AMENDMENT NO. 3, CONSENT & RELEASE
THIS AMENDMENT NO. 3, CONSENT & RELEASE (this "Amendment"), dated as of
September 15, 1998, is by and among XXXXX & LORD, INC., a Delaware corporation
(the "Borrower"), XXXXX & LORD INDUSTRIES, INC., a Delaware corporation ("G&L
Industries"), the other Domestic Subsidiaries of the Borrower (each a
"Guarantor", and together with G&L Industries, the "Guarantors"), the Lenders
identified on the signature pages hereto (the "Lenders") and FIRST UNION
NATIONAL BANK, as Agent for the Lenders (the "Agent").
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement dated as of January 29, 1998,
as amended from time to time prior to the date hereof (the "Existing Credit
Agreement") among the Borrower, the Guarantors, the Lenders and the Agent, the
Lenders have extended commitments to make certain credit facilities available to
the Borrower;
WHEREAS, G&L Industries and Swift Textiles, Inc. ("Swift") own all of
the Material Intellectual Property (as defined in the Security Agreement) and
certain other intellectual property (together, the "IP"), and the Borrower
desires to transfer ownership of some or all of such IP to two new Subsidiaries
(the "IP Transfers") as follows:
(a) the Borrower will form two new wholly-owned Subsidiaries
(the "IP Subsidiaries"), one to be wholly-owned by G&L Industries, the
other to be wholly-owned by Swift;
(b) each of G&L Industries and Swift will contribute all of
its Material Intellectual Property to its respective IP Subsidiary;
WHEREAS, the Borrower desires to reallocate certain acquisition-related
debt (the "Debt Pushdown") as follows:
(a) the Borrower shall form a new Canadian limited partnership
("CLP"), to be owned 90% by the Borrower and 10% by a Domestic
Subsidiary of the Borrower, with the Borrower making an initial equity
investment of up to $50,000,000 (the "Funds") in CLP;
(b) CLP shall lend the Funds contributed by the Borrower to
Drummondville Services, Inc. ("DSI"), a wholly-owned Canadian
subsidiary of the Borrower;
(c) DSI shall distribute the Funds loaned to it by the CLP
back to the Borrower as a return of initial equity;
WHEREAS, the Borrower desires to reorganize its ownership of certain of
its Foreign Subsidiaries (the "Foreign Subsidiary Reorganization"); as follows:
(a) the Borrower shall contribute all of the Capital Stock of
Dominion Textiles International (Asia) Pte. Ltd. ("Asia") to a
newly-formed Foreign Subsidiary ("Newco") to be wholly-owned by the
Borrower;
(b) Asia shall transfer all of the Capital Stock of Dominion
Textiles International B.V. ("DTI-BV") to Newco;
(c) Newco shall contribute some or all of the assets of DTI-BV
to a newly formed Subsidiary ("Luxco");
(d) Asia and DTI-BV shall be liquidated;
WHEREAS, the Borrower desires to redeem 100% of the issued and
outstanding preferred stock of Swift Textiles, Inc. (the "Swift Redemption");
WHEREAS, the parties hereto have agreed to amend the Existing Credit
Agreement as set forth herein;
NOW, THEREFORE, in consideration of the agreements herein contained,
the parties hereby agree as follows:
PART I
DEFINITIONS
SUBPART 1.1. Certain Definitions. Unless otherwise defined
herein or the context otherwise requires, the following terms used in
this Amendment No. 3, including its preamble and recitals, have the
following meanings:
"Amended Credit Agreement" means the Existing Credit
Agreement as amended hereby.
"Amendment No. 3 Effective Date" is defined in
Subpart 5.1.
SUBPART 1.2. Other Definitions. Unless otherwise defined
herein or the context otherwise requires, terms used in this Amendment,
including its preamble and recitals, have the meanings provided in the
Amended Credit Agreement.
