<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) September 20, 1996
------------------
Safety 1st, Inc.
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
Massachusetts
- --------------------------------------------------------------------------------
(State or Other Jurisdiction of Incorporation)
0-21404 04-2836423
- --------------------- ------------------------------------
(Commission File No.) (I.R.S. Employer Identification No.)
210 Boylston St., Chestnut Hill, Massachusetts 02167
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
(617) 964-7744
- --------------------------------------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
N/A
- --------------------------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
<PAGE> 2
ITEM 5. OTHER EVENTS
------------
The Company has entered into a Third, a Fourth and a Fifth Amendment to
Forbearance Agreement with its lenders, by which the lenders have agreed to
extend the Forbearance Termination Date (as defined in the Agreement) from
September 20, 1996 until September 27, 1996, October 4, 1996 and October 11,
1996, respectively.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
---------------------------------
(c) The following Exhibit is filed as part of this Report.
Exhibit Description
------- -----------
10.1 Third Amendment to Forbearance Agreement among Fleet
National Bank, The First National Bank of Boston and U.S.
Trust and Safety 1st, Inc., et al.
10.2 Fourth Amendment to Forbearance Agreement among Fleet
National Bank, The First National Bank of Boston and U.S.
Trust and Safety 1st, Inc., et al.
10.3 Fifth Amendment to Forbearance Agreement among Fleet
National Bank, The First National Bank of Boston and U.S.
Trust and Safety 1st, Inc., et al.
Page 2
<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 hereunto duly authorized.
Safety 1st, Inc.
--------------------------
(Registrant)
Date October 10, 1996 By /s/ Michael Lerner
--------------------- --------------------------
Michael Lerner, President
Chief Executive Officer
Page 3
<PAGE> 4
EXHIBIT INDEX
Exhibit Description Page
- ------- ----------- ----
10.1 Third Amendment to Forbearance Agreement among Fleet
National Bank, The First National Bank of Boston and
U.S. Trust and Safety 1st, Inc., et al.
10.2 Fourth Amendment to Forbearance Agreement among Fleet
National Bank, The First National Bank of Boston and
U.S. Trust and Safety 1st, Inc., et al.
10.3 Fifth Amendment to Forbearance Agreement among Fleet
National Bank, The First National Bank of Boston and
U.S. Trust and Safety 1st, Inc., et al.
Page 4
<PAGE> 1
EXHIBIT 10.1
<PAGE> 2
THIRD AMENDMENT TO FORBEARANCE AGREEMENT
AMONG FLEET NATIONAL BANK,
THE FIRST NATIONAL BANK OF BOSTON,
USTRUST AND SAFETY 1ST, INC., ET AL.
This Third Amendment to Forbearance Agreement (the "Third Amended
Forbearance Agreement") is made with respect to that certain Loan Agreement
dated March 28, 1996 as heretofore amended (the "Loan Agreement"), by and among
Safety 1st, Inc. ("Safety 1st"), a Massachusetts corporation with offices at 210
Boylston Street, Chestnut Hill, Massachusetts; Safety 1st (Europe) Limited
("Safety Europe"), a limited liability company organized under the laws of the
United Kingdom, 3232301 Canada, Inc. ("3232301"), a corporation organized under
the federal laws of Canada; Safety 1st Home Products Canada, Inc. ("Safety
Canada"), a corporation organized under the federal laws of Canada; Safety 1st
International, Inc. ("Safety International"), a corporation organized under the
laws of the U.S. Virgin Islands; and Fleet National Bank ("Fleet" or the
"Agent"), a banking corporation organized under the laws of the United States;
the First National Bank of Boston ("Bank of Boston"), a banking corporation
organized under the laws of the United States; and USTrust ("UST"), a
Massachusetts trust company (collectively "the Banks"). Safety lst, Safety
Europe, 3232301, Safety Canada and Safety International are sometimes
collectively hereinafter referred to as "the Borrowers". The term "Loan
Documents" as used herein shall include those documents, instruments and
agreements executed and delivered in connection with this Third Amended
Forbearance Agreement, the Second Amended Forbearance
<PAGE> 3
Agreement, the Amended Forbearance Agreement and the Forbearance Agreement (as
defined hereinafter), as well as the documents, instruments and agreements
included within the defined term "Loan Documents" in the Loan Agreement.
Capitalized terms used but not defined herein shall have the meanings ascribed
to them in the Loan Agreement.
