-----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, MAimt5JHHFpkYl55+7FpYjUOfhIADhTXj41NYdJOKzuiwf4MbNduwvfJexE/le4u CWAO7CyIA57K53RPnfhECg== 0000786877-97-000004.txt : 19970312 0000786877-97-000004.hdr.sgml : 19970312 ACCESSION NUMBER: 0000786877-97-000004 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970228 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970311 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: HILLS STORES CO /DE/ CENTRAL INDEX KEY: 0000786877 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-VARIETY STORES [5331] IRS NUMBER: 311153510 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09505 FILM NUMBER: 97554229 BUSINESS ADDRESS: STREET 1: 15 DAN RD CITY: CANTON STATE: MA ZIP: 02021 BUSINESS PHONE: 6178211000 MAIL ADDRESS: STREET 1: 15 DAN ROAD CITY: CANTON STATE: MA ZIP: 02021 FORMER COMPANY: FORMER CONFORMED NAME: HILLS STORES CO /NEW/ DATE OF NAME CHANGE: 19931103 FORMER COMPANY: FORMER CONFORMED NAME: HILLS STORES CO /NEW/ DATE OF NAME CHANGE: 19931015 FORMER COMPANY: FORMER CONFORMED NAME: THL HOLDINGS INC DATE OF NAME CHANGE: 19870506 8-K 1 1 _______________________________________________________________________________ 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 Date of Report (Date of earliest event reported): February 28, 1997 HILLS STORES COMPANY (Exact name of registrant as specified in its charter) Delaware 1-9505 31-1153510 (State or other juris- (Commission (I.R.S. employer diction of incorporation) file number) identification number)
15 Dan Road 02021 Canton, Massachusetts (Zip Code) (Address of principal executive office) Registrant's telephone number, including area code: (617) 821-1000 _______________________________________________________________________________ 2 Item 5. Other Events ------------ Hills Stores Company (the "Company"), through its wholly-owned subsidiary Hills Department Store Company ("HDSC"), and C.R.H. International, Inc., a wholly- owned subsidiary of HDSC, amended (the "Amendment") the Loan and Security Agreement (the "Agreement") governing its $300 million secured revolving credit facility (the "Facility") with BankAmerica Business Credit, Inc. ("BABC") as agent for the group of lenders. The Amendment extends the term of the Facility from September 30, 1999 to January 31, 2000 and provides the Company with greater flexibility in meeting the requirements of the two financial covenants contained in the Agreement. As to the cash flow covenant (which requires that EBITDA not be less than cash requirements for capital expenditures, taxes, and net interest/debt service), for purposes of determining compliance throughout the fiscal year ending January 31, 1998, $10 million will be deducted from the aggregate amount of cash requirements for capital expenditures. Second, compliance will be tested only at the end of each fiscal quarter based on the accumulation of the previous four fiscal quarters. The Amendment also clarifies that losses associated with announced store closings will not reduce EBITDA. With regard to the tangible net worth covenant, the Amendment reduces the required tangible net worth by $20 million to $110 million at year-end, with seasonally lower amounts at other times during the year, measured quarterly. The Company paid a total fee of $250,000 to BABC and the lenders in connection with the Amendment. A copy of the Amendment is filed as an Exhibit to this Report and is incorporated by reference herein. Item 7. Exhibits -------- The following Exhibit is filed as part of this Report: Exhibit Number Title - ------ ----- 99.1 First Amendment dated as of February 28, 1997 to Loan and Security Agreement dated as of September 30, 1996 among the Financial Institutions named therein as the Lenders, BankAmerica Business Credit, Inc. as the Agent, Hills Department Store Company and C.R.H. International, Inc. as the Borrowers, and the Other Loan Parties named therein. 2 3 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, on March 10, 1997. HILLS STORES COMPANY By: /s/ William K. Friend ------------------------------ Name: William K. Friend Title: Vice President-Secretary 3 4 EXHIBIT INDEX Pursuant to Item 601 of Regulation S-K Exhibit Number Title - ------ ----- 99.1 First Amendment dated as of February 28, 1997 to Loan and Security Agreement dated as of September 30, 1996 among the Financial Institutions named therein as the Lenders, BankAmerica Business Credit, Inc. as the Agent, Hills Department Store Company and C.R.H. International, Inc. as the Borrowers, and the Other Loan Parties named therein. 