FIFTH AMENDMENT TO CREDIT AGREEMENT AND WAIVER
THIS FIFTH AMENDMENT TO CREDIT AGREEMENT AND WAIVER (this
"Amendment"), dated as of March 29, 2000, is by and among Xxxxxx
--------- American Corp. (the "Borrower"), Xxxxxx American Investment
Corp. (the "Parent"), Xxxxxx American Group, Inc. ("Interco") and the
-------- ------ ------- certain subsidiaries of the Parent identified
on the signature pages hereto (together with the Parent and Interco,
the "Guarantors"), ---------- the lenders identified on the signature
pages hereto (the "Lenders"), Bank of America, N.A. (formerly known as
NationsBank, N.A.), as ------- agent for the Lenders (in such
capacity, the "Agent"), and Gleacher NatWest Inc., as documentation
agent (the "Documentation Agent"). ----- ------------------- W I T N E
S S E T H
WHEREAS, the Borrower, the Guarantors, the Lenders, the Agent and the
Documentation Agent have entered into that certain Credit Agreement dated as of
May 18, 1998, as amended as of May 27, 1998, December 18, 1998, March 19, 1999
and September 30, 1999 (as so previously amended the "Existing Credit
Agreement"); and
WHEREAS, the parties to the Existing Credit Agreement have agreed to
amend the Existing Credit Agreement and waive certain provisions thereof as
provided herein.
NOW, THEREFORE, in consideration of the agreements hereinafter set
forth, and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the parties hereto agree as follows:
PART 1
DEFINITIONS
SUBPART 1.1 Certain Definitions. Unless otherwise defined herein or the
context otherwise requires, the following terms used in this Amendment,
including its preamble and recitals, have the following meanings:
"Amended Credit Agreement" means the Existing Credit Agreement
as amended hereby.
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"Amendment No. 5 Effective Date" is defined in Subpart 4.1.
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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.
PART 2
AMENDMENTS TO EXISTING CREDIT AGREEMENT
Effective on (and subject to the occurrence of) the Amendment No. 5
Effective Date, the Existing Credit Agreement is hereby amended in accordance
with this Part 2. Except as so amended and except as waived pursuant to the
terms of Part 3, the Existing Credit Agreement and all other Credit Documents
shall continue in full force and effect.
SUBPART 2.1 Amendments to Section 1.1.
(a) The following definitions appearing in Section 1.1 of the Existing
Credit Agreement are amended and restated in their entireties to read as
follows:
"Asset Disposition Prepayment Event" means the receipt by the
Parent or any Consolidated Party of (i) the proceeds of any Asset
Disposition other than an Excluded Asset Disposition and (ii) any
dividend, distribution or other transfer from the Receivables Financing
Subsidiary pursuant to Section 7.14.
"Commitment" means (i) with respect to each Lender, the
Revolving Commitment of such Lender, the Tranche A Term Loan Commitment
of such Lender and the Tranche B Term Loan Commitment of such Lender,
(ii) with respect to the Tranche C Lender, the Tranche C Commitment of
such Lender, (iii) with respect to the Swingline Lender, the Swingline
Commitment and (iv) with respect to the Issuing Lender, the LOC
Commitment.
"Consolidated Cash Taxes" means, for any period, the aggregate
of all taxes of the Consolidated Parties on a consolidated basis for
such period, as determined in accordance with GAAP, to the extent the
same are paid in cash during such period.
"Consolidated Interest Expense" means, for any period, cash
interest expense of the Consolidated Parties on a consolidated basis
for such period, as determined in accordance with GAAP, but in any
event including the amortization of debt discount and premium, the
interest component under Capital Leases, the implied interest component
under Synthetic Leases and interest expense associated with the Tranche
C Obligations, but excluding amortization of deferred financing costs.
"Consolidated Parties" means a collective reference to the
Borrower and its Subsidiaries other than the Receivables Financing
Subsidiary, and "Consolidated Party" means any one of them.
"Consolidated Scheduled Funded Debt Payments" means, as of the
end of each fiscal quarter of the Consolidated Parties, for the
Consolidated Parties on a consolidated basis, the sum of all scheduled
payments of principal on Funded Indebtedness for the applicable period
ending on such date (including the principal component of payments due
on Capital Leases during the applicable period ending on such date); it
being understood that Consolidated Scheduled Funded Debt Payments shall
not include voluntary prepayments or the mandatory prepayments required
pursuant to Section 3.3.
"Equity Issuance" means any issuance for cash by the Parent or
any Consolidated Party to any Person which is not a Credit Party of (a)
any of its Equity Interests, (b) any of its Equity Interests pursuant
to the exercise of options or warrants or (c) any of its Equity
Interests pursuant to the conversion of any debt securities to equity;
provided, however, that, notwithstanding the above, the term "Equity
Issuance" shall also include any transaction involving a Sponsor
Support Payment. The term "Equity Issuance" shall not include any Asset
Disposition.
"Excluded Asset Disposition" means (i) any Asset Disposition
to any Consolidated Party if (a) the Credit Parties shall cause to be
executed and delivered such documents, instruments and certificates as
the Agent may request so as to cause the Credit Parties to be in
compliance with the terms of Section 7.13 after giving effect to such
Asset Disposition and (b) after giving effect to such Asset
Disposition, no Default or Event of Default exists, (ii) any casualty
or condemnation event (other than in respect of any Property comprising
the Shirt Group) with respect to which the net proceeds received by the
Parent or the Consolidated Parties are less than $1,000,000, (iii) the
sale or other disposition of any Property (other than inventory and
other than in respect of any Equity Interests or Property comprising
the Shirt Group) in the ordinary course of business, provided that the
aggregate book value of all Property so sold or disposed of in any
twelve consecutive months shall not exceed $2,000,000 and (iv) the sale
or discount without recourse of accounts receivable only in connection
with the compromise thereof or the assignment of past-due accounts for
collection.
"Funded Indebtedness" means, with respect to any Person,
without duplication, the sum of (a) all Indebtedness of such Person
other than Indebtedness of the types referred to in clause (e), (f),
(g), (i) and (m) of the definition of "Indebtedness" set forth in this
Section 1.1, plus (b) all Indebtedness of another Person of the type
referred to in clause (a) above secured by (or for which the holder of
such Funded Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on, or payable out of the
proceeds of production from, Property owned or acquired by such Person,
whether or not the obligations secured thereby have been assumed, plus
(c) all Guaranty Obligations of such Person with respect to
Indebtedness of the type referred to in clause (a) above of another
Person plus (d) Indebtedness of the type referred to in clause (a)
above of any partnership or unincorporated joint venture in which such
Person is a general partner or a joint venturer to the extent such
Person is liable therefor.
"Guaranty Obligations" means, with respect to any Person,
without duplication, any obligations of such Person (other than
endorsements in the ordinary course of business of negotiable
instruments for deposit or collection and other than typical indemnity
and repurchase obligations in respect of receivables transferred to the
Receivables Financing Subsidiary in accordance with Sections 8.5)
guaranteeing or intended to guarantee any Indebtedness of any other
Person in any manner, whether direct or indirect, and including without
limitation any obligation, whether or not contingent, (i) to purchase
any such Indebtedness or any Property constituting security therefor,
(ii) to advance or provide funds or other support for the payment or
purchase of any such Indebtedness or to maintain working capital,
solvency or other balance sheet condition of such other Person
(including without limitation keep well agreements, maintenance
agreements, comfort letters or similar agreements or arrangements) for
the benefit of any holder of Indebtedness of such other Person, (iii)
to lease or purchase Property, securities or services primarily for the
purpose of assuring the holder of such Indebtedness, or (iv) to
otherwise assure or hold harmless the holder of such Indebtedness
against loss in respect thereof. The amount of any Guaranty Obligation
hereunder shall (subject to any limitations set forth therein) be
deemed to be an amount equal to the outstanding principal amount (or
maximum principal amount, if larger) of the Indebtedness in respect of
which such Guaranty Obligation is made.
"Investment and Deposit Agreement" means the Amended and
Restated Investment and Deposit Agreement, dated as of March 29, 2000,
between the Sponsor and the Agent, as amended, modified, restated or
supplemented from time to time.
"Lender" means any of the Persons identified as a "Lender" on
the signature pages hereto, and any Eligible Assignee which may become
a Lender by way of assignment in accordance with the terms hereof,
together with their permitted successors and assigns. The term "Lender"
shall also mean any Revolving Lender, Tranche A Term Lender, Tranche B
Term Lender or the Tranche C Lender.
"Loan" or "Loans" means the Revolving Loans, the Tranche A
Term Loans, the Tranche B Term Loans, the Tranche C Loans (or a portion
of any Revolving Loan, Tranche A Term Loan, Tranche B Term Loan or
Tranche C Loan bearing interest at the Adjusted Base Rate or the
Adjusted Eurodollar Rate) and/or the Swingline Loans (or any Swingline
Loan bearing interest at the Adjusted Base Rate or the Quoted Rate and
referred to as a Base Rate Loan or a Quoted Rate Swingline Loan),
individually or collectively, as appropriate.
"LOC Documents" means, with respect to any Letter of Credit or
any Tranche C Letter of Credit, any application therefor, and any
agreements, instruments, guarantees or other documents (whether general
in application or applicable only to such Letter of Credit or Tranche C
Letter of Credit) governing or providing for (i) the rights and
obligations of the parties concerned or at risk or (ii) any collateral
security for such obligations.
"Material Domestic Subsidiary" means, at any time, any direct
or indirect Domestic Subsidiary (other than the Receivables Financing
Subsidiary) which (i) is not in the process of liquidation in
accordance with the terms of this Credit Agreement and (ii) has total
assets (as determined in accordance with GAAP) of at least $500,000 at
such time and revenues (as determined in accordance with GAAP) of at
least $500,000 for the most recently ended twelve-month period;
provided, however, that (w) at no time shall the aggregate total assets
(as determined in accordance with GAAP) of all Domestic Subsidiaries
(other than the Receivables Financing Subsidiary) which are not
Material Domestic Subsidiaries exceed $5,000,000 and (x) at no time
shall the aggregate revenues (as determined in accordance with GAAP) of
all Domestic Subsidiaries (other than the Receivables Financing
Subsidiary) which are not Material Domestic Subsidiaries for the most
recently ended twelve-month period exceed $5,000,000; provided further,
however, that, notwithstanding the above, any Domestic Subsidiary which
has any Guaranty Obligations with respect to any Funded Indebtedness of
any Credit Party (other than any of the Credit Party Obligations) shall
be deemed to be a Material Domestic Subsidiary.
"Maturity Date" means (i) as to the Revolving Loans, Letters
of Credit (and the related LOC Obligations), Swingline Loans and
Tranche X Xxxx Xxxx, Xxx 00, 0000, (xx) as to the Tranche B Term Loan,
May 18, 2005 and (iii) as to the Tranche C Loans and the Tranche C
Letters of Credit (and the related Tranche C LOC Obligations), either
(A) if the Leverage Reduction Requirements are not satisfied as of such
date, the last day of the Leverage Reduction Period or (B) in all other
cases, December 31, 2001.
