GMAC
COMMERCIAL CREDIT LLC
0000 XXXXXX XX XXX XXXXXXXX x XXX XXXX, XX 00000
000-000-0000
March 17, 2000
SIGNAL APPAREL COMPANY, INC.
000 0xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Waiver
Gentlemen:
Reference is made to the Revolving Credit, Term Loan and Security
Agreement, dated March 12, 1999 (as amended from time to time, the "Credit
Agreement") by and among SIGNAL APPAREL COMPANY, INC. ("Borrower") and GMAC
COMMERCIAL CREDIT LLC, as Agent (in such capacity, "Agent") for the lenders
(."Lenders") parties from time to time to the Credit Agreement. All
capitalization terms used and not otherwise defined herein shall have the
respective meanings ascribed to them in the Credit Agreement.
1. The Borrower has advised Lender that, for the year ending December 31,
1999, its Tangible Net Worth was less than ($74,000,000), the minimum Tangible
Net Worth permitted as of December 31, 1999 under Section 6.5 (Tangible Net
Worth) of the Credit Agreement; (ii) the Current Ratio was less than 0.60:1.00,
the minimum Current Ratio permitted as of December 31, 1999 under Section 6.6
(Current Ratio) of the Credit Agreement; (iii) Working Capital was less than
($10,500,000), the minimum Working Capital permitted as of December 31, 1999
under Section 6.7 (Working Capital) of the Credit Agreement; and (iv) net loss,
excluding any extraordinary or non-recurring items was greater than the
($5,000,000) permitted as of December 31, 1999 under Section 6.13(a) of the
Credit Agreement. As a result of such noncompliance, Events of Default have
occurred under Section 10.2 of Article X (Events of Default) of the Credit
Agreement ("Subject Events of Default"). Borrowers have requested Lender to
waive the Subject Events of Default, and Lender hereby waives the Subject Events
of Default.
2. Borrower hereby acknowledges, confirms and agrees that all amounts
charged or credited to the Borrower's account as of March 15, 2000 are correct
and binding upon the Borrower and that all amounts reflected to be due and owing
in the Borrower's account as of March 15, 2000 are due and owing without
defense, setoff, offset, recoupment, claim or counterclaim. Furthermore,
Borrower hereby also irrevocably releases and forever discharges Agent and
Lenders and each of Agent's and Lenders' respective affiliated concerns, as well
as all of Agent's Lenders' respective directors, officers, employees,
shareholders and agents from any an all liabilities, demands, obligations,
causes of action and other claims, of every kind, nature and description, known
and unknown, which Borrower now has or may hereafter have, by reason of any
matter, cause or thing occurred, done omitted or suffered to be done prior to
the date hereof.
3. Except as specifically set forth herein, no other changes or
modification to the Credit Agreement are intended or implied, and, in all other
respects the Credit Agreement shall continue to remain in full force and effect
in accordance with its terms as of the date hereof. Except as specifically set
forth herein, nothing contained herein shall evidence a waiver or an amendment
by Agent of any other provisions of the Credit Agreement nor of the specific
provisions referred to above for any other time period.
4. In consideration of the waiver given by Agent and Lenders herein,
Borrower agrees to pay a non-refundable waiver fee to Agent, for the benefit of
Lenders in the amount of $40,000, which fee shall be in addition to any fees,
charges or interest otherwise payable by you under the Credit Agreement, and
which fee shall be fully earned as of the date hereof and payment of which may
be effectuated by charging Borrower's loan account.
5. The terms and provisions of this agreement shall be for the benefits of
the parties hereto and their respective successors and assigns; no other person,
entity or corporation shall have any right, benefit or interest under this
agreement.
6. This Agreement may be signed in counterparts, each of which shall be an
original and all of which taken together constitute one amendment. In making
proof of this agreement, it shall not be necessary to produce or account for
more than one counterpart signed by the party to be charged.
7. This Agreement sets forth the entire agreement and understanding of the
parties with respect to the matters set forth herein. This agreement cannot be
changed, modified, amended or terminated except in a writing executed by the
party to be changed.
Very truly yours,
GMAC COMMERCIAL CREDIT LLC,
as Agents
By: /s/ Xxxxx Xxxxx VP
----------------------------
Acknowledge and Agreed:
Signal Apparel Company, Inc.
By: /s/ Xxxxxxx Xxxxxx
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Title: Controller
