Exhibit 10.15(k)
EXECUTION COPY
AMENDMENT No. 10 and CONSENT
AMENDMENT No. 10 and CONSENT (this "Amendment") dated as of September 29,
2000 among FINLAY ENTERPRISES, INC., a Delaware corporation (the "Parent"),
FINLAY FINE JEWELRY CORPORATION, a Delaware corporation (the "Company"), the
lenders signatory hereto (the "Lenders") and GENERAL ELECTRIC CAPITAL
CORPORATION, as agent (the "Agent") for the Lenders.
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, the Parent, the Company, the Lenders and the Agent are parties to
an Amended and Restated Credit Agreement dated as of September 11, 1997 (as
heretofore and hereafter amended, modified or supplemented from time to time in
accordance with its terms, the "Credit Agreement"); and
WHEREAS, the Company has entered into a Marketing Agreement dated as of
July 6, 2000 with 000-Xxxxxxx.xxx, Inc. ("800-Flowers") whereby the Company has
agreed to provide merchandise to customers of 800-Flowers; and
WHEREAS, the Company desires to establish a Domestic Subsidiary in
Delaware, eFinlay, Inc. ("eFinlay"), to handle the Company's marketing
arrangement with 800-Flowers, and in connection therewith the Company desires
(i) to transfer the assets listed on Annex A hereto to eFinlay pursuant to a
certain Contribution Agreement, (ii) to sell inventory on an ongoing basis to
eFinlay pursuant to purchase orders to allow eFinlay to satisfy its obligation
to deliver merchandise to customers of 800-Flowers, (iii) to provide certain
managerial advice, direction and services to eFinlay pursuant to a certain
Services Agreement, (iv) for Finlay Merchandising & Buying, Inc. to provide
certain merchandising and buying services to eFinlay pursuant to a certain
Services Agreement and (v) to lease certain space in its Connecticut
distribution center to eFinlay pursuant to a certain Lease Agreement; and
WHEREAS, subject to the terms and conditions contained herein the parties
hereto desire to amend certain provisions of the Credit Agreement.
NOW THEREFORE, for good and valuable consideration, the receipt of which is
hereby acknowledged, and subject to the fulfillment of the conditions set forth
below, the parties hereto agree as follows:
1. Defined Terms. Unless otherwise specifically defined herein, all
capitalized terms used herein shall have the respective meanings ascribed to
such terms in the Credit Agreement.
2. Amendments to Credit Agreement. Upon the Effective Date (as defined
herein), the Credit Agreement shall be amended as follows:
(A) Section 1.1 of the Credit Agreement is hereby amended to add the
following definitions in their proper alphabetical sequence:
"800-Flowers Marketing Agreement" shall mean that certain
Marketing Agreement dated as of July 6, 2000 between the Company and
000-Xxxxxxx.xxx, Inc.
"eFinlay" shall mean eFinlay, Inc., a Delaware corporation and
wholly-owned Subsidiary of the Company.
"eFinlay Agreements" shall mean, collectively, the eFinlay
Contribution Agreement, the eFinlay FFJC Services Agreement, the
eFinlay FMBI Services Agreement and the eFinlay Lease Agreement.
"eFinlay Contribution Agreement" shall mean that certain
Contribution Agreement dated as of September 29, 2000 between the
Company and eFinlay (as originally in effect, without any waivers or
modifications materially adverse to the Lenders not consented to by
the Majority Lenders) pursuant to which the Company will transfer to
eFinlay the assets listed on Schedule 9.5(i) hereto.
"eFinlay FFJC Services Agreement" shall mean that certain
Services Agreement dated as of September 29, 2000 between the Company
and eFinlay (as originally in effect, without any waivers or
modifications materially adverse to the Lenders not consented to by
the Majority Lenders) pursuant to which the Company will provide
certain managerial advice, direction and services to eFinlay.
"eFinlay FMBI Services Agreement" shall mean that certain
Services Agreement dated as of September 29, 2000 between Finlay
Merchandising and eFinlay (as originally in effect, without any
waivers or modifications materially adverse to the Lenders not
consented to by the Majority Lenders) pursuant to which Finlay
Merchandising will provide certain merchandising and buying services
to eFinlay.
"eFinlay Lease Agreement" shall mean that certain Lease Agreement
dated as of September 29, 2000 between the Company and eFinlay (as
originally in effect, without any waivers or modifications materially
adverse to the Lenders not consented to by the Majority Lenders)
pursuant to which the Company will lease certain space in its
Connecticut distribution center to eFinlay.
(B) The parenthetical contained in Section 7(b) to the Credit Agreement is
hereby amended by inserting the text "(x)" immediately following the text
"including, without limitation," and by adding to the end thereof the following:
"and (y) in connection with the operations of eFinlay".