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PART II
AMENDMENTS TO EXISTING CREDIT AGREEMENT
Effective on (and subject to the occurrence of) the Amendment No. 3
Effective Date, the Existing Credit Agreement is hereby amended in accordance
with this Part II. Except as so amended, the Existing Credit Agreement shall
continue in full force and effect.
SUBPART 2.1 Section 6.5(a) of the Existing Credit Agreement is
amended in its entirety as follows:
Section 6.5 Consolidation, Merger, Sale or Purchase of Assets, etc.
The Borrower will not, nor will it permit any Subsidiary to,
(a) dissolve, liquidate or wind up its affairs, sell,
transfer, lease or otherwise dispose of its property or assets or agree
to do so at a future time except the following, without duplication,
shall be expressly permitted:
(i) Specified Sales;
(ii) the sale, transfer, lease or other disposition
of property or assets to an unrelated party not in the
ordinary course of business (other than Specified Sales),
where and to the extent that they are the result of a Recovery
Event or otherwise and the net proceeds therefrom are used to
repair or replace damaged property or to purchase or otherwise
acquire new assets or property, provided that such purchase or
acquisition is consummated within 180 days of such receipt;
(iii) the sale, lease or transfer of property or
assets from a Domestic Credit Party to another Domestic Credit
Party;
(iv) the sale and lease of G&L Industries' property
permitted pursuant to Section 6.13 hereof; and
(v) the sale, lease or transfer of property or assets
not to exceed $15,000,000 in the aggregate.
provided, that in each case (except with respect to clause
(iii) above) at least 75% of the consideration received
therefor by the Borrower or any such Subsidiary is in the form
of cash or Cash Equivalents.
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PART III
CONSENT
SUBPART 3.1 Notwithstanding anything in the Credit Documents
to the contrary, subject to the conditions set forth below, the Lenders
hereby consent to the IP Transfers, the Foreign Subsidiary
Reorganization, the Swift Redemption and the Debt Pushdown:
a. With respect to each of the IP Transfers and the Debt Pushdown, the
Agent shall have received all items required by Sections 5.10 and 5.12 of the
Credit Agreement; and
b. With respect to the Foreign Subsidiary Reorganization, the Agent
shall have received all items required by Sections 5.10 and 5.12 of the Credit
Agreement; provided, however, that the Borrower shall not be required to deliver
a pledge of 65% of the Capital Stock of Newco until 120 days from the date of
formation of Newco.
PART IV
RELEASE & WAIVER
SUBPART 4.1 The Agent and the Lenders agree that in connection
with the IP Transfer, they will release their Lien on the IP. The
Lenders authorize the Agent to take such action as appropriate in order
to effectuate such release.
SUBPART 4.2 The Agent and the Lenders agree that in connection
with the Foreign Subsidiary Reorganization, the requirement that the
Borrower deliver a pledge of 65% of the Capital Stock of Asia is
forever waived.
SUBPART 4.3 The Agent and the Lenders agree that in connection
with the Swift Redemption, they will release their lien on the 12,500
shares of Class A Preferred Stock of Swift pledged by the Borrower
pursuant to the Pledge Agreement. The Lenders authorize the Agent to
take such action as appropriate in order to effectuate such release,
including, without limitation, the return of stock certificates.
PART V
CONDITIONS TO EFFECTIVENESS
SUBPART 5.1. Amendment No. 3 Effective Date. This Amendment
shall be and become effective as of the date hereof (the "Amendment No.
3 Effective Date") when all of the conditions set forth in this Part V
shall have been satisfied, and thereafter this Amendment shall be
known, and may be referred to, as "Amendment No. 3."
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SUBPART 5.2. Execution of Counterparts of Amendment. The Agent
shall have received counterparts (or other evidence of execution,
including telephonic message, satisfactory to the Agent) of this
Amendment, which collectively shall have been duly executed on behalf
of each of the Borrower, the Guarantors, the Agent and the Required
Lenders.