"Net Cash Proceeds" means the aggregate cash proceeds received
by the Parent or the Consolidated Parties in respect of any Asset
Disposition (other than an Excluded Asset Disposition), Equity Issuance
or Debt Issuance, net of (a) direct costs (including, without
limitation, legal, accounting and investment banking fees, and sales
commissions), (b) taxes paid or payable as a result thereof, (c) in the
case of any Asset Disposition, the amount necessary to retire any
Indebtedness secured by a Permitted Lien on the related Property
ranking senior to any Lien of the Agent thereon, (d) in the case of any
Asset Disposition, the amount necessary to retire any Indebtedness
evidenced by that Loan Agreement dated as of August 8, 0000 xxxxxxx
Xxxxxx, Xxxxxxx Xxxxxx, Inc. and Congress Financial Corporation
(Canada), (e) in the case of any Asset Disposition consisting of the
sale of receivables to the Receivables Financing Subsidiary, the amount
of the Investment made by the Consolidated Parties in the Receivables
Financing Subsidiary to the extent permitted under clause (xv) of the
definition of "Permitted Investments" set forth in this Section 1.1 and
(f) in the case of any Asset Disposition consisting of the sale of any
Equity Interests or Property comprising the Shirt Group, restructuring
costs such as severance payments, lease termination payments and, to
the extent that the amount thereof exceeds the amount of accounts
receivable associated with the related Equity Interests or Property,
accounts payable and accrued expenses associated with such Equity
Interests or Property; it being understood that "Net Cash Proceeds"
shall include, without limitation, any cash received upon the sale or
other disposition of any non-cash consideration received by the Parent
or the Consolidated Parties in any Asset Disposition, Equity Issuance
or Debt Issuance, but shall not include any licensing fees (including
guaranteed minimum payments) payable to the Consolidated Parties in
connection with the licensing of any of the intellectual property. In
addition, the "Net Cash Proceeds" of any Asset Disposition shall
include any other amounts defined as "Net Cash Proceeds" of such
transaction under the documents evidencing or governing the Senior
Subordinated Debt.
"Notice of Borrowing" means (i) with respect to the Revolving
Loans, the Tranche A Term Loan or the Tranche B Term Loan, a written
notice of borrowing in substantially the form of Exhibit 2.1(b)(i), as
required by, respectively, Section 2.1(b)(i), Section 2.4(b) or Section
2.5(b) and (ii) with respect to the Tranche C Loans, a written notice
satisfying the requirements of Section 2.6(b).
"Permitted Investments" means Investments which are either (i)
cash and Cash Equivalents; (ii) accounts receivable created, acquired
or made by the Parent or any Consolidated Party in the ordinary course
of business and payable or dischargeable in accordance with customary
trade terms; (iii) Investments consisting of Equity Interests,
obligations, securities or other property received by the Parent or any
Consolidated Party in settlement of accounts receivable (created in the
ordinary course of business) from bankrupt or insolvent obligors; (iv)
existing Investments in Subsidiaries and other Investments existing as
of the Closing Date and set forth in Schedule 1.1B; (v) additional
Investments in any Credit Party other than the Parent or Interco; (vi)
additional Investments in Foreign Subsidiaries not exceeding
$10,000,000 in the aggregate; (vii) Guaranty Obligations permitted by
Section 8.1; (viii) transactions permitted by Section 8.9; (ix)
advances or loans to directors, officers, employees, agents, customers
or suppliers that do not exceed $2,000,000 in the aggregate at any time
outstanding for the Parent and all of the Consolidated Parties taken
together; (x) advances or loans by the Parent to management of the
Parent and to Xxxxxxx and Marsal in conjunction with the
Recapitalization in an aggregate principal of up to $2.5 million; (xi)
Investments which constitute capital expenditures (as determined in
accordance with GAAP) otherwise permitted under this Credit Agreement;
(xii) Investments in Joint Ventures not to exceed $15,000,000; (xiii)
Permitted Acquisitions; (xiv) the purchase by the Borrower of the
Austell Property pursuant to the Austell Transaction; (xv) an
Investment in the Receivables Financing Subsidiary in an aggregate
amount not to exceed $6,000,000; and (xvi) an Investment of up to
$250,000 in a Person organized under the laws of, or doing business
primarily in, the Peoples Republic of China.
"Senior Leverage Ratio" means, as of the last day of any
fiscal quarter of the Consolidated Parties for the twelve month period
ending on such date, the ratio of (a) all Funded Indebtedness (net of
cash and Cash Equivalents, including cash and Cash Equivalents on
deposit in the Cash Collateral Account) of the Consolidated Parties on
a consolidated basis on the last day of such period, excluding (i)
Subordinated Indebtedness, (ii) the Tranche C Obligations and (iii) any
Credit Party Obligations in which a participation interest has been
purchased by, or on behalf of, the Sponsor pursuant to Section 2.1(c)
or Section 2.2(c) of the Investment and Deposit Agreement, to (b)
Consolidated EBITDA for such period.
"Total Leverage Ratio" means, as of the last day of any fiscal
quarter of the Consolidated Parties for the twelve month period ending
on such date, the ratio of (a) all Funded Indebtedness (net of cash and
Cash Equivalents, including cash and Cash Equivalents on deposit in the
Cash Collateral Account) of the Consolidated Parties on a consolidated
basis on the last day of such period, including Subordinated
Indebtedness, but excluding (i) the Tranche C Loans Obligations and
(ii) any Credit Party Obligations in which a participation interest has
been purchased by, or on behalf of, the Sponsor pursuant to Section
2.1(c) or Section 2.2(c) of the Investment and Deposit Agreement, to
(b) Consolidated EBITDA for such period.
(b) Clauses (xiv) and (xv) of the definition of "Permitted Liens" set
forth in Section 1.1 of the Existing Credit Agreement are amended and
restated in their entireties to read as follows, and the following
new clauses (xvi) and (xvii) are added to such definition immediately
succeeding such amended and restated clauses (xiv) and (xv) thereof:
"Permitted Liens" means:
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(xiv) Liens on Property of any Foreign Subsidiary securing
Indebtedness of such Foreign Subsidiary to the extent permitted under
Section 8.1(g);
(xv) Liens on Property of the Borrower or any other Domestic
Subsidiary not otherwise permitted hereunder securing Indebtedness of
such Person permitted under Section 8.1 not exceeding $7,500,000 in
aggregate at any time outstanding;
(xvi) Liens on cash and Cash Equivalents deposited by the
Borrower with the Tranche C Lender pursuant to and in accordance with
the terms of Section 2.6(i), Section 3.3(b)(vi)(D), Section
3.3(b)(vi)(E) or Section 3.15(b) to secure Tranche C LOC Obligations;
and
(xvii) any interest of title of a buyer in connection with,
and Liens arising from UCC financing statements relating to, the sale
of receivables by the Receivables Financing Subsidiary permitted under
this Credit Agreement.
(c) The definitions of "Application Period", "Equity Issuance
Prepayment Event", "Eligible Reinvestment", "Leverage Grace Period",
"Sale Moratorium" and "Sponsor Equity Issuance" set forth in Section
1.1 of the Existing Credit Agreement are deleted in their entireties.
(d) he following new definitions are added to Section 1.1 of the
Existing Credit Agreement in appropriate alphabetical order:
"Amendment No. 5 Effective Date" shall mean March 29, 2000.
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"Cash Collateral Account" shall have the meaning assigned to
such term in the Investment and Deposit Agreement.
"General Partner" shall have the meaning assigned to such term
in the Investment and Deposit Agreement.
"Investment Commitment" shall have the meaning assigned to
such term in the Investment and Deposit Agreement.
"Leverage Reduction Period" means the period from and
including the Amendment No. 5 Effective Date through and including June
30, 2000; provided, however, that the Leverage Reduction Period
automatically shall be extended on June 30, 2000 to August 31, 2000 if
(A) either (1) the Shirt Group Restructuring shall not have been
consummated by June 30, 2000, but there shall exist one or more legally
binding and enforceable definitive purchase (or other appropriate)
agreements (as determined by the Agent in its sole reasonable
discretion, supported by such opinions of counsel for the applicable
Consolidated Party(ies) and/or the relevant purchaser(s) as the Agent
shall reasonably request) providing for the consummation of the Shirt
Group Restructuring by August 31, 2000 or (2) the Shirt Group
Restructuring shall have been consummated by June 30, 2000, but there
shall exist one or more legally binding and enforceable definitive
purchase (or other appropriate) agreements (as determined by the Agent
in its sole reasonable discretion, supported by such opinions of
counsel for the applicable Consolidated Party(ies) and/or the relevant
purchaser(s) as the Agent shall reasonably request) providing for Asset
Disposition(s) permitted by Section 8.5 not comprising the Shirt Group
Restructuring, but relating to Equity Interests or Property comprising
the Shirt Group for aggregate consideration of at least $2,000,000 (but
in any event including any transaction involving the sale or licensing
of the non-domestic intellectual property of the Shirt Group), after
June 30, 2000 but on before to August 31, 2000 and (B) cash and/or Cash
Equivalents in an aggregate amount at least equal to the Investment
Commitment as of June 30, 2000 shall be on deposit in the Cash
Collateral Account.
"Leverage Reduction Requirements" shall be deemed to have been
satisfied as of the last day of the Leverage Reduction Period if, as of
the most recent fiscal month end preceding the date of determination
with respect to which the Agent has received the Required Financial
Information, (i) the Fixed Charge Coverage Ratio is at least 1.0 to
1.0, (ii) the Interest Coverage Ratio is at least 1.5 to 1.0, (iii) the
Senior Leverage Ratio is no greater than 3.25 to 1.0 and (iv) the Total
Leverage Ratio is no greater than 5.5 to 1.0. For purposes of any
determination under this definition, (1) all calculations shall be made
on a pro forma basis using the principles set forth in clauses (2), (3)
and (4) below and Section 1.3, (2) any Asset Disposition consummated
after the Amendment No. 5 Effective Date and any prepayment made
pursuant to Section 3.3(b)(v)(B) of the Credit Agreement after the
Amendment No. 5 Effective Date shall be deemed to have occurred as of
the most recent fiscal month end preceding the date of determination
with respect to which the Agent has received the Required Financial
Information, (3) liabilities for restructuring costs (such as
liabilities for severance payments and lease termination payments and,
to the extent that the aggregate amount thereof exceeds the amount of
accounts receivable associated with the related Equity Interests or
Property, accounts payable and accrued expenses associated with such
Equity Interests or Property) resulting from all Asset Dispositions
relating to any Equity Interests or Property comprising the Shirt Group
consummated on or before the last day of the Leverage Reduction Period
shall be deemed to constitute Indebtedness of the Consolidated Parties
and (4) Funded Indebtedness of the Consolidated Parties on such date
shall be deemed to be increased by the amount as of such date, as
reasonably calculated by the Borrower, of the non-recurring benefit to
leverage associated with a sale of receivables to the Receivables
Financing Subsidiary and the corresponding prepayment of the Credit
Party Obligations, provided that, in no event shall such increase
exceed the Net Cash Proceeds from such sale of receivables. Solely for
purposes of this definition, Funded Indebtedness of the Consolidated
Parties shall be calculated without netting for cash and Cash
Equivalents on deposit in the Cash Collateral Account.
