SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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) November 24, 1999 (October 1, 1999)
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THE TALBOTS, INC.
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(Exact Name of Registrant as Specified in Charter)
Delaware 1-12552 41-1111318
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(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
175 Beal Street, Hingham, Massachusetts 02043
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (781) 749-7600
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<PAGE>
INFORMATION TO BE INCLUDED IN THE REPORT
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
Exhibit 99.1 Third Amendment to Credit Agreement, dated as of
January 29, 1999 between The Talbots, Inc. and Bank
of Tokyo-Mitsubishi Trust Company.
Exhibit 99.2 First Amendment to Credit Agreement, dated as of
April 17, 1999 between The Talbots, Inc. and The Bank
of Toyko-Mitsubishi, Ltd., New York Branch.
Exhibit 99.3 Confirmation of Extension dated April 19, 1999
from The Dai-Ichi Kangyo Bank, Ltd., New York Branch
to The Talbots, Inc., relating to the Revolving
Credit Agreement.
Exhibit 99.4 Money Market Line Commercial Promissory Note
dated August 20, 1999 from The Talbots, Inc. to
BankBoston, N.A.
<PAGE>
SIGNATURE
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.
THE TALBOTS, INC.
CAROL GORDON STONE
Dated: November 24, 1999 By: _______________________________
Carol Gordon Stone
Vice President, Corporate Controller
<PAGE>
EXHIBIT INDEX
Exhibit 99.1 Third Amendment to Credit Agreement, dated as of
January 29, 1999 between The Talbots, Inc. and Bank
of Tokyo-Mitsubishi Trust Company.
Exhibit 99.2 First Amendment to Credit Agreement, dated as of
April 17, 1999 between The Talbots, Inc. and The Bank
of Toyko-Mitsubishi, Ltd., New York Branch.
Exhibit 99.3 Confirmation of Extension dated April 19, 1999
from The Dai-Ichi Kangyo Bank, Ltd., New York Branch
to The Talbots, Inc., relating to the Revolving
Credit Agreement.
Exhibit 99.4 Money Market Line Commercial Promissory Note
dated August 20, 1999 from The Talbots, Inc. to
BankBoston, N.A.
THIRD AMENDMENT TO CREDIT AGREEMENT
THIRD AMENDMENT, dated as of January 29, 1999 (the "Third
Amendment") by and between TALBOTS INC. (the "Borrower") and BANK OF
TOKYO-MITSUBISHI TRUST COMPANY (f/k/a The Bank of Tokyo Trust Company, the
"Bank").
W I T N E S S E T H:
WHEREAS, the Borrower and the Bank entered into that certain
Revolving Credit Agreement dated as of January 25, 1994, as amended by that
certain First Amendment dated as of November 21, 1995, and that certain Second
Amendment dated as of April 18, 1996 (the "Credit Agreement"); and
WHEREAS, the parties hereto wish to amend the Credit Agreement
as herein provided;
NOW THEREFORE, in consideration of the mutual agreements
contained in this Third Amendment, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
I. All capitalized terms used herein and not otherwise defined shall have the
respective meanings provided such terms in the Credit Agreement.
II. Amendments to the Credit Agreement
A. Section 5(a) of the Credit Agreement is hereby amended by deleting
"0.5%" from the end of the tenth line in said Section and inserting in its
place, "0.875%" in lieu thereof.
C. Section 8(a) of the Credit Agreement is hereby amended by adding the
following paragraphs (xi) and (xii) immediately following paragraph 8(a) in said
Section:
"(xi) The Borrower has developed and implemented a
comprehensive, detailed program to address on a
timely basis the Year 2000 Problem and reasonably
anticipates that it will on a timely basis
successfully resolve the Year 2000 Problem for all
material computer hardware or software applications
or other data processing capacities used by it, and
the Borrower, on the basis of inquiries made,
believes that each supplier, vendor and customer of
the Borrower that is of material importance to the
financial well-being of the Borrower will also
successfully resolve on a timely basis the year 2000
Problem for all of its material computer hardware or
software applications or other data processing
capacities.
(xii) The Borrower has conducted a comprehensive review and
assessment of its computer applications with respect
to the Year 2000 Problem and, based on that review,
the Borrower does not believe that the Year 2000
Problem or the costs of implementing a comprehensive
program to address the Year 2000 Problem will have a
materially adverse effect on the business condition
(financial or otherwise), operations, properties or
prospects of the Borrower or its ability to repay its
obligations."
