-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, S+qV3c5b3uz5Nm26ieekx2NznfTFF3EoTW7TtYtVAQjZCjuPdgIbYRr5lBB5hlA8 2wij0Yr543ETK+aH9d88iw== 0001275287-07-000599.txt : 20070208 0001275287-07-000599.hdr.sgml : 20070208 20070208080053 ACCESSION NUMBER: 0001275287-07-000599 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20070203 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20070208 DATE AS OF CHANGE: 20070208 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GYMBOREE CORP CENTRAL INDEX KEY: 0000786110 STANDARD INDUSTRIAL CLASSIFICATION: APPAREL & OTHER FINISHED PRODS OF FABRICS & SIMILAR MATERIAL [2300] IRS NUMBER: 942615258 STATE OF INCORPORATION: DE FISCAL YEAR END: 0128 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-21250 FILM NUMBER: 07590162 BUSINESS ADDRESS: STREET 1: 500 HOWARD STREET CITY: SAN FRANCISCO STATE: CA ZIP: 94105 BUSINESS PHONE: 415-278-7000 MAIL ADDRESS: STREET 1: 500 HOWARD STREET CITY: SAN FRANCISCO STATE: CA ZIP: 94105 8-K 1 gc8873.txt FORM 8-K ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FEBRUARY 3, 2007 -------------------------------- Date of Report (Date of earliest event reported) THE GYMBOREE CORPORATION -------------------------------------------------- (Exact Name of Registrant as Specified in Charter) Delaware 000-21250 94-2615258 ---------------------------- ----------- ------------------- (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File No.) Identification No.) 500 Howard Street, San Francisco, CA 94105 ---------------------------------------- ---------- (Address of principal executive offices) (Zip Code) (415) 278-7000 ---------------------------------------------------- (Registrant's telephone number, including area code) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ================================================================================ ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT. On February 7, 2007, The Gymboree Corporation, a Delaware corporation (the "Company"), entered into a Fifth Amendment to Credit Agreement (the "Fifth Amendment"), dated as of February 7, 2007, by and between the Company and certain of its subsidiaries and Bank of America, N.A. The Fifth Amendment amends certain terms of the Credit Agreement dated as of August 11, 2003, as previously amended by the Waiver and First Amendment to Credit Agreement dated December 3, 2004, the Second Amendment to Credit Agreement dated July 27, 2005, the Third Amendment to Credit Agreement, dated March 30, 2006, and the Fourth Amendment to Credit Agreement, dated July 5, 2006, (collectively, the "Credit Agreement"). Among other things, the Fifth Amendment amends the Credit Agreement by permitting the Company to purchase, redeem or otherwise acquire shares of its capital stock for cash in an aggregate amount of up to $50,000,000 under certain circumstances. The foregoing summary of the Fifth Amendment is qualified in its entirety by the terms of the Fifth Amendment, which is attached hereto as Exhibit 10.74 and incorporated herein by reference. ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On February 8, 2007, The Gymboree Corporation issued a press release announcing certain financial information for the five-week and fourth fiscal quarter periods ended February 3, 2007. A copy of the press release is attached hereto as Exhibit 99.1. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS. (d) EXHIBITS. Exhibit No. Description ----------- ----------------------------------------------------- 10.74 Fifth Amendment to Credit Agreement, dated February 7, 2007. 99.1 Press release of The Gymboree Corporation issued February 8, 2007. -2- 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. THE GYMBOREE CORPORATION Dated: February 8, 2007 By: /s/ BLAIR W. LAMBERT ---------------------------- Name: Blair W. Lambert Title: Chief Operating Officer and Chief Financial Officer -3- EXHIBIT INDEX Exhibit No. Description - ----------- ------------------------------------------------------------------ 10.74 Fifth Amendment to Credit Agreement, dated February 7, 2007. 99.1 Press release of The Gymboree Corporation issued February 8, 2007. -4- EX-10.74 2 gc8873ex1074.txt EXHIBIT 10.74 EXHIBIT 10.74 EXECUTION VERSION FIFTH AMENDMENT TO CREDIT AGREEMENT This FIFTH AMENDMENT TO CREDIT AGREEMENT (this "Amendment"), dated as of February 7, 2007, is entered into by and among THE GYMBOREE CORPORATION, a Delaware corporation (the "Company"), each other Borrower named in the signature pages hereof (together with the Company, each a "Borrower" and, collectively, the "Borrowers"), and BANK OF AMERICA, N.A. (the "Lender"). RECITALS A. The Borrowers and the Lender are parties to a Credit Agreement, dated as of August 11, 2003 (as amended, restated, extended, supplemented or otherwise modified from time to time, including as amended pursuant to that certain Waiver and First Amendment to Credit Agreement dated as of December 6, 2004 among the Borrowers and the Lender, that certain Second Amendment to Credit Agreement dated as of July 27, 2005, that certain Third Amendment to Credit Agreement dated as of March 30, 2006, and that certain Fourth Amendment to Credit Agreement dated as of July 5, 2006, the "Credit Agreement"), pursuant to which the Lender has extended certain credit facilities to the Borrowers. B. The Borrowers have requested that the Lender agree to amend the Credit Agreement, and the Lender has agreed to such request, subject to the terms and conditions of this Amendment. NOW, THEREFORE, for valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto hereby agree as follows: 1. Defined Terms. Unless otherwise defined herein, capitalized terms used herein shall have the meanings, if any, assigned to such terms in the Credit Agreement (as amended hereby). As used herein, "Amendment Documents" means this Amendment, the Credit Agreement (as amended by this Amendment), and each certificate and other document executed and delivered by the Borrowers pursuant to Section 5 hereof. 