Exhibit 10SS
SECOND AMENDMENT TO CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this "Second Amendment") is
dated as November 19, 1999 among XXXXXXXX XXXXX, INC. (the "Borrower"), WACHOVIA
BANK, N.A. (successor by merger to Wachovia Bank of Georgia, N.A.), as Agent
(the "Agent"), and WACHOVIA BANK, N.A. (successor by merger to Wachovia Bank of
North Carolina, N.A.), BANK OF TOKYO-MITSUBISHI, LTD. (successor by merger to
Bank of Tokyo, Ltd.), FIRST UNION NATIONAL BANK (successor by merger to First
Union National Bank of North Carolina), SUNTRUST BANK, ATLANTA, BANK OF AMERICA,
N.A. (formerly NationsBank, N.A., successor by merger to NationsBank, N.A.
(Carolinas)), BANK ONE, NA (formerly the First National Bank of Chicago
(assignee of NBD BANK) and ABN AMRO BANK, N.V. (collectively, the "Banks");
W I T N E S S E T H:
WHEREAS, the Borrower, the Agent and the Banks executed and delivered
that certain Credit Agreement, dated as of September 26, 1995, as amended by
First Amendment to Credit Agreement dated as of May 5, 1999 (the "Credit
Agreement");
WHEREAS, the Borrower has requested and the Agent and the Banks have
agreed to certain amendments to the Credit Agreement, subject to the terms and
conditions hereof;
NOW, THEREFORE, for and in consideration of the above premises and
other good and valuable consideration, the receipt and sufficiency of which
hereby is acknowledged by the parties hereto, the Borrower, the Agent and the
Banks hereby covenant and agree as follows:
1. Definitions. Unless otherwise specifically defined herein, each term
used herein which is defined in the Credit Agreement shall have the meaning
assigned to such term in the Credit Agreement. Each reference to "hereof",
"hereunder", "herein" and "hereby" and each other similar reference and each
reference to "this Agreement" and each other similar reference contained in the
Credit Agreement shall from and after the date hereof refer to the Credit
Agreement as amended hereby.
2. Amendment to Section 5.15. Section 5.15 of the Credit Agreement
hereby is deleted and the following is substituted therefor:
SECTION 5.15. Loans or Advances. Neither the Borrower
nor any of its Subsidiaries shall make loans or advances to any Person
except as permitted by Section 5.16 and except: (i) loans or advances
to employees not exceeding $1,000,000 in the aggregate principal amount
outstanding at any time, in each case made in the ordinary course of
business and consistent with practices existing on July 2, 1995; (ii)
deposits required by landlords, government agencies or public
utilities; (iii) loans or advances to the Borrower or any Guarantor or
permitted pursuant to the Consent and Waiver dated as of March 31, 1999
among the Borrower, the Agent and the Banks pertaining to "UK
Intercompany Loans" (as defined therein); and (iv) other loans or
advances in an aggregate outstanding amount which, together with
Investments permitted by clause (viii) of Section 5.16, do not exceed
(x) for the period from the First Amendment Date through and including
March 31, 2000, 20% of Consolidated Tangible Net Worth, and (y) at all
other times, 10% of Consolidated Tangible Net Worth; provided that
after giving effect to the making of any loans or advances permitted by
clause (iv) of this Section, if there are any Loans outstanding at that
time, no Default shall be in existence or be created thereby.
3. Amendment to Section 5.16. Section 5.16 of the Credit Agreement
hereby is deleted and the following is substituted therefor:
SECTION 5.16. Investments. Neither the Borrower nor
any of its Subsidiaries shall make Investments in any Person except as
permitted by Section 5.15 and except (i) Investments in direct
obligations of the United States Government maturing within one year,
(ii) Investments in certificates of deposit issued by a commercial bank
whose credit is satisfactory to the Agent, (iii) Investments in
commercial paper rated A1 or the equivalent thereof by Standard &
Poor's Rating Group, a division of XxXxxx-Xxxx, Inc. or P1 or the
equivalent thereof by Xxxxx'x Investors Service, Inc. and in either
case maturing within 6 months after the date of acquisition, (iv)
Investments in tender bonds the payment of the principal of and
interest on which is fully supported by a letter of credit issued by a
United States bank whose long-term certificates of deposit are rated at
least AA or the equivalent thereof by Standard & Poor's Corporation and
Aa or the equivalent thereof by Xxxxx'x Investors Service, Inc., (v)
Investments in the Borrower or any Guarantor, (vi) Investments
consisting of acquisitions of stock or assets of any Person which is in
the same or a similar line of business to that of the Borrower
(including, without limitation, manufacturing, sales, marketing,
distribution or other activities relating to components or end-products
used or produced in the textile, fabric, garment or apparel industries)
and which, as a result of such acquisition, becomes a Subsidiary, (vii)
Investments in Persons which are not Subsidiaries of the Borrower and
which are in the same or a similar line of business to that of the
Borrower (including those lines of business described in clause (vi)
above) in an aggregate amount not to exceed 10% of Consolidated Total
Assets and (viii) other Investments in an aggregate which, together
with loans and advances permitted by clause (iv) of Section 5.15, do
not exceed (x) for the period from the First Amendment Date through and
including March 31, 2000, 20% of Consolidated Tangible Net Worth, and
(y) at all other times, 10% of Consolidated Tangible Net Worth;
provided that after giving effect to the making of any Investments
permitted by clauses (vi) or (vii) of this Section, if there are any
Loans outstanding at that time, no Default shall be in existence or be
created thereby.