D. Section 10 of the Credit Agreement is hereby amended by adding the
following paragraphs (f) and (g) immediately following paragraph (e) in said
Section:
"(f) The Borrower shall take appropriate steps to assess,
quantify, address and resolve its business and financial risks
resulting from the Year 2000 Problem, including those business
and economic risks resulting from the failure of key
suppliers, vendors and customers of the Borrower to properly
assess, quantify, address and resolve the Year 2000 Problem.
(g) The Borrower shall provide from time to time such further
information regarding the business, assets, liabilities,
financial condition, results of operations or business
prospects of the Borrower as the Bank may request, including
information on its efforts to address the Year 2000 Problem
and any auditor's management letters concerning the same."
II. Miscellaneous Provisions
A. In order to induce the Bank to enter into this Third Amendment, the
Borrower hereby represents and warrants that:
1. No Default or Event of Default exists as of the date of
this Third Amendment, both before and after giving effect to the Third
Amendment; and
2. All of the representations and warranties contained in the
Credit Agreement are true and correct in all material respects on and as of the
date of this Third Amendment, both before and after giving effect to this
Amendment, with the same effect as though such representations and warranties
had been made on and as of this Third Amendment.
B. This Third Amendment is limited as specified and shall not
constitute a modification, acceptance or waiver of any other provision of the
Credit Agreement. Except as expressly amended hereby, the Credit Agreement, the
Note and all documents, instruments and agreements related thereto are hereby
ratified and confirmed in all respects and shall continue in full force and
effect.
C. From and after the date first above written, all references in the
Credit Agreement shall be deemed to be references to the Credit Agreement as
amended hereby.
D. This Third Amendment may be executed in any number of counterparts
and by the different parties hereto on separate counterparts, each of which
counterparts when executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.
E. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE
STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES.
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Third Amendment as of the date
first above written.
THE TALBOTS INC.
By: /s/ EDWARD L. LARSEN
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Name: Edward L. Larsen
Title:
BANK OF TOKYO-MITSUBISHI TRUST COMPANY
By: /s/ T. SAEGUSA
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Name: T. Saegusa
Title: S.V.P.
[LETTERHEAD OF BANK OF TOYKO-MITSUBISHI]
FIRST AMENDMENT TO CREDIT AGREEMENT
FIRST AMENDMENT, dated as of April 17, 1999 (the "First Amendment") by
and between TALBOTS, INC. (the "Borrower") and THE BANK OF TOKYO-MITSUBISHI,
LTD., NEW YORK BRANCH (the "Bank").
W I T N E S S E T H
WHEREAS, the Borrower and the Bank entered into that certain Credit
Agreement dated as of April 17, 1998 (the "Credit Agreement"); and
WHEREAS, the parties hereto wish to amend the Credit Agreement as
herein provided;
NOW THEREFORE, in consideration of the mutual agreements contained in
this First Amendment, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
I. All capitalized terms used herein and not otherwise defined shall have the
respective meanings provided such terms in the Credit Agreement.
II. Amendments to the Credit Agreement
A. Section 4 of the Credit Agreement is hereby amended by deleting
"0.625%" from the end of the second line in said Section and inserting in its
place, "0.875%" in lieu thereof.
B. Section 8 of the Credit Agreement is hereby amended by adding
paragraphs the following paragraphs (i) and (j) immediately following paragraph
(h) in said Section:
"(i) The Borrower has developed and implemented a
comprehensive detailed program to address on a timely basis
the Year 2000 Problem and reasonably anticipates that it will
on a timely basis successfully resolve the Year 2000 Problem
for all material computer hardware or software applications or
other data processing capacities used by it, and the Borrower,
on the basis of inquiries made, believes that each supplier,
vendor and customer of the Borrower (including any affiliate
or subsidiary of the Borrower) that is of material importance
to the financial well-being of the Borrower will also
successfully resolve on a timely basis the year 2000 Problem
for all of its material computer hardware or software
applications or other data processing capacities.
(j) The Borrower and each Subsidiary have conducted a
comprehensive review and assessment of their computer
applications with respect to the Year 2000 Problem and, based
on that review, the Borrower does not believe that the Year
2000 Problem or the costs of implementing a comprehensive
program to address the Year 2000 Problem will have a
materially adverse effect on the business condition (financial
or otherwise), operations, properties or prospects of the
Borrower and its Subsidiaries or its ability to repay its
obligations."