This Third Amended Forbearance Agreement extends that certain Forbearance
Agreement among the Banks, the Borrowers and Michael Lerner ("Lerner") dated
August 2, 1996 (the "Forbearance Agreement"), that certain Amended Forbearance
Agreement among the Banks, the Borrowers and Lerner dated August 13, 1996 (the
"Amended Forbearance Agreement") and that Second Amendment to Forbearance
Agreement among the Banks, the Borrowers and Lerner dated September 6, 1996 (the
"Second Amended Forbearance Agreement"), which continue to be in effect except
to the extent expressly superseded by this Third Amended Forbearance Agreement
and except to the extent that provisions of this Third Amended Forbearance
Agreement contradict the Amended Forbearance Agreement, as previously amended,
in which case the provisions of this Third Amended Forbearance Agreement shall
control.
The Borrowers and Lerner have requested that the Banks continue to forbear
through September 27, 1996 from enforcement of their rights and remedies against
the Borrowers.
The Banks are willing to continue to forbear from the exercise of such
rights and remedies but only upon the terms and conditions and based upon the
representations and warranties of the Borrowers and Lerner herein.
<PAGE> 4
1. The Borrowers hereby acknowledge that they are unconditionally liable to
the Banks for the full and immediate payment of each of the obligations
described in EXHIBIT I attached hereto and incorporated herein by reference
as of the date thereof, plus all charges that may arise under the Loan
Documents, including attorneys fees and costs of collection incurred in
connection with such obligations by the Banks.
2. The Borrowers and Lerner (as "Limited Guarantor") further acknowledge that
the Banks have no existing commitments, obligations or agreements to
advance credit or loans or make any other financial accommodations to the
Borrowers except as specifically set forth in the Forbearance Agreement,
the Amended Forbearance Agreement, and the Second Amended Forbearance
Agreement.
3. Upon the terms and conditions set forth herein, the Banks agree that they
will forbear from exercising the rights and remedies contained in the Loan
Documents, at law and in equity until the earlier of: (i) occurrence of an
Event of Default arising after the date of this Amendment other than the
continuing Events of Default as the result of a breach of the covenants
described in Exhibit 3, or (ii) September 27, 1996 (the "Forbearance
Termination Date"). Notwithstanding the acknowledgment of existing defaults
contained in the Forbearance Agreement, the Banks do not hereby agree to
waive any of the existing financial or other covenant Events of Defaults
under the Loan Agreement. The
<PAGE> 5
Borrowers shall comply with all of their other obligations to the Banks as
set forth in the Loan Documents. The Borrowers and Lerner acknowledge that
the Banks are under no obligation to continue to forbear, and have not
agreed to or made any representations that they would agree to forbear,
after the Forbearance Termination Date.
4. Lerner has previously executed and delivered to the Banks a Limited
Guaranty and First Amendment to Limited Guaranty (the "Lerner Guaranty")
pursuant to which Lerner guaranteed and continues to guaranty to the Banks
the full and timely payment of all Obligations of the Borrowers to the
Banks up to the dollar limitation referenced in the Lerner Guaranty. Lerner
hereby reaffirms i) the provisions of the Lerner Guaranty and ii) the
provisions and terms of the Third Party Pledge Agreement securing the
Lerner Guaranty, and the First Amendment to Third Party Pledge Agreement.
5. The Borrowers and Lerner (and their successors and assigns) hereby release,
waive and forever relinquish all claims, demands, obligations, liabilities
and causes of action of whatever kind or nature, whether known or unknown,
which any of them may have or might assert now or in the future, against
the Banks, their officers, directors, employees, agents, attorneys and
accountants, directly or indirectly, arising out of, based upon, or in any
manner connected with, (i) any transaction, event, action, failure to act
or occurrence of any sort or type, whether known or unknown, which existed,
occurred or was taken, permitted or begun
<PAGE> 6
prior to the execution of this Amendment; (ii) any discussions,
commitments, negotiations, conversations or communications with respect to
the Borrowers' and Lerner's respective Obligations prior to the execution
of this Amendment; or (iii) anything or matter prior to the execution of
this Amendment related to any of the foregoing.
6. As of the date hereof, the Borrowers and Lerner represent and warrant that
they have no offsets, claims, or other defenses to payment of full of their
obligations to the Banks, and reaffirm that all of the representations and
warranties made by them in the Loan Agreement, Forbearance Agreement, the
Amended Forbearance Agreement, the Second Amended Forbearance Agreement and
this Third Amended Forbearance Agreement and the other loan documents,
instruments and agreements remain true and correct, except for the defaults
in financial and other covenants set forth in Exhibit 3 hereto.
