, shall mean and refer to the Credit Agreement as amended by this
Amendment.
(C) This Amendment may be executed by the parties hereto
individually or in combination, in one or more counterparts, each of which shall
be an original and all of which shall constitute one and the same agreement.
(D) This Amendment shall be governed and controlled by the laws of
the State of New York without reference to its conflict of law principles.
IN WITNESS WHEREOF, the parties have caused this Amendment to
be duly executed by their respective officers thereunto duly authorized as of
the day and year first above written.
▇▇▇▇▇▇ ▇▇▇ MARKETING, INC.
By:
--------------------------------------------
Name:
Title:
THE CIT GROUP/COMMERCIAL SERVICES, INC.
By:
--------------------------------------------
Name:
Title:
10
EXHIBIT A
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SECOND AMENDED AND RESTATED
PROMISSORY NOTE
$52,000,000 Date of Original Note:
New York, New York as of June 2, 1997
Date of Amendment and Restatement
of Original Note: as of October 27, 1998
Date of Amendment and Restatement of
Amended Note: as of July 1, 2000
FOR VALUE RECEIVED, ▇▇▇▇▇▇ ▇▇▇ MARKETING, INC., a Delaware
corporation (the "Borrower"), promises to pay to the order of THE CIT
GROUP/COMMERCIAL SERVICES, INC. ("CIT") on or before the Maturity Date (as
defined in the Agreement referred to below), and at such earlier dates as may be
required by the Agreement, the lesser of (i) the principal sum of FIFTY-TWO
MILLION DOLLARS ($52,000,000) or (ii) the aggregate unpaid principal amount of
all Loans made by CIT to the Borrower pursuant to the Agreement. The Borrower
further promises to pay to the order of CIT interest on the unpaid principal
amount hereof from time to time outstanding at the rate or rates per annum
determined pursuant to the Agreement, payable on the dates set forth in the
Agreement.
This Second Amended and Restated Promissory Note constitutes
an amendment and restatement of the Amended and Restated Promissory Note, dated
as of October 27, 1998, in a principal amount of $42,000,000, issued by the
Borrower and payable to CIT (the "Amended Note"). The Amended Note constituted
an amendment and restatement of the "Note" (the "Original Note") referred to in
the Revolving Credit Agreement dated as of June 2, 1997 by and between the
Borrower and CIT (as the same may be amended, modified or supplemented from time
to time, the "Agreement"). This Second Amended and Restated Promissory Note is
entitled to the benefits of the Agreement, which, among other things, provides
for the acceleration of the maturity hereof upon the occurrence of certain
events and for prepayments in certain circumstances and upon certain terms and
conditions. Terms defined in the Agreement have the same meanings herein.
This Second Amended and Restated Promissory Note is secured by
and is entitled to the benefits of the liens and security interests granted by
the Agreement and the other Related Documents referred to in the Agreement, and
is further entitled to the benefits of the security agreements, guarantees and
other Related Documents referred to in the Agreement.
The Borrower hereby expressly waives presentment, demand,
notice, protest and all other demands and notices in connection with the
delivery, acceptance, performance, default
A-1
or enforcement of this Second Amended and Restated Promissory Note and the
Agreement, and an action for amounts due hereunder or thereunder shall
immediately accrue.
This Second Amended and Restated Promissory Note shall be
governed by, construed and enforced in accordance with the laws of the State of
New York, without regard to choice of law principles. This Second Amended and
Restated Promissory Note amends and restates in its entirety the Amended Note,
which amended and restated in its entirety the Original Note, but no novation or
cancellation of the indebtedness evidenced by the Amended Note or the Original
Note has been created by virtue of this amendment and restatement, and none is
intended or implied. The Borrower hereby confirms and reaffirms that all such
indebtedness continues to be owing by it in accordance with the terms of the
Agreement.
▇▇▇▇▇▇ ▇▇▇ MARKETING, INC.
--------------------------------------------
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
Chief Financial Officer and Treasurer
A-2
EXHIBIT B
---------
THE CIT GROUP/COMMERCIAL SERVICES INC.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
As of July 1, 2000
The ▇▇▇▇▇▇ ▇▇▇ Company, Inc.
▇▇▇▇▇▇ ▇▇▇ Licensing Enterprises Corp.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Confirmation of Continuing Secured Guaranties
-------------------------------------------------
Gentlemen:
Reference is made to the separate instruments of guaranty,
each dated as of June 2, 1997, executed by each of you in favor of The CIT
Group/Commercial Services, Inc. (the "Lender") (each a "Guaranty" and
collectively the "Guaranty"). Terms which are capitalized herein and not
otherwise defined shall have the meanings ascribed to them in the Guaranty.
By your signature below, you each hereby confirm your
acknowledgment of and agreement with the following:
1. Concurrently with the execution of this letter agreement,
the Lender and ▇▇▇▇▇▇ ▇▇▇ Marketing, Inc. (the "Borrower") are entering into the
Sixth Amendment to the Credit Agreement (the "Sixth Amendment"), pursuant to
which, among other things, the Revolving Credit Commitment (as defined in the
Credit Agreement) shall be increased to $52,000,000.
2. In conjunction with the execution of the Sixth Amendment,
the Amended and Restated Promissory Note, dated October 27, 1998, in the
principal amount of $42,000,000, evidencing the indebtedness of the Borrower
under the Credit Agreement, will be amended and restated in full, in the form of
a Second Amended and Restated Promissory Note in the principal amount of
$52,000,000 (the "Second Amended and Restated Note").
3. The term "Obligations", as set forth in the Guaranty, means
and includes all Obligations evidenced by, arising under or relating to (a) the
Second Amended and Restated Note and (b) the Credit Agreement, as heretofore
amended, as amended pursuant to the Sixth Amendment, and as the same may be
hereafter amended from time to time.
4. Each of you continues to be liable for the payment and
performance of all Obligations, in accordance with the terms of the Guaranty,
and the Guaranty executed by each of you continues to be valid and binding upon
each of you, respectively, and enforceable against each of you, respectively, in
accordance with its terms.
B-1
5. This letter agreement shall be governed by and construed in
accordance with the internal substantive laws of the State of New York without
giving effect to conflicts of law principles thereof. If the foregoing is in
accordance with your understanding, kindly sign in the space below to so
indicate.
Very truly yours,
THE CIT GROUP/COMMERCIAL
SERVICES INC.
By:
------------------------------------
Name:
Title:
Acknowledged and Agreed:
THE ▇▇▇▇▇▇ ▇▇▇ COMPANY, INC.
By:
----------------------------
Name:
Title:
▇▇▇▇▇▇ ▇▇▇ LICENSING
ENTERPRISES CORP.
By:
----------------------------
Name:
Title:
B-2
Schedule 1.01A
▇▇▇▇▇▇ ▇▇▇ Marketing, Inc.
Domestic Inventory Locations
[to be supplied by Borrower]