C. Section 10 of the Credit Agreement is hereby amended by adding the
following paragraphs (j) and (k) immediately following paragraph (i) in said
Section:
(j) The Borrower shall, and shall cause each Subsidiary to,
take appropriate steps to assess, quantify, address and
resolve its business and financial risks resulting from the
Year 2000 Problem, including those business and economic risks
resulting from the failure of key suppliers, vendors and
customers of the Borrower and each Subsidiary to properly
assess, quantify, address and resolve the Year 2000 Problem.
(k) The Borrower shall provide from time to time such further
information regarding the business, assets, liabilities,
financial condition, results of operations or business
prospects of the Borrower as the Bank may request, including
information on their efforts to address the Year 2000 Problem
and any auditor's management letters concerning the same.
II. Miscellaneous Provisions
A. In order to induce the Bank to enter into this First Amendment, the
Borrower hereby represents and warrants that:
1. No Default or Event of Default exists as of the date of
this First Amendment, both before and after giving effect to the First
Amendment; and
2. All of the representations and warranties contained in the
Credit Agreement are true and correct in all material respects on and as of the
date of this First Amendment, both before and after giving effect to this
Amendment, with the same effect as though such representations and warranties
had been made on and as of this First Amendment.
B. This First Amendment is limited as specified and shall not
constitute a modification, acceptance or waiver of any other provision of the
Credit Agreement. Except as expressly amended hereby, the Credit Agreement, the
Note and all documents, instruments and agreements related thereto are hereby
ratified and confirmed in all respects and shall continue in full force and
effect.
C. From and after the date first above written, all references in the
Credit Agreement shall be deemed to be references to the Credit Agreement as
amended hereby.
D. This First Amendment may be executed in any number of counterparts
and by the different parties hereto on separate counterparts, each of which
counterparts when executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.
E. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAW
OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this First Amendment as of the date
first above written.
TALBOTS, INC.
By: /s/ EDWARD L. LARSEN
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Name: Edward L. Larsen
Title: Sr. Vice President, Finance
& Chief Financial Officer
THE BANK OF TOKYO-MITSUBISHI, LTD.
New York Branch
By: /s/ T. SAEGUSA
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Name: T. SAEGUSA
Title: D.G.M.
[LETTERHEAD OF THE DAI-ICHI KANGYO BANK, LTD.]
THE TALBOTS, INC. April 19, 1999
175 Beal Street
Hingham, MA 02043
CONFIRMATION OF EXTENSION
Re: Revolving Credit Agreement made as of April 14, 1998, between
The Talbots, Inc. as borrower, and The Dai-Ichi Kangyo Bank,
Limited (the "Agreement")
Dear Sirs:
We are pleased to confirm with you the one year extension of the Revolving
Credit according to Section 14(j)(i) of the Agreement. The new expiry dated
April 17, 2001.
Very truly yours,
THE DAI-ICHI KANGYO BANK, LTD.
NEW YORK BRANCH
By: /s/ TAKASHI HORIE
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Takashi Horie
Vice President & Department Head
COMMERCIAL PROMISSORY NOTE
$5,000,000.00 Boston, Massachusetts
August 20, 1999
FOR VALUE RECEIVED, the undersigned (jointly and severally if more than
one) promise(s) to pay to the order of BANKBOSTON, N.A. (together with any
successors or assigns, the "Bank"), a national banking association with its Head
Office at 100 Federal Street, Boston, Massachusetts 02110, the aggregate
principal amount of all loans made by the Bank to the undersigned pursuant to
the letter agreement between the Bank and the undersigned dated as of August 18,
1999, as shown in the schedule attached hereto (the "Note Schedule"), together
with interest on each loan from the date such loan is made until the maturity
thereof at the applicable rate set forth in the Note Schedule. The principal
amount of each loan shall be payable on the maturity date of such loan as
indicated in the Note Schedule. Interest on the principal amount of each loan
shall be payable in arrears on the same day as the principal amount is due.
Interest shall be calculated on the basis of a 360-day year for the actual
number of days elapsed including holidays and days on which the Bank is not open
for the conduct of banking business.
SECTION 1. PAYMENT TERMS.