7. The Borrowers and Lerner shall take such further actions, and execute and
deliver to the Banks such further documents and agreements as the Banks may
require to evidence the agreements contained in the Loan Agreement, the
Forbearance Agreement, the Amended Forbearance Agreement, the Second
Amended Forbearance Agreement and herein, and the Banks shall take such
actions and execute and deliver such documents and agreements as may be
required to evidence their agreements contained herein.
8. This Amendment and the documents, instruments and agreements
<PAGE> 7
delivered in connection herewith, together with the Forbearance Agreement,
the Amended Forbearance Agreement, the Second Amended Forbearance Agreement
and documents, instruments and agreements delivered in connection
therewith, represent the entire agreement among the parties with respect to
the subject matter hereof, and shall be construed in accordance with the
laws of the Commonwealth of Massachusetts as an agreement under seal.
WITNESS OUR HANDS AND SEALS THIS _____ DAY OF SEPTEMBER, 1996.
BORROWER
SAFETY 1ST, INC.
By:
-------------------------------------
Michael Lerner, President
SAFETY 1st (EUROPE) LIMITED
By:
-------------------------------------
Michael Lerner, Director
By:
-------------------------------------
Michael Bernstein, Director
SAFETY 1ST HOME PRODUCTS
CANADA, INC.
By:
-------------------------------------
Michael Lerner, President
3232301 CANADA, INC.
By:
-------------------------------------
Michael Lerner, President
<PAGE> 8
SAFETY 1ST INTERNATIONAL, INC.
By:
-----------------------------------
Michael Lerner, President
BANKS:
FLEET NATIONAL BANK
By:
-----------------------------------
DEBORAH LAWRENCE
THE FIRST NATIONAL BANK OF BOSTON
By:
-----------------------------------
USTRUST
By:
-----------------------------------
THOMAS J. BYRNE, Senior Vice
President
GUARANTOR:
-----------------------------------
MICHAEL LERNER
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Michael Lerner, individually and
as President of Safety 1st, Inc., and acknowledged the foregoing instrument to
be his free act and deed and the free act and deed of Safety 1st, Inc., before
me,
-----------------------------------
, Notary Public
My Commission Expires:
<PAGE> 9
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Michael Lerner, the Director of
Safety lst (Europe) Limited, and acknowledged the foregoing instrument to be his
free act and deed on behalf of Safety 1st (Europe) Limited, before me,
-----------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Michael Lerner, the President of
Safety 1st Home Products Canada, Inc., and acknowledged the foregoing instrument
to be his free act and deed on behalf of Safety lst Home Products Canada, Inc.,
before me,
-----------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Michael Lerner, the President of
3232301 Canada, Inc., and acknowledged the foregoing instrument to be his free
act and deed on behalf of 3232301 Canada, Inc., before me,
-----------------------------------
, Notary Public
My Commission Expires:
<PAGE> 10
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Michael Lerner, the President of
Safety 1st International, Inc., and acknowledged the foregoing instrument to be
his free act and deed on behalf of Safety 1st International, Inc., before me,
-----------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named Deborah Lawrence, the Vice
President Fleet National Bank, and acknowledged the foregoing instrument to be
her free act and deed on behalf of Fleet National Bank, before me,
-----------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named Peter Haley, the Vice President of
The First National Bank of Boston, and acknowledged the foregoing instrument to
be his free act and deed on behalf of The First National Bank of Boston, before
me,
-----------------------------------
, Notary Public
My Commission Expires:
<PAGE> 11
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Errin Siagel, the Vice President
of USTrust, and acknowledged the foregoing instrument to be free act and deed on
behalf of USTrust, before me,
-----------------------------------
, Notary Public
My Commission Expires:
<PAGE> 12
EXHIBIT 1
Total Obligations as of September 20, 1996
$41,328,163.82
<PAGE> 1
EXHIBIT 10.2
<PAGE> 2
FOURTH AMENDMENT TO FORBEARANCE AGREEMENT
AMONG FLEET NATIONAL BANK,
THE FIRST NATIONAL BANK OF BOSTON,
USTRUST AND SAFETY 1ST, INC., ET AL.