2. Interpretation. The rules of interpretation set forth in Sections 1.02, 1.03, 1.04, 1.05, and 1.06 of the Credit Agreement shall be applicable to this Amendment and are incorporated herein by this reference. 3. Amendments to Credit Agreement. Subject to the terms and conditions hereof, and with effect from and after the Effective Date, the Credit Agreement shall be amended as follows: (a) Section 1.01 of the Credit Agreement shall be amended by adding the following definition to such Section in the appropriate alphabetical order: "`Fifth Amendment Date'" means the `Effective Date' as defined in that Fifth Amendment to Credit Agreement dated as of February 7, 2007 among the Borrowers and the Lender." (b) Section 7.06(e) of the Credit Agreement shall be amended by amending and restating such subsection to read in its entirety as follows "(e) the Company may purchase, redeem or otherwise acquire shares of its capital stock for cash, in an aggregate amount not to exceed, (i) for all such purchases, redemptions and other acquisitions together occurring from and after the Second Amendment Date until the Fifth Amendment Date, the amount of $110,000,000, and (ii) for all such purchases, redemptions and other acquisitions together occurring from and after the Fifth Amendment Date, the amount of $50,000,000; provided, in each case that after giving effect to such proposed action, no Default would exist." 4. Representations and Warranties. Each Borrower hereby represents and warrants to the Lender as follows: (a) No Default has occurred and is continuing (or would result from the amendment to the Credit Agreement contemplated hereby). (b) The execution, delivery and performance by the Borrowers of this Amendment have been duly authorized by all necessary corporate and other action and do not and will not require any registration with, consent or approval of, or notice to or action by, any Person (including any Governmental Authority) in order to be effective and enforceable. (c) The Amendment Documents constitute the legal, valid and binding obligations of the Borrowers party thereto, enforceable against each such Borrower in accordance with their respective terms, without defense, counterclaim or offset. (d) All representations and warranties of the Borrowers contained in Article V of the Credit Agreement are true and correct on and as of the Effective Date, except to the extent that any such representation and warranty specifically relates to an earlier date, in which case they are true and correct as of such earlier date. (e) Each Borrower is entering into this Amendment on the basis of its own investigation and for its own reasons, without reliance upon the Lender or any other Person. (f) There has occurred since January 28, 2006 no event or circumstance that has resulted or could reasonably be expected to result in a Material Adverse Effect. (g) The Obligations of each Borrower under the Credit Agreement and each other Loan Document are not subject to any defense, counterclaim, set-off, right of recoupment, abatement or other claim. 5. Effective Date. a. This Amendment will become effective when each of the conditions precedent set forth in this Section 5 has been satisfied (the "Effective Date"): (i) The Lender shall have received from each Borrower a duly executed original (or, if elected by the Lender, an executed facsimile copy) counterpart to this Amendment. (ii) The Lender shall have received from the Company a certificate signed by the assistant secretary of each Borrower, dated the Effective Date, in form and substance satisfactory to the Lender, and certifying evidence of the authorization of the execution, delivery and performance by each Borrower of the Amendment Documents to which it is party. (iii) The Lender shall have received, in form and substance satisfactory to it, such additional approvals, consents, opinions, documents and other information as the Lender shall request. (b) From and after the Effective Date, the Credit Agreement is amended as set forth herein. Except as expressly amended pursuant hereto, the Credit Agreement shall remain unchanged and in full force and effect and is hereby ratified and confirmed in all respects. 