(C) The following Section 8.29 is hereby added to the Credit Agreement:
"Section 8.29 Intercompany Charges and Mandatory Dividends
Relating to eFinlay. Each of the Company and Finlay
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Merchandising, as the case may be, shall account for all charges,
fees, rent and other amounts owing to it by eFinlay pursuant to the
eFinlay Agreements (the "eFinlay Agreement Expenses") as an
intercompany receivable and eFinlay shall pay the outstanding amount
of the eFinlay Agreement Expenses to the Company and Finlay
Merchandising, as the case may be, on a monthly basis to the extent
cash is available (net of reasonable operating expenses of eFinlay for
the then current and immediately succeeding calendar month (which may
be paid in cash) including, without limitation, payroll expenses for
employees of eFinlay) (and any amounts not paid shall be paid as soon
as cash becomes available). eFinlay shall, within thirty days (30)
following the end of each fiscal quarter, declare and distribute to
the Company as a dividend any excess amounts retained by eFinlay after
payment of the eFinlay Agreement Expenses (net of reasonable operating
expenses of eFinlay for the then current and immediately succeeding
calendar month (which may be paid in cash) including, without
limitation, payroll expenses for employees of eFinlay)."
(D) Section 9.4 of the Credit Agreement is hereby amended to delete the
"and" immediately following Section 9.4(s), to delete the period at the end of
Section 9.4(t) and to insert a semi-colon followed by the word "and" immediately
thereafter, and to add the following immediately thereafter:
"(u) Investments by the Company in eFinlay as set forth on
Schedule 9.5(i) hereto."
(E) Section 9.5 of the Credit Agreement is hereby amended to delete the
"and" immediately following Section 9.5(g), to delete the period at the end of
Section 9.5(h) and to insert a semi-colon followed by the word "and" immediately
thereafter, and to add the following immediately thereafter:
"(i) the sale, transfer and assignment by the Company to eFinlay
of the assets set forth on Schedule 9.5(i) hereto and of Inventory as
required to comply with the 800-Flowers Marketing Agreement."
(F) Section 9.6 of the Credit Agreement is hereby amended to delete the
"and" immediately following Section 9.6(a)(iv), to delete the period at the end
of Section 9.6(a)(v) and to insert a semi-colon followed by the word "and"
immediately thereafter, and to add the following immediately thereafter:
"(vi) The Company may purchase all, but not less than all of the
issued and outstanding capital stock of eFinlay."
(G) Section 9.7 of the Credit Agreement is hereby amended to delete the
"or" immediately following clause (i) therein and to add the following
immediately following clause (ii) therein: "or (iii) for the eFinlay
Agreements".
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(H) The first sentence of Section 9.14 of the Credit Agreement is hereby
amended (x) by inserting the following after "material respect": "(it being
understood that the Company and eFinlay shall be permitted to perform the
800-Flowers Marketing Agreement in accordance with the eFinlay Agreements and
otherwise in accordance with this Agreement)"; and (y) by replacing the word
"or" immediately following clause (i) therein with a comma (",") and by adding
the following immediately following clause (ii) therein: "or (iii) as required
to comply with the 800-Flowers Marketing Agreement".
(I) Section 9.18 of the Credit Agreement shall be amended to add the
following immediately following the last sentence thereof:
"Notwithstanding the foregoing, the Company may subscribe for and
eFinlay may sell to the Company, all, but not less than all, of the
issued and outstanding capital stock of eFinlay."
(J) A new Exhibit 9.5(i) is hereby added to the Credit Agreement in the
form attached hereto as Annex A.
3. Consents. As of the Effective Date:
(a) Notwithstanding Sections 7, 9.4 and 9.6 of the Credit Agreement, the
Majority Lenders hereby consent (so long as no Default or Event of Default has
occurred and is continuing at the time of any such transaction) to (i) the
repurchase by the Parent of up to $20 million of its common stock in open market
transactions to occur no later than September 29, 2001, (ii) dividends by the
Company to the Parent to provide funds for the purpose described in the
foregoing clause (i); and (iii) the use of proceeds of Revolving Advances, if
the Company so elects (and in any event otherwise in accordance with the terms
of the Credit Agreement), to provide funds for the purpose described in the
foregoing clause (ii); provided, that immediately after giving effect to any
such Revolving Advance, the Company shall have the ability to make an additional
Revolving Advance in the amount of $30,000,000 in accordance with the terms of
the Credit Agreement. The Parent shall give the Agent prior written notice of
each repurchase to be made by it pursuant to clause (i) of the preceding
sentence, specifying the amount of such repurchase and the source from which the
Company obtained the funds to be used to effectuate such repurchase.
