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EXHIBIT 4.1
AMENDMENT NO. 1 TO RECEIVABLES-BACKED CREDIT AGREEMENT
Amendment No. 1 to Receivables-Backed Credit Agreement (this
"Amendment"), dated as of September 28, 1993, among CHH RECEIVABLES, INC. (the
"Borrower"), BLUE HAWK FUNDING CORPORATION (the "Lender") and GENERAL ELECTRIC
CAPITAL CORPORATION, as Agent (in such capacity, the "Agent"). All capitalized
terms used herein not otherwise defined shall have the respective meanings
assigned to such terms in the Credit Agreement hereinafter described.
W I T N E S S E T H :
WHEREAS, the parties hereto have entered into a
Receivables-Backed Credit Agreement, dated as of October 8, 1992 (the "Credit
Agreement"); and
WHEREAS, the parties hereto wish to amend the Credit Agreement
as hereinafter provided;
NOW, THEREFORE, in consideration of the premises and of the
commitments made hereunder by the Borrower, the Lender and the Agent, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto, intending to be legally bound, hereby
agree as follows:
1. The definition of the term "Advance Rate" contained in Section
1.01 of the Credit Agreement is hereby amended and restated in its entirety as
follows:
"'Advance Rate' means, at any date of calculation thereof,
84.5% subject to any reduction or increase pursuant to clauses (i)
through (vi) below:
(i)(1) If, as of the end of any fiscal month of the
Borrower ending on or prior to January 1, 1994, the Loss-to-
Receivables Ratio exceeds 8.65%, the Advance Rate shall be
reduced, from and after the date the Lender Report for such
fiscal month is delivered, by an amount (ex-
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pressed as a percentage) equal to 2.2 times the amount by
which the Loss-to-Receivables Ratio exceeds 8.65%;
(2) If, as of the end of any fiscal month of the
Borrower ending after January 1, 1994, the Loss-to-Receivables
Ratio exceeds 7.98%, the Advance Rate shall be reduced, from
and after the date the Lender Report for such fiscal month is
delivered, by an amount (expressed as a percentage) equal to
2.6 times the amount by which the Loss-to-Receivables Ratio
exceeds 7.98%;
(ii)(1) If, as of the end of any fiscal month of the
Borrower ending on or prior to January 1, 1994, 8.65% exceeds
the Loss-to-Receivables Ratio, the Advance Rate will be
increased, from and after the date the Lender Report for such
fiscal month is delivered, by an amount (expressed as a
percentage) equal to 2.2 times the amount by which 8.65%
exceeds the Loss-to-Receivables Ratio;
(2) If, as of the end of any fiscal month of the
Borrower ending after January 1, 1994, 7.98% exceeds the
Loss-to-Receivables Ratio, the Advance Rate will be
increased, from and after the date the Lender Report for such
fiscal month is delivered, by an amount (expressed as a
percentage) equal to 2.6 times the amount by which 7.98%
exceeds the Loss-to-Receivables Ratio;
(iii)(1) If, as of the end of any fiscal month of
the Borrower ending on or prior to January 1, 1994, the
Dilution Ratio exceeds the Dilution Percentage, the Advance
Rate shall be reduced from and after the date the Lender
Report for such fiscal month is delivered, by an amount
(expressed as a percentage) equal to the amount by which the
Dilution Ratio exceeds the Dilution Percentage. As used in
this clause (iii)(1), "Dilution Percentage" means, for any
Measurement Period, the percentage set forth below opposite
the name of the fiscal month in which such Measurement Period
ends:
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MONTH PERCENTAGE
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January 3.29%
February 3.21%
March 2.08%
April 2.02%
May 2.11%
June 2.34%
July 2.33%
August 2.27%
September 2.30%
October 2.46%
November 2.69%
December 3.47%
(2) If, as of the end of any fiscal month of the
Borrower ending after January 1, 1994, the Dilution Ratio
exceeds the Dilution Percentage, the Advance Rate shall be
reduced from and after the date the Lender Report for such
fiscal month is delivered, by an amount (expressed as a
percentage) equal to the amount by which the Dilution Ratio
exceeds the Dilution Percentage. As used in this clause
(iii)(2), "Dilution Percentage" means, for any Measurement
Period, the percentage set forth below opposite the name of
the fiscal month in which such Measurement Period ends:
MONTH PERCENTAGE
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January 3.03%
February 2.95%
March 1.82%
April 1.76%
May 1.85%
June 2.08%
July 2.07%
August 2.01%
September 2.04%
October 2.20%
November 2.43%
December 3.21%
(iv)(1) If, as of the end of any fiscal month of the
Borrower ending on or prior to April 2, 1994, the Effective
Yield is less than 16%, the Advance Rate shall be reduced,
from and after
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the date the Lender Report for such fiscal month is delivered,
by an amount (expressed as a percentage) equal to the amount
by which 16% exceeds the Effective Yield;
(2) If, as of the end of any fiscal month of the
Borrower ending after April 2, 1994, the Effective Yield is
less than 17.6%, the Advance Rate shall be reduced, from and
after the date the Lender Report for such fiscal month is
delivered, by an amount (expressed as a percentage) equal to
the amount by which 17.6% exceeds the Effective Yield;
(v) If any state or federal law or regulation
applicable to Carter Hawley or the Receivables, or any
amendment to any such law or regulation, is enacted which in
any such case provides for a reduction in the maximum
allowable per annum rate of finance charges or other fees
which may be imposed in respect of any Receivables, the
Advance Rate shall be reduced to reflect the anticipated
