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EXHIBIT 10.4
AMENDMENT AGREEMENT NO. 3
THIS AMENDMENT AGREEMENT NO. 3 (the "Amendment Agreement") is made and
entered into as of this 10th day of June, 1998 by and among XXXXXXX FABRICS,
INC., a Delaware corporation (the "Borrower"), and NATIONSBANK, N.A. (formerly
NationsBank of Georgia, National Association), a national banking association,
in its capacity as Agent for each of the Lenders party to the Credit Agreement
(as defined below) (the "Agent"), and each of the undersigned Lenders. Unless
the context otherwise requires, all terms used herein without definition shall
have the respective meanings assigned thereto in the Credit Agreement.
WITNESSETH:
WHEREAS, the Borrower, the Agent and the Lenders have entered into that
certain Credit Agreement dated as of September 20, 1993, as amended by that
certain Amendment Agreement No. 1 dated as of May 31, 1995 and further amended
by that certain Amendment Agreement No.2 dated as of April 1, 1998, whereby the
Lenders have made available to the Borrower, a $60,000,000 revolving credit
facility (as at any time hereafter amended, restated, modified or supplemented,
the "Credit Agreement"); and
WHEREAS, the Borrower has requested that the Agent and the Lenders
make certain amendments to the Credit Agreement; and
WHEREAS, the Agent and the Lenders are willing to so amend the Credit
Agreement upon the terms and conditions set forth herein;
NOW THEREFORE, in consideration of the premises and conditions herein
set forth it is hereby agreed as follows:
1. Credit Agreement Amendment. Subject to the conditions hereof, the
Credit Agreement is hereby amended, effective as of the date hereof, as follows:
(a) Paragraph (1) of Section 7.8 of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:
"(1) Minimum Tangible Net Worth. The Tangible Net Worth of the Borrower and its
Subsidiaries shall not be less than $85,000,000 plus (A) 25% of its Net Income
(if positive), after taxes, on an ongoing basis for each Fiscal Quarter
beginning with the fiscal quarter ending August 2, 1998, plus (B) the aggregate
amount of all increases, if any, in its capital accounts resulting from the
issuance of capital stock or conversion of debt into capital stock or other
securities properly classified as equity in accordance with GAAP, or from the
sale or other disposition of treasury shares, from June 10, 1998 through the
date of determination minus Excess Common Stock Repurchases."
(b) Paragraph (3) of Section 7.8 of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:
"(3) Fixed Charge Coverage Ratio. The ratio of Income Available for
Debt Service to the sum of Lease Payments and Interest Expense of the
Borrower and its Subsidiaries for the most recently completed four
(4) Fiscal Quarters shall not be less than 1.50 to 1.00."
2. Representations and Warranties. In order to induce the Agent and the
Lenders to enter into this
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Amendment Agreement, the Borrower hereby represents and warrants that the Credit
Agreement has been re-examined by the Borrower and that except as disclosed by
the Borrower in writing to the Agent as of the date hereof:
(a) The representations and warranties made by the Borrower in Article
V thereof are true on and as of the date hereof;
(b) There has been no material adverse change in the condition,
financial or otherwise, of the Borrower and its Subsidiaries since the date of
the most recent consolidated financial statements of the Borrower and its
Subsidiaries delivered to the Agent under Section 7.3 thereof;
(c) The business and properties of the Borrower and its Subsidiaries
are not, and since the date of the most recent consolidated financial statements
of the Borrower and its Subsidiaries delivered to the Lender under Section 7.3
thereof, have not been, adversely affected in any substantial way as the result
of any fire, explosion, earthquake, accident, strike, lockout, combination of
workers, flood, embargo, riot, activities of armed forces, war or acts of God or
the public enemy, or cancellation or loss of any major contracts; and
(d) After giving effect to this Amendment Agreement, no condition
exists which, upon the effectiveness of the amendment contemplated hereby, would
constitute a Default or an Event of Default on the part of the Borrower under
the Credit Agreement or the other Loan Documents, either immediately or with the
lapse of time or the giving of notice, or both.
3. Conditions Precedent. The effectiveness of this Amendment Agreement
is subject to the receipt by the Agent of the following:
(i) six (6) counterparts of this Amendment Agreement duly executed by
all signatories hereto;
(ii) resolutions of the Board of Directors or other governing body of
the Borrower approving this Amendment Agreement certified by the Secretary of
the Borrower; and
(iii) copies of all additional agreements, instruments and documents
which the Lender may reasonably request, such documents, when appropriate to be
certified by appropriate governmental authorities.
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All proceedings of the Borrower relating to the matters provided for herein
shall be satisfactory to the Agent and its counsel.
4. Entire Agreement. This Amendment Agreement sets forth the entire
understanding and agreement of the parties hereto in relation to the subject
matter hereof and supersedes any prior negotiations and agreements among the
parties relative to such subject matter. No promise, condition, representation
or warranty, express or implied, not herein set forth shall bind any party
hereto, and no one of them has relied on any such promise, condition,
representation or warranty. Each of the parties hereto acknowledges that, except
as in this Amendment Agreement otherwise expressly stated, no representations,
warranties or commitments, express or implied, have been made by any party to
the other. None of the terms or conditions of this Amendment Agreement may be
changed, modified, waived or canceled orally or otherwise, except by writing,
signed by all the parties hereto, specifying such change, modification, waiver
or cancellation of such terms or conditions, or of any proceeding or succeeding
breach thereof.
5. Full Force and Effect of Agreement. Except as hereby specifically
amended, modified or supplemented, the Credit Agreement and all other Loan
Documents are hereby confirmed and ratified in all respects and shall remain in
full force and effect according to their respective terms.
6. Counterparts. This Amendment Agreement may be executed in any number
of counterparts, each of which shall be deemed an original as against any party
whose signature appears thereof, and all of which shall together constitute one
and the same instrument.
7. GOVERNING LAW. THIS AMENDMENT AGREEMENT SHALL IN ALL RESPECTS BE
GOVERNED BY THE LAW OF THE STATE OF GEORGIA, WITHOUT REGARD TO ANY OTHERWISE
APPLICABLE PRINCIPLES OF CONFLICT OF LAWS. THE BORROWER HEREBY (i) SUBMITS TO
THE JURISDICTION AND VENUE OF THE STATE AND FEDERAL COURTS OF GEORGIA FOR ~
PURPOSES OF RESOLVING DISPUTES HEREUNDER OR UNDER ANY OF THE OTHER LOAN
DOCUMENTS TO WHICH IT IS A PARTY OR FOR PURPOSES OF COLLECTION AND (ii) WAIVES
TRIAL BY JURY IN CONNECTION WITH ANY SUCH LITIGATION.
8. Enforceability. Should any one or more of the provisions of this
Amendment Agreement be determined to be illegal or unenforceable as to one or
more of the parties hereto, all other provisions nevertheless shall remain
effective and binding on the parties hereto.
9. Credit Agreement: All references in any of the Loan Documents to the
Credit Agreement shall mean and include the Credit Agreement as amended hereby.
10. Successors and Assigns. This Amendment Agreement shall be binding
upon and inure to the benefit of each of the Borrower, the Lenders, the Agent
and their respective successors, assigns and legal representatives; provided,
however, that the Borrower, without the prior consent of the Lenders, may not
assign any rights, powers, duties or obligations hereunder.
[signatures follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment
Agreement to be duly executed by their duly authorized officers, all as of the
day and year first above written.
BORROWER:
XXXXXXX FABRICS, INC.
By: /s/ Xxxxx X. Xxxxx
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Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer
NATIONSBANK, N. A. (formerly NationsBank of
Georgia, National Association), as Agent for the
Lenders
By: /s/ Xxxxx XxXxxxx
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Name: Xxxx XxXxxxx
Title: Vice President
Wachovia Bank, N. A.
By: /s/ Xxxxx X. Xxxx
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Name: Xxxxx X. Xxxx
Title: AVP
Suntrust Bank, Atlanta
By: /s/ X. X. Xxxx
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Name: Xxxxxxx X. Xxxx
Title: VP
Bank of Mississippi
By: /s/ Xxx Xxxxxxxxxx
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Name: Xxx Xxxxxxxxxx
Title: Executive Vice President
