STAGE STORES, INC. Item 1.01 Entry into a Material Definitive Agreement
On
Pursuant to the Amendment, the Company acknowledged the existence of certain
events of default (the "Specified Events of Default") under the Second Amended
and Restated Credit Agreement, as amended ("Credit Agreement"). The lenders (the
"Lenders") under the Credit Agreement agreed to forbear from demanding the
repayment of obligations under the Credit Agreement and exercising their rights
and remedies against the collateral with respect to the Specified Events of
Default from
The Credit Agreement was amended, among other things, to:
• Reduce the Aggregate Revolving Loan Commitments (as defined in the
Credit Agreement) from $425,000,000 to $250,000,000 ;
• Increase the outstanding term loan balance from $45 million to $47.4
million to capitalize the $2.4 million dollar amendment fee due to
the Lenders in connection with the Amendment;
• Remove the Company's ability to obtain a seasonal increase in
Revolving Loan Commitments of up to $25,000,000 ;
• Require the Agent to reduce the restructuring reserve established by
the Agent with respect to certain restructuring activities taken by
the Company as of the Effective Date in accordance with the
reduction schedule set forth in the Budget (defined below);
• Reduce the requirement to retain excess availability under the
Credit Agreement during the Forbearance Period to $30,000,000 ;
• Require the Company to deliver a weekly Borrowing Base Certificate to Agent;
• Require the Company to produce a budget for the 13-week period
commencing on the Effective Date and provide updates as reasonably
requested by the Agent (the "Budget"); and
• Require the Company to perform in accordance with the Budget with
permitted variances of 5% each for cash receipts and total
disbursements;
In addition, pursuant to the Amendment, the Company has agreed to provide mortgages on certain Company owned real estate to the Agent for the benefit of the Lenders.
As a result of the Specified Events of Default, among other things:
• the Lenders have no obligation to make loans, issue letters of
credit or otherwise provide financial accommodations to the Company;
• a Cash Dominion Event (as defined in the Credit Agreement) shall be
deemed to have occurred and be continuing at all times following the
Effective Date;
• the Applicable Margin (as defined in the Credit Agreement) shall be
determined based on Level I pricing, which is 0.5% on prime rate
loans and 1.5% on LIBO loans; and
• (i) the Company has agreed not to request a Revolving Loan
Commitment Increase or Additional Term Loans under the Credit
Agreement (each as defined in the Credit Agreement), (ii) the
Company has irrevocably waived all rights to request any such
commitment increases, and (iii) it is an immediate event of default
for the Company to request any such commitment increases.
A copy of the Amendment is filed as Exhibit 10.1 to this Form 8-K. The foregoing description of the Amendment and Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Amendment and Credit Agreement which are incorporated herein by reference.
--------------------------------------------------------------------------------
The Amendment included as an exhibit to this Form 8-K is intended to provide the reader with information regarding its terms and is not intended to provide any other factual or disclosure information about the Company or the other parties to the Amendment or the Credit Agreement. The Amendment and Credit Agreement contain representations, warranties, and covenants by the parties thereto, and those representations, warranties, and covenants:
• were made solely for purposes of the Amendment and the Credit Agreement and
for the benefit of the parties specified therein;
• have been qualified by disclosures that were made to the other parties in
connection with the negotiation of the Amendment and the Credit Agreement,
including being qualified by confidential disclosures made by one party to
others for the purpose of allocating contractual risk between them that
differ from those applicable to investors;
• may apply standards of materiality in a way that is different from what may
be viewed as material to the reader or other investors;
• were were made only as of the date of the Amendment, the Credit Agreement or
such other date(s) specified in the applicable document and are subject to
more recent developments; and
• may not describe the actual state of affairs as of the date they were made or
at any other time.
You should not rely on the representations, warranties, and covenants in the
Amendment or Credit Agreement, or any description thereof, as characterizations
of the actual state of facts or our condition. You should review the Amendment
and Credit Agreement, or any descriptions thereof, not in isolation, but only in
conjunction with the other information about us that the Company includes in
reports, statements, and other filings the Company makes with the
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
10.1 Forbearance and Fifth Amendment to Second Amended and
Restated Credit Agreement dated April 10, 2020 , among
Specialty Retailers, Inc. , as borrower, Stage Stores, Inc. , as
guarantor, and the banks named therein. Some schedules to this
exhibit have been omitted.
104 Cover Page Interactive Data File (embedded within the Inline XBRL Document)
© Edgar Online, source