FORM 8-K
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
February 7, 2000
(Date of Report, date of earliest event reported)
Stage Stores, Inc.
(Exact name of registrant as specified in its charter)
Commission file number 001-14035
DELAWARE 76-0407711
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identifications No.)
10201 Main Street, Houston, 77025
Texas (Zip Code)
(Address of principal executive
offices)
(713) 667-5601
(Registrant's telephone number, including area code)
Not Applicable
(Former name or address, if changed since last report)
ITEM 5. Other Events.
The fifth amendment agreement dated as of February 3,
2000 by and among Specialty Retailers, Inc., Stage Stores, Inc.,
the banks named therein and Credit Suisse First Boston to the
Credit Agreement dated as of June 17, 1997 is attached hereto as
Exhibit 99.1.
ITEM 7. Financial Statements and Exhibits.
(a) Financial statements of business acquired.
Not applicable.
(b) Pro forma financial information.
Not applicable.
(c) Exhibits.
4.1 Fifth amendment agreement dated as of February 3,
2000 by and among Specialty Retailers, Inc.,
Stage Stores, Inc., the banks named therein and Credit
Suisse First Boston to the Credit
Agreement dated as of June 17, 1997.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
STAGE STORES, INC.
February 7, 2000 /s/ James A. Marcum
(Date) James A. Marcum
Vice Chairman and,
Chief Financial Officer
FIFTH AMENDMENT AGREEMENT
This FIFTH AMENDMENT AGREEMENT, dated as of February 3,
2000 (the "Agreement"), is among Specialty Retailers, Inc. (the
"Borrower"), Stage Stores, Inc. (the "Parent"), the banks named
therein (the "Banks") and Credit Suisse First Boston, as
Administrative Agent, Collateral Agent, Swingline Bank and L/C
Bank (the "Administrative Agent").
PRELIMINARY STATEMENT
WHEREAS, the Borrower, the Parent, the Banks and the
Administrative Agent are parties to the Credit Agreement, dated
as of June 17, 1997, as amended through the date hereof (the
"Credit Agreement");
WHEREAS, the Borrower has requested the amendment of
certain provisions set forth in the Credit Agreement;
WHEREAS, the Banks have agreed to amend the specific
provisions set forth herein under the terms and conditions set
forth herein;
NOW, THEREFORE, the parties hereto hereby agree as
follows:
SECTION 1. Defined Terms. Capitalized terms used
and not defined herein shall have the meanings assigned to such
terms in the Credit Agreement.
SECTION 2. Amendments. The Banks hereby agree to
amend the Credit Agreement as follows:
(a) The definition of "Consolidated EBITDA" in Section 1.1
of the Credit Agreement is hereby amended by deleting clause
(vii) and adding the following before the "." at the end thereof:
", plus (vii) special charges for restructuring (consisting
of store closures, downsizing and inventory valuation
reserves) of up to $65,000,000 in the aggregate taken in the
fourth quarter of fiscal year 1999 and the first two fiscal
quarters of fiscal year 2000 as specified on Schedule 1 to
the Fifth Amendment Agreement, dated as of February 3, 2000,
plus (viii) executive severance payments pursuant to
the current terms of existing employment contracts."
(b) The definition of "Interest Period" in Section 1.1 of
the Credit Agreement is hereby amended by deleting paragraphs (i)
and (ii) replacing them with:
"(i) initially, the period commencing on the borrowing
or the conversion date as the case may be, with respect to such
Eurodollar Loan and ending on the numerically corresponding
calendar day in the calendar month that is one month thereafter,
as selected by the Borrower in its Notice of Borrowing; Notice of
Conversion or Notice of Continuation, as the case may be, given
with respect thereto; and
(ii) thereafter, each period commencing on the last day
of the next preceding Interest Period applicable to such
Eurodollar Loan and ending one month thereafter, as selected by
the Borrower by irrevocable notice to the Administrative Agent
not less than three Business Days prior to the last day of the
then current Interest Period with respect thereto;"
(c) The definition of "Margin Percentage" in Section 1.1 of
the Credit Agreement is hereby amended by (i) amending Category 6
and adding a new Category 7, each as set forth below
Adjusted Commitment Eurodol Base
Leverage Fee Per lar Rate
Ratio centage Margin Margin
Category 6 <= 5.0 to 1 0.50% 3.0% 2.0%
and > 4.5 to 1
Category 7 >5.0 to 1 0.50% 3.25% 2.25%
and (ii) by replacing the words "Category 5" at the end of clause
(ii) in the first proviso with the words "Category 7".
(d) The definition of "Retained Equity Proceeds" in Section
1.1 of the Credit Agreement is hereby amended by replacing
"January 31, 2000" with "and thereafter" in the second sentence.
(e) Section 2.6(c) of the Credit Agreement is hereby
amended by replacing "Base Rate Margin Percentage for Category 5"
with "the Base Rate and the highest Base Rate Margin Percentage
applicable".
(f) Section 2.12(a) of the Credit Agreement is hereby
amended by deleting the following parenthetical phrase contained
therein: "(other than an Asset Sale permitted under Section
6.13)".
