Exhibit 4(d)(11) Amendment Number Eleven to the Loan and Security Agreement by
and between Congress Financial Corporation (Southern) as Lender and the
Registrant and One Price Clothing of Puerto Rico, Inc. as Borrowers dated
January 31, 2002.
AMENDMENT NO. 11 TO FINANCING AGREEMENTS
Congress Financial Corporation
(Southern)
000 Xxxxxxxx Xxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
January 31, 2002
One Price Clothing Stores, Inc.
0000 Xxxx Xxxx Xxxxxx
Xxxxxx, Xxxxx Xxxxxxxx 00000
One Price Clothing of Puerto Rico, Inc.
0000 Xxxx Xxxx Xxxxxx
Xxxxxx, Xxxxx Xxxxxxxx 00000
Gentlemen:
Congress Financial Corporation (Southern) ("Lender"), One Price
Clothing Stores, Inc. ("One Price") and One Price Clothing of Puerto Rico, Inc.
("One Price PR"; and together with One Price, individually referred to as a
"Borrower" and collectively as the "Borrowers") have entered into certain
financing arrangements pursuant to the Loan and Security Agreement, dated March
25, 1996, between the Lender and Borrowers (as amended, the "Loan Agreement"),
as amended by Amendment No. 1 to Financing Agreements, dated May 16, 1997,
Amendment No. 2 to Financing Agreements, dated June 17, 1997, Amendment No. 3 to
Financing Agreements, dated February 19, 1998, Amendment No. 4 to Financing
Agreements, dated January 31, 1999, Amendment No. 5 to Financing Agreements,
dated February 23, 2000, Amendment No. 6 to Financing Agreements, dated June 30,
2000, Amendment No. 7 to Financing Agreements, dated February 9, 2001, Amendment
No. 8 to Financing Agreements dated September 13, 2001, Amendment No. 9 to
Financing Agreements dated November 12, 2001 and Amendment No. 10 to Financing
Agreements dated December 12, 2001 together with various other agreements,
documents and instruments at any time executed and/or delivered in connection
therewith or related thereto (as the same now exist or may hereafter be amended,
modified, supplemented, extended, renewed, restated or replaced, collectively,
the "Financing Agreements"). All capitalized terms used herein and not herein
defined shall have the meanings given to them in the Financing Agreements.
Borrower has requested that Lender agree to release certain Availability
Reserves and amend certain provisions of the Loan Agreement, and Lender is
willing to do so on the terms and conditions and to the extent set forth herein.
Now therefore, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties, the parties hereto
agree as follows:
1. Second Supplemental Loan Maturity Date. The term "Second Supplemental Loan
Maturity Date" is hereby redefined to mean "July 31, 2003."
2. Second Supplemental Loan Exit Fee. The phrase "of $80,000.00" set forth in
Section 3.4.4 of the Loan Agreement is hereby revised to read "equal to two
percent (2.00%) of the outstanding principal balance of the Second
Supplemental Loan as of the opening of business on July 31, 2003."
3. Back End Fee. A new Section 3.4.7 shall be added to the Loan Agreement
which reads as follows:
"3.4.7 Second Supplemental Loan Back End Fee.
As compensation for Lender's agreements hereunder, the Lender
shall have earned by its execution of this Agreement a Back
End Fee in the amount of $80,000 which shall be fully-earned
as of the date hereof, and if not paid sooner shall be payable
in full on the Second Supplemental Loan Termination Date, and
in any event (a) $60,000 of which shall be payable on July 13,
2002 and (b) $20,000 of which shall be payable on December 13,
2002."
4. Amendment Fee. A new Section 3.4.8 shall be added to the Loan Agreement
which reads as follows:
"The Borrowers shall pay to the Lender a non-refundable
Amendment Fee in the amount of $60,000 which shall be fully
earned as of January 31, 2002 but shall be payable on April 1,
2002."
5. ERF Letter of Credit Fees. A new Section 3.4.9 shall be added to the Loan
Agreement which reads as follows:
"The Borrowers shall pay to Lender the following
non-refundable fees, which shall be fully-earned on the dates
they are payable: (a) a monthly fee of $17,500 payable on the
first day of each month commencing February 1, 2002 and ending
on the expiration date of the ERF Letter of Credit, pro-rated
for partial months, and (b) a fee equal to the fees and costs
charged by the issuer of the ERF Letter of Credit to
Participant in connection with the issuance and maintenance of
the ERF Letter of Credit, due monthly in advance on the first
day of each month prior to the expiration date of the ERF
Letter of Credit, pro-rated for partial months."
6. Yield Maintenance. Section 12.1.2 of the Loan Agreement is hereby
revised to add the following language after the phrase "equal to"
in the first sentence thereof: "(a) $80,000 in the event the
Second Supplemental Loan is prepaid prior to December 31, 2002,
plus (b)".
