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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 8-K
CURRENT REPORT
Filed Pursuant to Section 13 or 15(d) of
The Securities and Exchange Act of 1934
Date of Report: March 14, 1995
JAN BELL MARKETING, INC.
(Exact name of registrant as specified in charter)
DELAWARE
(State of Incorporation)
1-9647 59-2290953
(Commission File Number) (IRS Employment Identification No.)
13801 N.W. 14TH STREET, SUNRISE, FLORIDA 33323
(Address of registrant's principal executive offices) (Zip code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (305) 846-2705
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ITEM 5. OTHER EVENTS.
The Company recently announced an agreement to extend a
forbearance agreement with its senior Noteholders until April 18, 1995. A copy
of the press release is attached as Exhibit 1 and a copy of the Forbearance
Agreement is attached as Exhibit 2.
ITEM 7. EXHIBITS.
Listed below are the exhibits filed as a part of this report.
99.1 Press release issued February 28, 1995.
99.2 Forbearance Agreement dated February 28, 1995.
ITEM 8. CHANGE IN FISCAL YEAR.
The Company on March 8, 1995 decided to change its fiscal year
from a retail 52/53 week fiscal year ending on the last Sunday of each January
to a retail 52/53 week fiscal year ending on the last Saturday of each January.
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.
JAN BELL MARKETING, INC.
(Registrant)
By: FRANK S. FUINO, JR.
--------------------------------
Frank S. Fuino, Jr.
Executive Vice President/Finance
and Chief Financial Officer
Date: March 14, 1995
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Index to Exhibits
Exhibits
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99.1 Press release issued February 28, 1995.
99.2 Forbearance Agreement dated February 28, 1995.
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Exhibit 99.1
SUNRISE, Fla. -- (BUSINESS WIRE) -- Feb. 28, 1995 -- Jan Bell
Marketing Inc., (ASE:JBM) announced Tuesday an agreement to extend the
forbearance arrangement with its senior Noteholders until April 18, 1995.
During that period, and thereafter if required, the company will
continue to negotiate with its Noteholders concerning the terms respecting its
outstanding indebtedness. The company is also having related discussions with
its revolving credit lender regarding its seasonal financing needs.
The company has had no borrowings outstanding under its Revolving
Credit Agreement since Dec. 20, 1994 and based upon internal cash generation
does not anticipate a borrowing need during this period.
CONTACT: Jan Bell Marketing, Inc., Sunrise
Rosemary Trudeau, 305/846-2798
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EXHIBIT 99.2
FORBEARANCE AGREEMENT
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This FORBEARANCE AGREEMENT (this "Agreement") is made and entered into
as of February 28, 1995 by and between JAN BELL MARKETING, INC. (the
"Company"), a Delaware corporation, and EACH OF THE UNDERSIGNED NOTEHOLDERS
(individually, a "Noteholder," and collectively, the "Noteholders").
PRELIMINARY STATEMENTS
A. The Company and each of the Noteholders have severally entered
into those certain Note Purchase Agreements, dated October 8, 1992
(collectively, as amended by (i) the Waiver and First Amendment, dated as of
August 30, 1993, (ii) the Waiver and Second Amendment, dated as of March 30,
1994, and (iii) the Forbearance Agreement and Third Amendment (the "Third
Amendment"), made and entered into as of December 6, 1994, the "Note Purchase
Agreement"), pursuant to which the Company issued and sold, and the Noteholders
purchased, the Company's 6.99% Senior Notes due October 8, 1999 (collectively,
as amended from time to time, the "Notes") in the aggregate principal amount of
Thirty-Five Million Dollars ($35,000,000).
B. Pursuant to the Third Amendment, the Noteholders agreed to
forbear from exercising remedies with respect to the Net Earnings Default (as
such term is defined in the Third Amendment) until February 28, 1995.
C. The Company has notified the Noteholders of certain existing
and potential Events of Default, as described on Schedule 1 hereto (such Events
of Default, the "Existing NPA Events of Default").
D. The Company has notified the Noteholders of certain existing
and potential "Events of Default" under, and as defined in, the Nationsbank
Credit Agreement, as more particularly described on Schedule 2 hereto (the
"Existing Credit Agreement Events of Default," and, together with the Existing
NPA Events of Default, the "Existing Events of Default").