This Fourth Amendment to Forbearance Agreement (the "Fourth Amended
Forbearance Agreement") is made with respect to that certain Loan Agreement
dated March 28, 1996 as heretofore amended (the "Loan Agreement"), by and among
Safety 1st, Inc. ("Safety 1st"), a Massachusetts corporation with offices at 210
Boylston Street, Chestnut Hill, Massachusetts; Safety 1st (Europe) Limited
("Safety Europe"), a limited liability company organized under the laws of the
United Kingdom, 3232301 Canada, Inc. ("3232301"), a corporation organized under
the federal laws of Canada; Safety 1st Home Products Canada, Inc. ("Safety
Canada"), a corporation organized under the federal laws of Canada; Safety 1st
International, Inc. ("Safety International"), a corporation organized under the
laws of the U.S. Virgin Islands; and Fleet National Bank ("Fleet" or the
"Agent"), a banking corporation organized under the laws of the United States;
the First National Bank of Boston ("Bank of Boston"), a banking corporation
organized under the laws of the United States; and USTrust ("UST"), a
Massachusetts trust company (collectively "the Banks"). Safety 1st, Safety
Europe, 3232301, Safety Canada and Safety International are sometimes
collectively hereinafter referred to as "the Borrowers". The term "Loan
Documents" as used herein shall include those documents, instruments and
agreements executed and delivered in connection with this Fourth Amended
Forbearance Agreement, the Third Amended Forbearance
<PAGE> 3
Agreement, the Second Amended Forbearance Agreement, the Amended Forbearance
Agreement and the Forbearance Agreement (as defined hereinafter), as well as the
documents, instruments and agreements included within the defined term "Loan
Documents" in the Loan Agreement. Capitalized terms used but not defined herein
shall have the meanings ascribed to them in the Loan Agreement.
This Fourth Amended Forbearance Agreement extends that certain Forbearance
Agreement among the Banks, the Borrowers and Michael Lerner ("Lerner") dated
August 2, 1996 (the "Forbearance Agreement"), that certain Amended Forbearance
Agreement among the Banks, the Borrowers and Lerner dated August 13, 1996 (the
"Amended Forbearance Agreement"), that Second Amendment to Forbearance Agreement
among the Banks, the Borrowers and Lerner dated September 6, 1996 (the "Second
Amended Forbearance Agreement"), and that Third Amendment to Forbearance
Agreement the Banks, the Borrowers, and herein dated September 20, 1996 ("Third
Amended Forbearance Agreement") which continue to be in effect except to the
extent expressly superseded by this Fourth Amended Forbearance Agreement and
except to the extent that provisions of this Fourth Amended Forbearance
Agreement contradict the Amended Forbearance Agreement, as previously amended,
in which case the provisions of this Fourth Amended Forbearance Agreement shall
control.
The Borrowers and Lerner have requested that the Banks continue to forbear
through October 4, 1996 from enforcement of their rights and remedies against
the Borrowers.
<PAGE> 4
The Banks are willing to continue to forbear from the exercise of such
rights and remedies but only upon the terms and conditions and based upon the
representations and warranties of the Borrowers and Lerner herein.
9. The Borrowers hereby acknowledge that they are unconditionally liable to
the Banks for the full and immediate payment of each of the obligations
described in EXHIBIT I attached hereto and incorporated herein by reference as
of the date thereof, plus all charges that may arise under the Loan Documents,
including attorneys fees and costs of collection incurred in connection with
such obligations by the Banks.
10. The Borrowers and Lerner (as "Limited Guarantor") further acknowledge
that the Banks have no existing commitments, obligations or agreements to
advance credit or loans or make any other financial accommodations to the
Borrowers except as specifically set forth in the Forbearance Agreement, the
Amended Forbearance Agreement, the Second Amended Forbearance Agreement, and the
Third Amended Forbearance Agreement.
11. Upon the terms and conditions set forth herein, the Banks agree that
they will forbear from exercising the rights and remedies contained in the Loan
Documents, at law and in equity until the earlier of: (i) occurrence of an Event
of Default arising after the date of this Amendment other than the continuing
Events of Default as the result of a breach of the covenants described in
Exhibit 3, or (ii) October 4, 1996 (the "Forbearance Termination Date").
Notwithstanding the acknowledgment of existing defaults contained in the
Forbearance
<PAGE> 5
Agreement, the Banks do not hereby agree to waive any of the existing financial
or other covenant Events of Defaults under the Loan Agreement. The Borrowers
shall comply with all of their other obligations to the Banks as set forth in
the Loan Documents. The Borrowers and Lerner acknowledge that the Banks are
under no obligation to continue to forbear, and have not agreed to or made any
representations that they would agree to forbear, after the Forbearance
Termination Date.
