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Exhibit 4.4
SECOND AMENDMENT TO CREDIT AGREEMENT
AND
CONSENT, RELEASE AND WAIVER
This SECOND AMENDMENT TO CREDIT AGREEMENT AND CONSENT, RELEASE AND WAIVER
(this "Amendment") is entered into as of June 1, 1998 among GERBER
CHILDRENSWEAR, INC., a Delaware corporation and AUBURN HOSIERY XXXXX, INC., a
Kentucky corporation (collectively the "Borrowers"); GCIH, INC., a Delaware
corporation (the "Parent") and the Subsidiaries of the Parent (other than the
Borrowers) and the Borrowers as Guarantors, the Lenders party hereto and
NATIONSBANK, N.A., as Administrative Agent for the Lenders (the "Administrative
Agent"). Capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Credit Agreement (as defined below).
RECITALS
WHEREAS, the Borrowers, the Guarantors, the Lenders and the Administrative
Agent entered into that certain Credit Agreement, dated as of December 17, 1997
(as amended by that certain First Amendment (the "First Amendment") to Credit
Agreement and Consent, Release and Waiver, dated as of April 3, 1998, the
"Credit Agreement").
WHEREAS, the proposed initial public offering described in the First
Amendment is no longer a complete and accurate description of the initial public
offering that the Credit Parties anticipate occurring.
WHEREAS, instead of the offering described in the First Amendment, the
Credit Parties wish to effectuate an initial public offering of the Common Stock
to be accomplished as follows:
x. Xxxxxx Childrenswear, Inc. will be merged with and into GCIH, Inc. with
GCIH, Inc. being the surviving entity (the "Merger");
b. Immediately following the Merger, the certificate of incorporation of
GCIH, Inc. will be amended and restated to provide for (i) the reclassification
of its authorized common stock into two classes of common stock (the "Common
Stock" and the "Class B Common Stock"), each with different voting rights and
(ii) the change of GCIH, Inc.'s corporate name to Gerber Childrenswear, Inc.
(the "Surviving Company");
c. The outstanding shares of common stock and preferred stock of the
Surviving Company held by CVC, members of the management of the Surviving
Company and CMP will be converted into shares of Common Stock or Class B Common
Stock of the Surviving Company or exchanged for cash; and
d. The Surviving Company will offer to sell shares of its Common Stock
pursuant to an initial public offering governed by the Securities Exchange Act
of 1933, as amended.
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WHEREAS, the Administrative Agent and the Lenders have agreed to (a)
consent to the Offering, Reorganization and Merger, (b) release their lien on
shares of Gerber Childrenswear, Inc. in connection with the Offering,
Reorganization and Merger and (c) amend and waive certain terms of the Credit
Agreement, in each case, on the terms, and subject to the conditions, set forth
below.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
AGREEMENT
1. Amendments to Credit Agreement.
(a) Existing DefinitioThe following definitions set forth in Section 1.1
of the Credit Agreement are amended and restated in their entirety to read as
follows:
"Offering" means the initial public offering of the shares of common
stock of the Surviving Company as set forth in Amendment No. 1 to Form S-1
filed with the Securities and Exchange Commission on April 27, 1998 and
Amendment No. 2 to Form S-1 filed with the Securities and Exchange
Commission on May 19, 1998 (as such terms may be amended).
"Reorganization" means, in connection with the Offering (a) the
merger of Gerber Childrenswear, Inc. with and into GCIH, Inc. with GCIH,
Inc. being the surviving entity, (b) the change of the corporate name of
GCIH, Inc. to Gerber Childrenswear, Inc., (c) the exchange of all of the
outstanding shares of all classes of common stock and warrants to purchase
common stock of GCIH, Inc. for shares of Common Stock, Class B Common
Stock or warrants of the Surviving Company and (d) the conversion of all
of the outstanding shares of Preferred Stock into either Common Stock or
the right to receive cash.
(b) New Definitions. The following new definitions are added to Section
1.1 of the Credit Agreement in the appropriate alphabetical order:
"Class B Common Stock" means Class B common stock of the Surviving
Company to be issued pursuant to the Reorganization.
"Common Stock" means common stock of the Surviving Company offered
for sale to the public pursuant to the Offering.
"Merger" means the merger of Gerber Childrenswear, Inc. with and
into GCIH, Inc. with GCIH, Inc. being the surviving entity and the
immediate change of name of GCIH, Inc. to Gerber Childrenswear, Inc.
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"Surviving Company" means Gerber Childrenswear, Inc., a Delaware
corporation, f/k/a GCIH, Inc.
2. Consent. Notwithstanding anything in the Credit Documents to the contrary,
subject to the conditions set forth below, the Lenders hereby consent to the
Offering, the Merger and the Reorganization (including any amendments to
articles of incorporation, bylaws or formation documents and any intercompany
transactions in the ordinary course, in each case consistent with the terms of
the Offering, Merger and the Reorganization):
(a) the Offering, the Merger and Reorganization occur prior to July
31, 1998.
