[GMAC COMMERCIAL CREDIT LLC LETTERHEAD]
December 31, 2001
Xxxxxxx Xxxxx, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxx Xxxxx, Chairwoman of the Board
Xxxxxxx Xxxxx, Inc.
000 Xxxxxxxx Xxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxx Xxxxxxxxx, Vice President of Finance
Ladies/Gentlemen:
Reference is made to the Second Restated and Amended Financing Agreement
between you and us as successor-in-interest to BNY Financial Corporation, dated
as of October 10, 1997, as supplemented and amended (the "Financing Agreement").
Capitalized terms used and not otherwise defined herein have the respective
meanings given to them in the Financing Agreement.
It is hereby agreed that, effective as of December 31, 2001, the Financing
Agreement shall be amended as follows:
1. The second and third sentences of Section 2.2 are restated to read
as follows:
"The Term Loan shall, with respect to principal, amortize annually as
follows, in twenty (20) quarterly installments, commencing as of March 31, 1998
and on the last day of each fiscal quarter thereafter and one final installment
on March 31, 2003 in the amount of the then outstanding principal balance,
subject to acceleration upon the occurrence and continuance of an Event of
Default under this Agreement or termination of this Agreement pursuant to
Section 7 hereof:
Annual Quarterly
Period Amortization Installment
------ ------------ -----------
Fiscal year ending June 30, 1998 $500,000 $250,000
Fiscal year ending June 30, 1999 $1,000,000 $250,000
Fiscal year ending June 30, 2000 $1,000,000 $250,000
Fiscal year ending June 30, 2001 $1,000,000 $250,000
Fiscal year ending June 30, 2002 $1,000,000 $250,000
September 30, 2002 $250,000 $250,000
December 31, 2002 $250,000 $250,000
March 31, 2003 The outstanding balance
The Term Loan shall be evidenced by and subject to the terms and conditions set
forth in the secured promissory note and the allonge to promissory note
attached hereto as Exhibit 2.2."
2. Section 7.1(a) is amended by deleting the date "December 31, 2002" and
replacing it with "March 31, 2003".
3. The first sentence of Section 7.3(b) is restated to read as follows:
"(b) If termination occurs at any time from October 9, 2000 through and
including March 31, 2003, Borrower shall pay Lender $2,200,000."
4. Section 9.1(d) is amended to provide that the Borrower will not permit
its Tangible Net Worth to be less than the following amounts as of the following
respective dates:
"As of December 31, 2001 $3,000,000
As of March 31, 2002 $4,000,000
As of June 30, 2002 $4,000,000"
5. Section 9.1(e) is amended to provide that the Borrower will not permit
its Working Capital to be less than the following amounts on the following
respective dates:
"As of December 31, 2001 $6,000,000
As of March 31, 2002 $7,500,000
As of June 30, 2002 $7,000,000"
6. Section 9.1(g) is amended to provide that the Borrower's (i) Loss (after
taxes) will not exceed, and (ii) Profit (after taxes) will not be less than, the
respective amounts specified below, as applicable to the indicated Periods under
the applicable column below:
Maximum Minimum
"Period Permitted Loss Permitted Profit
------ -------------- ----------------
Fiscal quarter ended December 31, 2001 $6,900,000
Fiscal quarter ended March 31, 2002 $200,000
Fiscal quarter ended June 30, 2002 $200,000
Fiscal year ended June 30, 2002 $6,000,000"
7. Exhibit 2.2 is amended by adding an Allonge to Promissory Note thereto,
a copy of which is attached hereto.
Except as specifically amended hereby, the Financing Agreement shall
remain unmodified and in full force and effect in accordance with its terms.
In consideration of the foregoing, you agree to pay us an amendment fee of
$15,000, which fee shall be in addition to any other fees, charges or interest
payable by you to us under the
2
Financing Agreement, and payment of which may be effectuated by our charging
your account with us.
If you are in agreement with the foregoing, please so indicate by signing
and returning to us the enclosed copy of this letter.
Very truly yours,
GMAC COMMERCIAL CREDIT LLC
By: /s/ Xxxx X. XxXxxxx
-----------------------
Name: Xxxx X. XxXxxxx
Title: Vice President
AGREED AND ACCEPTED:
--------------------
XXXXXXX XXXXX, INC.
By: /s/ Xxxxxx Xxxxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Vice President of Finance
CHAUS RETAIL, INC.
(Guarantor)
By: /s/ Xxxxxx Xxxxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Vice President of Finance
Exhibit 2.2
ALLONGE TO PROMISSORY NOTE
THIS ALLONGE, effective this 31st day of December, 2001, is to be part of
and attached to the Promissory Note of XXXXXXX XXXXX, INC., a New York
corporation (the "Maker") to GMAC COMMERCIAL CREDIT LLC (the "Payee"), dated
October 10, 1997 in the original principal amount of $15,000,000 (the "Note").
Effective as of the date of this Allonge, the first sentence of the Note is
revised as follows:
"FOR VALUE RECEIVED, the undersigned XXXXXXX XXXXX, INC. (the "Maker")
hereby promises to pay to the order of GMAC COMMERCIAL CREDIT LLC (the
"Payee"), at 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at
such other place as may be designated in writing by the holder hereof, the
principal sum of Fifteen Million Dollars ($15,000,000), in lawful money of
the United States of America, in twenty (20) consecutive, equal quarterly
installments, each in the amount of $250,000.00, commencing on March 31,
1998 and on the last day of each fiscal quarter thereafter and one final
installment on March 31, 2003 in the amount of the then outstanding
principal balance."
This Allonge shall be deemed to amend and modify the Note, to the extent
inconsistent with the Note. Subject to the foregoing, the Note and all of its
terms and conditions are ratified and reaffirmed and remain in full force and
effect.
XXXXXXX XXXXX, INC.
By: /s/ Xxxxxxxx XxXxxxx
--------------------------------------
Title: Vice Chairman of the Board, and
Chief Operating Officer
ATTEST:
/s/ Xxxxxx Xxxxxxxxx
-------------------------------
Secretary
[CORPORATE SEAL]
Accepted and Agreed:
GMAC COMMERCIAL CREDIT LLC
By: /s/ Xxxx X. XxXxxxx
----------------------------
Title: Vice President