4 EX-99.1 2 1 EXHIBIT 99.1 FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT, dated as of February 28, 1997, among HILLS DEPARTMENT STORE COMPANY, a Delaware corporation ("HDSC"), C.R.H. INTERNATIONAL, INC., an Ohio corporation ("CRH" and together with HDSC, the "Borrowers"), HILLS STORES COMPANY, a Delaware corporation (the "Parent"), the other Loan Parties named herein and signatories hereto, the financial institutions listed on the signature pages hereof (collectively, the "Lenders") and BANKAMERICA BUSINESS CREDIT, INC., as Agent (the "Agent"). WHEREAS, the Borrowers, the Parent, the other Loan Parties, the Lenders and the Agent are parties to that certain Loan and Security Agreement, dated as of September 30, 1996, (such agreement being referred to herein as the "Loan and Security Agreement"); WHEREAS, the Borrowers have requested certain modifications to the financial covenants contained in the Loan and Security Agreement and an extension of the maturity date of the credit facility provided under the Loan and Security Agreement, and the Lenders and the Agent are agreeable to making such changes, subject to the terms and conditions herein contained. NOW, THEREFORE, the Borrowers, the Parent, the other Loan Parties, the Lenders and the Agent hereby agree as follows: SECTION 1. CAPITALIZED TERMS. Capitalized terms used but not defined herein shall have the respective meanings set forth in the Loan and Security Agreement. SECTION 2. AMENDMENTS TO LOAN AND SECURITY AGREEMENT. The Loan and Security Agreement shall be, and upon the fulfillment of the conditions set forth in Section 3 hereof is, amended as follows: 2.1 The definition "EBITDA" in Section 1.1 of the Loan and Security Agreement is amended by (i) adding the following phrase to the end of clause (c) of such definition before the comma: "(provided that for purposes of determining compliance with SECTION 9.24 for any period for which EBITDA is being calculated which ends on the last day of any fiscal quarter of the Parent comprising part of the Parent's 1997 Fiscal Year, the fifty percent (50%) figure in this clause (c) shall be increased to one hundred percent (100%))" and (ii) adding the following sentence to the end of such definition: "Notwithstanding the foregoing, EBITDA shall not in any event include any loss arising directly and solely from the closing of store 227 located at 1072 W. Mercury Blvd., Hampton, VA 23666 and those stores of HDSC described on Exhibit A to either of the Waivers and Consents, dated as of January 29, 1997 and January 31, 1997, respectively, to the Loan and Security Agreement." 2 2.2 The definition "Net Capex" in Section 1.1 of the Loan and Security Agreement is amended by adding the following clause immediately after the phrase "during such period" in clause (b) of such definition: "(which aggregate amount of Capital Expenditures shall, for purposes of determining compliance with SECTION 9.24 (and not for the purpose of determining the Coverage Ratio) for each of the twelve consecutive fiscal month periods of the Parent ending on the last day of any fiscal quarter of the Parent comprising part of the Parent's 1997 Fiscal Year (without duplication), be reduced by $10,000,000)" 2.3 The definition "Stated Termination Date" in Section 1.1 of the Loan and Security Agreement is amended by (i) deleting the phrase "the third anniversary of the Closing Date" and (ii) substituting therefor the date "January 31, 2000". 2.4 Section 9.23 of the Loan and Security Agreement is deleted in its entirety and the following Section 9.23 shall be substituted therefor: "9.23 ADJUSTED TANGIBLE NET WORTH. The Parent will maintain Adjusted Tangible Net Worth, determined as of the last day of each fiscal quarter of the Parent, of not less than the following: FISCAL QUARTER ENDING IN OR ABOUT AMOUNT January of any year $110,000,000 April of any year $100,000,000 July of any year $ 90,000,000 October of any year $ 80,000,000"
2.5 Section 9.24 of the Loan and Security Agreement is amended by (i) deleting the phrases "twelve consecutive fiscal months" and "twelve fiscal month" and substituting the phrases "four consecutive fiscal quarters" and "four fiscal quarter", respectively, therefor and (ii) deleting the phrase "(determined as of the last day of each fiscal month of the Parent)" and substituting therefor the phrase "(determined as of the last day of each fiscal quarter of the Parent)". SECTION 3. EFFECTIVENESS. This Agreement and the amendments contemplated hereby shall become effective when: (a) counterparts hereof have been duly executed and delivered to the Agent on behalf of the Borrowers, the Parent, the other Loan Parties, the Lenders and the Agent; (b) the Agent shall be satisfied that there exists no Default or Event of Default; and (c) the Agent shall have received for the benefit of the Lenders an amendment fee in the amount of $250,000 (to be allocated among the Lenders based upon each Lender's respective Commitment at the time such fee is received by the Agent). 