Document:

exv10w72

 

Exhibit 10.72

SECOND AMENDMENT

     THIS SECOND AMENDMENT to Agreement (“Second Amendment”) is entered into as
of this 21st day of February, 2005 by and between Wilsons The Leather Experts
Inc. (the “Company”), and Joel N. Waller, a Minnesota resident (“Waller”).

     WHEREAS, Waller was previously employed by the Company as its Chief
Executive Officer and continues as a director, until the expiration of his term
at the 2005 annual meeting of shareholders of the Company;

     WHEREAS, Waller was employed under the terms and conditions of an Amended
Employment Agreement, which provided certain severance benefits to Waller in
the event that his employment with the Company ended under circumstances
described in the Amended Employment Agreement;

     WHEREAS, the Company and Waller entered into an Agreement dated October
28, 2004, as amended (“Separation Agreement”), regarding the terms of Waller’s
separation from the Company, which Separation Agreement modified the payment
schedule for the severance pay expected to be owed to Waller under the Amended
Employment Agreement;

     WHEREAS, while the parties were negotiating the terms of the Separation
Agreement, the American Jobs Creation Act of 2004 (the “Act”) was enacted,
Section 885 of which Act added new provisions to the Internal Revenue Code
pertaining to deferred compensation;

     WHEREAS, in December 2004 and January 2005, after the parties had entered
into the Separation Agreement, the Treasury Department issued transition
guidance and revised transition guidance regarding the deferred compensation
provisions of the Act (“Notice 2005-1”);

     WHEREAS, the parties agree that it is in their mutual best interests to
further modify the severance pay provisions of the Amended Employment
Agreement, as implemented under the Separation Agreement, with the full
intention of complying with the Act and Notice 2005-1 so as to avoid the excise
taxes and penalties imposed under the Act, and to further amend the Separation
Agreement to effect such modification; and

     WHEREAS, pursuant to the Act and Notice 2005-1 (including, without
limitation, Q&A-20 thereunder), it is the intention of the parties to hereby
amend the Amended Employment Agreement and the Separation Agreement to
terminate and cancel any and all deferral aspects of the severance pay
provisions therein and to provide for payment of all such severance pay in
calendar year 2005, in accordance with the provisions of this Second Amendment;

     NOW, THEREFORE, in consideration of the premises and mutual covenants and
agreements contained herein, the parties agree as follows:

 

 

     1. Subsection 4(a) of the Separation Agreement is hereby deleted in its
entirety and replaced with the following:

     a. Severance Pay. Section 6(c)(i) of the Amended Employment
Agreement is hereby cancelled and terminated. In lieu of any
payments under Section 6(c)(i) of the Amended Employment Agreement,
the Company shall instead pay to Waller severance pay in the gross
amount of $1,100,000.00, payable in two installments as follows:
(i) $505,576.92, less required tax withholdings, shall be paid to
Waller by the Company promptly after execution of this Second
Amendment by Waller and the Company; and (ii) $594,423.08, less
required tax withholdings, shall be paid to Waller by the Company
on or before December 31, 2005.

     2. Waller and the Company each acknowledge that the application of the Act
and Notice 2005-1 to the arrangements hereunder is uncertain and subject to
legal interpretation. The parties are entering into this Second Amendment
based on their own best judgment and legal advice, with the full intention of
complying with the Act and Notice 2005-1 so as to avoid the excise taxes and
penalties imposed under the Act. Neither party has made any representation to
the other regarding the tax implications of this Second Amendment.

     3. All capitalized terms not otherwise defined herein shall have the
meanings ascribed to such terms in the Separation Agreement. Other than as
expressly amended in this Second Amendment, the Separation Agreement shall
continue in full force and effect, as so amended by this Second Amendment.

     IN WITNESS WHEREOF, the parties hereto have executed this Second Amendment
as of the date stated above.

	 	 	 	 	 
	 	 	

WILSONS THE LEATHER EXPERTS INC.

 	 
	/s/ Joel N. Waller 	 	By:  	/s/ Michael Cowhig
 	 
	Joel N. Waller 	 	 	Michael Cowhig 	 
	 	 	 	Its Chairman, Compensation Committee 	 
	 

2exv10w73

 

Exhibit 10.73

Waiver and Modification under Employment Agreement

     This waiver and modification, dated March 2, 2005, is made by Michael
Searles (the “Executive”) with respect to his Employment Agreement (the
“Employment Agreement”) dated November 22, 2004 with Wilsons The Leather
Experts Inc. (the “Company”).

RECITALS

     1. Section 4(c) of the Employment Agreement provides that for each Plan
Year during which Executive is employed, Executive’s target award under the
Company’s Incentive Plan that is then in effect shall be 100% of Executive’s
base salary.