4. Amendment to Exhibit F (Compliance Certificate). Exhibit F hereby
is amended by deleting paragraphs 1 and 2 thereof and substituting the
following therefor:
1. Loans and Advances (Section 5.15)
Neither the Borrower nor any of its Subsidiaries shall make
loans or advances to any Person except as permitted by Section
5.16 and except: (i) loans or advances to employees not
exceeding $1,000,000 in the aggregate principal amount
outstanding at any time, in each case made in the ordinary
course of business and consistent with practices existing on
July 2, 1995; (ii) deposits required by landlords, government
agencies or public utilities; (iii) loans or advances to the
Borrower or any Guarantor or permitted pursuant to the Consent
and Waiver dated as of March 31, 1999 among the Borrower, the
Agent and the Banks pertaining to "UK Intercompany Loans" (as
defined therein); and (iv) other loans or advances in an
aggregate outstanding amount which, together with Investments
permitted by clause (viii) of Section 5.16, do not exceed (x)
for the period from the First Amendment Date through and
including March 31, 2000, 20% of Consolidated Tangible Net
Worth, and (y) at all other times, 10% of Consolidated
Tangible Net Worth; provided that after giving effect to the
making of any loans or advances permitted by clause (iv) of
this Section, if there are any Loans outstanding at that time,
no Default shall be in existence or be created thereby.
(a) To Employees $__________
Limitation $1,000,000
(b) other loans and advances
pursuant to clause (iv) $__________
(c) sum of (b) and amount in line (c)
of paragraph 2 below $__________
(d) [10%] [20%] of Consolidated Tangible
Net Worth $__________
Limitation (c) may not exceed (d)
2. Investments (Section 5.16)
Neither the Borrower nor any of its Subsidiaries shall make
Investments in any Person except as permitted by Section 5.15
and except (i) Investments in direct obligations of the United
States Government maturing within one year, (ii) Investments
in certificates of deposit issued by a commercial bank whose
credit is satisfactory to the Agent, (iii) Investments in
commercial paper rated A1 or the equivalent thereof by
Standard & Poor's Rating Group, a division of XxXxxx- Xxxx,
Inc. or P1 or the equivalent thereof by Xxxxx'x Investors
Service, Inc. and in either case maturing within 6 months
after the date of acquisition, (iv) Investments in tender
bonds the payment of the principal of and interest on which is
fully supported by a letter of credit issued by a United
States bank whose long-term certificates of deposit are rated
at least AA or the equivalent thereof by Standard & Poor's
Corporation and Aa or the equivalent thereof by Xxxxx'x
Investors Service, Inc., (v) Investments in the Borrower or
any Guarantor, (vi) Investments consisting of acquisitions of
stock or assets of any Person which is in the same or a
similar line of business to that of the Borrower (including,
without limitation, manufacturing, sales, marketing,
distribution or other activities relating to components or
end-products used or produced in the textile, fabric, garment
or apparel industries) and which, as a result of such
acquisition, becomes a Subsidiary, (vii) Investments in
Persons which are not Subsidiaries of the Borrower and which
are in the same or a similar line of business to that of the
Borrower (including those lines of business described in
clause (vi) above) in an aggregate amount not to exceed 10% of
Consolidated Total Assets and (viii) other Investments in an
aggregate which, together with loans and advances permitted by
clause (iv) of Section 5.15, do not exceed (x) for the period
from the First Amendment Date through and including March 31,
2000, 20% of Consolidated Tangible Net Worth, and (y) at all
other times, 10% of Consolidated Tangible Net Worth; provided
that after giving effect to the making of any Investments
permitted by clauses (vi) or (vii) of this Section, if there
are any Loans outstanding at that time, no Default shall be in
existence or be created thereby.
(a) Investments in persons who are not
yet Subsidiaries pursuant to
clause (vii) $__________
(b) 10% of Consolidated Total Assets $__________
Limitation (a) may not exceed (b)
(c) other Investments
pursuant to clause (viii) $__________
(d) sum of (c) and amount in line (b)
of paragraph 1 above $__________
(e) [10%] [20%] of Consolidated Tangible
Net Worth $__________
Limitation (d) may not exceed (e)
5. Restatement of Representations and Warranties. The Borrower hereby
restates and renews each and every representation and warranty heretofore made
by it in the Credit Agreement and the other Loan Documents as fully as if made
on the date hereof and with specific reference to this Second Amendment and all
other loan documents executed and/or delivered in connection herewith.
6. Effect of Amendment. Except as set forth expressly hereinabove, all
terms of the Credit Agreement and the other Loan Documents shall be and remain
in full force and effect, and shall constitute the legal, valid, binding and
enforceable obligations of the Borrower. The amendments contained herein shall
be deemed to have prospective application only, unless otherwise specifically
stated herein.