12. Lerner has previously executed and delivered to the Banks a Limited
Guaranty and First Amendment to Limited Guaranty (the "Lerner Guaranty")
pursuant to which Lerner guaranteed and continues to guaranty to the Banks the
full and timely payment of all Obligations of the Borrowers to the Banks up to
the dollar limitation referenced in the Lerner Guaranty. Lerner hereby reaffirms
i) the provisions of the Lerner Guaranty and ii) the provisions and terms of the
Third Party Pledge Agreement securing the Lerner Guaranty, and the First
Amendment to Third Party Pledge Agreement.
13. The Borrowers and Lerner (and their successors and assigns) hereby
release, waive and forever relinquish all claims, demands, obligations,
liabilities and causes of action of whatever kind or nature, whether known or
unknown, which any of them may have or might assert now or in the future,
against the Banks, their officers, directors, employees, agents, attorneys and
accountants, directly or indirectly, arising out of, based upon, or in any
manner connected with, (i) any transaction, event, action, failure to act or
occurrence of any sort or type,
<PAGE> 6
whether known or unknown, which existed, occurred or was taken, permitted or
begun prior to the execution of this Amendment; (ii) any discussions,
commitments, negotiations, conversations or communications with respect to the
Borrowers' and Lerner's respective Obligations prior to the execution of this
Amendment; or (iii) anything or matter prior to the execution of this Amendment
related to any of the foregoing.
14. As of the date hereof, the Borrowers and Lerner represent and warrant
that they have no offsets, claims, or other defenses to payment of full of their
obligations to the Banks, and reaffirm that all of the representations and
warranties made by them in the Loan Agreement, Forbearance Agreement, the
Amended Forbearance Agreement, the Second Amended Forbearance Agreement, the
Third Amended Forbearance Agreement and this Fourth Amended Forbearance
Agreement and the other loan documents, instruments and agreements remain true
and correct, except for the defaults in financial and other covenants set forth
in Exhibit 3 hereto.
15. The Borrowers and Lerner shall take such further actions, and execute
and deliver to the Banks such further documents and agreements as the Banks may
require to evidence the agreements contained in the Loan Agreement, the
Forbearance Agreement, the Amended Forbearance Agreement, the Second Amended
Forbearance Agreement, the Third Amended Forbearance Agreement and herein, and
the Banks shall take such actions and execute and deliver such documents and
agreements as may be required to evidence their agreements contained herein.
16. This Amendment and the documents, instruments and
<PAGE> 7
agreements delivered in connection herewith, together with the Forbearance
Agreement, the Amended Forbearance Agreement, the Second Amended Forbearance
Agreement, the Third Amended Forbearance Agreement and documents, instruments
and agreements delivered in connection therewith, represent the entire agreement
among the parties with respect to the subject matter hereof, and shall be
construed in accordance with the laws of the Commonwealth of Massachusetts as an
agreement under seal.
WITNESS OUR HANDS AND SEALS THIS _____ DAY OF SEPTEMBER, 1996.
BORROWER
SAFETY 1ST, INC.
By:
-------------------------------
Michael Lerner, President
SAFETY 1st (EUROPE) LIMITED
By:
-------------------------------
Michael Lerner, Director
By:
-------------------------------
Michael Bernstein, Director
SAFETY 1ST HOME PRODUCTS
CANADA, INC.
By:
-------------------------------
Michael Lerner, President
3232301 CANADA, INC.
By:
-------------------------------
Michael Lerner, President
<PAGE> 8
SAFETY 1ST INTERNATIONAL, INC.
