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):
October 30, 2006
Shoe Pavilion, Inc.
13245 Riverside Drive, Suite 450
(Exact name of registrant as specified in its charter)
Sherman Oaks, California 91423
(Address of principal executive offices including zip code)
(818) 907 9975
(Registrant's telephone number, including area code)
Not Applicable
(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))
Item 2.01 Entry into a Material Definitive Agreement Amendment of Wells Fargo Retail Finance Loan and Security Agreement
On October 30, 2006, Shoe Pavilion Corporation (the "Borrower"), the wholly-owned
subsidiary of Shoe Pavilion, Inc. (the "Company") entered into Amendment Number Five of the Loan and Security
Agreement, dated as of October 30, 2006, by and between the Borrower and Wells Fargo Retail Finance, LLC ("Wells
Fargo"). Amendment Number Five further amends the Loan and Securities Agreement dated April 18, 2003, and as
previously amended on September 24, 2004, May 12, 2005, August 11, 2005 and March 15, 2006 (the "Revolving
Credit Facility").
The effect of Amendment Number Five is generally to lower the cost of borrowings under the Revolving Credit
Facility. This is accomplished by adding two new definitions to the Revolving Credit Facility, including "Excess Availability"
and "Average Excess Availability," while also amending certain other material terms or definitions, including "Base
Rate Margin," "LIBOR Rate Margin" and "Margin Pricing Grid." Together, these new definitions may result
in lowering the cost of borrowings under the Revolving Credit Facility by calculating the LIBOR Rate Margin, on which the cost of
borrowing is ultimately based, with reference to a revised Margin Pricing Grid, which, in turn, is newly-based on "Average Excess
Availability," rather than using as its benchmark applicable EBITDA. Excess Availability is newly-defined in Amendment Number
Five as the difference between the Borrowing Base and the sum of all Advances plus Letter of Credit Usage, but without taking into
account the Maximum Revolver Amount, all as defined in the Revolving Credit Facility, as previously in effect. The LIBOR Rate Margin
provided for in Amendment Number Five falls in the range of 1.25% and 1.75%, depending on the Borrower's Average Excess
Availability.
In all other respects, the Revolving Credit Facility remains in full force and effect.
A copy of Amendment Number Five to the Revolving Credit Facility is filed as an exhibit to this Form 8-K and is incorporated
herein by this reference. Item 9.01. Exhibits. Description Amendment Number Five to Loan and Security Agreement between Shoe Pavilion
Corporation and Wells Fargo Retail Finance, LLC, dated as of October 30, 2006
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 thereunto duly authorized.
Date: November 2, 2006
Shoe Pavilion, Inc.
By: /s/ Bruce L. Ross
Bruce L. Ross
Executive Vice President and Chief Financial Officer
EXHIBIT INDEX
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Description |
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Amendment Number Five to Loan and Security Agreement between Shoe Pavilion Corporation and Wells Fargo Retail Finance, LLC, dated as of October 30, 2006 Also provided in PDF format as a courtesy. |