     2. The Incentive Plan in effect on the date of the Employment Agreement
was the Company’s Executive and Key Management Incentive Plan effective May 26,
1996 (the “1996 Incentive Plan”).

     3. Executive has recommended the adoption of a Corporate Leadership Team
Incentive Plan (the “2005 Incentive Plan”) to replace the Executive and Key
Management Incentive Plan. Because the 2005 Incentive Plan may provide greater
incentives to the Company’s associates than the 1996 Plan, may result in larger
overall payments by the Company to the Company’s associates than the 1996
Incentive Plan and may provide larger payments to the Executive in certain
circumstances than the 1996 Incentive Plan, Executive is willing to waive his
rights to a target award under the 2005 Incentive Plan of 100% of Executive’s
base salary.

Waiver and Modification

     NOW, THEREFORE, in order to induce the Company to adopt the 2005 Incentive
Plan and in consideration of the additional benefits Executive and other
associates of the Company may receive under the 2005 Incentive Plan because of
the differences in incentives to him and other associates under the 2005
Incentive Plan, Executive, intending to be legally bound, agrees as follows:

     1. Executive agrees that the 1996 Incentive Plan shall be replaced by the
2005 Incentive Plan upon adoption by the Company, as recommended by Executive,
and the Executive shall not be entitled to any payment under the 1996 Incentive
Plan.

     2. Executive waives any rights that he would otherwise have under Section
4(c) or any other provision of the Employment Agreement to a target award of
100% of Executive’s base salary under the 2005 Incentive Plan, provided that
Executive’s target award under the 2005 Incentive Plan shall be at least 75% of
Executive’s base salary, and the maximum incentive opportunity of Executive
under the 2005 Incentive Plan, including distributions from the Incentive Pool
thereunder, shall be 200% of Executive’s base salary.

 

 

     3. Executive understands and agrees that notwithstanding anything stated
in Section 4(c) or any other provision of the Employment Agreement or anything
stated in this Waiver and Modification, Executive shall not be entitled to any
payment under the 2005 Incentive Plan other than in accordance with the terms
of the 2005 Incentive Plan and that, under the provisions of the 2005 Incentive
Plan, 40% of the basic incentive award payment to which Executive is otherwise
entitled under the 2005 Incentive Plan is at risk pursuant to the terms of the
2005 Incentive Plan and is dependent upon the achievement of annual individual
performance measures established by the Compensation Committee.

     4. This Waiver and Modification is a continuing waiver given in accordance
with Section 14(f) of the Employment Agreement.

     IN WITNESS WHEREOF, Executive has executed this Waiver and Modification as
of the date set forth in the first paragraph of this Agreement.

	 	 	 	 	 
	 	 	 
	 	     /s/ Michael Searles
 	 
	 	Michael Searles 	 
	 	 	 
	 

Agreed and accepted as of the date

first above written to induce the

Company to adopt the 2005 Incentive

Plan.

	 	 	 	 	 
	WILSONS THE LEATHER EXPERTS INC.

 	 
	By:  	/s/ Betty A. Goff
 
	 	Its:  Vice President, Human Resources  	 
	 	 	 
	 

2exv10w74

 

Exhibit 10.74

LIMITED WAIVER AND EIGHT AMENDMENT TO

FOURTH AMENDED AND RESTATED CREDIT AGREEMENT

     This LIMITED WAIVER AND EIGHTH AMENDMENT TO FOURTH AMENDED AND RESTATED
CREDIT AGREEMENT (this “Waiver and Amendment”) is entered into as of
this 4th day of April, 2005 among WILSONS LEATHER HOLDINGS INC., a Minnesota
corporation (“Borrower”), GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware
corporation, as Lender, Term Lender, Swing Line Lender and as Agent (“Agent”),
the Credit Parties signatory hereto and the Lenders signatory hereto. Unless
otherwise specified herein, capitalized terms used in this Waiver and Amendment
shall have the meanings ascribed to them by the Credit Agreement (as
hereinafter defined).

RECITALS

     WHEREAS, Borrower, certain Credit Parties, Agent and Lenders have entered
into that certain Fourth Amended and Restated Credit Agreement dated as of
April 23, 2002 (as amended, supplemented, restated or otherwise modified from
time to time, the “Credit Agreement”); and

     WHEREAS, Borrower, the Credit Parties signatories to the Credit Agreement,
the Requisite Lenders and Agent wish to waive and amend certain provisions of
the Credit Agreement, as more fully set forth herein.