By:
------------------------------
Michael Lerner, President
BANKS:
FLEET NATIONAL BANK
By:
------------------------------
DEBORAH LAWRENCE
THE FIRST NATIONAL BANK OF
BOSTON
By:
------------------------------
USTRUST
By:
------------------------------
THOMAS J. BYRNE, Senior Vice
President
GUARANTOR:
------------------------------
MICHAEL LERNER
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Michael Lerner, individually and
as President of Safety 1st, Inc., and acknowledged the foregoing instrument to
be his free act and deed and the free act and deed of Safety 1st, Inc., before
me,
-------------------------------------
, Notary Public
My Commission Expires:
<PAGE> 9
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Michael Lerner, the Director of
Safety 1st (Europe) Limited, and acknowledged the foregoing instrument to be his
free act and deed on behalf of Safety 1st (Europe) Limited, before me,
-------------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Michael Lerner, the President of
Safety 1st Home Products Canada, Inc., and acknowledged the foregoing instrument
to be his free act and deed on behalf of Safety 1st Home Products Canada, Inc.,
before me,
-------------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Michael Lerner, the President of
3232301 Canada, Inc., and acknowledged the foregoing instrument to be his free
act and deed on behalf of 3232301 Canada, Inc., before me,
-------------------------------------
, Notary Public
My Commission Expires:
<PAGE> 10
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Michael Lerner, the President of
Safety 1st International, Inc., and acknowledged the foregoing instrument to be
his free act and deed on behalf of Safety 1st International, Inc., before me,
-------------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named Deborah Lawrence, the Vice
President Fleet National Bank, and acknowledged the foregoing instrument to be
her free act and deed on behalf of Fleet National Bank, before me,
-------------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named Peter Haley, the Vice President of
The First National Bank of Boston, and acknowledged the foregoing instrument to
be his free act and deed on behalf of The First National Bank of Boston, before
me,
-------------------------------------
, Notary Public
My Commission Expires:
<PAGE> 11
COMMONWEALTH OF MASSACHUSETTS
__________________, ss September __, 1996
Then personally appeared the above-named, Thomas J. Byrne, the Senior Vice
President of USTrust, and acknowledged the foregoing instrument to be free act
and deed on behalf of USTrust, before me,
-------------------------------------
, Notary Public
My Commission Expires:
EXHIBIT 1
Total Obligations as of September 26, 1996 $42,042,202.74
<PAGE> 1
EXHIBIT 10.3
<PAGE> 2
FIFTH AMENDMENT TO FORBEARANCE AGREEMENT
AMONG FLEET NATIONAL BANK,
THE FIRST NATIONAL BANK OF BOSTON,
USTRUST AND SAFETY 1ST, INC., ET AL.
This Fifth Amendment to Forbearance Agreement (the "Fifth Amended
Forbearance Agreement") is made with respect to that certain Loan Agreement
dated March 28, 1996 as heretofore amended (the "Loan Agreement"), by and among
Safety 1st, Inc. ("Safety 1st"), a Massachusetts corporation with offices at 210
Boylston Street, Chestnut Hill, Massachusetts; Safety 1st (Europe) Limited
("Safety Europe"), a limited liability company organized under the laws of the
United Kingdom, 3232301 Canada, Inc. ("3232301"), a corporation organized under
the federal laws of Canada; Safety 1st Home Products Canada, Inc. ("Safety
Canada"), a corporation organized under the federal laws of Canada; Safety 1st
International, Inc. ("Safety International"), a corporation organized under the
laws of the U.S. Virgin Islands; and Fleet National Bank ("Fleet" or the
"Agent"), a banking corporation organized under the laws of the United States;
the First National Bank of Boston ("Bank of Boston"), a banking corporation
organized under the laws of the United States; and USTrust ("UST"), a
Massachusetts trust company (collectively "the Banks"). Safety 1st, Safety
Europe, 3232301, Safety Canada and Safety International are sometimes
collectively hereinafter referred to as "the Borrowers". The term "Loan
Documents" as used herein shall include those documents, instruments and
agreements executed and delivered in connection with this Fifth Amended
Forbearance Agreement, the Fourth Amended Forbearance Agreement, the Third
Amended Forbearance Agreement, the Second Amended Forbearance Agreement, the
Amended Forbearance Agreement
<PAGE> 3
and the Forbearance Agreement (as defined hereinafter), as well as the
documents, instruments and agreements included within the defined term "Loan
Documents" in the Loan Agreement. Capitalized terms used but not defined herein
shall have the meanings ascribed to them in the Loan Agreement.
This Fifth Amended Forbearance Agreement extends that certain Forbearance
Agreement among the Banks, the Borrowers and Michael Lerner ("Lerner") dated
August 2, 1996 (the "Forbearance Agreement"), that certain Amended Forbearance
Agreement among the Banks, the Borrowers and Lerner dated August 13, 1996 (the
"Amended Forbearance Agreement"), that Second Amendment to Forbearance Agreement
among the Banks, the Borrowers and Lerner dated September 6, 1996 (the "Second
Amended Forbearance Agreement"), that Third Amendment to Forbearance Agreement
among the Banks, the Borrowers and Lerner dated September 20, 1996 ("Third
Amended Forbearance Agreement") and that Fourth Amendment to Forbearance
Agreement dated September 27, 1996 ("Fourth Amended Forbearance Agreement")
which continue to be in effect except to the extent expressly superseded by this
Fifth Amended Forbearance Agreement and except to the extent that provisions of
this Fifth Amended Forbearance Agreement contradict the Amended Forbearance
Agreement, as previously amended, in which case the provisions of this Fifth
Amended Forbearance Agreement shall control.
