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): June 10, 1998
CROWLEY MILNER AND COMPANY
(Exact name of registrant as specified in its charter)
Michigan 1-1594 38-0454910
(State or other (Commission File (IRS Employer
jurisdiction) Number) Identification
Number)
2301 West Lafayette Boulevard, Detroit, Michigan 48216
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (313) 962-2400
Not applicable
(Former name or former address, if changed since last report)
Item 5. Other Items.
Loan and Security Agreement -- Congress Financial Corporation (Central).
As previously reported by the registrant in its Current Report on
Form 8-K dated August 31, 1996, effective as of September 5, 1996, Congress
Financial Corporation (Central) ("Congress"), Crowley, Milner and Company, a
Michigan corporation (the "Company"), and Steinbach Stores, Inc., an Ohio
corporation and a wholly-owned subsidiary of the Company ("Steinbach"),
entered into an Amended and Restated Loan and Security Agreement (the
"Amended Loan Agreement") pursuant to which Congress was obligated to
provide, on an aggregate basis to the Company and Steinbach, a fully secured
line of credit of up to $24 million and, included within such line of
credit, a facility for letters of credit of up to $5 million, with the
interest rate on the foregoing, subject to certain terms and conditions, at
25 basis points above the prime rate of CoreStates Bank, N.A. The Company
and Steinbach each granted Congress a security interest in and general lien
upon substantially all of their respective tangible and intangible personal
assets and property, whether now owned or hereafter acquired, as security
for all debts, liabilities and obligations of the Company and Steinbach
under the Amended Loan Agreement. The Amended Loan Agreement shall continue
for a term ending on November 4, 1999, and from year to year thereafter
unless sooner terminated pursuant to the terms thereof.
As also previously reported by the registrant in its Current Report
on Form 8-K dated July 3, 1997, Congress, the Company and Steinbach entered
into Amendment No. 1 to the Amended Loan Agreement, pursuant to which (i)
the maximum credit available under the Amended Loan Agreement was increased
from $24 million to $35 million for the period of December 1 of any year
through August 31 of the following year and $42 million for the period of
September 1 through November 30 of each year, and (ii) the letter of credit
accommodation was increased from $5 million to $10 million.
Effective as of June 10, 1998, Congress, the Company and Steinbach
entered into Amendment No. 2 to the Amended Loan Agreement, pursuant to
which, among other things, (i) the maximum credit available under the
Amended Loan Agreement was increased from $35 million to $43 million for the
period of December 1 of any year through August 31 of the following year and
from $42 million to $50 million for the period of September 1 through
November 30 of each year; (ii) the borrowing rate was increased to 34% of
eligible retail inventory from 30%; and (iii) a new feature was added
pursuant to which the Company and Steinbach may, from time to time and
subject to certain stated terms and conditions, request that the prime rate
loans (i.e., loans bearing interest 25 basis points above the prime rate of
CoreStates Bank, N.A.) be converted to Eurodollar rate loans bearing
interest equal to the average rates at which CoreStates Bank, N.A. is
offered deposits of United States dollars in the London interbank market.
The information set forth in Amendment No. 2 to the Amended Loan
Agreement attached hereto as Exhibit 10.10 is hereby incorporated herein by
reference.
Resignation of Chief Financial Officer
On July 9, 1998 the Company issued a press release announcing that
Vice-President of Finance, Chief Financial Officer, Secretary and Treasurer,
John R. Dallacqua has tendered his resignation to be effective as of July
10, 1998 in order to pursue a new career opportunity in a non-retail
business. The press release is attached hereto as Exhibit 99.1 and is
hereby incorporated herein by reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
10.10 Amended and Restated Loan and Security Agreement, dated
September 5, 1996, among Congress Financial Corporation
(Congress), Crowley, Milner and Company and Steinbach
Stores, Inc. (amends and restates Loan and Security
Agreement previously filed as an exhibit to the Company's
Quarterly Report on Form 10-Q for the quarter ended October
31, 1994) (previously filed as an exhibit to the Company's
Current Report on Form 8-K dated August 31, 1996), Amendment
No. 1 thereto (previously filed as an exhibit to the
Company's Current Report on Form 8-K dated July 3, 1997), as
amended by Amendment No. 2 thereto (a copy of which is filed
herewith).
99.1 Press release issued by Crowley, Milner and Company on July
9, 1998.
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.
CROWLEY, MILNER AND COMPANY
/s/ JOHN R. DALLACQUA
John R. Dallacqua,
Vice President of Finance
July 10, 1998
EXHIBIT INDEX
Exhibit
No. Description
10.10 Amended and Restated Loan and Security Agreement, dated September 5,
1996, among Congress Financial Corporation (Congress), Crowley,
Milner and Company and Steinbach Stores, Inc. (amends and restates
Loan and Security Agreement previously filed as an exhibit to the
Company's Quarterly Report on Form 10-Q for the quarter ended
October 31, 1994) (previously filed as an exhibit to the Company's
Current Report on Form 8-K dated August 31, 1996), Amendment No. 1
thereto (previously filed as an exhibit to the Company's Current
Report on Form 8-K dated July 3, 1997), as amended by Amendment No.
2 thereto (a copy of which is filed herewith).
99.1 Press Release issued by Crowley, Milner and Company on July 9, 1998.