<PAGE> 1
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
Date of Report: March 9, 1994
Date of earliest event reported: March 4, 1994
CARTER HAWLEY HALE STORES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 1-8765 94-0457907
(State or other jurisdiction of (Commission (I.R.S. employer
incorporation or organization file number) identification no.)
3880 NORTH MISSION ROAD
LOS ANGELES, CALIFORNIA 90031
(Address of principal executive offices, including zip code)
213-227-2000
(Registrant's telephone number, including area code)
<PAGE> 2
ITEM 5. OTHER EVENTS
On March 4, 1994 the Registrant entered into a Sixth Amendment to
its Credit Agreement with General Electric Capital Corporation, a copy of which
is attached as Exhibit 10 hereto.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits
See Exhibit Index on Page 3.
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.
Carter Hawley Hale Stores, Inc.
/s/ MARC E. BERCOON
----------------------------------------
Marc E. Bercoon
Senior Vice President,
General Counsel and Corporate Secretary
March 9, 1994
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
<S> <C>
10 Sixth Amendment to the October 8, 1992 Credit Agreement, among Carter Hawley Hale Stores, Inc., as
the borrower, certain Commercial Lending Institutions, as the lenders, and General Electric Capital
Corporation, as the agent for the Lenders.
</TABLE>
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<PAGE> 1
SIXTH AMENDMENT TO CREDIT AGREEMENT
THIS AMENDATORY AGREEMENT, dated as of February 26, 1994, among CARTER HAWLEY
HALE STORES, INC., a Delaware corporation (the "Borrower"), various financial
institutions (collectively, the "Lenders"), and GENERAL ELECTRIC CAPITAL
CORPORATION, a New York corporation, as agent (the "Agent") for the Lenders;
W I T N E S S E T H:
WHEREAS, the parties hereto have entered into a Credit Agreement, dated as of
October 8, 1992 and amended as of April 29, 1993, August 20, 1993, September
30, 1993, October 31, 1993 and December 10, 1993 (as so amended, the "Existing
Credit Agreement"), and now desire to amend the Existing Credit Agreement in
certain respects;
NOW, THEREFORE, in consideration of the agreements herein contained, the
parties hereto hereby agree as follows:
PART I
DEFINITIONS
SUBPART 1.1. Certain Definitions. The following terms (whether or not
underscored) when used in this Amendatory Agreement shall have the following
meanings:
"Amended Credit Agreement" means the Existing Credit Agreement as amended by
Part II.
"Effective Date" is defined in Part III.
"Existing Credit Agreement" is defined in the first recital.
SUBPART 1.2. Other Definitions. Terms for which meanings are provided in the
Amended Credit Agreement are, unless otherwise defined herein or the context
otherwise requires, used in this Amendatory Agreement with such meanings.
<PAGE> 2
PART II
AMENDMENTS TO
EXISTING CREDIT AGREEMENT
Effective on (and subject to the occurrence of) the Effective Date, the
Existing Credit Agreement is hereby amended in accordance with Subparts 2.1 and
2.2; except as so amended, the Existing Credit Agreement shall continue in full
force and effect.
SUBPART 2.1. Amendments to Article 1. The definition of the term
"Consolidated Net Cash Flow" in Article 1 is amended by inserting the following
immediately prior to the end thereof:
plus all net cash proceeds (after deducting all fees and expenses, including,
without limitation, underwriting and brokerage commissions, fees and
discounts) received by the Borrower from the sale of Common Stock, the
Borrower's preferred stock or, subject to the prior written approval of the
Agent, unsecured subordinated obligations of the Borrower having terms and
conditions satisfactory to the Agent plus, subject to the prior written
approval of the Agent, all net cash proceeds (after deducting all fees and
expenses (including, without limitation, underwriting and brokerage
commissions, fees and discounts) from any sale by the Borrower of all or a
substantial portion of the Borrower's Accounts on terms and conditions
satisfactory to the Agent (other than sales of the Borrower's Accounts to the
Receivables Borrower in accordance with the terms of Accounts Receivable
Financing).
SUBPART 2.2. Amendments to Article 7. Section 7.1 of the Existing Credit
Agreement is hereby amended in its entirety to read as set forth below:
7.1 Financial Covenants.
(a) Consolidated EBITDA. The Borrower will not permit aggregated
Consolidated EBITDA during any period set forth below to be less than the
amount set forth below opposite such period (except that any amount set
forth below in parentheses shall be the maximum amount of permitted
Consolidated EBITDA deficit for the period set forth opposite such amount):
<TABLE>
<CAPTION>
Period (Fiscal Months) Amount
---------------------- ------
<S> <C>
February 1994 ($ 20,100,000)
February 1994 - March 1994 ($ 16,300,000)
February 1994 - April 1994 ($ 13,300,000)
</TABLE>
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<TABLE>
<S> <C>
February 1994 - May 1994 ($ 6,300,000)
February 1994 - June 1994 $ 3,200,000
February 1994 - July 1994 $ 3,500,000
February 1994 - August 1994 $ 5,300,000
February 1994 - September 1994 $ 9,600,000
February 1994 - October 1994 $ 12,800,000
February 1994 - November 1994 $ 22,000,000
February 1994 - December 1994 $ 78,100,000
February 1994 - January 1995 $ 73,200,000
March 1994 - February 1995 $ 78,800,000
April 1994 - March 1995 $ 82,000,000
May 1994 - April 1995 $ 85,600,000
June 1994 - May 1995 $ 88,800,000
July 1994 - June 1995 $ 92,600,000
August 1994 - July 1995 $ 96,600,000
September 1994 - August 1995 $100,500,000
October 1994 - September 1995 $104,000,000
</TABLE>
(b) Consolidated Net Cash Flow. The Borrower
will not permit Consolidated Net Cash Flow for any period set
forth below to be less than the amount set forth below
opposite such period (except that any amount set forth below
in parentheses shall be the maximum amount of permitted
Consolidated Net Cash Flow deficit for the period set forth
opposite such amount):
<TABLE>
<CAPTION>
Period (Fiscal Months) Amount
---------------------- ------
<S> <C>
February 1994 ($27,800,000)
February 1994 - March 1994 ($32,100,000)
February 1994 - April 1994 ($36,100,000)
February 1994 - May 1994 ($35,700,000)
February 1994 - June 1994 ($33,600,000)
February 1994 - July 1994 ($40,200,000)
February 1994 - August 1994 ($44,800,000)
February 1994 - September 1994 ($47,900,000)
February 1994 - October 1994 ($51,100,000)
February 1994 - November 1994 ($48,200,000)
February 1994 - December 1994 $ 800,000
February 1994 - January 1995 ($10,400,000)
February 1994 - February 1995 ($31,600,000)
February 1994 - March 1995 ($32,300,000)
February 1994 - April 1995 ($32,500,000)
February 1994 - May 1995 ($16,500,000)
February 1994 - June 1995 $ 2,000,000
February 1994 - July 1995 $12,300,000
February 1994 - August 1995 $24,000,000
February 1994 - September 1995 $24,300,000
</TABLE>
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(c) Consolidated Net Inventory Ratio. The Borrower will
not permit the Consolidated Net Inventory Ratio on the last day of any
two consecutive Fiscal Months set forth below to exceed the
percentages set forth below opposite such Fiscal Months:
<TABLE>
<CAPTION>
Fiscal Month Percentage
------------ ----------
<S> <C>
February 1994 85.3%
March 1994 87.1%
April 1994 87.2%
May 1994 82.3%
June 1994 89.8%
July 1994 87.1%
August 1994 81.9%
September 1994 81.9%
October 1994 77.1%
November 1994 73.3%
December 1994 81.7%
January 1995 88.8%
February 1995 83.1%
March 1995 87.1%
April 1995 87.0%
May 1995 82.7%
June 1995 89.8%
July 1995 86.5%
August 1995 78.9%
September 1995 80.1%
</TABLE>
(d) Consolidated Maximum/Minimum Inventory Balance. The
Borrower will not permit the aggregate amount of all inventory of the
Borrower and its Subsidiaries (determined on the lower of a first-in,
first-out or market basis) on the last day of any two consecutive
Fiscal Months set forth below to exceed the maximum amount, or to be
less than the minimum amount, set forth below opposite such Fiscal
Months:
<TABLE>
<CAPTION>
Fiscal Month Minimum Amount Maximum Amount
------------ -------------- --------------
<S> <C> <C>
February 1994 $390,800,000 $440,800,000
March 1994 $362,100,000 $412,100,000
April 1994 $362,000,000 $412,000,000
May 1994 $400,900,000 $450,900,000
June 1994 $364,500,000 $414,500,000
July 1994 $373,700,000 $423,700,000
August 1994 $415,400,000 $465,400,000
September 1994 $420,800,000 $470,800,000
October 1994 $471,600,000 $521,600,000
November 1994 $529,800,000 $579,800,000
December 1994 $374,700,000 $424,700,000
January 1995 $421,900,000 $471,900,000
February 1995 $422,300,000 $472,300,000
March 1995 $396,900,000 $446,900,000
April 1995 $392,600,000 $442,600,000
May 1995 $409,400,000 $459,400,000
</TABLE>
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<TABLE>
<S> <C> <C>
June 1995 $365,700,000 $415,700,000
July 1995 $365,700,000 $415,700,000
August 1995 $415,700,000 $465,700,000
September 1995 $415,000,000 $465,000,000
</TABLE>
(e) Consolidated Capital Expenditures. The Borrower will
not permit the aggregate amount of all Capital Expenditures of the
Borrower and its Subsidiaries to exceed, during any period set forth
below, the amount set forth below opposite such period:
<TABLE>
<CAPTION>
Period (Fiscal Months) Amount
---------------------- ------
From Through (and including)
---- -----------------------
<S> <C> <C>
February 1994 January 1995 $110,000,000
February 1995 September 1995 $ 62,000,000;
</TABLE>
provided, however, that the aggregate amount of Capital Expenditures
otherwise permitted pursuant to this Section 7.1(e) during the period
from the February 1995 through and including the September 1995 Fiscal
Months shall be increased (i) by an amount equal to the lesser of
$20,000,000 or the unused portion of the allowance for Capital
Expenditures for the period from February 1994 through January 1995
and (ii) by an amount equal to the lesser of $16,000,000 or 75% of the
excess, if any, of Consolidated EBITDA as of the end of any Fiscal
Month after February 1994 through January 1995 over the Consolidated
EBITDA required to be achieved by the Borrower pursuant to Section
7.1(a) hereof as of the end of such Fiscal Month. Notwithstanding
anything to the contrary set forth in this Section 7.1(e), in no event
shall the aggregate amount of Capital Expenditures of the Borrower and
its Subsidiaries exceed $25,000,000 during any Fiscal Month.