The Borrowers and Lerner have requested that the Banks continue to forbear
through October 11, 1996 from enforcement of their rights and remedies against
the Borrowers.
The Banks are willing to continue to forbear from the exercise of such
rights and remedies but only upon the terms and conditions and
<PAGE> 4
based upon the representations and warranties of the Borrowers and Lerner
herein.
17. The Borrowers hereby acknowledge that they are unconditionally liable
to the Banks for the full and immediate payment of each of the obligations
described in Exhibit I attached hereto and incorporated herein by reference as
of the date thereof, plus all charges that may arise under the Loan Documents,
including attorneys fees and costs of collection incurred in connection with
such obligations by the Banks.
18. The Borrowers and Lerner (as "Limited Guarantor") further acknowledge
that the Banks have no existing commitments, obligations or agreements to
advance credit or loans or make any other financial accommodations to the
Borrowers except as specifically set forth in the Forbearance Agreement, the
Amended Forbearance Agreement, the Second Amended Forbearance Agreement, the
Third Amended Forbearance Agreement, and the Fourth Amended Forbearance
Agreement.
19. Upon the terms and conditions set forth herein, the Banks agree that
they will forbear from exercising the rights and remedies contained in the Loan
Documents, at law and in equity until the earlier of: (i) occurrence of an Event
of Default arising after the date of this Amendment other than the continuing
Events of Default as the result of a breach of the covenants described in
Exhibit 3, or (ii) October 11, 1996 (the "Forbearance Termination Date").
Notwithstanding the acknowledgment of existing defaults contained in the
Forbearance Agreement, the Banks do not hereby agree to waive any of the
existing financial or other covenant Events of Defaults under the Loan
Agreement. The Borrowers shall comply with all of their other
<PAGE> 5
obligations to the Banks as set forth in the Loan Documents. The Borrowers and
Lerner acknowledge that the Banks are under no obligation to continue to
forbear, and have not agreed to or made any representations that they would
agree to forbear, after the Forbearance Termination Date.
20. Lerner has previously executed and delivered to the Banks a Limited
Guaranty and First Amendment to Limited Guaranty (the "Lerner Guaranty")
pursuant to which Lerner guaranteed and continues to guaranty to the Banks the
full and timely payment of all Obligations of the Borrowers to the Banks up to
the dollar limitation referenced in the Lerner Guaranty. Lerner hereby reaffirms
i) the provisions of the Lerner Guaranty and ii) the provisions and terms of the
Third Party Pledge Agreement securing the Lerner Guaranty, and the First
Amendment to Third Party Pledge Agreement.
21. The Borrowers and Lerner (and their successors and assigns) hereby
release, waive and forever relinquish all claims, demands, obligations,
liabilities and causes of action of whatever kind or nature, whether known or
unknown, which any of them may have or might assert now or in the future,
against the Banks, their officers, directors, employees, agents, attorneys and
accountants, directly or indirectly, arising out of, based upon, or in any
manner connected with, (i) any transaction, event, action, failure to act or
occurrence of any sort or type, whether known or unknown, which existed,
occurred or was taken, permitted or begun prior to the execution of this
Amendment; (ii) any discussions, commitments, negotiations, conversations or
communications with respect to the Borrowers' and Lerner's respective
Obligations prior to the execution of this
<PAGE> 6
Amendment; or (iii) anything or matter prior to the execution of this Amendment
related to any of the foregoing.
22. As of the date hereof, the Borrowers and Lerner represent and warrant
that they have no offsets, claims, or other defenses to payment of full of their
obligations to the Banks, and reaffirm that all of the representations and
warranties made by them in the Loan Agreement, Forbearance Agreement, the
Amended Forbearance Agreement, the Second Amended Forbearance Agreement, the
Third Amended Forbearance Agreement, the Fourth Amended Forbearance Agreement
and this Fifth Amended Forbearance Agreement and the other loan documents,
instruments and agreements remain true and correct, except for the defaults in
financial and other covenants set forth in Exhibit 3 hereto.
23. The Borrowers and Lerner shall take such further actions, and execute
and deliver to the Banks such further documents and agreements as the Banks may
require to evidence the agreements contained in the Loan Agreement, the
Forbearance Agreement, the Amended Forbearance Agreement, the Second Amended
Forbearance Agreement, the Third Amended Forbearance Agreement, the Fourth
Amended Forbearance Agreement and herein, and the Banks shall take such actions
and execute and deliver such documents and agreements as may be required to
evidence their agreements contained herein.