6. Reservation of Rights. Each Borrower acknowledges and agrees that neither the execution nor the delivery by the Lender of this Amendment shall (a) be deemed to create a course of dealing or otherwise obligate the Lender to execute similar amendments under the same or similar circumstances in the future or (b) be deemed to create any implied waiver of any right or remedy of the Lender with respect to any term or provision of any Loan Document (including any term or provision relating to the occurrence of a Material Adverse Effect). 7. Miscellaneous. (a) Except as herein expressly amended, all terms, covenants and provisions of the Credit Agreement are and shall remain in full force and effect and all references therein to such Credit Agreement shall henceforth refer to the Credit Agreement as amended by this Amendment. This Amendment shall be deemed incorporated into, and a part of, the Credit Agreement. (b) This Amendment shall be binding upon and inure to the benefit of the parties hereto and thereto and their respective successors and assigns. No third party beneficiaries are intended in connection with this Amendment. (c) THIS AMENDMENT IS SUBJECT TO THE PROVISIONS OF SECTIONS 9.19, 9.20 and 9.23 OF THE CREDIT AGREEMENT RELATING TO GOVERNING LAW, VENUE, WAIVER OF RIGHT TO TRIAL BY JURY AND JUDICIAL REFERENCE, THE PROVISIONS OF WHICH ARE BY THIS REFERENCE INCORPORATED HEREIN IN FULL. (d) This Amendment may be executed in any number of counterparts, each of which shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument. Each of the parties hereto understands and agrees that this document (and any other document required herein) may be delivered by any party hereto or thereto either in the form of an executed original or an executed original sent by facsimile transmission to be followed promptly by mailing of a hard copy original, and the receipt by the Lender of a facsimile transmitted document purportedly bearing the signature of a Borrower shall bind such Borrower with the same force and effect as the delivery of a hard copy original. Any failure by the Lender to receive the hard copy executed original of such document shall not diminish the binding effect of receipt of the facsimile transmitted executed original of such document of the party whose hard copy page was not received by the Lender. (e) This Amendment, together with the Credit Agreement, contains the entire and exclusive agreement of the parties hereto with reference to the matters discussed herein and therein. This Amendment supersedes all prior drafts and communications with respect thereto. This Amendment may not be amended except in accordance with the provisions of Section 9.01 of the Credit Agreement. (f) If any term or provision of this Amendment shall be deemed prohibited by or invalid under any applicable law, such provision shall be invalidated without affecting the remaining provisions of this Amendment or the Credit Agreement, respectively. (g) Each Borrower covenants to pay to or reimburse the Lender, upon demand, for all costs and expenses (including Attorney Costs and the non-duplicative allocated costs of in-house counsel) incurred in connection with the development, preparation, negotiation, execution and delivery of this Amendment. (h) This Amendment shall constitute a "Loan Document" under and as defined in the Credit Agreement. [Remainder of Page Intentionally Left Blank] IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first above written. THE GYMBOREE CORPORATION, as a Borrower By: /s/ BLAIR W. LAMBERT ------------------------------ Name: Blair W. Lambert Title: COO - CFO GYMBOREE MANUFACTURING, INC., as a Borrower By: /s/ BLAIR W. LAMBERT ------------------------------ Name: Blair W. Lambert Title: COO - CFO GYM-MARK, INC., as a Borrower By: /s/ BLAIR W. LAMBERT ------------------------------ Name: Blair W. Lambert Title: COO - CFO Signature Page Two to Fifth Amendment to Credit Agreement GYMBOREE RETAIL STORES, INC., as a Borrower By: /s/ BLAIR W. LAMBERT ------------------------------ Name: Blair W. Lambert Title: COO - CFO THE GYMBOREE STORES, INC., as a Borrower By: /s/ BLAIR W. LAMBERT ------------------------------ Name: Blair W. Lambert Title: COO - CFO GYMBOREE LOGISTICS PARTNERSHIP, as a Borrower By: GYMBOREE RETAIL STORES, INC. as General Partner By: /s/ BLAIR W. LAMBERT ------------------------------ Name: Blair W. Lambert Title: COO - CFO GYMBOREE PLAY PROGRAMS, INC., as a Borrower By: /s/ BLAIR W. LAMBERT ------------------------------ Name: Blair W. Lambert Title: COO - CFO Signature Page Three to Fifth Amendment to Credit Agreement GYMBOREE OPERATIONS, INC., as a Borrower By: /s/ BLAIR W. LAMBERT ------------------------------ Name: Blair W. Lambert Title: COO - CFO GYMBOREE, INC. (CANADA), as a Borrower By: /s/ BLAIR W. LAMBERT ----------------------------- Name: Blair W. Lambert Title: COO - CFO LENDER BANK OF AMERICA, N.A., as the Lender By: /s/ MAILE DOUGLAS ----------------------------- Name: Maile Douglas Title: Vice President Signature Page Three to Fifth Amendment to Credit Agreement EX-99.1 3 gc8873ex991.txt EXHIBIT 99.1 EXHIBIT 99.1 INVESTOR RELATIONS CONTACT: Jeffrey P. Harris Tel: 415-278-7933 investor_relations@gymboree.com MEDIA RELATIONS CONTACT: Jamie Falkowski Tel: 415-278-7942 media_relations@gymboree.com THE GYMBOREE CORPORATION REPORTS JANUARY AND FOURTH QUARTER SALES San Francisco, Calif., February 8, 2007 - The Gymboree Corporation (NASDAQ: GYMB) reported net sales from continuing