PART III
CONDITIONS TO EFFECTIVENESS
SUBPART 3.1. Effective Date. This Amendatory Agreement shall be
and become effective on such date (the "Effective Date") when all of the
conditions set forth in Subparts 3.1.1 through 3.1.4 shall have been satisfied
and thereafter shall be known, and may be referred to, as the Sixth Amendment
to the Existing Credit Agreement.
SUBPART 3.1.1. Certificate as to Resolutions. The Agent shall have
received a certificate, dated the Effective Date, of the Secretary or any
Assistant Secretary of the Borrower as to resolutions of the Board of Directors
of the Borrower authorizing
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this Amendatory Agreement and the transactions contemplated hereby.
SUBPART 3.1.2. Opinions of Counsel. The Agent shall have received
the opinions, dated the Effective Date and addressed to each Lender, of Marc
Bercoon, general counsel of the Borrower, and of Messrs. Skadden, Arps, Slate,
Meagher & Flom, counsel to the Borrower, each of which shall be satisfactory in
form and substance to the Agent.
SUBPART 3.1.3. Certain Other Conditions. On the Effective Date:
(a) no Default or Event of Default under the Amended
Credit Agreement shall have occurred and be continuing, and
(b) the representations and warranties contained in
Article 4 of the Amended Credit Agreement shall be true and correct in
all respects as if made on and as of the Effective Date (except to the
extent that any such representation or warranty expressly relates to
an earlier date and for changes therein permitted or contemplated by
the Amended Credit Agreement),
and the Agent shall have received a certificate, dated the Effective Date and
signed by the vice president - treasurer of the Borrower, with respect to each
of the matters set forth in clauses (a) and (b) of this Subpart.
SUBPART 3.1.4. Legal Details, etc. All documents executed or
submitted pursuant hereto shall be satisfactory in form and substance to the
Agent and its counsel; the Agent and its counsel shall have received all
information, and such counterpart originals or such certified or other copies
of such materials, as the Agent or its counsel may reasonably request; and all
legal matters incident to the transactions contemplated by this Amendatory
Agreement shall be satisfactory to the Agent and its counsel.
SUBPART 3.2. Expiration. If the Effective Date shall not have
occurred on or prior to March 10, 1994, the agreements of the parties contained
in this Amendatory Agreement shall terminate effective immediately on such date
and without any further action.
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PART IV
MISCELLANEOUS
SUBPART 4.1. Cross References. References in this Amendatory
Agreement to any Part or Subpart are, unless otherwise specified, to such Part
or Subpart of this Amendatory Agreement.
SUBPART 4.2. GOVERNING LAW. THIS AMENDATORY AGREEMENT SHALL BE
DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR
ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
SAID STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
SUBPART 4.3. Severability. Any provision in this Amendatory
Agreement that is held to be inoperative, unenforceable, avoidable or invalid
in any jurisdiction shall, as to that jurisdiction, be inoperative,
unenforceable, avoidable or invalid, as the case may be, without invalidating
the remainder of this Amendatory Agreement, and the operation, enforceability
or validity of that provision in any other jurisdiction shall not be impaired,
and to this end the provisions of this Amendatory Agreement are declared to be
severable.
SUBPART 4.4. Execution in Counterparts. This Amendatory Agreement
may be executed in any number of counterparts and by the different parties on
separate counterparts, and each such counterpart shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same Amendatory Agreement.
SUBPART 4.5. Successors and Assigns. This Amendatory Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendatory
Agreement to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.
CARTER HAWLEY HALE STORES, INC.
By___________________________________
Title:_____________________________
GENERAL ELECTRIC CAPITAL CORPORATION,
as the Agent and as a Lender
By____________________________________
Title:______________________________
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