(b) Notwithstanding Section 9.12 of the Credit Agreement, the Majority
Lenders hereby consent to an amendment to the Gold Consignment Documents (A) to
increase the xxxx ounce figure in the definition of "Consignment Limit" to
125,000 and (B) to increase the Consignment Precious Metal Fair Market Value
limit thereunder to up to $40 million.
4. Cash Management. As of the Effective Date and subject to the proviso at
the end of this sentence, the Agent and the Majority Lenders waive compliance by
the Company with Section 8.22 of the Credit Agreement as it relates to eFinlay
(including without limitation the requirement to cause eFinlay to enter into a
lockbox agreement); provided, that the Agent reserves the right upon notice to
the Company to
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revoke such waiver at any time in its sole and absolute discretion and to
reinstate the obligation of the Company to comply in all respects with Section
8.22 of the Credit Agreement as it relates to eFinlay. Promptly upon receipt of
any such notice from the Agent, the Company agrees to promptly comply in all
respects with Section 8.22 of the Credit Agreement as it relates to eFinlay
(including without limitation the requirement to cause eFinlay to enter into a
lockbox agreement).
5. Representations and Warranties. Each of the Parent and the Company
represents and warrants as follows (which representations and warranties shall
survive the execution and delivery of this Amendment):
(a) Each of the Parent and the Company 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 the Parent and
the Company and the acknowledgement attached hereto has been duly executed and
delivered by each Subsidiary. This Amendment and the Credit Agreement as amended
hereby constitute the legal, valid and binding obligation of the Parent and the
Company, enforceable against them in accordance with their respective terms,
subject to applicable bankruptcy, reorganization, insolvency, fraudulent
conveyance or transfer, moratorium and similar laws affecting the enforcement of
creditors' rights generally and by general equity principles.
(c) No consent or approval of any person, firm, corporation or entity, and
no consent, license, approval or authorization of any governmental authority is
or will be required in connection with the execution, delivery, performance,
validity or enforcement of this Amendment other than any such consent, approval,
license or authorization which has been obtained and remains in full force and
effect or where the failure to obtain such consent, approval, license or
authorization would not result in a Material Adverse Effect.
(d) After giving effect to this Amendment, each of the Company and the
Parent is in compliance with all covenants and agreements applicable to it set
forth in the Credit Agreement and each of the other Loan Documents.
(e) After giving effect to this Amendment, no event has occurred and is
continuing which constitutes a Default or an Event of Default.
(f) All representations and warranties contained in the Credit Agreement
and each of the other Loan Documents are true and correct in all material
respects as of the date hereof, except to the extent that any representation or
warranty relates to a specified date, in which case such are true and correct in
all material respects as of the specific date to which such representations and
warranties relate.
6. Effective Date. The amendments to the Credit Agreement and the consents
contained herein shall not become effective (the "Effective Date") until (i)
this Amendment has been duly executed and delivered by the Company, the Parent,
the Agent and the Majority Lenders; (ii) the acknowledgement attached hereto
shall have been
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executed and delivered by each of the Subsidiaries; (iii) the certificate of
incorporation of eFinlay shall have been filed with the Delaware Secretary of
State; (iv) each of the eFinlay Agreements shall be in a form satisfactory to
the Agent and shall have been executed by each of the respective parties
thereto, and a letter from the Company to that effect shall have been delivered
to the Agent; (v) eFinlay shall have executed and delivered Amendment No. 2 to
the Security Agreement in a form satisfactory to the Agent, and related UCC
filings satisfactory to the Agent shall have been made; (vi) eFinlay shall have
executed and delivered a Guaranty in a form satisfactory to the Agent in respect
of the obligations of the Parent and the Company under the Credit Agreement;
(vii) the Company shall have executed and delivered Amendment No. 2 to the
Pledge Agreement in a form satisfactory to the Agent, and the stock of eFinlay
shall have been delivered in pledge thereunder, and (viii) the Agent shall have
received the opinion of Blank Rome Xxxxxx Xxxxxxxxxx LLP, counsel to the Credit
Parties, in a form reasonably acceptable to the Agent.
7. Gold Consignment Agreement; Intercreditor Agreement. The Majority
Lenders hereby consent to the execution and delivery by the Parent, the Company,
eFinlay and/or the Agent, as applicable, of amendments to the Gold Consignment
Agreement and the Intercreditor Agreement (and any ancillary documents thereto)
consistent with the terms of this Amendment.
8. Expenses. The Company agrees to pay on demand all costs and expenses,
including reasonable attorneys' fees, of the Agent incurred in connection with
this Amendment.
9. Continued Effectiveness. The term "Agreement", "hereof", "herein" and
similar terms as used in the Credit Agreement, and references in the other Loan
Documents to the Credit Agreement, shall mean and refer to, from and after the
Effective Date, the Credit Agreement as amended by this Amendment. Each of the
Company and the Parent hereby agrees that all of the covenants and agreements
contained in the Credit Agreement and the Loan Documents are hereby ratified and
confirmed in all respects.
