EX-10.18 18 dex1018.txt CONTRACT WAIVER LETTER DATED NOVEMBER 9, 2001 Exhibit 10.18 November 9, 2001 Spiegel, Inc. 3500 Lacey Road Downers Grove, Illinois 60515 Attn: John R. Steele Re: Waiver ------ Ladies and Gentlemen: Please refer to the Second Amended and Restated Revolving Credit Agreement, dated as of June 30, 2000, as amended (the "Second Amended Credit --------------------- Agreement"), and the 364-Day Revolving Credit Agreement, dated as of June 30, --------- 2000, as amended (the "364-Day Credit Agreement" and together with the Second ------------------------ Amended Credit Agreement, individually a "Credit Agreement" and, collectively, ---------------- the "Credit Agreements"), each among Spiegel, Inc. (the "Borrower"), various ----------------- ------------- financial institutions as the Lenders, the Arrangers, the Syndication Agent and Deutsche Bank AG, New York Branch, as the Administrative Agent. Capitalized terms used but not otherwise defined herein have the respective meanings assigned thereto in the Credit Agreements. At the Borrower's request, the Required Lenders under each Credit Agreement hereby waive: (a) any failure by the Borrower to comply with Section 7.2.6(c) of the Credit Agreements (minimum Fixed Charge Coverage Ratio) for the Fiscal Quarters ended December 29, 2001 and March 30, 2002 and (b) any failure by the Borrower to comply with Section 7.2.6(d) of the Credit Agreements (maximum Debt to EBITDAR Ratio) as of the last day of the 2001 Fiscal Year; provided, that such waivers shall be in effect from the date hereof through June -------- 15, 2002 (such period being the "Waiver Period"). Upon the expiration of the ------------- Waiver Period, unless extended, if the Borrower were not in compliance with each of the foregoing covenants as of the end of each of the foregoing covenant periods, it shall constitute an Event of Default. In consideration of the foregoing waivers during the Waiver Period, the Borrower agrees with the Agent and the Required Lenders that: (a) The Borrower shall not be permitted to declare or make any Restricted Payment until it is once again in compliance with all the financial covenants of Section 7.2.6 (including Section 7.2.6(c) and without regard to any waiver thereof provided for in this Waiver Letter) on and after March 31, 2002 and it is otherwise in compliance with Section 7.2.8 of the Credit Agreements. (b) Otto Versand (GmbH & Co) shall provide up to a $100,000,000 loan (the "Loan") to the Borrower (as more fully described ---- in the letter agreement dated of even Spiegel, Inc. November 9, 2001 Page 2 date herewith); the Borrower agrees that any interest on the Loan may accrue, but shall not be paid, during the Waiver Period. (c) The Borrower agrees to pay to the Administrative Agent for the account of each consenting Lender a waiver fee equal to 0.25% of the amount of such Lender's Commitment under each Credit Agreement concurrently with the effectiveness hereof. (d) The Borrower will not, and will not permit any Subsidiary to, make any Permitted Acquisition without the prior written consent of the Required Lenders under each Credit Agreement. This Waiver Letter is limited to the matters specifically set forth herein and shall not be deemed to constitute a waiver or consent with respect to any other matter whatsoever. The Administrative Agent and the Lenders hereby reserve all of their rights, powers and remedies under the Credit Agreements and applicable law. This Waiver Letter may be executed in counterparts and by the parties hereto on separate counterparts. This Waiver Letter shall become effective upon receipt by the Administrative Agent of (i) counterparts hereof (or facsimiles thereof) executed by the Borrower, the Subsidiaries listed below and the Required Lenders, (ii) the amendment fee referred to in clause (c) above and ------ --- (iii) a letter agreement executed by Otto Versand (GmbH & Co) and the Administrative Agent evidencing the obligations referred to in clause (b) above. ---------- The Borrower agrees to pay on demand all reasonable expenses of