E. Absent earlier default and the exercise of remedies as a
result thereof, the Company and the Noteholders intend to engage in discussions
in March and April 1995 concerning the potential restructuring and prepayment
of the obligations of the Company under the Note Purchase Agreement and the
Notes.
F. In order to avoid the consequences of the Existing Events of
Default pending the conduct of the discussions referred to in Preliminary
Statement E above, the Company has requested that the Noteholders agree to
forbear through April 18, 1995 from exercising their rights and remedies under
the Note Purchase Agreement solely with respect to the Existing Events of
Default.
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G. As a condition to such forbearance, the Noteholders have
requested that the Company agree to certain other matters as more particularly
described herein.
AGREEMENTS
For valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
SECTION 1. DEFINED TERMS. Capitalized terms used in this
Agreement and not defined herein have the meanings assigned to them in the Note
Purchase Agreement.
SECTION 2. Agreement To Forbear. During the period commencing
on the Effective Date (as defined herein) and terminating on the earliest to
occur of:
(a) April 18, 1995,
(b) an "Event of Default" under and as defined in the
Note Purchase Agreement (other than the Existing NPA Events of
Default),
(c) an "Event of Default" under and as defined in the
Nationsbank Credit Agreement (other than the Existing Credit Agreement
Events of Default),
(d) the breach by the Company of any of its covenants or
obligations under this Agreement, and
(e) any time any of the representations or warranties of
the Company set forth in this Agreement proves to be false or
misleading in any respect.
but, in any case, not thereafter, the Noteholders shall forbear from exercising
any rights or remedies that they may have under the Note Purchase Agreement or
otherwise in respect of the Existing Events of Default. The terms of this
Agreement shall not operate as a waiver by the Noteholders of, or otherwise
prejudice the Noteholders' rights, remedies or powers under, the Note Purchase
Agreement, the Notes or applicable law or with respect to (x) any "Events of
Default" that may currently exist under either the Note Purchase Agreement or
the Nationsbank Credit Agreement but have not been disclosed by the Company on
Schedule 1 or Schedule 2 hereto, as applicable, or (y) except for the agreement
of forbearance set forth in the immediately preceding sentence of this Section
2, any Existing Event of Default. Except as expressly provided herein:
(i) no terms and provisions of the Note Purchase
Agreement, the Notes or any other agreement are modified or
changed by this Agreement; and
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(ii) the terms and provisions of the Note Purchase
Agreement and the Notes shall continue in full force and
effect.
SECTION 3. WARRANTIES AND REPRESENTATIONS. To induce the
Noteholders to enter into this Agreement, the Company warrants and represents
to the Noteholders that, as of the Effective Date:
3.1 LITIGATION. There are no proceedings pending or, to
the knowledge of the Company or any of its Subsidiaries, threatened
against or affecting the Company, any Subsidiary or any of their
respective properties in any court or before any governmental
authority or arbitration board or tribunal which, either individually
or in the aggregate, would conflict with or interfere with the ability
of the Company to execute and deliver this Agreement or to perform its
obligations under the Note Purchase Agreement and the Notes.
3.2 AUTHORIZATION, EXECUTION AND ENFORCEABILITY. The
execution and delivery by the Company of this Agreement and the
performance by the Company of its obligations under the Note Purchase
Agreement and the Notes have been duly authorized by all necessary
corporate action on the part of the Company. This Agreement has been
duly executed and delivered by the Company. This Agreement, the Note
Purchase Agreement and the Notes are valid and binding obligations of
the Company, enforceable in accordance with their respective terms,
except that the enforceability thereof may be:
(a) limited by bankruptcy, insolvency or other
similar laws affecting the enforceability of creditors' rights
generally; and
(b) subject to the availability of equitable
remedies.
3.3 NO CONFLICTS OR DEFAULTS. Neither the execution and
delivery by the Company of this Agreement, nor the performance by the
Company of its obligations under the Note Purchase Agreement and the
Notes, conflicts with, results in any breach in any of the provisions
of, constitutes a default under, violates or results in the creation
of any lien, security interest or other encumbrance upon any property
of the Company or any Subsidiary under the provisions of:
(a) any charter document or the bylaws of the
Company or any of the Subsidiaries;
(b) any agreement, instrument or conveyance to
which the Company or any of the Subsidiaries or any of their
respective properties may be bound or affected; or
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(c) any statute, rule or regulation or any order,
judgment or award of any court, tribunal or arbitrator by
which the Company or any of the Subsidiaries or any of their
respective properties may be bound or affected.