"Limited Partners" shall have the meaning assigned to such
term in the Investment and Deposit Agreement.
"Mandatory Investment" shall have the meaning assigned to such
term in the Investment and Deposit Agreement.
"Non-Sponsor Equity Issuance Prepayment Event" means the
receipt by the Parent or any Consolidated Party of the proceeds of any
Equity Issuance other than (i) a Sponsor Support Payment or (ii) any
Equity Issuance to the Sponsor or its Affiliates or designated
co-investors or any of the officers, directors or employees of the
Parent or a Consolidated Party (A) pursuant to the exercise of options
or warrants or (B) the proceeds of which are used by the Parent to
repurchase Equity Interests of the Parent in accordance with the terms
of Section 8.7(v).
"Permitted Austell Property Sale" means (i) the sale of the
Austell Property contemplated by clause (ii) of the definition of
"Austell Transaction" set forth in this Section 1.1 and (ii) a sale of
the Austell Property otherwise in compliance with the terms of Section
8.5 and with respect to which the Agent shall have received an opinion
from an independent auditor or appraiser acceptable to the Agent as to
the fairness of such transaction to the Borrower.
"Pro Rata Share" shall have the meaning assigned to such term
in the Investment and Deposit Agreement.
"Receivables Financing Subsidiary" means a direct or indirect
Domestic Subsidiary created after the Amendment No. 5 Effective Date
and having no business other than, in a single transaction permitted by
Section 8.5, acquiring from the Consolidated Parties receivables,
related assets, proceeds and other assets customarily transferred in
connection with an asset-backed transaction and selling such
receivables, related assets, proceeds and other assets to a third
Person, and activities incidental or related thereto.
"Shirt Group Restructuring" means the consummation, in one or
more transactions or series of transactions permitted by Section 8.5,
of (i) the licensing of all or substantially all of the domestic
intellectual property of the Shirt Group and (ii) the sale of all or
substantially all of the inventory of the Shirt Group.
"Sponsor Support Payment" means any payment by, or on behalf
of, the Sponsor pursuant to Section 2.1 or Section 2.2 of the
Investment and Deposit Agreement.
"Tranche C Commitment" means the commitment of the Tranche C
Lender in an aggregate principal amount at any time outstanding of up
to the Tranche C Committed Amount, to make Tranche C Loans to the
Borrower in accordance with the provisions of Section 2.6(a) and issue
Tranche C Letters of Credit for the account of the Borrower in
accordance with the provisions of Section 2.7(a).
"Tranche C Committed Amount" shall have the meaning assigned
to such term in Section 2.6(a).
"Tranche C Default" means any event, act or condition which
with notice or lapse of time, or both, would constitute a Tranche C
Event of Default.
"Tranche C Event of Default" shall have the meaning assigned
to such term in Section 2.6(i).
"Tranche C Guaranty" means that certain Guaranty and
Investment Agreement dated as of March 29, 2000 between the Sponsor and
the Tranche C Lender.
"Tranche C Lender" means Bank of America, N.A.
"Tranche C Letter of Credit" means (i) any letter of credit
issued by the Tranche C Lender for the account of the Borrower in
accordance with the terms of Section 2.7 and (ii) and any of the
letters of credit described by date of issuance, letter of credit
number, undrawn amount, name of beneficiary and date of expiry on
Schedule 1.1E.
"Tranche C Loan" shall have the meaning assigned to such term
in Section 2.6(a).
"Tranche C LOC Obligations" means, at any time, the sum of (i)
the maximum amount which is, or at any time thereafter may become,
available to be drawn under Tranche C Letters of Credit then
outstanding, assuming compliance with all requirements for drawings
referred to in such Tranche C Letters of Credit plus (ii) the aggregate
amount of all drawings under Tranche C Letters of Credit honored by the
Tranche C Lender but not theretofore reimbursed by the Borrower.
"Tranche C Obligations" means, without duplication, all of the
obligations of the Borrower to the Tranche C Lender (in its capacity as
such), whenever arising, under this Credit Agreement or any Tranche C
Letter of Credit or related LOC Documents (including, but not limited
to, any interest accruing after the occurrence of a Bankruptcy Event
with respect to the Borrower, regardless of whether such interest is an
allowed claim under the Bankruptcy Code).
SUBPART 2.2 Amendments to Section 1.3. The second paragraph of Section
1.3 of the Existing Credit Agreement is amended and restated in its
entirety to read as follows:
1.3 Accounting Terms.
* * * * * * *
Notwithstanding the above or the terms of any definition set forth in
Section 1.1, the parties hereto acknowledge and agree that, for
purposes of all calculations made under the financial covenants set
forth in Section 7.11 or Section 8.5 (including without limitation for
purposes of the definitions of "Applicable Percentage" and "Pro Forma
Basis" set forth in Section 1.1), without duplication, (i)(A) subject
to the terms of clause (iv) below, income statement items (whether
positive or negative) attributable to the Property disposed of in any
Asset Disposition as contemplated by Section 8.5, as applicable, shall
be excluded to the extent relating to any period occurring prior to the
date of such transaction, (B) Indebtedness which is retired in
connection with any such Asset Disposition shall be excluded and deemed
to have been retired as of the first day of the applicable period and
(C) pro forma adjustments may be included to the extent that such
adjustments give effect to events that are directly attributable to
such transaction and are factually supportable, (ii) income statement
items (whether positive or negative) attributable to any Property
acquired in any Investment transaction contemplated by Section 8.6 and
clause (xiii) of the definition of "Permitted Investment" set forth in
Section 1.1 shall, to the extent not otherwise included in such income
statements items for the Consolidated Parties in accordance with GAAP
or in accordance with any defined terms set forth in Section 1.1, be
included to the extent relating to any period applicable in such
calculations, (iii) the portion of Funded Indebtedness of the
Consolidated Parties as of any date consisting of Revolving Loans shall
be deemed to be the monthly average amount of Revolving Loans
outstanding for the twelve-month period ended as of such date, (iv)
following the consummation of the licensing of any of the intellectual
property of the Shirt Group, Consolidated Net Income for any period (a
"Measurement Period") shall include the aggregate amount of all
scheduled "guaranteed minimum payments" payable by the licensee of such
intellectual property to the Consolidated Parties during the twelve
month period immediately succeeding such Measurement Period and (v)
one-time, non-recurring costs directly attributable to any Asset
Disposition relating to any Equity Interests or Property comprising the
Shirt Group may be excluded from the calculation of Consolidated Net
Income for any period occurring after the consummation of such Asset
Disposition.
SUBPART 2.3 New Section 2.6. The following new Section 2.6 is hereby
added to the Existing Credit Agreement immediately following existing
Section 2.5 thereof:
2.6 Tranche C Loans.
(a) Tranche C Commitment. Subject to the terms and conditions
of this Credit Agreement, the Tranche C Lender agrees to make available
to the Borrower revolving credit loans requested by the Borrower in
Dollars ("Tranche C Loans") from time to time from the Amendment No. 5
Effective Date until the Maturity Date, or such earlier date as the
Tranche C Commitment shall have been terminated as provided herein;
provided, however, that the sum of the aggregate principal amount of
outstanding Tranche C Loans shall not exceed TWELVE MILLION DOLLARS
($12,000,000) (as such aggregate maximum amount may be increased or
reduced from time to time as provided in Section 2.6(d), the "Tranche C
Committed Amount"). Tranche C Loans may consist of Base Rate Loans or
Eurodollar Loans, or a combination thereof, as the Borrower may
request; provided, however, that no more than 5 Eurodollar Loans which
are Tranche C Loans shall be outstanding hereunder at any time (it
being understood that, for purposes hereof, Eurodollar Loans with
different Interest Periods shall be considered as separate Eurodollar
Loans, even if they begin on the same date, although borrowings,
extensions and conversions may, in accordance with the provisions
hereof, be combined at the end of existing Interest Periods to
constitute a new Eurodollar Loan with a single Interest Period. Tranche
C Loans hereunder may be repaid and reborrowed in accordance with the
provisions hereof.
(b) Borrowing Procedures. The Borrower shall request a Tranche
C Loan borrowing by written notice (or telephonic notice promptly
confirmed in writing) to the Tranche C Lender not later than 11:00 A.M.
(Charlotte, North Carolina time) on the Business Day of the requested
borrowing in the case of Base Rate Loans, and on the third Business Day
prior to the date of the requested borrowing in the case of Eurodollar
Loans. Each Notice of Borrowing shall be irrevocable and shall specify
(A) that a Tranche C Loan is requested, (B) the date of the requested
borrowing (which shall be a Business Day), (C) the aggregate principal
amount to be borrowed, and (D) whether the borrowing shall be comprised
of Base Rate Loans, Eurodollar Loans or a combination thereof, and if
Eurodollar Loans are requested, the Interest Period(s) therefor. If the
Borrower shall fail to specify in any such Notice of Borrowing (I) an
applicable Interest Period in the case of a Eurodollar Loan, then such
notice shall be deemed to be a request for an Interest Period of one
month, or (II) the type of Tranche C Loan requested, then such notice
shall be deemed to be a request for a Base Rate Loan hereunder. The
Tranche C Lender shall make the applicable Tranche C Loan available to
the Borrower by 1:00 P.M. (Charlotte, North Carolina time) on the date
specified in the applicable Notice of Borrowing in Dollars and in
immediately available funds by crediting the account of the Borrower on
the books of the Tranche C Lender at the office of the Tranche C Lender
designated from time to time to the Borrower.
(c) Minimum Amounts. Each Eurodollar Loan or Base Rate
Loan that is a Tranche C Loan shall be in integral multiples of
$100,000 (or the remaining amount of the Tranche C Committed Amount,
if less). (d) Repayment and Prepayments of Tranche C Loans; Reductions
and Increases of Tranche C Committed Amount.
(i) Maturity Date. The Borrower hereby promises to
pay to the order of the Bank, on the Maturity Date (unless
accelerated sooner pursuant to Section 2.6(i)), the aggregate
unpaid principal amount of all Tranche C Loans then
outstanding.
(ii) Termination of Tranche C Commitment. Unless
terminated sooner pursuant to Section 2.6(i), the Tranche C
Commitment shall automatically terminate on the Maturity Date.
(iii) Other. Subject to any contrary provisions set
forth in Section 3.3 or Section 3.15(b), the Borrower shall
prepay each Tranche C Loan on or before the date 30 days after
such Tranche C Loan is advanced by the Tranche C Lender;
provided that each of the parties hereto agrees that the
Sponsor may, in its sole discretion, waive the obligation of
the Borrower under this Section 2.6(d)(iii) with respect to
any Tranche C Loan.
(iv) Reductions of Tranche C Committed Amount.
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(A) Voluntary. The Borrower may from time to time
permanently reduce or terminate the Tranche C Committed
Amount in whole or in part in integral multiples of $100,000
(or, if less, the full remaining amount of the then
applicable Tranche C Committed Amount) upon three Business
Days' prior written notice to the Tranche C Lender;
provided, however, no such termination or reduction shall be
made which would cause the aggregate principal amount of
outstanding Tranche C Loans plus Tranche C LOC Obligations
outstanding to exceed the Tranche C Committed Amount unless,
concurrently with such termination or reduction, the Tranche
C Loans are repaid to the extent necessary to eliminate such
excess.
(B) Mandatory. On any date that the Tranche C
Loans are required to be prepaid pursuant to the terms of
Section 3.3(b), the Tranche C Committed Amount automatically
shall be permanently reduced by the amount of such required
prepayment and/or reduction.
(v) Increases in Tranche C Committed Amount. Upon the
occurrence of any permanent reductions (other than permanent
reductions effected with the proceeds of any "Asset Sale" as
such term is defined in the documents evidencing or governing
the Senior Subordinated Debt) in the outstanding principal
amount of the Loans (other than Tranche C Loans) on or after
the Amendment No. 5 Effective Date, the Tranche C Committed
Amount automatically shall be increased by a corresponding
amount, provided that at the time of such increase, the sum
of, without duplication, (1) the aggregate outstanding
principal amount of the Tranche C Obligations at such time
(assuming that the Tranche C Committed Amount as so increased
is fully drawn), (2) the aggregate amount of payments made by,
or on behalf of, the Sponsor after the Amendment No. 5
Effective Date through and including such date which
permanently reduce the Tranche C Obligations (including,
without limitation, payments made in order to cash
collateralize Tranche C LOC Obligations), (3) the aggregate
amount of capital contributions made by, or on behalf of, the
Sponsor to the Parent after the Amendment No. 5 Effective Date
through and including such date which are used by the Borrower
to make a mandatory prepayment of the Loans pursuant to
Section 3.3(b)(v)(B) and (4) the aggregate amount of payments
made by, or on behalf of, the Sponsor to purchase
participation interests in the Credit Party Obligations
outstanding under the Credit Documents pursuant to Section
2.1(c) or Section 2.2(c) of the Investment and Deposit
Agreement after the Amendment No. 5 Effective Date through and
including such time, shall not exceed $30,000,000.
(e) Interest. The Tranche C Loans shall bear interest at
a per annum rate equal to:
--------
(i) Base Rate Loans. During such periods as Tranche C
Loans shall be comprised in whole or in part of Base Rate
Loans, such Base Rate Loans shall bear interest at a per annum
rate equal to the Base Rate plus 0.50%.
(ii) Eurodollar Loans. During such periods as Tranche
C Loans shall be comprised in whole or in part of Eurodollar
Loans, such Eurodollar Loans shall bear interest at a per
annum rate equal to the Eurodollar Rate plus 1.50%.
(iii) Default Interest. Upon the occurrence, and
during the continuance, of default in the payment of any
amount under this Section 2.6 or under Section 2.7, such
overdue amount shall bear interest, payable on demand, at a
per annum rate 2% greater than the rate which would otherwise
be applicable (or if no rate is applicable, whether in respect
of interest, fees or other amounts, then the Base Rate plus
2%).
The Borrower hereby promises to pay in arrears to
the order of the Tranche C Lender, on each Interest Payment
Date (or at such other times as may be specified herein),
accrued interest on the Tranche C Loans.
(f) Tranche C Fee. In consideration of the Tranche C
Commitment of the Tranche C Lender hereunder, the Borrower
hereby promises to pay to the Tranche C Lender a per annum
fee (the "Tranche C Fee") on the amount by which (i) the
then applicable Tranche C Committed Amount exceeds (ii) the
daily average sum for such period of (A) the outstanding
aggregate principal amount of all Tranche C Loans plus (B)
the outstanding aggregate principal amount of all Tranche C
LOC Obligations computed for each day during the applicable
Tranche C Fee Calculation Period (hereinafter defined) at a
rate equal to 50 basis points. The Tranche C Fee shall
commence to accrue on the Amendment No. 5 Effective Date and
shall be due and payable in arrears on the last Business Day
of each March, June, September and December (and any date
that the Tranche C Committed Amount is reduced or terminated
as provided in Section 2.6 and the Maturity Date) for the
immediately preceding quarter (or portion thereof) (each
such quarter or portion thereof for which the Tranche C Fee
is payable hereunder being herein referred to as a "Tranche
C Fee Calculation Period"), beginning with the first of such
dates to occur after the Amendment No. 5 Effective Date.
(g) Conditions to Tranche C Loans and Tranche C
Letters of Credit. The obligations of the Tranche C Lender
to make any Tranche C Loan and to issue or extend any
Tranche C Letter of Credit are subject to satisfaction of
the following conditions:
(i) The Borrower shall have delivered (i) in the case
of any Tranche C Loan, an appropriate Notice of Borrowing; and
(ii) in the case of any Tranche C Letter of Credit, the
Tranche C Lender shall have received an appropriate request
for issuance in accordance with the provisions of Section
2.7(b);
(ii) The representations and warranties set forth in
(A) with respect to the Borrower only, Sections 6.3, 6.4, 6.5
and 6.6 and (B) Section 11 of the Tranche C Guaranty, shall,
subject to the limitations set forth therein, be true and
correct in all material respects as of such date (except for
those which expressly relate to an earlier date);
(iii) There shall not have been commenced against the
Sponsor an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or
any case, proceeding or other action for the appointment of a
receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of such Person or for any
substantial part of its Property or for the winding up or
liquidation of its affairs, and such involuntary case or other
case, proceeding or other action shall remain undismissed,
undischarged or unbonded;
(iv) No Tranche C Default or Tranche C Event of
Default shall exist and be continuing either prior to or after
giving effect to such extension of credit;
(v) Immediately after giving effect to the making of
such Tranche C Loan (and the application of the proceeds
thereof) or to the issuance of such Tranche C Letter of
Credit, as the case may be, the aggregate principal amount of
outstanding Tranche C Loans plus Tranche C LOC Obligations
outstanding shall not exceed the Tranche C Committed Amount;
and
The delivery of each Notice of Borrowing pursuant
to Section 2.6(b), each request for a Tranche C Letter of
Credit pursuant to Section 2.7(b) and each Notice of
Extension/Conversion with respect to any Tranche C Loan
shall constitute a representation and warranty by the
Borrower of the correctness of the matters specified in
subsections (ii), (iii), (iv) and (v) above.
(h) Tranche C Events of Default. A Tranche C Event
of Default shall exist upon the occurrence and continuation
of any of the following specified events (each a "Tranche C
Event of Default"):
(i) the Borrower shall default in the payment when
due of any Tranche C Obligations or other amounts owing under
Section 2.6, Section 2.7 or in connection with the Tranche C
Obligations; or
(ii) any representation, warranty or statement made
or deemed to be made by the Borrower pursuant to Section
2.6(g) shall prove untrue in any material respect on the date
as of which it was deemed to have been made; or
(iii) any "Event of Default" shall occur and be
continuing under and as defined in the Tranche C Guaranty.
(i) Remedies of Tranche C Lender. Upon the
occurrence of a Tranche C Event of Default, and at any time
thereafter unless and until such Tranche C Event of Default
has been waived by the Tranche C Lender or cured to the
satisfaction of the Tranche C Lender, the Tranche C Lender
may, by written notice to the Borrower and the Sponsor, take
any of the following actions (subject to the terms of
Section 3.15(b)):
(i) Termination of the Tranche C Commitment.
Declare the Tranche C Commitment terminated whereupon
-----------------------------------------
the Tranche C Commitment shall be immediately terminated.
(ii) Acceleration. Declare the unpaid principal of
and any accrued interest in respect of all Tranche C Loans and
any and all other indebtedness or obligations of any and every
kind owing by the Borrower to the Tranche C Lender (in its
capacity as such) hereunder to be due whereupon the same shall
be immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby
waived by the Borrower.
(iii) Cash Collateral. Direct the Borrower to pay
(and the Borrower hereby promises to pay, upon receipt of such
notice) to the Tranche C Lender additional cash to be held by
the Tranche C Lender in a cash collateral account as
additional security for the Tranche C LOC Obligations in
respect of subsequent drawings under all then outstanding
Tranche C Letters of Credit in an amount equal to the maximum
aggregate amount which may be drawn under all Tranche C
Letters of Credits then outstanding. The Borrower hereby
grants a security interest to the Tranche C Lender in any
amounts so deposited with the Tranche C Lender.
(iv) Enforcement of Rights. Enforce (A) any and all
rights and interests of the Tranche C Lender (in its capacity
as such) created and existing under this Section 2.6, Section
2.7, the LOC Documents (to the extent relating to any Tranche
C Letters of Credit) or the Tranche C Guaranty and (B) all
rights of set-off.
Notwithstanding the foregoing, if a Tranche C
Event of Default occurs as the result of the occurrence of
an Event of Default specified in Section 9.1(f) with respect
to the Borrower, then the Tranche C Commitment shall
automatically terminate, all outstanding Tranche C
Obligations automatically shall immediately become due and
payable without the giving of any notice or other action by
the Tranche C Lender and the Borrower automatically shall be
obligated (and hereby promises) to pay to the Tranche C
Lender additional cash, to be held by the Tranche C Lender
in a cash collateral account as additional security for the
Tranche C LOC Obligations in respect of subsequent drawings
under all then outstanding Tranche C Letters of Credit in an
amount equal to the maximum aggregate amount which may be
drawn under all Tranche C Letters of Credits then
outstanding, and the Borrower hereby grants a security
interest to the Tranche C Lender in any amounts so deposited
with the Tranche C Lender.
SUBPART 2.4 New Section 2.7. The following new Section 2.7
is hereby added to the Existing Credit Agreement immediately following
Section 2.6 thereof:
2.7 Tranche C Letter of Credit Facility.
(a) Issuance. Subject to the terms and conditions of this
Credit Agreement, the Tranche C Lender agrees to issue standby and
trade Tranche C Letters of Credit in Dollars from time to time from the
Amendment No. 5 Effective Date until the date five (5) days prior to
the Maturity Date as the Borrower may request, in a form acceptable to
the Tranche C Lender; provided, however, that the sum of the aggregate
principal amount of outstanding Tranche C Loans plus Tranche C LOC
Obligations outstanding shall not at any time exceed the Tranche C
Committed Amount. No Tranche C Letter of Credit shall either (x) have
an original expiry date more than one year from the date of issuance or
(y) as originally issued or as extended, have an expiry date extending
beyond the Maturity Date. Each Tranche C Letter of Credit shall comply
with the related LOC Documents. The issuance and expiry dates of each
Tranche C Letter of Credit shall be a Business Day.
(b) Notice. The request for the issuance of a Tranche C Letter
of Credit shall be submitted by the Borrower to the Tranche C Lender at
least three (3) Business Days prior to the requested date of issuance.
(c) Reimbursement. In the event of any drawing under any
Tranche C Letter of Credit, the Tranche C Lender will promptly notify
the Borrower. Unless the Borrower shall immediately notify the Tranche
C Lender that the Borrower intends to otherwise reimburse the Tranche C
Lender for such drawing, the Borrower shall be deemed to have requested
that the Tranche C Lender make a Tranche C Loan in the amount of the
drawing as provided in subsection (d) below on the related Tranche C
Letter of Credit, the proceeds of which will be used to satisfy the
related reimbursement obligations. The Borrower promises to reimburse
the Tranche C Lender on the day on which the Tranche C Lender notifies
the Borrower of a drawing under any Tranche C Letter of Credit (either
with the proceeds of a Tranche C Loan obtained hereunder or otherwise)
in same day funds provided such notice is received by the Borrower from
the Tranche C Lender on or before 2:00 P.M.(Charlotte, North Carolina
time) (otherwise such payment shall be made on or before 12:00 Noon
(Charlotte, North Carolina time) on the Business Day next succeeding
the day such notice is received). The unreimbursed amount of any
drawing under a Tranche C Letter of Credit shall bear interest at a per
annum rate equal to (i) for the first two (2) Business Days following
the date of the related drawing, the Base Rate plus 0.50% and (ii)
thereafter, the Base Rate plus 2.50%. The Borrower's reimbursement
obligations hereunder shall be absolute and unconditional under all
circumstances irrespective of any rights of setoff, counterclaim or
defense to payment the Borrower may claim or have against the Tranche C
Lender, the beneficiary of the Tranche C Letter of Credit drawn upon or
any other Person, including without limitation any defense based on any
failure of the Borrower to receive consideration or the legality,
validity, regularity or unenforceability of the Tranche C Letter of
Credit.
(d) Repayment with Tranche C Loans. On any day on which the
Borrower shall have requested, or been deemed to have requested, a
Tranche C Loan advance to reimburse a drawing under a Tranche C Letter
of Credit, a Tranche C Loan advance comprised of Base Rate Loans (or
Eurodollar Loans to the extent the Borrower has complied with the
procedures of Section 2.6(b) with respect thereto) shall be immediately
made to the Borrower by the Tranche C Lender.
(e) Designation of a Subsidiary as an Account Party.
Notwithstanding anything to the contrary set forth in this Credit
Agreement, including without limitation Section 2.7(a), a Tranche C
Letter of Credit issued hereunder may contain a statement to the effect
that such Tranche C Letter of Credit is issued for the account of a
Subsidiary of the Borrower, provided that notwithstanding such
statement, the Borrower shall be the actual account party for all
purposes of this Credit Agreement for such Tranche C Letter of Credit
and such statement shall not affect the Borrower's reimbursement
obligations hereunder with respect to such Tranche C Letter of Credit.
(f) Renewal, Extension. The renewal or extension of any
Tranche C Letter of Credit shall, for purposes hereof,
-------------------
be treated in all respects the same as the issuance of a new Tranche C
Letter of Credit hereunder.
(g) Uniform Customs and Practices. The Tranche C Lender may
have the Tranche C Letters of Credit be subject to The Uniform Customs
and Practice for Documentary Credits (the "UCP") or the International
Standby Practices 1998 (the "ISP98"), in either case as published as of
the date of issue by the International Chamber of Commerce, in which
case the UCP or the ISP98, as applicable, may be incorporated therein
and deemed in all respects to be a part thereof.
(h) Incorporation by Reference. In issuing or administering
any Tranche C Letters of Credit, the Tranche C Lender shall be entitled
to all the rights, authority, privileges and immunities provided to the
Issuing Lender in Section 2.2(i) and Section 2.2(k), and the Borrower
shall be entitled to all of the rights, privileges and immunities
provided to the Borrower in Section 2.2(i), in each case as in effect
on the Amendment No. 5 Effective Date, all of which provisions are
incorporated by reference herein with the same force and effect as if
set forth in full in this Section 2.7.
(i) Tranche C Letter of Credit Fees. The Borrower hereby
promises to pay to the Tranche C Lender (i) a letter of credit issuance
fee of (A) 1.5% per annum on the average daily maximum amount available
to be drawn under each standby Tranche C Letter of Credit and (B) 0.75%
per annum on the average daily maximum amount available to be drawn
under each trade Tranche C Letter of Credit, in each case computed for
each day from the date of issuance to the date of expiration (which
fees shall be payable quarterly in arrears on the last Business Day of
each March, June, September and December and the Maturity Date for the
immediately preceding quarter (or a portion thereof)) and (ii) the
customary charges from time to time of the Tranche C Lender with
respect to the issuance, amendment, transfer, administration,
cancellation and conversion of, and drawings under, such Tranche C
Letters of Credit.
SUBPART 2.5 Amendments to Section 3.3. Section 3.3 of the
Existing Credit Agreement is amended and restated in its entirety to
read as follows:
3.3 Prepayments.
(a) Voluntary Prepayments. The Borrower shall have the right
to prepay Loans in whole or in part from time to time; provided,
however, that each partial prepayment of Loans shall be (i) in the case
of Revolving Loans, in a minimum principal amount of $2,000,000 and
integral multiples of $100,000 in excess thereof and (ii) in the case
of Swingline Loans, in a minimum principal amount of $100,000. Subject
to the foregoing terms, amounts prepaid under this Section 3.3(a) shall
be applied as the Borrower may elect; provided, however, that if the
Leverage Reduction Period shall have been extended to August 31, 2000
in accordance with the definition thereof set forth in Section 1.1,
that the Tranche C Loans and Tranche C LOC Obligations may not be
prepaid pursuant to this Section 3.3(a) at any time during the period
from and including June 30, 2000 through and including the date that
the Leverage Reductions Requirements shall have been satisfied unless
the Revolving Loans, the LOC Obligations, the Tranche A Term Loan and
the Tranche B Term Loan shall have been paid in full, no Letters of
Credit shall be outstanding and the Revolving Commitments shall have
expired or been terminated. All prepayments under this Section 3.3(a)
shall be subject to Section 3.12, but otherwise without premium or
penalty, and be accompanied by interest on the principal amount prepaid
through the date of prepayment.
(b) Mandatory Prepayments.
---------------------
(i)Revolving Committed Amount/Tranche C Committed Amount.
-----------------------------------------------------
(A) Revolving Committed Amount. If, at any
time, the sum of the aggregate principal amount of
outstanding Revolving Loans plus LOC Obligations
outstanding plus outstanding Swingline Loans shall
exceed the Revolving Committed Amount, the Borrower
hereby promises to prepay the Revolving Loans and
Swingline Loans and, after all Revolving Loans and
Swingline Loans have been repaid, cash collateralize
the LOC Obligations in an amount sufficient to
eliminate such excess (such prepayment to be applied
as set forth in clause (vi)(A) below).
(B) Tranche C Committed Amount. If, at any
time, the sum of the aggregate principal amount of
outstanding Tranche C Loans plus Tranche C LOC
Obligations outstanding shall exceed the Tranche C
Committed Amount, the Borrower hereby promises to
prepay the Tranche C Loans immediately and, after all
Tranche C Loans and have been repaid, cash
collateralize the Tranche C LOC Obligations in an
amount sufficient to eliminate such excess (such
prepayment to be applied as set forth in clause
(vi)(B) below).
(ii) Excess Cash Flow. Within 90 days
after the end of each fiscal year (commencing with
the fiscal year ending December 31, 1998), the
Borrower hereby promises to prepay the Loans in an
amount equal to (x) 50% of the Excess Cash Flow
earned during such prior fiscal year less (y) the
amount of any voluntary prepayments of the Tranche
A Term Loan, the Tranche B Term Loan or (to the
extent accompanied by a reduction in the Revolving
Committed Amount) the Revolving Loans during such
prior fiscal year (such prepayment to be applied
as set forth in clause (vi)(C) below).
(iii) Asset Dispositions.
------------------
(A) Shirt Group. Immediately upon the
occurrence of any Asset Disposition Prepayment Event
involving any Equity Interests or Property comprising
the Shirt Group (other than the Austell Property),
the Borrower hereby promises to prepay the Loans in
an aggregate amount equal to 100% of the Net Cash
Proceeds of the related Asset Disposition (such
prepayment to be applied as set forth in clause
(vi)(D) below).
(B) Other Asset Sales. Immediately upon the
occurrence of (1) any Asset Disposition Prepayment
Event not involving any Equity Interests or Property
comprising the Shirt Group or (2) any Asset
Disposition Prepayment Event involving the Austell
Property, the Borrower hereby promises to prepay the
Loans in an aggregate amount equal to 100% of the Net
Cash Proceeds of the related Asset Disposition (such
prepayment to be applied as set forth in clause
(vi)(C) below).
(iv) Debt Issuances. Immediately upon
receipt by the Parent or any Consolidated Party of
proceeds from any Debt Issuance, the Borrower
hereby promises to prepay the Loans in an
aggregate amount equal to 100% of the Net Cash
Proceeds of such Debt Issuance to the Lenders
(such prepayment to be applied as set forth in
clause (vi)(C) below).
(v) Issuances of Equity and Sponsor
Support Payments.
------------------------------------------------
(A) Non-Sponsor Equity Issuance. Immediately upon
the occurrence of a Non-Sponsor Equity Issuance
Prepayment Event, the Borrower hereby promises to
prepay the Loans in an aggregate amount equal to
100% of the Net Cash Proceeds of such Equity
Issuance (such prepayment to be applied as set
forth in clause (vi)(C) below).
(B) Sponsor Support Payment. Immediately
upon the receipt by the Parent or the Borrower of the
proceeds of a Sponsor Support Payment, the Borrower
hereby promises to prepay the Loans in an aggregate
amount equal to 100% of the Net Cash Proceeds of the
related Sponsor Support Payment (such prepayment to
be applied as set forth in clause (vi)(C), (D) or (E)
below, as applicable).
(vi) Application of Mandatory
Prepayments. All amounts required to be paid
pursuant to Section 3.3(b) and Section 3.3(c)
shall be applied as follows: (A) Overadvances
under Revolving Committed Amount. With respect to
all amounts prepaid pursuant to Section
3.3(b)(i)(A), first, to Swingline Loans and
second, to the Revolving Loans and, after all
Revolving Loans have been repaid, to a cash
collateral account in respect of LOC Obligations
(in any such case, without any reduction in the
Revolving Committed Amount);
(B) Overadvances under Tranche C Committed
Amount. With respect to all amounts prepaid pursuant
to Section 3.3(b)(i)(B), first, to the Tranche C
Loans and, after all Tranche C Loans have been
repaid, to a cash collateral account in respect of
Tranche C LOC Obligations (in any such case, without
any reduction in the Tranche C Committed Amount);
(C) Excess Cash Flow, Sales of Assets (Other
than Shirt Group), Sale of Austell Property, Debt
Issuances, Non-Sponsor Equity Issuances and Section
3.3(c) Prepayments. With respect to all amounts
prepaid pursuant to Section 3.3(b)(ii), Section
3.3(b)(iii)(B), Section 3.3(b)(iv), Section
3.3(b)(v)(A) or Section 3.3(c), pro rata to the
Tranche A Term Loan and the Tranche B Term Loan (in
each case ratably to the remaining Principal
Amortization Payments thereof); provided, however,
that notwithstanding the foregoing terms of this
clause (C), 25% of the Net Cash Proceeds from the
sale of the Austell Property may, at the option of
the Borrower, be applied pro rata to (1) the
Swingline Loans (without any reduction in the
Revolving Committed Amount) and (2) the Revolving
Loans and, after all Revolving Loans have been
repaid, to a cash collateral account in respect of
LOC Obligations (without any reduction in the
Revolving Committed Amount);
(D) Sale of Shirt Group and Sponsor Support
Payments in Connection with Sale of Shirt Group. With
respect to all amounts prepaid pursuant to Section
3.3(b)(iii)(A) or amounts prepaid pursuant to Section
3.3(b)(v)(B) with the proceeds of a Sponsor Support
Payment made pursuant to Section 2.1(a)(i) of the
Investment and Deposit Agreement (or, in lieu
thereof, a Sponsor Support Payment made pursuant to
Section 2.1(c) of the Investment and Deposit
Agreement), first, pro rata to the Tranche A Term
Loan and the Tranche B Term Loan (in each case
ratably to the remaining Principal Amortization
Payments thereof) until the ratio (calculated on a
pro forma basis using the principles set forth in the
definition of "Leverage Reduction Requirements" set
forth in Section 1.1) of (1) all Funded Indebtedness
(net of cash and Cash Equivalents) of the
Consolidated Parties on a consolidated basis on the
date of determination (including Subordinated
Indebtedness, but excluding the Tranche C Obligations
and any Credit Party Obligations in which a
participation interest has been purchased by, or on
behalf of, the Sponsor pursuant to Section 2.1(c) or
Section 2.2(c) of the Investment and Deposit
Agreement) to (2) Consolidated EBITDA for the four
fiscal-quarter period ending as of the most recent
fiscal month end preceding the date of determination
with respect to which the Agent has received the
Required Financial Information, has been reduced to
6.5 to 1.0, second, pro rata to (1) the Swingline
Loans (without any reduction in the Revolving
Committed Amount), (2) the Revolving Loans and, after
all Revolving Loans have been repaid, to a cash
collateral account in respect of LOC Obligations
(without any reduction in the Revolving Committed
Amount), (3) the Tranche A Term Loan (ratably to the
remaining Principal Amortization Payments thereof)
and (4) the Tranche B Term Loan (ratably to the
remaining Principal Amortization Payments thereof)
until the Leverage Reduction Requirements shall have
been satisfied, third, pro rata to the Tranche C
Loans and, after all Tranche C Loans have been
repaid, to a cash collateral account in respect of
Tranche C LOC Obligations, and fourth, pro rata to
(1) the Swingline Loans (without any reduction in the
Revolving Committed Amount), (2) the Revolving Loans
and, after all Revolving Loans have been repaid, to a
cash collateral account in respect of LOC Obligations
(without any reduction in the Revolving Committed
Amount), (3) the Tranche A Term Loan (ratably to the
remaining Principal Amortization Payments thereof)
and (4) the Tranche B Term Loan (ratably to the
remaining Principal Amortization Payments thereof);
(E) Sponsor Support Payments in Connection
with Non-Sale of Shirt Group. With respect to all
amounts prepaid pursuant to Section 3.3(b)(v)(B) with
the proceeds of a Sponsor Support Payment made
pursuant to Section 2.1(a)(ii), Section 2.1(b) or
Section 2.2(c) of the Investment and Deposit
Agreement, of the Investment and Deposit Agreement,
pro rata to (1) the Swingline Loans (without any
reduction in the Revolving Committed Amount) and (2)
the Revolving Loans and, after all Revolving Loans
have been repaid, to a cash collateral account in
respect of LOC Obligations (without any reduction in
the Revolving Committed Amount).
Solely for purposes of determining the pro rata share of any
Tranche A Term Lender in connection with any prepayment
referred to in clause (C) above, subclause "first" of clause
(D) above or subsection (vii) below, the outstanding principal
amount of all Revolving Loans and LOC Obligations, and the
outstanding Participation Interests in Swingline Loans, of
such Tranche A Term Lender (in its capacity as a Revolving
Lender) shall be deemed to be additional Tranche A Term Loan
principal owing to such Lender. Within the parameters of the
applications set forth above, prepayments of Revolving Loans,
the Tranche A Term Loan or the Tranche B Term Loan shall be
applied first to Base Rate Loans and then to Eurodollar Loans
in direct order of Interest Period maturities. All prepayments
under this Section 3.3(b) shall be subject to Section 3.12 and
be accompanied by interest on the principal amount prepaid
through the date of prepayment.
(vii) No Purchase of Participation Interests in
Revolving Loans, etc. Notwithstanding any provision to the
contrary contained herein or in the Investment and Deposit
Agreement, the proceeds of a Sponsor Support Payment shall not
be applied to pay for the purchase on behalf of the Sponsor of
a participation interest in any Swingline Loans, Revolving
Loans or LOC Obligations (or cash collateral therefor), and,
to the extent that any provision of this Credit Agreement or
the Investment and Deposit Agreement provides for the proceeds
of a Sponsor Support Payment to be so applied, such proceeds
instead shall be applied, at the Borrower's option, either (a)
to the pro rata prepayment of (1) the Swingline Loans (without
any reduction in the Revolving Committed Amount) and (2) the
Revolving Loans and, after all Revolving Loans have been
repaid, to a cash collateral account in respect of LOC
Obligations (without any reduction in the Revolving Committed
Amount), in which case such proceeds shall be deemed to
constitute a Mandatory Investment, or (b) to purchase an
undivided, non-voting participation interest in the Term Loans
then outstanding under the Credit Documents, such
participation interest to be subject to an intercreditor
agreement with the Agent on behalf of the Lenders containing
substantially the terms and conditions set forth on Exhibit C
to the Investment and Deposit Agreement and the purchase price
of such participation interest to be applied in the same
manner prescribed for the application of prepayment proceeds
under Section 3.3(b)(vi)(C) above.
(c) Additional Mandatory Prepayments of the Term Loans.
--------------------------------------------------
(i) In the event that the Shirt Group Restructuring
has not occurred by June 30, 2000 and the Leverage Reduction
Period shall not have been extended to August 31, 2000 in
accordance with the definition thereof set forth in Section
1.1, the Borrower hereby promises to prepay the Term Loans in
the amounts and on the dates set forth below:
Date Payment
June 30, 2000 $4,000,000
July 31, 2000 $3,000,000
September 30, 2000 $4,000,000
December 31, 2000 $9,000,000.
Such prepayments shall be applied as set forth in Section
3.3(b)(vi)(C) above; provided, however, the Borrower shall
have the right, in lieu of making the prepayment of the Term
Loans required by this Section 3.3(c)(i) on June 30, 2000, to
cause the Sponsor to purchase an undivided, non-voting
participation interest in the Term Loans then outstanding
under the Credit Documents for a purchase price equal to the
amount of the prepayment that otherwise would have been
required, such participation interest to be subject to an
intercreditor agreement with the Agent on behalf of the
Lenders containing substantially the terms and conditions set
forth on Exhibit C to the Investment and Deposit Agreement and
the purchase price of such participation interest shall be
applied in the same manner prescribed for the application of
prepayment proceeds under Section 3.3(b)(vi)(C) above.
(ii) In the event that the Leverage Reduction Period
shall have been extended to August 31, 2000 in accordance with
the definition thereof set forth in Section 1.1 and the Shirt
Group Restructuring has not occurred by August 31, 2000, the
Borrower hereby promises to prepay the Term Loans in the
amounts and on the dates set forth below:
Date Payment
August 31, 2000 $7,000,000
September 30, 2000 $4,000,000
December 31, 2000 $9,000,000.
Such prepayments shall be applied as set forth in Section
3.3(b)(vi)(C) above; provided, however, the Borrower shall
have the right, in lieu of making the prepayment of the Term
Loans required by this Section 3.3(c)(ii) on August 31, 2000,
to cause the Sponsor to purchase an undivided, non-voting
participation interest in the Term Loans then outstanding
under the Credit Documents for a purchase price equal to the
amount of the prepayment that otherwise would have been
required, such participation interest to be subject to an
intercreditor agreement with the Agent on behalf of the
Lenders containing substantially the terms and conditions set
forth on Exhibit C to the Investment and Deposit Agreement and
the purchase price of such participation interest shall be
applied in the same manner prescribed for the application of
prepayment proceeds under Section 3.3(b)(vi)(C) above.
(d) Escrow Account. If the Borrower is required to make a
mandatory prepayment under Section 3.3(b) that would result in a
payment by the Borrower under Section 3.12, the Borrower may, at its
option, elect to deposit funds constituting such prepayment with the
Agent to be held by the Agent in a cash collateral account and applied
(including any income or gains earned on amounts in the Escrow
Account), upon the earliest to occur of (A) the request of the
Borrower, (B) the last day of any Interest Period, (C) the occurrence
of an Event of Default or (D) the Maturity Date, to the Credit Party
Obligations in accordance with the terms of Section 3.3(b)(vi).
SUBPART 2.6 Amendments to Section 3.13(a). Section 3.13(a)
of the Existing Credit Agreement is amended and restated in its
entirety to read as follows:
3.13 Pro Rata Treatment.
Except to the extent otherwise provided herein:
(a) Loans. Each Loan, each payment or (subject to the terms of
Section 3.3) prepayment of principal of any Loan or reimbursement
obligations arising from drawings under Letters of Credit, each payment
of interest on the Loans or reimbursement obligations arising from
drawings under Letters of Credit, each payment of Unused Fees, each
payment of the Standby Letter of Credit Fee, each payment of the Trade
Letter of Credit Fee, each reduction of the Revolving Committed Amount
and each conversion or extension of any Loan, shall be allocated pro
rata among the Lenders in accordance with the respective principal
amounts of their outstanding Loans and Participation Interests.