(g) The second sentence of Section 2.12(e) of the Credit
Agreement is hereby amended by replacing "January 31, 2000" with
"and thereafter".
(h) Section 2.12(f) of the Credit Agreement is hereby
amended by deleting the second proviso and replacing it with the
following:
"; provided further, that from the effective date of
the Fifth Amendment Agreement, dated as of February 3, 2000,
through July 31, 2000, for the twelve month period ending July
31, 2000, the Borrower shall prepay, repay or not borrow the
Revolving Loans and Swingline Loans so as to cause the aggregate
outstanding principal amount of Revolving Loans and Swingline
Loans not to exceed $80,000,000 during a period of not less than
thirty consecutive days during such period".
(i) The Credit Agreement is hereby amended by adding the
following new Section 5.1(l):
"(l) Weekly Cash Flow Reports. Within 3 business days
after the close of each calendar week, a cash flow report
for the preceding week and a cash flow projection for not
less than the next five weeks thereafter, in each case in
form, substance and detail reasonably satisfactory to the
Required Banks."
(j) Section 6.1(a) (i) of the Credit Agreement is hereby
amended by deleting the grid set forth therein and replacing it
with the following:
Date Ratio
"From February 3, 2001 and thereafter 4.5:1"
(k) Section 6.1(a) (ii) of the Credit Agreement is hereby
amended by deleting the grid set forth therein and replacing it
with the following:
Date Ratio
"From February 3, 2001 and thereafter 4.0:1"
(l) Section 6.1(b) of the Credit Agreement is hereby
amended by deleting the grid set forth therein and replacing it
with the following:
Four Fiscal Quarters Ending On Ratio
"February 3, 2001 2.24:1
From May 5, 2001 and thereafter 2.25:1"
(m) Section 6.1(c) of the Credit Agreement is hereby
amended by deleting the grid set forth therein and replacing it
with the following:
Date Ratio
"From February 3, 2001 and thereafter 1.25:1"
(n) Section 6.1(d) of the Credit Agreement is hereby
amended by deleting the grid set forth therein and replacing it
with the following:
Fiscal Year Ending
Closest to December 31 Maximum Amount
"2000 $15,000,000
2001 $20,000,000 plus 2/3 of the
Retained Equity Proceeds
not to exceed $76,000,000
2002 $20,000,000 plus 2/3 of the
Retained Equity Proceeds
not to exceed $84,000,000"
(o) The Credit Agreement is hereby amended by adding the
following new Section 6.1(e):
"(e) Minimum Consolidated EBITDA. The Parent
shall not permit the Consolidated EBITDA as determined
on a cumulative basis for the periods beginning on
January 30, 2000, and ending on the last day of each
fiscal quarter ending on a date set forth below (in
each case taken as one accounting period), to be less
than the amount set forth opposite such date:
Minimum Consolidated
Date EBITDA
First Quarter $8,000,000
Second Quarter $20,000,000
Third Quarter $36,000,000"
(p) The Credit Agreement is hereby amended by adding the
following new Section 6.17:
"6.17 Receivables Program. The Borrower shall
not take any action to diminish the equity value of the
Receivables Subsidiary other than to pay dividends in the
ordinary course of business consistent with past practice and
will continue to operate the Receivables Subsidiary in the
ordinary course of business consistent with past practice."
SECTION 3. Interest Rate Payable. Anything to the
contrary contained in the Credit Agreement notwithstanding,
interest shall be payable monthly on the last Business Day of
each month, provided, however, that if the Borrower is in full
compliance with all covenants in the Credit Agreement at the end
of the fourth quarter of fiscal year 2000, then interest shall be
payable quarterly on the last Business Day of each quarter
thereafter.
SECTION 4. Waiver of Default. Upon the
effectiveness of this Agreement, any Default or Event of Default
existing under Section 6.1 (a), (b) or (c) of the Credit
Agreement for the fiscal year ended January 29, 2000 is hereby
waived by the Banks.
SECTION 5. Representations and Warranties; No
Defaults. Each Loan Party hereby represents and warrants that
after giving effect to the amendments set forth in Section 2 of
this Agreement and the waiver set forth in Section 4 of this
Agreement, (a) the representations and warranties contained in
the Credit Agreement and Loan Documents are correct on the
effective date of this Agreement, and (b) no Default or Event of
Default has occurred or is continuing on the date hereof and on
the effective date of this Agreement.
SECTION 6. Counterparts. This Agreement (a) may be
executed in two or more counterparts, each of which shall be
deemed an original, but all of which taken together shall
constitute one and the same instrument, (b) shall be effective
only in this specific instance for the specific purpose set forth
herein, and (c) does not allow any other or further departure
from the terms of the Credit Agreement or the Loan Documents,
which terms shall continue in full force and effect.