10. Counterparts. This Amendment may be executed in counterparts, each of
which shall be an original, and all of which, taken together, shall constitute a
single instrument. Delivery of an executed counterpart of a signature page to
this Amendment by telecopier shall be effective as delivery of a manually
executed counterpart of this Amendment.
11. Governing Law. This Amendment shall be governed by, and construed in
accordance with, the laws of the State of New York without giving effect to the
conflict of laws provisions thereof.
* * *
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IN WITNESS WHEREOF the parties hereto have caused this Amendment No. 10 and
Consent to be duly executed by their respective officers as of the date first
written above.
FINLAY ENTERPRISES, INC.
By: /s/ Xxxxx Xxxxxxxx
-----------------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Senior Vice President, Chief
Financial Officer and Treasurer
FINLAY FINE JEWELRY CORPORATION
By: /s/ Xxxxx Xxxxxxxx
-----------------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Senior Vice President, Chief
Financial Officer and Treasurer
GENERAL ELECTRIC CAPITAL CORPORATION,
Individually and as Agent
By: /s/ Xxxxx X. Xxxxx, Xx.
-----------------------------------------------
Name: Xxxxx X. Xxxxx, Xx.
Title: Duly Authorized Signatory
FLEET PRECIOUS METALS INC.
By: /s/ Xxxxx X. XxXxxxxxx
-----------------------------------------------
Name: Xxxxx X. XxXxxxxxx
Title: Vice President
By: /s/ Xxxxxxxxx X. Xxxxxxxxx
-----------------------------------------------
Name: Xxxxxxxxx X. Xxxxxxxxx
Title: Senior Vice President
THE CHASE MANHATTAN BANK
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
Signature Page 1 of 3
to Amendment No. 10 and Consent
XXXXXXX XXXXX CREDIT PARTNERS L.P.
By: /s/ Xxxxxxxxx Xxxxxxx
-----------------------------------------------
Name: Xxxxxxxxx Xxxxxxx
Title: Authorized Signatory
ABN AMRO BANK N.V.
By: /s/ Xxxxx X. Xxxxxxx
----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Group Vice President
By: /s/ Xxxxxxx Xxxxxxx
----------------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
BANK LEUMI
By: /s/ Xxxxx Xxxxxx
-----------------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
By:
-----------------------------------------------
Name:
Title:
TRANSAMERICA BUSINESS CREDIT CORPORATION
By: /s/ Xxxxxxxxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxx
Title: Vice President
Signature Page 2 of 3
to Amendment No. 10 and Consent
Each of the Guarantors, by signing below, confirms
in favor of the Agent and the Lenders that it
consents to the terms and conditions of the
foregoing Amendment No. 10 and Consent to the
Amended and Restated Credit Agreement and agrees
that it has no defense, offset, claim,
counterclaim or recoupment with respect to any of
its obligations or liabilities under its
respective Guaranty and that all terms of such
Guaranty shall continue in full force and effect,
subject to the terms thereof.
FINLAY JEWELRY, INC.
By: /s/ Xxxxx Xxxxxxxx
----------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Senior Vice President, Chief
Financial Officer and Treasurer
SONAB HOLDINGS, INC.
By: /s/ Xxxxx Xxxxxxxx
----------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Senior Vice President, Chief
Financial Officer and Treasurer
SONAB INTERNATIONAL, INC.
By: /s/ Xxxxx Xxxxxxxx
----------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Senior Vice President, Chief
Financial Officer and Treasurer
SOCIETE NOUVELLE D'ACHAT DE BIJOUTERIE - S.O.N.A.B.
By: /s/ Xxxxx Xxxxxxxx
----------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Authorized Signatory
FINLAY MERCHANDISING & BUYING, INC.
By: /s/ Xxxxx Xxxxxxxx
----------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Senior Vice President, Chief
Financial Officer and Treasurer
Signature Page 3 of 3
to Amendment No. 10 and Consent
ANNEX A
to Amendment No. 10 and Consent
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Exhibit 9.5(i) to the Credit Agreement
Assets Contributed by the Company to eFinlay
All of the Company's rights under the 800-Flowers Marketing Agreement and
the assets listed below.
Item Net Book Value
Cash $ 1,000
3 new Conveying Solutions Packing Tables 3,015
4 new Industrial 24x36 Carts 429
3 new Filing Cabinets 748
1 new 2 ton Xxxx Xxxxxxx 312
100 linear feet of used shelving 4,500
2 used desks 750
2 used credenzas 550
2 Used PCs/Printers/Screens 1,535
Total $12,839