     NOW THEREFORE, in consideration of the mutual covenants herein and other
good and valuable consideration the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

Section 1 Limited Waiver. The Agent and the Requisite Lenders hereby
waive any breach or violation of the Credit Agreement (and any resulting Event
of Default) which has occurred solely as a result of the failure by Borrower to
deliver the report set forth in item (ii) of clause (d) of
Schedule G to Credit Agreement for the Fiscal Years ending in January
2003 and 2004. This limited waiver shall be limited precisely as written and
shall not be deemed or otherwise construed to constitute a waiver of any
Default or Event of Default arising out of any other failure of the Credit
Parties to comply with the terms of the Credit Agreement.

Section 2 Amendment to the Credit Agreement. Subject to the
satisfaction of the conditions precedent set forth in Section 4 hereof, the
parties hereto hereby agree to amend and restate clause (d) of
Schedule G to Credit Agreement to read in its entirety as follows:

     “(d) Annual Audited Financials. To Agent and Lenders, within
ninety (90) days after the end of each Fiscal Year, copies of the
Ultimate Parent’s 10-K. Such Financial Statements shall be accompanied
by (i) a statement prepared in reasonable detail by Ultimate Parent’s
Chief Financial Officer showing the calculations used in determining
compliance with each of the financial covenants set forth on Schedule
I, (ii) upon Agent’s request, a report from such accounting firm to
the effect that, in

1

 

connection with their audit examination, nothing has come to their
attention to cause them to believe that a Default or Event of Default has
occurred (or specifying those Defaults and Events of Default that they
became aware of), it being understood that such audit examination
extended only to accounting matters and that no special investigation was
made with respect to the existence of Defaults or Events of Default,
(iii) a letter addressed to Agent, on behalf of itself and Lenders, in
form and substance reasonably satisfactory to Agent and subject to
standard qualifications taken by nationally recognized accounting firms,
signed by such accounting firm acknowledging that Agent and Lenders are
entitled to rely upon such accounting firm’s certification of such
audited Financial Statements, and (iv) the annual letters to such
accountants in connection with their audit examination detailing
contingent liabilities and material litigation matters;”

Section 3 Representations and Warranties. Borrower and the Credit
Parties who are party hereto represent and warrant that:

     (a) the execution, delivery and performance by Borrower and such Credit
Parties of this Waiver and Amendment have been duly authorized by all necessary
corporate action and this Waiver and Amendment is a legal, valid and binding
obligation of Borrower and such Credit Parties enforceable against Borrower and
such Credit Parties in accordance with its terms, except as the enforcement
thereof may be subject to (i) the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or similar law affecting creditors’
rights generally and (ii) general principles of equity (regardless of whether
such enforcement is sought in a proceeding in equity or at law);

     (b) each of the representations and warranties contained in the Credit
Agreement is true and correct in all material respects on and as of the date
hereof as if made on the date hereof, except to the extent that such
representations and warranties expressly relate to an earlier date;

     (c) neither the execution, delivery and performance of this Waiver and
Amendment nor the consummation of the transactions contemplated hereby does or
shall contravene, result in a breach of, or violate (i) any provision of
Borrower’s or Credit Parties’ certificate or articles of incorporation or
bylaws, (ii) any law or regulation, or any order or decree of any court or
government instrumentality or (iii) indenture, mortgage, deed of trust, lease,
agreement or other instrument to which Borrower, the Credit Parties or any of
their Subsidiaries is a party or by which Borrower, the Credit Parties or any
of their Subsidiaries or any of their property is bound, except in any such
case to the extent such conflict or breach has been waived by a written waiver
document a copy of which has been delivered to Agent on or before the date
hereof; and

     (d) no Default or Event of Default will exist or result after giving
effect hereto.

Section 4 Conditions to Effectiveness. This Waiver and Amendment will
be effective only upon execution and delivery of this Waiver and Amendment by
Borrower, the Credit Parties that are listed on the signature pages hereto, the
Agent and Requisite Lenders.

Section 5 Reference to and Effect Upon the Credit Agreement.

     (a) Except as specifically set forth herein, the Credit Agreement and the
other Loan Documents shall remain in full force and effect and are hereby
ratified and confirmed.

2

 

     (b) The execution, delivery and effectiveness of this Waiver and Amendment
shall not operate as a waiver of any right, power or remedy of Agent or any
Lender under the Credit Agreement or any Loan Document, nor constitute a waiver
of any provision of the Credit Agreement or any Loan Document, except as
specifically set forth herein. Upon the effectiveness of this Waiver and
Amendment, each reference in the Credit Agreement to “this Agreement”,
“hereunder”, “hereof”, “herein” or words of similar import shall mean and refer
to the Credit Agreement as amended hereby.