7. Ratification. The Borrower hereby restates, ratifies and reaffirms each
and every term, covenant and condition set forth in the Credit Agreement and the
other Loan Documents effective as of the date hereof, except that in about May,
1999, Altimira Centro de la Confeccion, S.A. de C.V. became a joint venture 50%
owned by the Borrower, rather than a Subsidiary.
8. Counterparts. This Second Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed and delivered shall be deemed to be an original and
all of which counterparts, taken together, shall constitute but one and the same
instrument.
9. Section References. Section titles and references used in this
Second Amendment shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreements among the parties hereto
evidenced hereby.
10. No Default. To induce the Agent and the Banks to enter into this
Second Amendment and to continue to make advances pursuant to the Credit
Agreement, the Borrower hereby acknowledges and agrees that, as of the date
hereof, and after giving effect to the terms hereof, there exists (i) no Default
or Event of Default and (ii) no right of offset, defense, counterclaim, claim or
objection in favor of the Borrower arising out of or with respect to any of the
Loans or other obligations of the Borrower owed to the Banks under the Credit
Agreement.
11. Further Assurances. The Borrower agrees to take such further actions
as the Agent shall reasonably request in connection herewith to evidence the
amendments herein contained to the Borrower.
12. Governing Law. This Second Amendment shall be governed by and
construed and interpreted in accordance with, the laws of the State of North
Carolina.
13. Conditions Precedent. This Second Amendment shall become effective only
upon (i) execution and delivery of this Second Amendment by the Borrower, the
Agent and the Required Banks, (ii) execution and delivery of the Consent and
Reaffirmation of Guarantors at the end hereof by each of the Guarantors, and
(iii) payment to the Agent, for the account of each Bank which executes this
Second Amendment, of an amendment fee in the amount of $5,000 for each such
Bank, and (iv) payment to the Agent, for its own account, of the fees payable
pursuant to the letter agreement between the Agent and the Borrower dated
November 3, 1999.
[SIGNATURES CONTAINED ON NEXT PAGE]
IN WITNESS WHEREOF, the Borrower, the Agent and each of the Banks has
caused this Second Amendment to be duly executed, under seal, by its duly
authorized officer as of the day and year first above written.
XXXXXXXX XXXXX, INC., (SEAL) WACHOVIA BANK, N.A., (SEAL)
as Borrower as Agent and as a Bank
By: /s/ Xxxxxxxx X. Xxxxxxxx By: /s/ Xxxxxxx Xxxxxxxxx, V
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Title: Executive Vice President Title: Senior Vice President
and Chief Financial Officer
BANK OF TOKYO-MITSUBISHI, (SEAL) FIRST UNION NATIONAL BANK, (SEAL)
LTD., as a Bank as a Bank
By: /s/ Xxxxx Xxxxx By: /s/ Xxxxxxx Xxxxx, Xx.
-------------------------- ----------------------
Title: Vice President Title: Senior Vice President
SUNTRUST BANK, ATLANTA, (SEAL) BANK OF AMERICA, N.A. (formerly as
as a Bank Nationsbank, N.A.), (SEAL)
as a Bank
By: /s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxxx
---------------------- -------------------------
Title: Director Title: Managing Director
By:
-----------------------
Title
BANK ONE, NA (formerly The First ABN AMRO BANK, N.V.,
National Bank of Chicago), as a Bank (SEAL)
as a Bank (SEAL)
By: /s/ Xxxxx X. Xxxxx By:/s/ Xxxx Xxxxx, Xx.
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Title: Assistant Vice President Title: Vice President
By: By:/s/Xxxxxx X. Xxxxxx
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Title: Title: Vice President
CONSENT AND REAFFIRMATION OF GUARANTORS
Each of the undersigned (i) acknowledges receipt of the foregoing
Second Amendment to Credit Agreement (the "Second Amendment"), (ii) consents to
the execution and delivery of the Second Amendment by the parties thereto and
(iii) reaffirms all of its obligations and covenants under the Guaranty
Agreement dated as of September 26, 1995 executed by Gold Xxxxx, Inc., as
supplemented by Second Supplement to Guaranty entered into by Raschel Fashion
Interknitting, Ltd. and Curtains and Fabrics, Inc., as additional Guarantors,
and agrees that none of such obligations and covenants shall be affected by the
execution and delivery of the Second Amendment. This Consent and Reaffirmation
may be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed to be an original and all of which counterparts, taken together, shall
constitute but one and the same instrument.
GOLD XXXXX, INC. (SEAL)
By:/s/ Xxxxxxxx X. Xxxxxxxx
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Title: Executive Vice President and
Chief Financial Officer
RASCHEL FASHION INTERKNITTING, LTD. (SEAL)
By:/s/ Xxxxxxxx X. Xxxxxxxx
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Title: Executive Vice President and
Chief Financial Officer
CURTAINS AND FABRICS, INC. (SEAL)
By:/s/ Xxxxxxxx X. Xxxxxxxx
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Title: Executive Vice President and
Chief Financial Officer