3 SECTION 4. COUNTERPARTS. This First Amendment to Loan and Security Agreement may be executed in counterparts, each of which shall be an original, and all of which, taken together, shall constitute a single instrument. This First Amendment to Loan and Security Agreement shall be governed by, and construed in accordance with, the internal laws (as opposed to the conflicts of laws provisions) of the State of New York. Delivery of an executed counterpart of a signature page to this First Amendment to Loan and and Security Agreement by telecopier shall be effective as delivery of a manually executed signature page hereto. SECTION 5. REFERENCES TO LOAN AND SECURITY AGREEMENT. From and after the effectiveness of this First Amendment to Loan and Security Agreement and the amendments contemplated hereby, all references in the Loan and Security Agreement to "this Agreement", "hereof", "herein", and similar terms shall mean and refer to the Loan and Security Agreement, as amended and modified by this First Amendment to Loan and Security Agreement, and all references in other documents to the Loan and Security Agreement shall mean such agreement as amended and modified by this First Amendment to Loan and Security Agreement. SECTION 6. RATIFICATION AND CONFIRMATION. The Loan and Security Agreement is hereby ratified and confirmed and, except as herein agreed, remains in full force and effect. Each of the Loan Parties represents and warrants that on the date hereof (i) all representations and warranties made by any Loan Party contained in Articles 6 and 8 of the Loan and Security Agreement are correct in all material respects on and as of the date hereof, other than any such representation or warranty which relates to a specified prior date and (ii) there exists no Default or Event of Default. IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to Loan and Security Agreement to be duly executed by their respective authorized officers as of the day and year first above written. "BORROWERS" HILLS DEPARTMENT STORE COMPANY By /s/ C. Scott Litten ------------------------------ Name: C. Scott Litten Title: Executive Vice President- Chief Financial Officer C.R.H. INTERNATIONAL, INC. By /s/ William K. Friend ------------------------------ Name: William K. Friend Title: Vice President-Secretary 4 "PARENT" HILLS STORES COMPANY By /s/ C. Scott Litten ------------------------------ Name: C. Scott Litten Title: Executive Vice President- Chief Financial Officer OTHER "LOAN PARTIES" CANTON ADVERTISING, INC. By /s/ William K. Friend ------------------------------ Name: William K. Friend Title: Vice President-Secretary/Clerk HDS TRANSPORT, INC. By /s/ William K. Friend ------------------------------ Name: William K. Friend Title: Vice President-Secretary CORPORATE VISION, INC. By /s/ William K. Friend ------------------------------ Name: William K. Friend Title: Vice President-Secretary/Clerk HILLS DISTRIBUTING COMPANY By /s/ William K. Friend ------------------------------ Name: William K. Friend Title: Vice President-Secretary 5 "AGENT" BANKAMERICA BUSINESS CREDIT, INC., as the Agent By /s/ Michael Lemiszko ------------------------------ Name: Michael Lemiszko Title: Vice President "LENDERS" BANKAMERICA BUSINESS CREDIT, INC., as a Lender By /s/ Michael Lemiszko ------------------------------ Name: Michael Lemiszko Title: Vice President THE FIRST NATIONAL BANK OF BOSTON, as a Lender By /s/ Janet G. O'Donnell ------------------------------ Name: Janet G. O'Donnell Title: Vice President THE CIT GROUP/BUSINESS CREDIT, INC., as a Lender By /s/ Jon Oldham ------------------------------ Name: Jon Oldham Title: Assistant Secretary CONGRESS FINANCIAL CORPORATION, as a Lender By /s/ Josephine Norris ------------------------------ Name: Josephine Norris Title: Vice President 6 HELLER FINANCIAL, INC., as a Lender By /s/ Scott Ziemke ------------------------------ Name: Scott Ziemke Title: AVP-Account Manager IBJ SCHRODER BANK & TRUST COMPANY, as a Lender By /s/ James M. Steffy ------------------------------ Name: James M. Steffy Title: Vice President LASALLE BUSINESS CREDIT, INC., as a Lender By /s/ Lawrence P. Garni ------------------------------ Name: Lawrence P. Garni Title: Vice President SANWA BUSINESS CREDIT CORPORATION, as a Lender By /s/ Peter L. Skavla ------------------------------ Name: Peter L. Skavla Title: Vice President TRANSAMERICA BUSINESS CREDIT CORPORATION, as a Lender By /s/ Michael Burns ------------------------------ Name: Michael Burns Title: Vice President -----END PRIVACY-ENHANCED MESSAGE-----