PART VI
MISCELLANEOUS
SUBPART 6.1. Cross-References. References in this Amendment to
any Part or Subpart are, unless otherwise specified, to such Part or
Subpart of this Amendment.
SUBPART 6.2. Instrument Pursuant to Existing Credit Agreement.
This Amendment is a Credit Document executed pursuant to the Existing
Credit Agreement and shall (unless otherwise expressly indicated
therein) be construed, administered and applied in accordance with the
terms and provisions of the Existing Credit Agreement.
SUBPART 6.3. References in Other Credit Documents. At such
time as this Amendment No. 3 shall become effective pursuant to the
terms of Subpart 5.1, all references in the Existing Credit Agreement
to the "Agreement" and all references in the other Credit Documents to
the "Credit Agreement" shall be deemed to refer to the Existing Credit
Agreement as amended by this Amendment.
SUBPART 6.4. Representations and Warranties of the Borrower.
The Borrower hereby represents and warrants that (a) the
representations and warranties contained in Article III of the Existing
Credit Agreement (as amended by this Amendment) are correct in all
material respects on and as of the date hereof as though made on and as
of such date and after giving effect to the amendments contained herein
and (b) no Default or Event of Default exists under the Existing Credit
Agreement on and as of the date hereof and after giving effect to the
amendments contained herein.
SUBPART 6.5. Counterparts. This Amendment may be executed by
the parties hereto in several counterparts, each of which shall be
deemed to be an original and all of which shall constitute together but
one and the same agreement.
SUBPART 6.6. Governing Law. THIS AMENDMENT SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER AND GOVERNED BY THE
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INTERNAL LAWS OF THE STATE OF NORTH CAROLINA WITHOUT GIVING EFFECT TO
THE CONFLICT OF LAW PRINCIPLES THEREOF.
SUBPART 6.7. Successors and Assigns. This Amendment shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.
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Each of the parties hereto has caused a counterpart of this Amendment to be duly
executed and delivered as of the date first above written.
BORROWER: XXXXX & LORD, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Title: Executive Vice-President
GUARANTORS: XXXXX & LORD INDUSTRIES, INC.,
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Title: Executive Vice-President
G&L SERVICE COMPANY, NORTH
AMERICA, INC., a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Title: Vice-President
SWIFT XXXXXXXX XXX.,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Title: Executive Vice-President
SWIFT DENIM XXXXXXXX XXX.,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Title: Executive Vice-President
LENDERS: FIRST UNION NATIONAL BANK
individually in its capacity as
a Lender and in its
capacity as Agent
By: /s/ Xxxxx Xxxx
---------------------------------------
Name: Xxxxx Xxxx
---------------------------------------
Title: Senior Vice-President
---------------------------------------
THE CIT GROUP / COMMERCIAL SERVICES, INC.
By: /s/ Xxxxxxx Xxxxxxxxxx
---------------------------------------
Title: Vice-President
THE CIT GROUP / EQUIPMENT FINANCING, INC.
By: /s/ Xxxxx Xxxxx
---------------------------------------
Title: Sr. Credit Analyst
THE FIRST NATIONAL BANK
OF CHICAGO
By: /s/ Xxxxxx Xxxxxxxx
---------------------------------------
Title: Vice-President
FLEET BANK, N.A.
By: /s/ Xxxxxx Xxxxxx
---------------------------------------
Title: Vice-President
NATIONSBANK, N.A.
By: /s/ X. Xxxxxx Xxxxx
---------------------------------------
Title: Senior Vice-President
SUNTRUST BANK, ATLANTA
By: /s/ Xxxxx X. Xxxxxx
---------------------------------------
Title: Senior Vice-President
By: /s/ Xxxxx Xxxx
---------------------------------------
Title: Senior Vice-President
WACHOVIA BANK, N.A.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Title: Senior Vice-President
BANKBOSTON, N.A.
By: /s/ Xxxxx X. Xxxx
---------------------------------------
Title: Vice-President
CIBC INC.
By: /s/ Xxxxxxxxx Xxxx
---------------------------------------
Title: Executive Director
NATIONAL BANK OF CANADA
By: /s/ Xxxxxxx Xxxxxx
---------------------------------------
Title: Vice-President
BANK OF SCOTLAND
By: /s/ Xxxxx Xxxx Tat
---------------------------------------
Title: Senior Vice-President
THE BANK OF TOKYO-MITSUBISHI, LTD.
By: /s/ Xxxxxxx X. Xxxxx, Xx.
---------------------------------------
Title: Vice-President
NATIONAL CITY BANK
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------------
Title: Assistant Vice-President
PNC BANK, NATIONAL ASSOCIATION
By: /s/ Xxxx Xxxxx
---------------------------------------
Title: Vice-President
COOPERATIEVE CENTRALE
RAIFFEISEN-BOERENLEENBANK B.A.,
"Rabobank Nederland", New York Branch
By: /s/ Xxxxxxxx X. Xxx
---------------------------------------
Title: Vice-President
XXXXXXX LYNCH, PIERCE, XXXXXX
& XXXXX INCORPORATED
By: /s/ Xxxxxxxx X. Xxx
---------------------------------------
Title: Authorized Signatory
GENERAL ELECTRIC CAPITAL
CORPORATION
By: /s/ Xxxxx X. Xxxxxxxx
---------------------------------------
Title: Duly Authorized Signatory
MASSACHUSETTS MUTUAL LIFE
INSURANCE COMPANY
By: /s/ Xxxx Xxx XxXxxxxx
---------------------------------------
Title: Managing Director
ML CLO XII PILGRIM AMERICA (CAYMAN) LTD
By: PILGRIM AMERICA INVESTMENTS, INC.,
its Investment Manager
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------------
Title: Vice-President
ALLSTATE INSURANCE COMPANY
By: /s/ Xxxx Xxxxxx
---------------------------------------
Title: Senior Vice-President
KZH-CYPRESSTREE-1 LLC
By: /s/ Xxxxxxxx Xxxxxx
---------------------------------------
Title: Authorized Agent
KZH III LLC
By: /s/ Xxxxxxxx Xxxxxx
---------------------------------------
Title: Authorized Agent
THE TRAVELERS INSURANCE COMPANY
By: /s/ Xxxx X. Xxxxxxxx
---------------------------------------
Title: Second Vice-President
THE TRAVELERS LIFE AND ANNUITY COMPANY
By: /s/ Xxxx X. Xxxxxxxx
---------------------------------------
Title: Second Vice-President
OSPREY INVESTMENTS PORTFOLIO
By: Citibank, N.A., as Manager
By: /s/ Xxxx X. Xxxxxxxxxxx
-----------------------------------
Title:
ARCHIMEDES FUNDING, L.L.C.
By: ING Capital Advisors, Inc.,
as Collateral Manager
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
Title: Senior Vice-President
KZH-CRESCENT LLC
By: /s/ Xxxxxxxx Xxxxxx
-----------------------------------
Title: Authorized Agent
XXX XXXXXX CLO I, LIMITED
By: Xxx Xxxxxx American Capital
Management, Inc.,
as Collateral Manager
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------
Title: Sr. Vice Pres & Director
KZH CNC LLC
By: /s/ Xxxxxxxx Xxxxxx
-----------------------------------
Title: Authorized Agent
KZH-SOLEIL-2 LLC
By: /s/ Xxxxxxxx Xxxxxx
-----------------------------------
Title: Authorized Agent
DEEPROCK & COMPANY
By: Xxxxx Xxxxx Management
as Investment Advisor
By: /s/ Xxxxx X. Page
-----------------------------------
Title: Vice President
CANADIAN IMPERIAL BANK OF COMMERCE
By: /s/ Xxxxxxxxx Xxxx
-----------------------------------
Title: Authorized Signatory