7. Second Supplemental Loan Amortization. The following sentence is added to
the beginning of Section 2.1.2(c) of the Loan
Agreement:
The Borrower shall make the following principal payments on or
before the following dates on account of the Second
Supplemental Loans:
Date Payment
8/31/02 $ 50,000
9/30/02 $ 50,000
10/31/02 $275,000
11/30/02 $ 75,000
12/31/02 $400,000
4/30/03 $375,000
5/31/03 $125,000
6/30/03 $125,000
Any prepayment of the Second Supplemental Loan shall be
applied to the foregoing installments in the order of their
maturity. Once repaid, the principal balance of the Second
Supplemental Loan may not be re-borrowed.
8. Definitions. The following definitions shall be added to Section 1 of
the Loan Agreement:
(a) "ERF Letter of Credit" shall mean Standby Letter of Credit No.
_____ issued by Fleet National Bank in the stated amount of
$1,750,000 for the account of Participant and for the benefit of
Lender.
(b) "Amendment No. 11 to Financing Agreements" shall mean Amendment
No. 11 to Financing Agreements between Borrower and Lender dated
as of January 31, 2002.
(f) "Designated Letters of Credit" shall mean that certain Letter of
Credit No. SM415940P issued by First Union Bank in the stated
amount of $750,000, together with that certain Letter of Credit
No. SM416040P issued by First Union Bank in the stated amount of
$1,000,000.
9. Availability Reserves.
(a) Commencing on the date of this Amendment No. 11, Lender shall
release $1,750,000 of its Availability Reserve being maintained
in respect of the Designated Letters of Credit in accordance with
Section 1.4(d) of the Loan Agreement (the "Designated
Availability Reserve").
(b) On May 3, 2002 and each Friday thereafter through June 14, 2002,
$250,000 of the Designated Availability Reserve shall be
re-imposed (and the Borrower shall have repaid Revolving Loans to
the extent necessary to prevent the occurrence of an Event of
Default) so that by June 14, 2002, the Designated Availability
Reserve shall be $1,750,000. Each re-imposition of the Designated
Availability Reserve shall serve to reduce the stated amount of
the ERF Letter of Credit in a like amount. To the extent that the
imposition of any installment of the Designated Availability
Reserve would at any time cause the outstanding amount of Loans
and Letter of Credit Accommodations to exceed the amount of
Revolving Loans and Letter of Credit Accommodations available to
Borrowers pursuant to Sections 2.1 and 2.2 of the Loan Agreement
(as calculated by Lender, subject to sublimits and Availability
Reserves as provided for in the Loan Agreement), then Borrowers
shall be deemed to have requested that the outstanding amount of
the Second Supplemental Loan be increased by the amount of such
excess.
10. ERF Letter of Credit; Second Supplemental Loan.
(a) In the event that a draw is honored under either of the
Designated Letters of Credit which is not immediately reimbursed
by Borrower, Borrower shall be deemed to have requested an
increase in the outstanding amount of the Second Supplemental
Loan in an amount equal to the amount of any such draw. .
(b) The term "Second Supplemental Loan" as used in the Loan Agreement
is hereby redefined to mean: "the loan made by Lender to or for
the benefit of Borrowers pursuant to Section 2.1.2 hereof, as the
same may be increased pursuant to Sections 9(b) and 10 of
Amendment No. 11 to Financing Agreements."
11. Excess Availability. Section 9.15.1 of the Loan Agreement is
hereby amended to add the following language at the end thereof:
"plus the amount of any increase to the Second Supplemental Loan
pursuant to Sections 9 and 10 of this Amendment No. 11."
12. Additional Event of Default. In addition to the Events of Default
set forth in the Loan Agreement and the other Financing
Agreements, the occurrence of any of the following shall also
constitute an Event of Default: (a) if the ERF Letter of Credit
shall be void or invalid or the validity thereof shall be
contested by the issuer with request thereto or by Borrower or
ERF or any other applicant with respect thereto, (b) the issuer
of the ERF Letter of Credit shall fail to honor any properly
presented draw thereunder in accordance with its terms, or deny
it has any further liability or obligation thereunder or shall
revoke, terminate or purport to revoke or terminate it, or (c)
any injunctive relief or restraining order is sought or granted
which does or would, if granted, limit or impair the right of
Lender to draw under the ERF Letter of Credit in accordance with
the terms thereof or retain any funds drawn thereunder; or (d)
there is a payment by Participant on account of Lender's notice
of its intent to draw under the ERF Letter of Credit, or a draw
by Lender under the ERF Letter of Credit. Upon the occurrence of
any such Event of Default described in (a), (b) or (c) above,
Lender shall, in addition to all other rights and remedies
available to Lender, be entitled to immediately re-impose the
$1,750,000 of the Designated Availability Reserves previously
released pursuant to Section 9 of this Amendment No. 11, to the
extent not otherwise previously re-imposed. Upon the occurrence
of any such Event of Default described in (d) above, Lender
shall, in addition to all other rights and remedies available to
Lender, be entitled to immediately re-impose a portion of the
Designated Availability Reserve in the amount of the payment or
draw referred to in (d) above.