(b) the Merger and Reorganization occur on terms identical to those
described herein and in Amendment No. 1 to Form S-1 filed with the
Securities and Exchange Commission on April 27, 1998 and Amendment No. 2
to Form S-1 filed with the Securities and Exchange Commission on May 19,
1998.
(c) Net Cash Proceeds from the Offering are greater than or equal to
$37,500,000.
(d) Simultaneously with the consummation of the Offering, the Merger
and the Reorganization, the Surviving Company provides to the
Administrative Agent:
(i) a duly executed Assumption Agreement in the form
attached hereto as Exhibit A;
(ii) certified copies of all amendments and articles of
merger filed by any Credit Party in connection with the Merger and
Reorganization, in form and substance reasonably satisfactory to the
Administrative Agent;
(iii) an opinion of counsel to the Credit Parties in
substantially the form attached hereto as Exhibit B;
(iv) an updated Schedule 6.15 to the Credit Agreement;
(v) an updated Schedule 2(a) to the Pledge Agreement,
together with any new stock certificates and executed stock powers
as the Administrative Agent may reasonably request;
(vi) evidence satisfactory to the Administrative Agent
that the Merger and Reorganization does not create a breach of, or
default under, any
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contract, agreement or instrument to which a Credit Party is a
party, including, without limitation, any Material License
Agreement;
(vii) such amendments, modifications or assumptions to
any Mortgage Documents as the Administrative Agent may reasonably
request in order to provide for the Lenders' continued
first-priority perfected security interest in any real estate
pledged by any Credit Party, together with opinions with respect
thereto;
(viii) such Uniform Commercial Code filings that the
Administrative Agent may reasonably request in order to provide for
its continued first-priority perfected security interest in any
Collateral, together with opinions with respect thereto;
(ix) evidence satisfactory to the Administrative Agent
that the Preferred Stock has all been converted into Common Stock or
the right to receive cash and that all of the Subordinated Debt has
been paid in full; and
(x) such other information, documents, filings or
opinions as the Administration Agent may reasonably request in
connection with the Offering, the Merger and the Reorganization.
3. References to the Parent, Gerber Childrenswear, Inc., the Subordinated Debt
and the Preferred Stock.
(a) As a part of the Reorganization, the Merger and the Offering,
GCIH, Inc.'s name will be changed to Gerber Childrenswear, Inc. and all
references to the "Parent" or the "Parent and its Subsidiaries" appearing
in the Credit Agreement and the other Credit Documents shall be replaced
with references to Gerber Childrenswear, Inc. and Gerber Childrenswear,
Inc. and its Subsidiaries, respectively, except that references to the
"Parent" set forth in (i) the definitions of "Domestic Subsidiary",
"Foreign Subsidiary" and "Guarantor" in Section 1.1 of the Credit
Agreement, (ii) Section 8.4 of the Credit Agreement and (iii) Section 11.6
shall be disregarded.
(b) Subsequent to the Reorganization, the Merger and the Offering,
all references in the Credit Agreement to Gerber Childrenswear, Inc. shall
mean a reference to the Surviving Company and all references to the
Borrowers shall mean a reference to Auburn Hosiery Xxxxx, Inc. and the
Surviving Company.
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(c) Subsequent to the Reorganization, the Merger and the Offering,
(i) the Preferred Stock will no longer exist and (ii) the Subordinated
Debt will have been satisfied in full, and all references to the
"Preferred Stock", the "Intercreditor Agreement", the "Junior Subordinated
Note", the "Senior Subordinated Credit Agreement" and the "Subordinated
Debt" appearing in the Credit Agreement and the other Credit Documents
shall be disregarded.
4. Waiver. Subject to the conditions set forth in Section 2 above, the Lenders
hereby agree to waive any Event of Default caused by the Offering,
Reorganization or Merger as a result of a violation of Section 8.4 or Section
9.1(j) of the Credit Agreement. This is a one time waiver and shall not be
construed to be a waiver of any other Event of Default that may exist or an
agreement to waive any Event of Default that may occur in the future.
5. Release of Gerber Childrenswear, Inc. Common Stock. The Administrative Agent
and the Lenders agree that in connection with the Offering, the Merger and the
Reorganization, they will release their lien on the 10 shares of common stock of
Gerber Childrenswear, Inc. pledged by GCIH, Inc. pursuant to the Pledge
Agreement. The Lenders authorize the Administrative Agent to take such action as
appropriate in order to effectuate such release, including, without limitation,
the return of stock certificates.
