EXHIBIT 10.9
SECOND AMENDMENT
TO
INTERCREDITOR AND LIEN
SUBORDINATION AGREEMENT
THIS SECOND AMENDMENT TO
INTERCREDITOR AND LIEN SUBORDINATION AGREEMENT
(this “ Amendment
”) is entered into as of April 29, 2005, by and among S.A.C.
CAPITAL ASSOCIATES, LLC, a limited liability company organized
under the laws of Anguila, as “Administrative Agent”
and “Collateral Agent” for all Second Lien Lenders
party to the Second Lien Credit Agreement as described more fully
in the Intercreditor Agreement referred to below (the “
Second Lien Agent ”), THE WET SEAL, INC., a Delaware
corporation (the “ Lead Borrower ”), THE WET
SEAL RETAIL, INC., a Delaware corporation (“ Wet Seal
Retail ”), WET SEAL CATALOG, INC., a Delaware corporation
(collectively, with Wet Seal Retail and the Lead Borrower, the
“ Companies ”), WET SEAL GC, INC., a Virginia
corporation (the “ Facility Guarantor ”), and
FLEET RETAIL GROUP, INC., as “Administrative Agent” and
“Collateral Agent” for all of the First Lien Lenders
party to the First Lien Credit Agreement as described more fully in
the Intercreditor Agreement referred to below (the “ First
Lien Agent ”). All capitalized terms used but not defined
herein shall have the meanings ascribed to such terms in the
Intercreditor Agreement referred to below.
RECITALS
A. Concurrently with the
Companies’, the Facility Guarantor’s and the Second
Lien Agent’s execution and delivery of that certain Second
Lien Credit Agreement with the Second Lien Lenders, the Companies,
the Facility Guarantor, the Second Lien Agent and the First Lien
Agent executed an Intercreditor and Lien Subordination Agreement,
dated as of November 9, 2004 (as amended and in effect from time to
time, the “ Intercreditor Agreement
”);
B. The Companies and the Facility
Guarantor have requested that the First Lien Credit Agreement be
amended to provide, among other things, that the Borrowing Base and
the Minimum Required Excess Availability be amended and that the
Second Lien Credit Agreement be amended to provide, among other
things, that the Minimum Required Excess Availability be amended;
and
C. The First Lien Agent and the
Second Lien Agent have agreed, subject to the terms and conditions
provided herein, to amend the Intercreditor Agreement as provided
herein.
NOW, THEREFORE
, for good and valuable
consideration, the receipt and sufficiency of which hereby are
acknowledged, the parties hereto hereby agree as
follows:
1. Amendments to Intercreditor
Agreement .
(a) Section 1 of the Intercreditor
Agreement is hereby amended by adding the following new definition
of “Third Amendment to First Lien Credit Agreement Effective
Date” in the appropriate alphabetical order:
““ Third Amendment
to First Lien Credit Agreement Effective Date ” means
the date on which all conditions precedent to the Third Amendment
to Amended and Restated Credit Agreement, dated as of April 29,
2005, among the Credit Parties, the First Lien Agent and the First
Lien Lenders, have been satisfied.”
(b) Section 1 of the Intercreditor
Agreement is hereby further modified by deleting the definition of
“Borrowing Base Certificate” in its entirety and
substituting in lieu thereof the following new
definition:
““ Borrowing Base
Certificate ” means the Borrowing Base Certificate as
defined in the First Lien Credit Agreement (as in effect on the
Third Amendment to First Lien Credit Agreement Effective
Date).”
(c) Section 1 of the Intercreditor
Agreement is hereby further modified by deleting the definition of
“Maximum First Lien Debt” in its entirety and
substituting in lieu thereof the following new
definition:
““ Maximum First
Lien Debt ” shall mean on any date of determination
thereof, First Lien Debt in an amount equal to (a) the lesser of
(i) $50,000,000 and (ii) the result of (A) the greater of the (I)
Borrowing Base and (II) Term Loan Borrowing Base (as such terms
(including the component definitions thereof) are defined in the
First Lien Credit Agreement as of the Third Amendment to First Lien
Credit Agreement Effective Date), minus (B) the Minimum
Required Excess Availability (as such term (including the component
definitions thereof) is defined in the First Lien Credit Agreement
as of the Third Amendment to First Lien Credit Agreement Effective
Date); plus (b) $8,000,000; plus , (c) the Permitted
Overadvance Amount, minus (d) all Asset Sale Revolver
Reserves, all Insurance Reserves and all Term Loan Permanent
Reductions.”
(d) Section 1 of the Intercreditor
Agreement is hereby further modified by deleting the definition of
“Second Lien Actionable Default” in its entirety and
substituting in lieu thereof the following new
definition:
““ Second Lien
Actionable Default ” shall mean, collectively to the
extent that such events have not been cured or waived, (a) an
“Event of Default” that aris