SECTION 7. Conditions to Effectiveness. This Agree
ment shall become effective as of the date hereof when (a) copies
hereof, when taken together, bearing the signatures of each of
the Loan Parties and the Required Banks have been received by the
Administrative Agent, (b) an amendment fee of 0.50% of the
Commitments of the Banks (the "Executing Banks") who have
returned executed signature pages of this Agreement to the
Administrative Agent by 6:00 p.m. New York City time on
Wednesday, February 2, 2000 has been received from the Borrower
by the Administrative Agent, (c) an administrative fee of
$100,000 has been received from the Borrower by the
Administrative Agent, (d) the fees of Skadden, Arps, Slate,
Meagher & Flom, LLP, and Arthur Andersen LLP incurred in connec
tion with this Agreement have been paid in full, and each has
been paid a retainer of $100,000 for future services to be
rendered in connection with the Credit Agreement, and (e) Alco
Capital shall have been paid a retainer of $50,000 for future
services to be rendered in connection with the Credit Agreement.
SECTION 8. Corporate Aircraft. Within 120 days of the
effective date of this Agreement, the Borrower shall sell its
Hawker 400 for a fair value price, provided, however, that the
Borrower shall not be obligated to sell the Hawker 400 unless the
fair value price exceeds the Borrower's obligations under its
lease with General Electric Capital Corporation. The net
consideration received from the sale of the Hawker 400 will be
used by the Borrower to pay down the Revolving Loans and will
permanently reduce the Total Revolving Loan Commitment.
SECTION 9. Acknowledgments, Releases and Defenses.
Each Loan Party hereby (i) acknowledges and confirms that the
Administrative Agent and the Banks have performed fully all of
their respective obligations under the Credit Agreement and the
other Loan Documents and the instruments and agreements referred
to therein; (ii) releases the Administrative Agent, the Banks,
and the Administrative Agent's and Banks' respective officers,
directors, employees, agents, attorneys, affiliates, subsidiaries
and representatives from any an all actions, causes of action,
claims, demands, damages and liabilities of whatever kind or
nature, in law or in equity, now known or unknown, suspected or
unsuspected to the extent that any of the foregoing arises from
any action or failure to act on or prior to the date hereof;
(iii) acknowledges that it has no offsets or defenses to its
obligations under the Credit Agreement and the other Loan
Documents; and (iv) ratifies, acknowledges and affirms its
obligations under the Credit Agreement and the other Loan
Documents, including, without limitation, the amounts borrowed
thereunder. Except as otherwise specified herein, there is no
amendment of any other term, condition or provision of the Credit
Agreement all of which are hereby ratified and confirmed by the
Borrower and the Parent.
SECTION 10. Applicable Law. THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their duly authorized officers,
all as of the date and year first written above.
SPECIALTY RETAILERS, INC.
By: /s/ Charles M. Sledge
Name: Charles M. Sledge
Title: SVP, Finance & Treasurer
STAGE STORES, INC.
By: /s/ Charles M. Sledge
Name: Charles M. Sledge
Title: SVP, Finance & Treasurer
CREDIT SUISSE FIRST BOSTON,
as Administrative Agent, Collateral Agent,
Swingline Bank and L/C Bank
By: /s/ Jan Kofol
Name: Jan Kofol
Title: Director
By: /s/ Didier Siffer
Name: Didier Siffer
Title: Vice President
BANK UNITED
By: /s/ Gordon Kovacs
Name: Gordon Kovacs
Title: Senior Special Assets Manager
BANQUE WORMS CAPITAL CORPORATION
By: /s/ F. Gamet
Name: F. Garnet
Title: Senior Vice President
By: /s/ Michele Fleming
Name: F. Garnet
Title: General Counsel
BANQUE PARIBAS HOUSTON AGENCY
By: /s/ Albert A. Young Jr.
Name: Albert A. Young Jr.
Title: Director
By: /s/ Amy Kirschner
Name: Amy Kirschner
Title: Vice President
BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.
F.K.A. Creditanstalt Corporate Finance, Inc.
By: /s/ A. W. Seidel
Name: A. W. Seidel
Title: Senior Vice President
By: /s/ Jane E. Erdtman
Name: Jane E. Erdtman
Title: Vice President
HIBERNIA NATIONAL BANK
By: /s/ Christopher Pitre
Name: Christopher Pitre
Title: Vice President
IMPERIAL BANK, A CALIFORNIA BANKING CORPORATION
By: /s/ Renee Faber
Name: Renee Faber
Title: Assistant Vice President
ROYAL BANK OF SCOTLAND
By: /s/ Grant Stoddart
Name: Grant Stoddart
Title: EVP The Americas
THE FUJI BANK, LIMITED
By: /s/ Hirashi Nagamine
Name: Hirashi Nagamine
Title: Vice President & Senior Team Leader
UNION BANK OF CALIFORNIA, N.A.
By: /s/ Richard P. Degrey
Name: Richard P. Degrey
Title: Vice President
FIRST COMMERCIAL BANK
By: /s/ Vincent T. C. Chen
Name: Vincent T. C. Chen
Title: SVP and General Manager
KZH CNC LLC
By: /s/ Peter Chin
Name: Peter Chin
Title: Authorized Agent
[STEIN, ROE & FARNHAM / KEYPORT LIFE]
By: /s/ James R. Fellows
Name: James R. Fellows
Title: Vice President