6. Conditions Precedent. The effectiveness of this Amendment is subject to
receipt by the Administrative Agent of the following:
(a) copies of this Amendment duly executed by the Credit Parties and
the Lenders;
(b) certified copies of resolutions or authorization of each Credit
Party approving and adopting this Amendment, the transactions contemplated
herein and authorizing execution and delivery hereof;
(c) an opinion or opinions from counsel to the Credit Parties, in
form and substance satisfactory to the Administrative Agent, addressed to
the Administrative Agent on behalf of the Lenders and dated as of the date
hereof; and
(d) the payment of expenses, including without limitation reasonable
attorneys fees, incurred in connection with the preparation of the
Amendment.
7. Ratification of Credit Agreement. The term "Credit Agreement" as used in each
of the Credit Documents shall hereafter mean the Credit Agreement as amended and
modified by this Amendment. Except as herein specifically agreed, the Credit
Agreement, as amended by the First
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Amendment and this Amendment, is hereby ratified and confirmed and shall remain
in full force and effect according to its terms.
8. Authority/Enforceability. Each of the Credit Parties, the Administrative
Agent and the Lenders represents and warrants as follows:
(a) It has taken all necessary action to authorize the execution,
delivery and performance of this Amendment.
(b) This Amendment has been duly executed and delivered by such
Person and constitutes such Person's legal, valid and binding obligations,
enforceable in accordance with its terms, except as such enforceability
may be subject to (i) bankruptcy, insolvency, reorganization, fraudulent
conveyance or transfer, moratorium or similar laws affecting creditors'
rights generally and (ii) general principles of equity (regardless of
whether such enforceability is considered in a proceeding at law or in
equity).
(c) No consent, approval, authorization or order of, or filing,
registration or qualification with, any court or governmental authority or
third party is required in connection with the execution, delivery or
performance by such Person of this Amendment.
9. No Default. The Credit Parties represent and warrant to the Lenders that (a)
the representations and warranties of the Credit Parties set forth in Section 6
of the Credit Agreement (as amended by this Amendment) are true and correct as
of the date hereof and (b) no event has occurred and is continuing which
constitutes a Default or an Event of Default.
10. Counterparts/Telecopy. This Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall constitute one and the same instrument. Delivery of
executed counterparts of this Amendment by telecopy shall be effective as an
original and shall constitute a representation that an original shall be
delivered.
11. GOVERNING LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NORTH CAROLINA.
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IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of
this Amendment to be duly executed and delivered and this Amendment shall be
effective as of the date first above written.
BORROWERS:
GERBER CHILDRENSWEAR, INC., a Delaware
corporation
By: /s/ Xxxxxxx Solar
-----------------------------------
Name: Xxxxxxx Solar
Title: Senior Vice President
AUBURN HOSIERY XXXXX, INC.,
a Kentucky corporation
By: /s/ Xxxxxxx Solar
-----------------------------------
Name: Xxxxxxx Solar
Title: Senior Vice President
[Signatures continue]
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GUARANTORS:
GCIH, INC.,
a Delaware corporation
By: /s/ Xxxxxxx Solar
-----------------------------------
Name: Xxxxxxx Solar
Title: Senior Vice President
COSTURA DOMINICANA, INC.,
a Delaware corporation
By: /s/ Xxxxxxx Solar
-----------------------------------
Title: Senior Vice President
AUBURN HOLDINGS, INC.,
a Delaware corporation
By: /s/ Xxxxxxx Solar
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Title: Senior Vice President
GCI IP SUB, INC.,
a Delaware corporation
By: /s/ Xxxxxxx Solar
-----------------------------------
Name: Xxxxxxx Solar
Title: Senior Vice President
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Signature Page to Second Amendment to Credit Agreement and Consent, Release and
Waiver
LENDERS:
NATIONSBANK, N.A., acting in its capacity
as Administrative Agent and Collateral Agent
and individually as a Lender
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: Vice President
NATIONSBANK OF TENNESSEE, N.A., solely in its
capacity as an Issuing Lender in connection
with certain Existing Letters of Credit
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: Vice President
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Signature Page to Second Amendment to Credit Agreement and Consent, Release and
Waiver
BANK OF AMERICA, FSB
By:
Name:
Title:
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Signature Page to Second Amendment to Credit Agreement, Consent and Release and
Waiver
THE CHASE MANHATTAN BANK
By:
Name:
Title:
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Signature Page to Second Amendment to Credit Agreement, Consent and Release and
Waiver
FLEET BANK, N.A.
By:
Name:
Title:
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Signature Page to Second Amendment to Credit Agreement, Consent and Release and
Waiver
SUNTRUST BANK, ATLANTA
By:
Name:
Title:
By:
Name:
Title:
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Signature Page to Second Amendment to Credit Agreement, Consent and Release and
Waiver
WACHOVIA BANK, N.A.
By:
Name:
Title:
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Signature Page to Second Amendment to Credit Agreement, Consent and Release and
Waiver
BANK BOSTON, N.A.
By:
Name:
Title: