Exhibit 10.1
SECOND AMENDMENT TO CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT (the "Second Amendment") is made
as of December 16, 2004, by and between XXXXXXX FABRICS, INC., a Delaware
corporation (the "Borrower"), and SOUTHTRUST BANK, an Alabama banking
corporation (the "Bank"). Capitalized terms used herein but not defined shall
have the meanings ascribed to such terms in the Credit Agreement, as amended (as
hereinafter defined).
WHEREAS, pursuant to that certain Credit Agreement between Borrower and
Bank dated as of March 26, 2002 (the "Credit Agreement"), Bank made available to
Borrower, subject to the terms and conditions thereof, the Syndicated Loan and
the Money Market Loan in the aggregate principal amount of up to $25,000,000.00;
and
WHEREAS, pursuant to that certain First Amendment to Credit Agreement
between Borrower and Bank dated as of October 14, 2004 (the "First Amendment"),
the Credit Agreement was amended in order to provide for a temporary increase in
the Commitment from up to $25,000,000.00 to up to $30,000,000.00 (the Credit
Agreement, as amended by the First Amendment, hereinafter referred to as the
"Credit Agreement, as amended"); and
WHEREAS, Borrower and Bank have agreed to amend the Credit Agreement, as
amended, in order to amend certain of the financial covenants contained therein,
as more specifically hereinafter set forth.
NOW, THEREFORE, in consideration of One Dollar ($1.00) and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties agree that the Credit Agreement, as amended, is hereby
amended as of the date of this Second Amendment, as follows:
1. The Credit Agreement, as amended, is hereby amended by deleting Section
5.06 in its entirety, and by substituting the following new Section 5.06 in lieu
thereof:
SECTION 5.06. Fixed Charges Coverage. At the end of each Fiscal
Quarter from the Fiscal Quarter ending January 31, 2005 through and
including the Fiscal Quarter ending January 31, 2006, the ratio of Income
Available for Fixed Charges for the period of 4 consecutive Fiscal Quarters
then ended to Consolidated Fixed Charges for the period of 4 consecutive
Fiscal Quarters then ended, shall be greater than 1.35 to 1.00. At the end
of each Fiscal Quarter thereafter, the ratio of Income Available for Fixed
Charges for the period of 4 consecutive Fiscal Quarters then ended to
Consolidated Fixed Charges for the period of 4 consecutive Fiscal Quarters
then ended, shall be greater than 1.40 to 1.00.
2. As a condition to the effectiveness of this Second Amendment (a)
Borrower shall have paid to Bank a modification fee in the amount of $62,500.00;
(b) Borrower shall have provided to Bank the resolutions of the board of
directors of Borrower as to the amendments contemplated herein; (c) Borrower
shall have paid directly or reimbursed Bank for all of Bank's fees and expenses,
including, but not limited to, any and all filing fees, recording fees, and
expenses and fees of Bank's legal counsel, incurred in connection with the
preparation, amendment, modification or enforcement of this Second Amendment,
the Credit Agreement, as amended, and any and all documents executed and
delivered in connection herewith or therewith; (d) Borrower shall have executed
and delivered to Bank all further documents and perform all other acts which
Bank deems necessary or appropriate to perfect or protect its security for the
Loans; and (e) Borrower shall have delivered to Bank such other documentation,
if any, as may be requested by Bank to satisfy Bank that this Second Amendment,
and all other documents and instruments executed by Borrower in connection with
this Second Amendment or in furtherance hereof have each been duly authorized,
executed and delivered on behalf of Borrower, and constitute valid and binding
obligations of Borrower.
3. Borrower represents and warrants to Bank that all representations and
warranties given by Borrower in the Credit Agreement, as amended, are true and
correct as of the date hereof, except to the extent affected by this Second
Amendment. Borrower represents and warrants to Bank that Borrower is in full
compliance with all of the covenants of Borrower contained in the Credit
Agreement, as amended, except to the extent affected by this Second Amendment.
4. Except as heretofore or herein expressly modified, or as may otherwise
be inconsistent with the terms of this Second Amendment (in which case the terms
and conditions of this Second Amendment shall govern), all terms of the Credit
Agreement, as amended, and all documents and instruments executed and delivered
in furtherance thereof shall be and remain in full force and effect, and the
same are hereby ratified and confirmed in all respects.
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IN WITNESS WHEREOF, this Second Amendment has been duly executed and
delivered as of the day and year first above written.
WITNESS: BORROWER:
XXXXXXX FABRICS, INC.
/s/ Xxxxx X. Fair By: /s/ Xxxxx X. Xxxxx
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Print Name: Xxxxx X. Fair Its: Chief Financial Officer
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BANK:
SOUTHTRUST BANK
By: /s/ Xxx Xxxxxxx
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Print Name: Its: Senior Vice President
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