Payments made to the Tranche C Lender in respect of the obligations of
the Sponsor arising under the Tranche C Guaranty shall not be subject
to the provisions of this Section 3.13 and shall be solely for the
account of the Tranche C Lender.
SUBPART 2.7 Amendments to Section 3.14. The following
sentence is added at the end of Section 3.14 of the Existing Credit
Agreement:
3.14 Sharing of Payments.
*******
Payments made to the Tranche C Lender in respect of the obligations of
the Sponsor arising under the Tranche C Guaranty shall not be subject
to the provisions of this Section 3.14 and shall be solely for the
account of the Tranche C Lender.
SUBPART 2.8 Amendments to Section 3.15(b). Section 3.15(b)
of the Existing Credit Agreement is amended and restated in its
entirety to read as follows:
3.15 Payments, Computations, Etc.
* * * * * * *
(b) Allocation of Payments After Event of Default.
Notwithstanding any other provisions of this Credit Agreement to the
contrary, after the occurrence and during the continuance of an Event
of Default, all amounts collected or received by the Agent or any
Lender on account of the Credit Party Obligations or any other amounts
outstanding under any of the Credit Documents or in respect of the
Collateral shall be paid over or delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket
costs and expenses (including without limitation reasonable
attorneys' fees) of the Agent in connection with enforcing the
rights of the Lenders (excluding the Tranche C Lender in its
capacity as such) under the Credit Documents and any
protective advances made by the Agent with respect to the
Collateral under or pursuant to the terms of the Collateral
Documents;
SECOND, to payment of any fees payable to the Agent
then due and owing;
THIRD, to the payment of all reasonable out-of-pocket
costs and expenses (including without limitation, reasonable
attorneys' fees) of each of the Lenders (excluding the Tranche
C Lender in its capacity as such) in connection with enforcing
its rights under the Credit Documents or otherwise with
respect to the Credit Party Obligations owing to such Lender;
FOURTH, to the payment of all of the Credit Party
Obligations (excluding the Tranche C Obligations) consisting
of accrued fees and interest then due and owing;
FIFTH, to the payment of the outstanding principal
amount of the Credit Party Obligations (including the payment
or cash collateralization of the outstanding LOC Obligations,
but excluding the Tranche C Obligations) then due and owing;
SIXTH, to all other Credit Party Obligations (other
than the Tranche C Obligations) and other obligations which
shall have become due and payable under the Credit Documents
or otherwise and not repaid pursuant to clauses "FIRST"
through "FIFTH" above;
SEVENTH, to the payment of all reasonable
out-of-pocket costs and expenses (including without
limitation, reasonable attorneys' fees) of the Tranche C
Lender in connection with enforcing its rights under Section
2.6, Section 2.7, the LOC Documents related to Tranche C
Letters of Credit, the Tranche C Guaranty or otherwise with
respect to the Tranche C Obligations;
EIGHTH, to the payment of all of the Tranche C
Obligations consisting of accrued fees and interest then due
and owing;
NINTH, to the payment of the outstanding principal
amount of the Tranche C Obligations (including the payment or
cash collateralization of the outstanding Tranche C LOC
Obligations) then due and owing;
TENTH, to all other Tranche C Obligations and other
obligations which shall have become due and payable under the
Credit Documents or otherwise and not repaid pursuant to
clauses "FIRST" through "NINTH" above; and
ELEVENTH, to the payment of the surplus, if any, to
whoever may be lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied in
the numerical order provided until exhausted prior to application to
the next succeeding category; (ii) each of the Lenders shall receive an
amount equal to its pro rata share (based on the proportion that the
then outstanding Loans (other than Tranche C Loans) and LOC
Obligations, as applicable, held by such Lender bears to the aggregate
then outstanding Loans and LOC Obligations, as applicable) of amounts
available to be applied pursuant to clauses "THIRD", "FOURTH", "FIFTH",
"SIXTH", "SEVENTH", "EIGHTH", "NINTH" and "TENTH" above; (iii) to the
extent that any amounts available for distribution pursuant to clause
"FIFTH" above are attributable to the issued but undrawn amount of
outstanding Letters of Credit, such amounts shall be held by the Agent
in a cash collateral account and applied (A) first, to reimburse the
Issuing Lender from time to time for any drawings under such Letters of
Credit and (B) then, following the expiration of all Letters of Credit,
to all other obligations of the types described in clauses "FIFTH",
"SIXTH", "SEVENTH", "EIGHTH", "NINTH" and "TENTH" above in the manner
provided in this Section 3.15(b) and (iv) to the extent that any
amounts available for distribution pursuant to clause "NINTH" above are
attributable to the issued but undrawn amount of outstanding Tranche C
Letters of Credit, such amounts shall be held by the Tranche C Lender
in a cash collateral account, and the Borrower hereby grants a security
interest to the Tranche C Lender in any amounts so deposited with the
Tranche C Lender, and applied (A) first, to reimburse the Tranche C
Lender from time to time for any drawings under such Tranche C Letters
of Credit and (B) then, following the expiration of all Tranche C
Letters of Credit, to all other obligations of the types described in
clauses "NINTH" and "TENTH" above in the manner provided in this
Section 3.15(b).
Payments made to the Tranche C Lender in respect of the obligations of
the Sponsor arising under the Tranche C Guaranty shall not be subject
to the provisions of this Section 3.15(b) and shall be solely for the
account of the Tranche C Lender.
The provisions of this Section 3.15 are solely for the benefit of the
Lenders and their respective successors and assigns. Except as provided
in the preceding sentence, none of the Credit Parties or any other
Person other than the Lenders shall have any right, benefit, priority
or other interest under or because of the existence of this Section
3.15. This Section 3.15 shall solely define the relative rights of the
Lenders as amongst themselves and shall not define the rights of the
Lenders vis-a-vis any of the Credit Parties. For the avoidance of
doubt, each of the Credit Parties expressly agrees that the Credit
Party Obligations constitute unsubordinated indebtedness of such
Person.
SUBPART 2.9 Amendments to Section 5.2. Section 5.2 of the
Existing Credit Agreement is amended and restated in its entirety to
read as follows:
5.2 Conditions to Extensions of Credit (other than Tranche C Loans and
Tranche C Letters of Credit).
The obligations of each Lender to make any Loan (other than
any Tranche C Loan) and of the Issuing Lender to issue or extend any
Letter of Credit (including the initial Loans and the initial Letter
of Credit) are subject to satisfaction of the following conditions in
addition to satisfaction on the Closing Date of the conditions set
forth in Section 5.1:
(a) The Borrower shall have delivered (i) in the case of any
Revolving Loan, any portion of the Tranche A Term Loan or any portion
of the Tranche B Term Loan, an appropriate Notice of Borrowing; (ii) in
the case of any Letter of Credit, the Issuing Lender shall have
received an appropriate request for issuance in accordance with the
provisions of Section 2.2(b); and (iii) in the case of any Swingline
Loan, the Swingline Lender shall have received an appropriate request
for a Swingline Loan advance in accordance with the provisions of
Section 2.3(b);
(b) The representations and warranties set forth in Section 6
shall, subject to the limitations set forth therein, be true and
correct in all material respects as of such date (except for those
which expressly relate to an earlier date);
(c) There shall not have been commenced against the Parent or
any Consolidated Party an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect,
or any case, proceeding or other action for the appointment of a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or
similar official) of such Person or for any substantial part of its
Property or for the winding up or liquidation of its affairs, and such
involuntary case or other case, proceeding or other action shall remain
undismissed, undischarged or unbonded;
(d) No Default or Event of Default shall exist and be
continuing either prior to or after giving effect thereto; and
(e) Immediately after giving effect to the making of such Loan
(and the application of the proceeds thereof) or to the issuance of
such Letter of Credit, as the case may be, (i) the sum of the aggregate
principal amount of outstanding Revolving Loans plus LOC Obligations
outstanding plus the aggregate principal amount of outstanding
Swingline Loans shall not exceed the Revolving Committed Amount, (ii)
the LOC Obligations shall not exceed the LOC Committed Amount and (iii)
the aggregate principal amount of outstanding Swingline Loans shall not
exceed the Swingline Committed Amount.
The delivery of each Notice of Borrowing (other than in respect of any
Tranche C Loan), each Notice of Extension/Conversion (other than in
respect of any Tranche C Loan), each request for a Letter of Credit
pursuant to Section 2.2(b) and each request for a Swingline Loan
pursuant to Section 2.3(b) shall constitute a representation and
warranty by the Credit Parties of the correctness of the matters
specified in subsections (b), (c), (d) and (e) above.
SUBPART 2.10 Amendments to Section 7.1. Subsections (a), (b)
and (c) of Section 7.1 of the Existing Credit Agreement are amended
and restated in their entireties to read as follows:
7.1 Information Covenants.
(a) Annual Financial Statements. As soon as available, and in
any event within 90 days after the close of each fiscal year of the
Consolidated Parties, a consolidated balance sheet and income statement
of the Consolidated Parties, as of the end of such fiscal year,
together with related consolidated statements of cash flows for such
fiscal year, in each case setting forth in comparative form
consolidated figures for the preceding fiscal year and including
footnotes setting forth related consolidating information, all in
reasonable form and detail and, in the case of consolidated financial
information only, audited by independent certified public accountants
of recognized national standing reasonably acceptable to the Agent and
whose opinion shall be to the effect that such financial statements
have been prepared in accordance with GAAP (except for changes with
which such accountants concur) and shall not be limited as to the scope
of the audit or qualified as to the status of the Consolidated Parties
as a going concern.
(b) Interim Financial Statements.
----------------------------
(i) Quarterly Financial Statements. As soon as
available, and in any event within 45 days after the close of
each of the first three fiscal quarters of each fiscal year of
the Consolidated Parties a consolidated balance sheet and
income statement of the Consolidated Parties, as of the end of
such fiscal quarter, together with related consolidated
statements of cash flows for such fiscal quarter, in each case
setting forth in comparative form consolidated figures for the
corresponding period of the preceding fiscal year and
including footnotes setting forth related consolidating
information, all in reasonable form and detail and reasonably
acceptable to the Agent, and accompanied by a certificate of
the chief financial officer of the Borrower to the effect that
such quarterly financial statements fairly present in all
material respects the financial position of the Consolidated
Parties and have been prepared in accordance with GAAP,
subject to changes resulting from audit and normal year-end
adjustments.