13. Additional Representations, Warranties and Covenants. Borrower
represents, warrants and covenants with and to Lender as follows, which
representations, warranties and covenants are continuing and shall
survive the execution and delivery hereof, and the truth and accuracy
of, or compliance with each, together with the representations,
warranties and covenants in the other Financing Agreements, being a
continuing condition of the making of Loans by Lender to Borrower:
(a) Borrower shall cause ERF to maintain the ERF Letter of
Credit in full force and effect until the July 2, 2002. Borrower does
not have and shall not have any property or other interest in the ERF
Letter of Credit or in any funds available or drawn thereunder.
(b) No Event of Default or act, condition or event which with
notice or passage of time or both would constitute an Event of Default
exists or has occurred as of the date of this Amendment (after giving
effect to the amendments to the Financing Agreements made by this
Amendment).
(c) This Amendment has been duly executed and delivered by
Borrower and is in full force and effect as of the date hereof and the
agreements and obligations of Borrower contained herein constitute
legal, valid and binding obligations of Borrower enforceable against
Borrower in accordance with their respective terms.
14. Conditions Precedent. The following shall be conditions precedent to
the effectiveness of this Amendment No. 11:
(a) All representations and warranties of Borrower made in any of the
Financing Agreements shall be true and correct as of the date when made;
(b) There shall have occurred and be continuing no Event of Default.
(c) The Lender and the Participant shall have entered into a mutually
acceptable Amendment to the Participation Agreement.
(d) The Lender shall have received evidence satisfactory to it of the due
authorization, execution and delivery of this Amendment.
(e) All fees and expenses payable to Lender, Participant and their
respective counsel and due as of the date hereof shall have
been paid in full.
(f) One Price shall have delivered a Warrant Purchase Agreement in
favor of Participant for the purchase of 23,000 shares of One
Price, in form and substance acceptable to Participant in its
sole discretion.
(g) The ERF Letter of Credit shall have been delivered to Lender
in form and substance satisfactory to Lender and shall have
been issued by an issuer satisfactory to Lender.
15. Confirmation. Borrower confirms and agrees that (a) all representations
and warranties contained in the Financing Agreements are on the date
hereof true and correct in all material respects and (b) it is
unconditionally and jointly and severally liable for the punctual and
full payment of all Obligations, including, without limitation, all
charges, fees, expenses and costs (including attorneys' fees and
expenses) under the Financing Agreements, and that Borrower has no
defenses, counterclaims or setoffs with respect to full, complete and
timely payment of all Obligations.
16. Miscellaneous. The Borrowers confirm that the Financing
Agreements remain in full force and effect without amendment or
modification of any kind, except for the amendments explicitly
set forth herein. The undersigned further confirm that no Event
of Default or events which with notice or the passage of time or
both would constitute an Event of Default have occurred and are
continuing. The execution and delivery of this Amendment by
Lender shall not be construed as a waiver by Lender of any Event
of Default under the Financing Agreements. This Amendment shall
be deemed to be a Financing Agreement and, together with the
other Financing Agreements, constitute the entire agreement
between the parties with respect to the subject matter hereof and
supersedes all prior dealings, correspondence, conversations or
communications between the parties with respect to the subject
matter hereof. This Agreement may be executed in any number of
counterparts, but all such counterparts shall together constitute
but one and the same agreement. In making proof of this
Amendment, it shall not be necessary to produce or account for
more than one counterpart thereof signed by each of the parties
hereto.
17. Governing Law. This Amendment and the rights and obligations
hereunder of each of the parties hereto shall be governed by and
interpreted in accordance with Section 11.1 or 11.1.1 of the Loan
Agreement, as the case may be.
18. Successors and Assigns. This Amendment shall be binding upon and
inure to the benefit of each of the parties hereto and their
respective successor, assigns and the Participant.
Executed under seal on the date set forth above.
Very truly yours,
CONGRESS FINANCIAL CORPORATION
(SOUTHERN)
By: /s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: Senior Vice President
AGREED AND ACCEPTED:
-------------------
ONE PRICE CLOTHING STORES, INC.
By: /s/ C. Xxxx Xxxxx
------------------
C. Xxxx Xxxxx
Title: Vice President & Treasurer
--------------------------
ONE PRICE CLOTHING OF PUERTO RICO, INC.
By: /s/ C. Xxxx Xxxxx
------------------
C. Xxxx Xxxxx
Title: Vice President & Treasurer
--------------------------
CONSENTED TO AND AGREED:
-----------------------
ONE PRICE CLOTHING - U.S. VIRGIN ISLANDS, INC.
By: /s/ C. Xxxx Xxxxx
-----------------
C. Xxxx Xxxxx
Title: Vice President & Treasurer
--------------------------