3.4 DEFAULTS.
(a) Except for the Existing NPA Events of
Default, no event has occurred and no condition exists which
would constitute a default or an Event of Default under the
Note Purchase Agreement, and, except for the Existing Credit
Agreement Events of Default, no event has occurred and no
condition exists which would constitute a default or an "Event
of Default" under and as defined in the NationsBank Credit
Agreement.
(b) Except as set forth in clause (a), neither
the Company nor any Subsidiary is in violation in any material
respect of any term in (i) any agreement or other instrument
to which it is a party or by which it or any of its property
may be bound which relates to outstanding Indebtedness of such
Person, or (ii) any other agreement or instrument to which it
is a party or by which it or any of its property may be bound
which could reasonably be expected to have a material adverse
effect on the business, properties or financial condition of
the Company or any of the Subsidiaries, or the ability of the
Company to perform its obligations set forth in the Note
Purchase Agreement or in the Notes. Without limiting the
generality of the foregoing, (A) neither the Company nor any
Subsidiary is (x) in default in the payment of principal or
interest on any Indebtedness, including, without limitation,
the NationsBank Credit Agreement, or (y) except for the
Existing Events of Default, in default under any instrument or
agreement under and subject to which any outstanding
Indebtedness has been issued, including, without limitation,
the NationsBank Credit Agreement, and (B) except for the
Existing Events of Default, no event has occurred and is
continuing under the provisions of any such instrument or
agreement which with the lapse of time or the giving of
notice, or both, would constitute an event of default
thereunder.
SECTION 4. CONDITIONS PRECEDENT TO THIS AGREEMENT. The
agreement to forbear set forth in Section 2 hereof shall not become effective
unless all of the following conditions precedent shall have been satisfied on
or before February 28, 1995 (the "Effective Date"):
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4.1 EXECUTION AND DELIVERY OF AGREEMENT. The Company
shall have executed and delivered to each of the Noteholders a
counterpart of this Agreement.
4.2 REPRESENTATIONS AND WARRANTIES TRUE. The warranties
and representations set forth in Section 2 hereof shall be true and
correct on, and as of, the Effective Date.
4.3 AUTHORIZATION OF TRANSACTIONS. The Company shall
have authorized, by all necessary corporate action, the execution and
delivery of this Agreement and each of the documents executed and
delivered in connection herewith and the performance of all
obligations of, and the satisfaction of all closing conditions
pursuant to this Section 4 by, and the consummation of all
transactions contemplated by this Agreement by, the Company.
4.4 EXPENSES. The Company shall have paid all costs and
expenses of the Noteholders relating to this Agreement incurred on or
before the Effective Date including, without limitation, (a) the fees
and expenses of Hebb & Gitlin, special counsel to the Noteholders, and
(b) the fees and expenses of Policano & Manzo, financial consultant to
Hebb & Gitlin, in each case reflected in the statements delivered to
the Company on or prior to February 28, 1995.
4.5 FEE RESERVES. The Company shall have (a) executed
and delivered a counterpart of a fee arrangement letter with Hebb &
Gitlin in form and substance satisfactory to each of the Noteholders
(the "Reserve Letter"), (b) delivered a fee reserve of Fifty Thousand
Dollars ($50,000) to Hebb & Gitlin in connection with the Reserve
Letter, and (c) delivered a fee reserve of Fifty Thousand Dollars
($50,000) to Policano & Manzo in connection with the Reserve Letter.
4.6 PROCEEDINGS SATISFACTORY. All proceedings taken in
connection with this Agreement and all documents and papers relating
thereto shall be satisfactory to the Noteholders and their special
counsel. The Noteholders and their special counsel shall have
received copies of such documents and papers as they may reasonably
request in connection therewith, in form and substance satisfactory to
them.
SECTION 5. MISCELLANEOUS.
5.1 GOVERNING LAW. This Agreement shall be construed,
interpreted and enforced in accordance with, and governed by, internal
New York law.