retail operations for the five-week period ended February 3, 2007, of $62.5 million, an increase of 24% compared to net sales from continuing retail operations of $50.6 million for the four-week period ended January 28, 2006. Comparable store sales for the five-week period were flat to the equivalent five-week period in the prior year. The results follow a 2% increase in comparable store sales for the four-week period last year. Net sales from continuing retail operations for the fourth fiscal quarter of 2006 were $238.5 million, an increase of 19% compared to net sales from continuing retail operations of $200.3 million for the fourth fiscal quarter of last year. Comparable store sales for the fourth fiscal quarter increased 7% compared to a 14% increase in comparable store sales for the same period in fiscal 2005. During the quarter, the Company completed the closure of all 17 Janeville division retail locations. The Company anticipates fourth quarter incremental costs and lower gross margin associated with the division's closure will be approximately $3.4 million before tax or $0.06 per diluted share. The Company now anticipates the total incremental impact of the closure of Janeville on full year 2006 earnings will be approximately $13.6 million before tax, or approximately $0.25 per diluted share. Excluding the incremental costs and reduced gross margin related to the closure of the Janeville division, the Company continues to expect earnings per diluted share for the fourth fiscal quarter and full year 2006 to be in the range of $0.70 to $0.72 and $1.97 to $1.99, respectively. Including the costs associated with the closure of the Janeville division, the Company now anticipates earnings for the fourth fiscal quarter of 2006 to be in the range of $0.64 to $0.66 per diluted share, reflecting a $0.06 Janeville-related charge. For the full fiscal year, the Company expects earnings in the range of $1.72 to $1.74 per diluted share, including $0.25 of incremental costs and reduced gross margin associated with the closure of Janeville. MANAGEMENT PRESENTATIONS For more information about January sales, please listen to The Gymboree Corporation's monthly sales recording by calling the Company's Investor Relations Hotline at 415-278-7933. The recording will be available Thursday, February 8 at 7:55 a.m. ET through Wednesday, February 14 at 11:59 p.m. PT. The live broadcast of the discussion of fourth quarter 2006 financial results will be available to interested parties at 1:30 p.m. PT (4:30 p.m. ET) on Tuesday, March 13, 2007. To listen to the live broadcast over the internet, please log on to www.gymboree.com, click on "Our Company" at the bottom of the page, go to "Investor and Media Relations" and then "Conference Calls, Webcasts & Presentations." A replay of the call will be available two hours after the broadcast through midnight PT, Wednesday, March 21, 2007, at 800-642-1687. The Gymboree Corporation's specialty retail brands offer unique, high-quality products delivered with personalized customer service. As of February 3, 2007, the Company operated a total of 698 retail stores: 575 Gymboree(R) stores (547 in the United States and 28 in Canada), 42 Gymboree Outlet stores and 81 Janie and Jack(R) shops in the United States. The Company also operates online stores at www.gymboree.com and www.janieandjack.com, and offers directed parent-child developmental play programs at 548 franchised and company-operated centers in the United States and 29 other countries. FORWARD-LOOKING STATEMENTS The foregoing sales figures for the five-week period ended February 3, 2007, and fourth fiscal quarter, as well as expected charges relating to the closure of the Janeville division, are un-audited and subject to quarter-end and year-end adjustment, and could differ materially from the financial information indicated. The foregoing paragraphs contain forward-looking statements relating to anticipated sales growth and future financial performance and costs related to the closing of the Janeville division. These are forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results could differ materially as a result of a number of factors, including customer reactions to new merchandise, service levels and new concepts, success in meeting our delivery targets, the level of our promotional activity, our gross margin achievement, our ability to appropriately manage inventory, unanticipated costs actually incurred in connection with the closure of the Janeville division, general economic conditions, effects of future embargos from countries used to source product, and competitive market conditions. Other factors that may cause actual results to differ materially include those set forth in the reports that we file from time to time with the Securities and Exchange Commission, including our annual report on Form 10-K for the year-ended January 28, 2006. These forward-looking statements reflect The Gymboree Corporation's expectations as of February 3, 2007. The Gymboree Corporation undertakes no obligation to update the information provided herein. Gymboree, Janie and Jack, and Janeville are registered trademarks of The Gymboree Corporation. ### -----END PRIVACY-ENHANCED MESSAGE-----