Section 6 Waiver and Release.

     In consideration of the foregoing, each of Borrower and each Credit Party
hereby waives, releases and covenants not to sue Agent or any Lender with
respect to, any and all claims it may have against Agent or any Lender, whether
known or unknown, arising in tort, by contract or otherwise prior to the date
hereof relating to one or more Loan Documents.

Section 7 Costs and Expenses.

     As provided in Section 11.3 of the Credit Agreement, Borrower
agrees to reimburse Agent for all fees, costs and expenses, including the fees,
costs and expenses of counsel or other advisors for advice, assistance, or
other representation in connection with this Waiver and Amendment.

Section 8 Governing Law.

     THIS WAIVER AND AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS OF THE STATE OF ILLINOIS.

Section 9 Headings.

     Section headings in this Waiver and Amendment are included herein for
convenience of reference only and shall not constitute a part of this Waiver
and Amendment for any other purposes.

Section 10 Counterparts.

     This Waiver and Amendment may be executed in any number of counterparts,
each of which when so executed shall be deemed an original but all such
counterparts shall constitute one and the same instrument.

Section 11 Confidentiality.

     The matters set forth herein are subject to Section 11.18 of the Credit
Agreement, which is incorporated herein by reference.

[signature page follows]

3

 

     IN WITNESS WHEREOF, this Waiver and Amendment has been duly executed as of
the date first written above.

	 	 	 	 	 
	 	BORROWER:

WILSONS LEATHER HOLDINGS INC.

 	 
	 	By: 	/s/
Peter G. Michielutti	 
	 	 	 	 
	 	Title: 	Executive
Vice President, Chief Financial	 
	 	 	Officer,
Chief
Operating Officer	 
	 
	Revolving Loan Commitment:

$41,666,667 (including $10,000,000

Swing Line Commitment)

	GENERAL ELECTRIC CAPITAL
CORPORATION, as Agent, Lender and
Swing Line Lender
	 
	Term
Loan B Commitment:

	By: 	/s/
Kristina M. Miller	 
	$25,000,000	 	 	 
	 	Title:	Duly
Authorized Signatory	 
	 
	Revolving
Loan Commitment:
$20,833,333

	LASALLE RETAIL FINANCE,
a division of LaSalle BusinessCredit, as agent for Standard Federal Bank National
Association, as Lender
	 
	 	By: 	/s/
Matthew Potter	 
	 	 	 	 
	 	Title: 	Assistant
Vice President	 
	 
	Revolving
Loan Commitment:
$31,250,000

	THE CIT GROUP/BUSINESS CREDIT,
INC., as Lender and Documentation
Agent
	 

	 	By: 	/s/
Steven Schuit	 
	 	 	 	 
	 	Title: 	Vice
President	 
	 
	Revolving
Loan Commitment:
$31,250,000

	WELLS FARGO RETAIL FINANCE LLC,
as Lender and Syndication Agent

	 
	 	By:  	/s/
Francis D. O’Connor	 
	 	 	 	 
	 	Title: 	Senior
Vice President	 

[Signature Page to Limited Waiver and Eight Amendment]

 

 

     The undersigned are executing this Waiver and Amendment in their capacity
as Credit Parties:

	 	 	 	 	 
	 	Wilsons The Leather Experts Inc.

 	 
	 	By: 	/s/
Peter G. Michielutti	 
	 	 	 	 
	 	Title:	Executive
Vice President, Chief
Financial	 
	 	 	Officer, Chief
Operating Officer	 
	 
	 	Wilsons Center, Inc.

 	 
	 	By: 	/s/
Peter G. Michielutti	 
	 	 	 	 
	 	Title:	Executive
Vice President, Chief
Financial	 
	 	 	Officer, Chief
Operating Officer	 
	 
	 	Rosedale Wilsons, Inc.

 	 
	 	By: 	/s/
Peter G. Michielutti	 
	 	 	 	 
	 	Title:	Executive
Vice President, Chief
Financial	 
	 	 	Officer, Chief
Operating Officer	 
	 
	 	River Hills Wilsons, Inc.

 	 
	 	By: 	/s/
Peter G. Michielutti	 
	 	 	 	 
	 	Title:	Executive
Vice President, Chief
Financial	 
	 	 	Officer, Chief
Operating Officer	 
	 
	 	Bermans The Leather Experts Inc.

 	 
	 	By: 	/s/
Peter G. Michielutti	 
	 	 	 	 
	 	Title: 	Executive
Vice President, Chief
Financial	 
	 	 	Officer, Chief
Operating Officer	 
	 

[Signature Page to Limited Waiver
and Eight Amendment]

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