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5.2 DUPLICATE ORIGINALS. Two or more duplicate originals
of this Agreement may be signed by the parties, each of which shall be
an original but all of which together shall constitute one and the
same instrument. This Agreement may be executed in one or more
counterparts and shall be effective when at least one counterpart
shall have been executed by each party hereto, and each set of
counterparts which, collectively, show execution by each party hereto
shall constitute one duplicate original.
5.3 AGREEMENTS. Neither this Agreement nor any term
hereof may be changed, waived, discharged or terminated orally, or by
any action or inaction, but only by an instrument in writing signed by
the party against which enforcement of the change, waiver, discharge
or termination is sought.
5.4 SECTION HEADINGS. The titles of the sections hereof
appear as a matter of convenience only, do not constitute a part of
this Agreement and shall not affect the construction hereof.
5.5 RETENTION OF PROFESSIONALS; COSTS AND EXPENSES.
Without limitation of any of its obligations under the Note Purchase
Agreement or the Notes, the Company hereby reaffirms its obligations
pursuant to Section 5.5 of the Third Amendment and will continue to
comply with all of the provisions thereof.
5.6 ACKNOWLEDGMENT AND WAIVER. THE COMPANY ACKNOWLEDGES
AND AGREES THAT THE NOTE PURCHASE AGREEMENT AND THE NOTES ARE VALID
AND BINDING OBLIGATIONS OF THE COMPANY, ENFORCEABLE IN ACCORDANCE WITH
THEIR RESPECTIVE TERMS, WITHOUT DEFENSES, OFFSETS, RIGHTS OF
RECOUPMENT, COUNTERCLAIMS OR CLAIMS OF ANY NATURE WHATSOEVER, AND TO
THE EXTENT THAT ANY SUCH DEFENSES, OFFSETS, RIGHTS OF RECOUPMENT,
COUNTERCLAIMS OR CLAIMS MAY EXIST, THE COMPANY HEREBY EXPRESSLY
WAIVES, RELEASES AND DISCHARGES THE SAME.
5.7 ENTIRE AGREEMENT. This Agreement embodies the entire
agreement and understanding of the parties hereto and supersedes all
prior agreements and understandings, written or otherwise, relating to
the subject matter of this Agreement.
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IN WITNESS WHEREOF, the Company and each Noteholder have caused this
Agreement to be executed by their respective duly authorized officers as of the
day and year first above written.
JAN BELL MARKETING, INC.
By: /s/ Joseph Pennacchio
------------------------------------------
Name: Joseph Pennacchio
Title:
METROPOLITAN LIFE INSURANCE
COMPANY
By: /s/ Joseph Augustini
------------------------------------------
Name: Joseph Augustini
Title:
TEXAS LIFE INSURANCE COMPANY
By: /s/ Bradley D. Rhodes
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Name: Bradley D. Rhodes
Title:
THE GREAT-WEST LIFE ASSURANCE
COMPANY
By: /s/ E. A. Marr
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Name: E. A. Marr
Title:
By: /s/ Wayne T. Hoffmann
------------------------------------------
Name: Wayne T. Hoffmann
Title:
[Signature Page to FORBEARANCE AGREEMENT]
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SCHEDULE 1
EXISTING EVENTS OF DEFAULT UNDER NOTE PURCHASE AGREEMENT
1. Events of Default under clause (x) of Section 9.1(c) of the
Note Purchase Agreement occurring because of the Company's failure to comply
with Section 8.7(b), Section 8.8(a) and Section 8.8(b) of the Note Purchase
Agreement.
2. Events of Default under clause (y) of Section 9.1(c) of the
Note Purchase Agreement occurring because of the Existing Credit Agreement
Events of Default described on Schedule 2.
SCHEDULE 1-1
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SCHEDULE 2
EXISTING EVENTS OF DEFAULT UNDER NATIONSBANK CREDIT AGREEMENT
1. Events of Default under Section 10.01(c) of the Nationsbank
Credit Agreement occurring because of the Company's failure to comply with
Section 9.02 and Section 9.04 of the Nationsbank Credit Agreement.
2. Events of Default under clause (ii) of Section 10.01(e) of the
Nationsbank Credit Agreement occurring because of the Existing NPA Events of
Default described on Schedule 1.
SCHEDULE 2-1