1.1 PAYMENTS; PREPAYMENTS. All payments hereunder shall be made by the
undersigned to the Bank in United States currency at the Bank's address
specified above (or at such other address as the Bank may specify), in
immediately available funds, on or before 2:00 p.m. (Boston, Massachusetts time)
on the due date thereof. Payments received by the Bank prior to the occurrence
of an Event of Default (as defined in Section 2) will be applied first to fees,
expenses and other amounts due hereunder (excluding principal and interest);
second, to accrued interest; and third to outstanding principal; after the
occurrence of an Event of Default, payments will be applied to the Obligations
under this Note as the Bank determines in its sole discretion. No prepayment of
any loan shall be permitted.
1.2. PREPAYMENT CHARGE. If any payment of principal is made for any
reason on any day other than the date scheduled therefor, whether as a result of
acceleration or otherwise, the undersigned shall reimburse the Bank for the
loss, if any, including any lost profits, resulting from such prepayment, as
reasonably determined by the Bank. The undersigned shall pay such loss upon
presentation by the Bank of a statement of the amount of such loss, setting
forth the Bank's calculation thereof, which notice and calculation (including
the method of calculation) shall be deemed true and correct absent manifest
error.
1.3 DEFAULT RATE. To the extent permitted by applicable law, upon and
after the occurrence of an Event of Default (whether or not the Bank has
accelerated payment of this Note), interest on principal and overdue interest
shall, at the option of the Bank be payable on demand at a rate per annum equal
to 4% above the greater of the rate of interest otherwise payable hereunder or
the rate announced by the Bank from time to time as its Base Rate.
SECTION 2. DEFAULTS AND REMEDIES.
2.1 DEFAULT. The occurrence of any of the following events or
conditions shall constitute an "Event of Default" hereunder:
(a) (i) default in the payment when due of the principal of or
interest on this Note or (ii) any other default in the payment or
performance of this Note or any other Obligation or (iii) default in
the payment or performance of any obligation of any Obligor to others
for borrowed money or in respect of any extension of credit or
accommodation or under any lease in excess of $1,000,000.
(b) failure of any representation or warranty herein or in any
agreement, instrument, document or financial statement delivered to the
Bank in connection herewith to be true and correct in any material
respect;
(c) failure to furnish the Bank promptly on request with
financial information about, or to permit inspection by the Bank of any
books, records and properties of, any Obligor;
(d) merger, consolidation, sale of all or substantially all of
the assets or change in control of any Obligor; or
(e) any Obligor generally not paying its debts as they become
due; the death, dissolution, termination of existence or insolvency of
any Obligor; the appointment of a trustee, receiver, custodian,
liquidator or other similar official for such Obligor or any
substantial part of its property or the assignment for the benefit of
creditors by any Obligor; or the commencement of any proceedings under
any bankruptcy or insolvency laws by or against any Obligor.
As used herein, "Obligation" means any obligation hereunder or
otherwise of any Obligor to the Bank or to any of its affiliates, whether direct
or indirect, absolute or contingent, due or to become due, now existing or
hereafter arising; and "Obligor" means the undersigned, any guarantor or any
other person primarily or secondarily liable hereunder or in respect hereof.
2.2 REMEDIES. Upon an Event of Default described in Section 2.1(e)
immediately and automatically, and upon or after the occurrence of any other
Event of Default at the option of the Bank, all Obligations of the undersigned
shall become immediately due and payable without notice or demand. All rights
and remedies of the Bank are cumulative and are exclusive of any rights or
remedies provided by law or in equity or any other agreement, and may be
exercised separately or concurrently.
SECTION 3. MISCELLANEOUS.
3.1 WAIVER; AMENDMENT. No delay or omission on the part of the Bank in
exercising any right hereunder shall operate as a waiver of such right or of any
other right under this Note. No waiver of any right or any amendment hereto
shall be effective unless in writing and signed by the Bank, nor shall a waiver
on one occasion bar or waive the exercise of any such right on any future
occasion. Without limiting the generality of the foregoing, the acceptance by
the Bank of any late payment shall not be deemed to be a waiver of the Event of
Default arising as a consequence thereof. Each Obligor waives presentment,
demand, notice, protest, and all other demands and notices in connection with
the delivery, acceptance, performance, default or enforcement of this Note and
assents to any extensions or postponements of the time of payment and to any
other indulgences under this Note, and to any additions or releases of any other
parties or persons primarily or secondarily liable hereunder, that from time to
time may be granted by the Bank in connection herewith.