decrease in the finance charge or fee income generated by the
Receivables as a result of such legislation, such reduction to
be determined by the Agent, in its reasonable discretion after
consultation with the Borrower, and promptly notified to the
Borrower; and
(vi) If a cumulative total of more than 20 retail
stores (1) are closed and/or sold by Carter Hawley, (2) are
announced to be closed and/or sold by Carter Hawley and/or (3)
cease to permit customers to make payment for goods and
services under a Charge Account Agreement, subsequent to April
1, 1992, the Agent shall determine, after consultation with
the Borrower, the rate to which the Advance Rate with respect
to Eligible Receivables should be adjusted by reason of such
store closings, such adjustment to be based upon the
historical experience relating to previous store closings and
taking into account the extent to which, if at all, the effect
of such store closings (or announced closings) has resulted
(as determined by the Agent) in reductions of the Advance Rate
pursuant to clauses (i), (iii) and (iv) above;
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provided, however, that if the Lender Report for the most recent
fiscal month after the effective date of any such reduction or
increase shows that the circumstances that triggered such reduction or
increase pursuant to clauses (i) through (v) above no longer exist,
the Advance Rate shall be modified, from and after the date such
Lender Report for such fiscal month is delivered, to an amount equal
to 84.5%, subject to any reductions or increase computed as set forth
above after giving effect to such changed circumstances; provided,
further, that at no time shall the Advance Rate exceed 88%."
2. The definition of the term "Effective Yield" contained in
Section 1.01 of the Credit Agreement is hereby amended and restated in its
entirety as follows:
"Effective Yield" means the ratio (expressed as a percentage)
computed as of the last day of each Measurement Period by dividing (i)
the aggregate accrued finance charge income (exclusive of late and
other similar charges) on all Receivables (net of adjustments
consistent with current accounting and credit practice) during the
period of twelve consecutive Measurement Periods ending on such day by
(ii) the average Outstanding Balance of all Receivables as of the
first day of each Measurement Period occurring during such twelve
month period; provided, however, that with respect to each Measurement
Period ending during the period from April 3, 1994 through December
31, 1994 (the "Special 1994 Period"), "Effective Yield" shall mean the
ratio (expressed as a percentage) computed as of the last day of each
such Measurement Period by dividing (i) the product of (x) the
aggregate accrued finance charge income (exclusive of late and other
similar charges) on all Receivables (net of adjustments consistent
with current accounting and credit practice) during the period
beginning on January 30, 1994 and ending on the last day of such
Measurement Period multiplied by (y) a fraction the numerator of which
is 12 and the denominator of which is the number of Measurement
Periods ending during the period from January 30, 1994 through the
date of such calculation by (ii) the average Outstanding Balance of
all Receivables as of the first day of each Measurement Period
occurring during the period beginning on
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January 30, 1994 and ending on the last day of such Measurement Period;
3. In order to induce the Lender to enter into this Amendment,
the Borrower hereby represents and warrants as of the date hereof that no
Default or Event or Default has occurred and is continuing.
4. This Amendment is limited as specified and shall not
constitute a modification or waiver of any other provision of the Credit
Agreement. Any references to the Credit Agreement in any of the Facility
Documents or in any of the documents executed or delivered in connection
therewith or in contemplation thereof shall be deemed after the date hereof to
be references to the Credit Agreement as amended by this Amendment.
5. The Borrower shall deliver to the Agent such resolutions
approving and authorizing this Amendment and such corporate certificates as the
Agent may reasonably request, which resolutions and certificates shall be in
form and substance satisfactory to the Agent.
6. This Amendment shall be effective on the later of (i) the date
on which each of the parties hereto shall have executed and delivered a copy or
counterpart of this Amendment to each other party hereto and (ii) the date upon
which each Rating Agency shall have confirmed that the execution of this
Amendment shall not result in the downgrading of the Commercial Paper.
7. This Amendment may be executed in any number of counterparts
and by the different parties hereto on separate counterparts each of which when
so executed and delivered shall be an original, but all of which together shall
constitute one and the same instrument.
8. This Amendment and the rights and obligations of the parties
hereunder shall be construed in accordance with and governed by the laws of the
State of New York.
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IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Amendment to be duly executed and delivered as of the date
first above written.
CHH RECEIVABLES, INC.
By:___________________________
Name:
Title:
BLUE HAWK FUNDING CORPORATION
By:___________________________
Name:
Title:
GENERAL ELECTRIC CAPITAL CORPORATION, as Agent
By:___________________________
Name:
Title:
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