the Arrangers and the Administrative Agent (including the fees and reasonable out-of-pocket expenses of counsel to the Arrangers and the Administrative Agent), in connection with the negotiation, preparation, execution and delivery of this Waiver Letter and of each other Loan Document executed in connection with this Waiver Letter as may from time to time hereafter be required, whether or not the transactions contemplated hereby are consummated. This Waiver Letter shall be governed by the laws of the State of Illinois applicable to contracts made and to be performed entirely within such State. Spiegel, Inc. November 9, 2001 Page 3 Please acknowledge your agreement to the foregoing by signing and returning a counterpart hereof to the Administrative Agent. DEUTSCHE BANK AG, NEW YORK BRANCH, Individually and as Administrative Agent By:/s/ Hans-Josef Thiele -------------------------------------- Name: Hans-Josef Thiele ---------------------------------- Title: Director --------------------------------- By: /s/ Stephan G. Peetzen ------------------------------------ Name:Stephan G. Peetzen ----------------------------------- Title: Director --------------------------------- ABN AMRO BANK N.V., as a Lender By:/s/ John E. Robertson ------------------------------------- Name: John E. Robertson ---------------------------------- Title: Group Vice President --------------------------------- By:/s/ Peter J. Hallan ------------------------------------- Name: Peter J. Hallan ---------------------------------- Title: Vice President --------------------------------- BANCA COMMERCIALE ITALIANA, NEW YORK BRANCH, as a Lender By: /s/ Charles Dougherty ------------------------------------ Name: Charles Dougherty ---------------------------------- Title: Vice President --------------------------------- By: /s/ J. Dickerhof ------------------------------------ Name: J. Dickerhof ---------------------------------- Title: Vice President --------------------------------- Spiegel, Inc. November 9, 2001 Page 4 BANK OF AMERICA, N.A., as a Lender By:/s/Timothy H. Spanos ------------------------------------ Name: Timothy H. Spanos ------------------------------------ Title:Managing Director ------------------------------------ Spiegel, Inc. November 9, 2001 Page 5 THE BANK OF NEW YORK, as a Lender By:/s/ Charlotte Sohn Fuiks ---------------------------------------- Name: Charlotte Sohn Fuiks ------------------------------------ Title: Vice President ----------------------------------- BAYERISCHE HYPO UND VEREINSBANK AG, as a Lender By:/s/ A. von der Lahr ------------------------------------------ Name: A. von der Lahr ------------------------------------ Title: Senior Vice President ----------------------------------- By:/s/ A. Neuheuser ------------------- Name: A. Neuheuser ------------ Title: Vice President -------------- BANKGESELLSCHAFT BERLIN AG, as a Lender By: ______________________________________ Name: ____________________________________ Title: ___________________________________ COMMERZBANK AG, NEW YORK AND GRAND CAYMAN BRANCHES, as a Lender By:/s/ Albert Morrow ------------------------------------------ Name: Albert Morrow ------------------------------------------ Title: Assistant Treasurer ------------------------------------------ By:/s/ Mark Monson ----------------------------------- Name: Mark Monson ------------------------------------ Title: Vice President ----------------------------------- Spiegel, Inc. November 9, 2001 Page 6 CREDIT LYONNAIS NEW YORK BRANCH, as a Lender By: /s/ Genevieve Leruth ------------------------------------ Name: Genevieve Leruth -------------------------------- Title: Vice President -------------------------------- CREDIT SUISSE FIRST BOSTON, as a Lender By: /s/ Bill O' Daly ------------------------------------ Name: Bill O'Daly -------------------------------- Title: Vice President -------------------------------- By: /s/ Cassandra Droogan ------------------------------------ Name: Cassandra Droogan -------------------------------- Title: Associate -------------------------------- DEUTSCHE BANK AG NEW YORK AND/OR