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): December 4, 2009
THE BON-TON STORES, INC.
(Exact name of registrant as specified in its charter)
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Pennsylvania |
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0-19517 |
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23-2835229 |
(State or other Jurisdiction of Incorporation) |
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(Commission File Number) |
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(IRS Employer Identification No.) |
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2801 E. Market Street, York, Pennsylvania
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17402 |
(Address of Principal Executive Offices) |
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(Zip Code) |
Registrants telephone number, including area code: 717-757-7660
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Not Applicable
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(Former name or former address if changed since last report.) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
1
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Item 1.01. |
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Entry into a Material Definitive Agreement |
Amended and Restated Loan and Security Agreement
On December 4, 2009, The Bon-Ton Department Stores, Inc. and The Elder-Beerman Stores Corp. as
borrowers (the Borrowers), and The Bon-Ton Stores, Inc. (the Company) and certain other
subsidiaries as obligors (together with the Borrowers and the Company, the Obligors) entered into
an Amended and Restated Loan and Security Agreement with Bank of America, N.A., as Agent, and
certain financial institutions as lenders that amends and restates the Loan and Security Agreement
entered into on March 6, 2006 (as amended prior to December 4, 2009, the 2006 Revolving Credit
Facility), and provides for a revolving credit facility of $675.0 million expiring June 4, 2013
(the Amended Revolving Credit Facility). All borrowings under the Amended Revolving Credit
Facility are limited by amounts available pursuant to a borrowing base calculation, which is based
on percentages of eligible inventory, real estate and credit card receivables, in each case subject
to reductions for applicable reserves.
The terms of the Amended Revolving Credit Facility are substantially based on the terms of the 2006
Revolving Credit Facility. The Borrowers are jointly and severally liable for all of the
obligations incurred under the Amended Revolving Credit Facility and the other loan documents,
which obligations are guaranteed on a joint and several basis by the Company, the other Obligors
and all future domestic subsidiaries of the Obligors (subject to certain exceptions). The proceeds
of the Amended Revolving Credit were used to pay the outstanding balance under the 2006 Revolving
Credit Facility and will be used for other general corporate purposes.
Commitments for loans under the Amended Revolving Credit Facility are in two tranches: Tranche A
revolving commitments of $625.0 million (which includes a $150.0 million subline for letters of
credit and $75.0 million for swing line loans) and Tranche A-1 revolving commitments of $50.0
million. The Amended Revolving Credit Facility provides that the
Borrowers may make requests to increase
the Tranche A revolving commitments up to $800.0 million in the aggregate upon the satisfaction of
certain conditions, provided that the lenders are under no obligation
to provide any such increases.
On December 31, 2010, the Tranche A-1 revolving commitments will be reduced by $20.0 million and
such amount will be reallocated to the Tranche A revolving commitments.
Borrowings under the Amended Revolving Credit Facility will be at either (A) Adjusted LIBOR (based
on the highest of (i) the British Bankers Association LIBOR Rate based on an interest period
selected by the Borrowers, (ii) the British Bankers Association LIBOR Rate based on an interest
period of three months and (iii) 1.25%) plus the applicable margin or (B) a base rate (based on the
highest of (i) the Federal Funds Rate plus 0.5%, (ii) the Bank of America prime rate, and (iii)
Adjusted LIBOR based on an interest period of one month plus 1.0%) plus the applicable margin. The
applicable margin is as follows:
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Average Excess |
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LIBOR Tranche A |
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LIBOR Tranche A-1 |
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Base Rate Tranche A |
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Base Rate Tranche |
Level |
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Availability |
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Revolver Loans |
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Revolver Loans |
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Revolver Loans |
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A-1 Revolver Loans |
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Greater than
$250.0 million
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3.75 |
% |
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6.75 |
% |
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2.75 |
% |
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5.75 |
% |
II
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Less than or equal
to $250.0 million
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4.00 |
% |
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7.00 |
% |
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3.00 |
% |
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6.00 |
% |
The Borrowers will pay an unused line fee to the lenders for unused commitments as follows:
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Level |
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Total Facility Usage Ratio |
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Unused Fee |
I
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Greater than or equal to 66%
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0.50 |
% |
II
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Greater than 33% but less than 66%
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0.75 |
% |
III
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Less than or equal to 33%
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1.00 |
% |
The Amended Revolving Credit Facility is secured by a first priority security position on
substantially all of the current and future assets of the Borrowers and the other Obligors,
including, but not limited to, inventory, general intangibles, trademarks, equipment, certain real
estate and proceeds from any of the foregoing, subject to certain exceptions and liens.
The financial covenant contained in the Amended Revolving Credit Facility requires that the minimum
excess availability be at least $75.0 million at all times. Other covenants continue the
requirements of the 2006 Revolving Credit Facility and require that the Obligors provide the
lenders with certain financial statements, forecasts and other reports, borrowing base certificates
and notices and comply with various federal, state and local rules and regulations. In addition,
there are certain limitations, including limitations on:
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any debt the Obligors may have in addition to the existing debt, and the terms of that debt; |
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acquisitions, joint ventures and investments; |
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mergers and consolidations; |
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dispositions of property; |
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dividends by the Obligors or their subsidiaries; |
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transactions with affiliates; |
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changes in the business or corporate structure of the Obligors or their subsidiaries; |
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prepaying, redeeming or repurchasing certain debt; |
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changes in accounting policies or reporting practices; and |
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speculative transactions. |
The Amended Revolving Credit Facility may be terminated upon the occurrence of certain events of
default (subject to applicable grace periods for certain defaults) including:
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failure to pay principal, interest or fees when due; |
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material breach of the warranties or failure to perform the covenants
in the Amended Revolving Credit Facility; |
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default under certain other debt; |
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entry of certain monetary judgments against an Obligor that are not
discharged in stated periods of time; |
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a change of control; |
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customary ERISA defaults; |
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an asserted invalidity of the loan documentation or an impairment of
the collateral under the Amended Revolving Credit Facility; and |
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an Obligors inability to pay its debts or bankruptcy of an Obligor. |
The foregoing description of the Amended Revolving Credit Facility is qualified in its entirety by
reference to the Amended and Restated Loan and Security Agreement, a copy of which is included as
Exhibit 10.1 hereto and incorporated herein by reference.
On December 7, 2009, the Company issued a press release announcing it had entered into an
amended and restated $675.0 million revolving credit agreement. The press release is attached as
Exhibit 99.1 to the Current Report on Form 8-K and is incorporated herein by reference.
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Item 9.01. |
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Financial Statements and Exhibits. |
(d) Exhibits
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Exhibit No. |
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Description |
10.1
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Amended and Restated Loan and Security Agreement dated December 4, 2009 |
99.1
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Press Release dated December 7, 2009 |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the
Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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The Bon-Ton Stores, Inc.
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By: |
/s/ Keith E. Plowman
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Keith E. Plowman |
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Executive Vice President, Chief Financial
Officer and Principal Accounting Officer |
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Dated: December 9, 2009