3.2 SET-OFF. Regardless of the adequacy of any collateral or other
means of obtaining repayment of the Obligations, the Bank is hereby authorized
at any time and from time to time, after the occurrence and during the
continuation of any Event of Default hereunder, without notice to the
undersigned (any such notice being expressly waived by the undersigned) and to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) and other sums
credited by or due from the Bank to the undersigned or subject to withdrawal by
the undersigned against the Obligations of the undersigned, although such
Obligations may be contingent or unmatured.
3.3 EXPENSES. The undersigned will pay on demand all expenses of the
Bank in connection with the preparation, administration, default, collection,
waiver or amendment of the Obligations or in connection with the Bank's
exercise, preservation or enforcement of any of its rights, remedies or options
thereunder, including, without limitation, fees of outside legal counsel or the
allocation costs of in-house legal counsel, accounting, consulting, brokerage or
other similar professional fees or expenses, and any fees or expenses associated
with any travel or other costs relating to any appraisals or examinations
conducted in connection with the Obligations or any collateral therefor, and the
amount of all such expenses shall, until paid, bear interest at the rate
applicable to principal hereunder (including any default rate) and be an
Obligation secured by any such collateral.
3.4 BANK RECORDS. The entries on the records of the Bank (including any
appearing on this Note) shall be prima facie evidence of the aggregate principal
amount outstanding under this Note and interest accrued thereon.
3.5 INFORMATION. The undersigned shall furnish the Bank from time to
time with such business records and other information reasonably related to the
Obligations as the Bank may require. All such information shall be true and
correct and fairly represent the financial condition and the operating results
of such Obligor as of the date and for the periods for which the same are
furnished. The undersigned shall permit representatives of the Bank to inspect
its properties and its books and records, and to make copies or abstracts
thereof. Each Obligor authorizes the Bank to release and disclose to its
affiliates, agents and contractors any financial statements and other
information relating to said Obligor provided to or prepared by or for the Bank
in connection with any Obligation. The undersigned will notify the Bank promptly
of the existence or upon the occurrence of any Event of Default or event which,
with the giving of notice or the passage of time or both, would become an Event
of Default.
3.6 GOVERNING LAW; CONSENT TO JURISDICTION. This Note is intended to
take effect as a sealed instrument and shall be governed by, and construed in
accordance with, the laws of The Commonwealth of Massachusetts, without regard
to its conflicts of law rules. The undersigned agrees that any suit for the
enforcement of this Note may be brought in the courts of such state or any
Federal Court sitting in such state and consents to the non-exclusive
jurisdiction of each such court and to service of process in any such suit being
made upon the undersigned by mail at the address specified below. The
undersigned hereby waives any objection that it may now or hereafter have to the
venue of any such suit or any such court or that such suit was brought in an
inconvenient court.
3.7 SEVERABILITY; AUTHORIZATION TO COMPLETE; PARAGRAPH HEADINGS. If any
provision of this Note shall be invalid, illegal or unenforceable, such
provisions shall be severable from the remainder of this Note and the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby. The Bank is hereby authorized, without further
notice, to fill in any blank spaces on this Note, and to date this Note as of
the date funds are first advanced hereunder. Paragraph headings are for the
convenience of reference only and are not a part of this Note and shall not
affect its interpretation.
3.8 JURY WAIVER. THE BANK (BY ITS ACCEPTANCE OF THIS NOTE) AND THE
UNDERSIGNED AGREE THAT NEITHER OF THEM NOR ANY ASSIGNEE OR SUCCESSOR SHALL (A)
SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER ACTION
BASED UPON, OR ARISING OUT OF, THIS NOTE, ANY RELATED INSTRUMENTS, ANY
COLLATERAL OR THE DEALINGS OR THE RELATIONSHIP BETWEEN OR AMONG ANY OF THEM, OR
(B) SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY
TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH SHALL
BE SUBJECT TO NO EXCEPTIONS. NEITHER THE BANK NOR THE UNDERSIGNED HAS AGREED
WITH OR REPRESENTED TO THE OTHER THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT
BE FULLY ENFORCED IN ALL INSTANCES.
175 Beal Street The Talbots, Inc.
Hingham, MA 02043
By: /s/ EDWARD L. LARSEN
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Edward L. Larsen
Senior Vice President, Finance
Chief Financial Officer and Treasurer