24. This Amendment and the documents, instruments and agreements delivered
in connection herewith, together with the Forbearance Agreement, the Amended
Forbearance Agreement, the Second Amended Forbearance Agreement, the Third
Amended Forbearance Agreement, the Fourth Amended Forbearance Agreement and
documents, instruments and agreements delivered in connection therewith,
represent the entire
<PAGE> 7
agreement among the parties with respect to the subject matter hereof, and shall
be construed in accordance with the laws of the Commonwealth of Massachusetts as
an agreement under seal.
WITNESS OUR HANDS AND SEALS THIS _____ DAY OF OCTOBER, 1996.
BORROWER
SAFETY 1ST, INC.
By:
----------------------------------
Michael Lerner, President
SAFETY 1st (EUROPE) LIMITED
By:
----------------------------------
Michael Lerner, Director
By:
----------------------------------
Michael Bernstein, Director
SAFETY 1ST HOME PRODUCTS CANADA,
INC.
By:
----------------------------------
Michael Lerner, President
3232301 CANADA, INC.
By:
----------------------------------
Michael Lerner, President
SAFETY 1ST INTERNATIONAL, INC.
By:
----------------------------------
Michael Lerner, President
<PAGE> 8
BANKS:
FLEET NATIONAL BANK
By:
----------------------------------
DEBORAH LAWRENCE
THE FIRST NATIONAL BANK OF BOSTON
By:
----------------------------------
USTRUST
By:
----------------------------------
THOMAS J. BYRNE, Senior Vice
President
GUARANTOR:
----------------------------------
MICHAEL LERNER
COMMONWEALTH OF MASSACHUSETTS
__________________, ss October __, 1996
Then personally appeared the above-named, Michael Lerner, individually and
as President of Safety 1st, Inc., and acknowledged the foregoing instrument to
be his free act and deed and the free act and deed of Safety 1st, Inc., before
me,
----------------------------------
, Notary Public
My Commission Expires:
<PAGE> 9
COMMONWEALTH OF MASSACHUSETTS
__________________, ss October __, 1996
Then personally appeared the above-named, Michael Lerner, the Director of
Safety 1st (Europe) Limited, and acknowledged the foregoing instrument to be his
free act and deed on behalf of Safety 1st (Europe) Limited, before me,
----------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss October __, 1996
Then personally appeared the above-named, Michael Lerner, the President of
Safety 1st Home Products Canada, Inc., and acknowledged the foregoing instrument
to be his free act and deed on behalf of Safety 1st Home Products Canada, Inc.,
before me,
----------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss October __, 1996
Then personally appeared the above-named, Michael Lerner, the President of
3232301 Canada, Inc., and acknowledged the foregoing instrument to be his free
act and deed on behalf of 3232301 Canada, Inc., before me,
----------------------------------
, Notary Public
My Commission Expires:
<PAGE> 10
COMMONWEALTH OF MASSACHUSETTS
__________________, ss October __, 1996
Then personally appeared the above-named, Michael Lerner, the President of
Safety 1st International, Inc., and acknowledged the foregoing instrument to be
his free act and deed on behalf of Safety 1st International, Inc., before me,
----------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss October __, 1996
Then personally appeared the above-named Deborah Lawrence, the Vice
President Fleet National Bank, and acknowledged the foregoing instrument to be
her free act and deed on behalf of Fleet National Bank, before me,
----------------------------------
, Notary Public
My Commission Expires:
COMMONWEALTH OF MASSACHUSETTS
__________________, ss October __, 1996
Then personally appeared the above-named Peter Haley, the Vice President of
The First National Bank of Boston, and acknowledged the foregoing instrument to
be his free act and deed on behalf of The First National Bank of Boston, before
me,
----------------------------------
, Notary Public
My Commission Expires:
<PAGE> 11
COMMONWEALTH OF MASSACHUSETTS
__________________, ss October __, 1996
Then personally appeared the above-named, Thomas J. Byrne, the Senior Vice
President of USTrust, and acknowledged the foregoing instrument to be free act
and deed on behalf of USTrust, before me,
----------------------------------
, Notary Public
My Commission Expires:
<PAGE> 12
EXHIBIT 1
Total Obligations as of October 1, 1996 $42,273,163.82