CAYMAN ISLAND BRANCHES, as a Lender By: /s/ Hans-Josef Thiele ------------------------------------ Name: Hans-Josef Thiele -------------------------------- Title: Director -------------------------------- By: /s/ Stephan G. Peetzen ------------------------------------ Name: Stephan G. Peetzen -------------------------------- Title: Director -------------------------------- DEN DANSKE BANK, as a Lender By: /s/ Bo Anderson /s/ Lars Emmery ------------------------------------ Name: Bo Anderson Lars Emmery -------------------------------- Title: Vice President Vice President -------------------------------- Spiegel, Inc. November 9, 2001 Page 7 DG BANK DEUTSCHE GENOSSENSCHAFTSBANK AG, as a Lender By: /s/ Jochen Breitgens --------------------------------- Name: Jochen Breitgens ------------------------------ Title: Vice President ----------------------------- By: /s/ Dagmar Werner -------------------------------- Name: Dagmar Werner ------------------------------ Title: Vice President ----------------------------- DRESDNER BANK AG, NEW YORK AND GRAND CAYMAN BRANCHES, as a Lender By: /s/ Gerd Lengfeld -------------------------------- Name: Gerd Lengfeld ------------------------------ Title: Director ----------------------------- By: /s/ Ulrich Kahlow -------------------------------- Name: Ulrich Kahlow ----------------------------- Title: Vice President ----------------------------- THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED, as Issuer By: /s/ Jeremy P. Bollington -------------------------------- Name: Jeremy P. Bollington ------------------------------ Title: Senior Vice President ----------------------------- Spiegel, Inc. November 9, 2001 Page 8 HSBC BANK USA, as a Lender By: /s/ Anne Serewicz ------------------------------------------------- Name: Anne Serewicz --------------------------------------------- Title: Senior Vice President --------------------------------------------- LANDESBANK HESSEN-THURINGEN, as a Lender By: /s/ Fred Musch /s/ Bernd Haeger --------------------- -------------------------- Name: Fred Musch Bernd Haeger ----------------- -------------------------- Title: Vice President Senior Vice President ----------------- -------------------------- MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as a Lender By: /s/ Barry K. Bergman --------------------- -------------------------- Name: Barry K. Bergman --------------------- -------------------------- Title: Vice President --------------------- -------------------------- NORDDEUTSCHE LANDESBANK GIROZENTRALE NEW YORK BRANCH AND/OR CAYMAN ISLAND BRANCH, as a Lender By: /s/ Stephanie Finnen /s/ Stephen K. Hunter --------------------- -------------------------- Name: Stephanie Finnen Stephen K. Hunter ------------------- ---------------------- Title: Vice President Senior Vice President ------------------ ---------------------- Spiegel, Inc. November 9, 2001 Page 9 WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as a Lender By: /s/ Martin Clements /s/ Lars Kickstein --------------------- ----------------------------- Name: Martin Clements Lars Kickstein ------------- ------------------------- Title: Director Manager -------- -------------------------
ACCEPTED AND AGREED as of November 9, 2001 SPIEGEL, INC. By: /s/ John R. Steele --------------------------------- Title: Vice President, Treasurer --------------------------------- EDDIE BAUER, INC. By: /s/ John R. Steele --------------------------------- Name: John R. Steele Title: Treasurer ULTIMATE OUTLET INC. By: /s/ John R. Steele --------------------------------- Name: John R. Steele Title: Treasurer NEWPORT NEWS, INC. By: /s/ John R. Steele --------------------------------- Name: John R. Steele Title: Treasurer Spiegel, Inc. November 9, 2001 Page 10 DISTRIBUTION FULFILLMENT SERVICES, INC. (DFS) By: /s/ John R. Steele ---------------------- Name: John R. Steele Title: Treasurer SPIEGEL PUBLISHING COMPANY By: /s/ John R. Steele ---------------------- Name: John R. Steele Title: Treasurer SPIEGEL CATALOG, INC. By: /s/ John R. Steele ---------------------- Name: John R. Steele Title: Treasurer