(ii) Monthly Financial Statements. As soon as
available, and in any event within 45 days after the close of
each fiscal month of the Consolidated Parties a consolidated
balance sheet and income statement of the Consolidated
Parties, as of the end of such fiscal month, together with
related consolidated statements of cash flows for such fiscal
month, in each case setting forth in comparative form
consolidated figures for the corresponding period of the
preceding fiscal year and including footnotes setting forth
related consolidating information, all in reasonable form and
detail and reasonably acceptable to the Agent, and accompanied
by a certificate of the chief financial officer of the
Borrower to the effect that such monthly financial statements
fairly present in all material respects the financial position
of the Consolidated Parties and have been prepared in
accordance with GAAP, subject to changes resulting from audit
and normal year-end adjustments.
(c) Officer's Certificate. At the time of delivery of the
financial statements provided for in Sections 7.1(a) and 7.1(b)(i)
above, a certificate of the chief financial officer of the Borrower
substantially in the form of Exhibit 7.1(c), (i) demonstrating
compliance with the financial covenants contained in Section 7.11 by
calculation thereof as of the end of each such fiscal period and (ii)
stating that no Default or Event of Default exists, or if any Default
or Event of Default does exist, specifying the nature and extent
thereof and what action the Credit Parties propose to take with respect
thereto.
SUBPART 2.11 Amendments to Section 7.11. Section 7.11 of the
Existing Credit Agreement is amended and restated in its entirety to
read as follows:
7.11 Financial Covenants.
The Credit Parties shall cause:
(a) Fixed Charge Coverage Ratio. The Fixed Charge
Coverage Ratio, as of the last day of each fiscal
quarter of the Consolidated Parties, to be at least
1.00 to 1.00 for the period from December 31, 2000
and at all times thereafter.
(b) Interest Coverage Ratio. The Interest Coverage
Ratio, as of the last day of each fiscal quarter of
the Consolidated Parties, to be greater than or equal
to:
(i) for the period from June 30, 2000 to and including September 29, 2000, 1.00 to 1.00;
(ii) for the period from September 30, 2000 to and including December 30, 2000, 1.30 to 1.00;
(iii) for the period from December 31, 2000 to and including December 30, 2001, 1.50 to 1.00;
(iv) for the period from December 31, 2001 to and including December 30, 2002, 1.85 to 1.0;
(v) for the period from December 31, 2002 to and including December 30, 2003, 2.00 to 1.0;
(vi) for the period from December 31, 2003 to and including December 30, 2004, 2.25 to 1.0; and
(vii) at all times thereafter, 2.50 to 1.00.
(c) Senior Leverage Ratio. The Senior Leverage Ratio,
as of the last day of each fiscal quarter of the
Consolidated Parties, to be less than or equal to:
(i) for the period from June 30, 2000 to and including September 29, 2000, 6.00 to 1.00;
(ii) for the period from September 30, 2000 to and including December 30, 2000, 4.50 to 1.00;
(iii) for the period from December 31, 2000 to and including December 30, 2001, 3.25 to 1.00;
(iv) for the period from December 31, 2001 to and including December 30, 2002, 3.00 to 1.00;
(v) for the period from December 31, 2002 to and including December 30, 2003, 2.75 to 1.00; and
(vi) at all times thereafter, 2.50 to 1.00.
(d) Total Leverage Ratio. The Total Leverage Ratio,
as of the last day of each fiscal quarter of the
Consolidated Parties, to be less than or equal to:
(i) for the period from June 30, 2000 to and including September 29, 2000, 11.00 to 1.00;
(ii) for the period from September 30, 2000 to and including December 30, 2000, 8.50 to 1.00;
(iii) for the period from December 31, 2000 to and including December 30, 2001, 6.00 to 1.00;
(iv) for the period from December 31, 2001 to and including December 30, 2002, 5.50 to 1.00;
(v) for the period from December 31, 2002 to and including December 30, 2003, 4.75 to 1.00; and
(vi) at all times thereafter, 4.00 to 1.00.
(e) Minimum Sock Group EBITDA. The portion of Consolidated
EBITDA attributable to the Sock Group, as of the last day of each
fiscal quarter of the Consolidated Parties for the twelve month period
ending on such date, to be greater than or equal to:
(i) for the period from September 30, 1999 to
and including December 31, 2000, $32,000,000; and
(ii) at all times thereafter, $33,000,000.
SUBPART 2.12 Amendments to Section 7.14. Section 7.14 of the Existing
Credit Agreement is amended and restated in its entirety to read as follows:
7.14 Furtherance Assurances.
Following the consummation of any Asset Disposition of receivables to
the Receivables Financing Subsidiary, the Credit Parties will cause the
Receivables Financing Subsidiary to dividend, distribute or otherwise transfer
to the Credit Parties any Property of the Receivables Financing Subsidiary not
required to be pledged to the purchaser of receivables from the Receivables
Financing Subsidiary.
SUBPART 2.13 Amendments to Section 8.5. Section 8.5 of the Existing
Credit Agreement is amended and restated in its entirety to read as follows:
8.5 Asset Dispositions.
The Credit Parties will not permit the Parent or any Consolidated Party
to make any Asset Disposition (including, without limitation, any Sale and
Leaseback Transaction) other than Excluded Asset Dispositions and a Permitted
Austell Property Sale, unless (a) except in connection with the licensing of any
of the intellectual property of the Shirt Group on terms providing for the
reversion to the applicable Consolidated Parties of all rights to such
intellectual property at the end of the license term and upon default in the
payment of licensing fees by the applicable licensee thereof, the consideration
paid in connection therewith is at least 75% cash or Cash Equivalents, (b) if
such transaction is a Sale and Leaseback Transaction, such transaction is
permitted by the terms of Section 8.13 and (c) the Credit Parties shall,
immediately following the consummation of such Asset Disposition apply (or cause
to be applied) an amount equal to the Net Cash Proceeds of such Asset
Disposition to prepay the Credit Party Obligations in accordance with the terms
of Section 3.3(b)(iii). Notwithstanding any provision of this Credit Agreement
to the contrary, (i) no Asset Disposition involving any portion of the Sock
Group shall be permitted unless simultaneously all of the Credit Party
Obligations are repaid and this Credit Agreement is terminated in accordance
with the terms of Section 11.13(b) except pursuant to a transaction permitted
under clause (ii)(A) below and (ii) none of the Consolidated Parties may sell,
lease, transfer or otherwise dispose of accounts receivable except pursuant to
(A) a single Asset Disposition of receivables having an aggregate fair market
value of not greater than $24,000,000 by one or more Consolidated Parties to the
Receivables Financing Subsidiary in a transaction which (1) is non-recourse to
the Consolidated Parties (except for representations, warranties, covenants and
indemnities which are reasonably customary in an accounts receivable
transaction), (2) complies with the foregoing terms of this Section 8.5 and (3)
does not constitute an "Asset Sale" under and as defined in the documents
evidencing or governing the Senior Subordinated Debt and (B) a transaction
constituting an Excluded Asset Disposition.
Upon a sale of Property (including, without limitation, the sale of
Equity Interests of a Consolidated Party) permitted by this Section 8.5, the
Agent shall (to the extent applicable and provided that such Person is also
released from any and all of its obligations, if any, in respect of all other
Indebtedness of the Credit Parties) deliver to the Credit Parties, upon the
Credit Parties' request and at the Credit Parties' expense, such documentation
as is reasonably necessary to evidence the release of the Agent's security
interest, if any, in such Property or Equity Interests, including, without
limitation, amendments or terminations of UCC financing statements, if any, the
return of stock certificates, if any, and the release of such Consolidated Party
from all of its obligations, if any, under the Credit Documents.
SUBPART 2.14 Amendments to Section 8.9. Section 8.9 of the Existing
Credit Agreement is amended and restated in its entirety to read as follows:
8.9 Transactions with Affiliates.
The Credit Parties will not permit the Parent or any Consolidated Party
to enter into or permit to exist any transaction or series of transactions with
any officer, director, shareholder, Foreign Subsidiary or Affiliate of such
Person other than (a) advances of working capital to any Credit Party other than
the Parent or Interco, (b) transfers of cash and assets to any Credit Party
other than the Parent or Interco, (c) transactions permitted by Section 8.1,
Section 8.4, Section 8.5, Section 8.6, Section 8.7 or Section 8.13, (d) normal
compensation and reimbursement of expenses of employees, officers and directors,
(e) provided that no Default or Event of Default exists either before or after
giving effect thereto, payment on the Closing Date to the Sponsor of an
investment banking fee in an amount, together with transaction fees and
out-of-pocket expenses of the Sponsor, including those previously paid, not to
exceed $4,500,000, (f) payments to the Sponsor or its Affiliate designee of a
annual management fee, together with out-of-pocket expenses of all such Persons
for the applicable year, not to exceed $600,000, (g) except as otherwise
specifically limited in this Credit Agreement, other transactions which are
entered into in the ordinary course of such Person's business on terms and
conditions substantially as favorable to such Person as would be obtainable by
it in a comparable arms-length transaction with a Person other than an officer,
director, shareholder, Subsidiary or Affiliate and (h) the Consolidated Parties
may service receivables sold to the Receivables Financing Subsidiary and receive
a fee from the Receivables Financing Subsidiary for such services.
SUBPART 2.15 Amendments to Section 8.13. Section 8.13 of the Existing
Credit Agreement is amended and restated in its entirety to read as follows:
8.13 Sale Leasebacks.
Except in connection with the Austell Transaction, the Credit Parties
will not permit the Parent or any Consolidated Party to, directly or indirectly,
become or remain liable as lessee or as guarantor or other surety with respect
to any lease, whether an Operating Lease or a Capital Lease, of any Property
(whether real, personal or mixed), whether now owned or hereafter acquired, (a)
which the Parent or such Consolidated Party has sold or transferred or is to
sell or transfer to a Person other than the Parent or a Consolidated Party or
(b) which the Parent or such Consolidated Party intends to use for substantially
the same purpose as any other Property which has been sold or is to be sold or
transferred by such Consolidated Party to another Person other than the Parent
or a Consolidated Party in connection with such lease. Notwithstanding the
above, the Borrower may enter into a Sale and Leaseback Transaction with any
Affiliate with respect to the Austell Property in a transaction otherwise
permitted under Section 8.5.
SUBPART 2.16 Amendments to Section 9.1. Subsections (a), (b), (c)(ii),
(d), (h) and (m) of Section 9.1 of the Existing Credit Agreement are amended and
restated in their entireties to read as follows, and the following new
subsection (n) is added to Section 9.1 of the Existing Credit Agreement
immediately following subsection (m) thereof:
9.1 Events of Default.
An Event of Default shall exist upon the occurrence and continuation of
any of the following specified events (each an "Event of Default"):
(a) Payment. Any Credit Party shall
(i) default in the payment when due of any principal
of any of the Loans (other than the Tranche C Loans) or of any
reimbursement obligations arising from drawings under Letters
of Credit, or
(ii) default in the payment when due of any interest
on the Loans (other than the Tranche C Loans) or on any
reimbursement obligations arising from drawings under Letters
of Credit (other than Tranche C Letters of Credit), or of any
Fees or other amounts owing hereunder, under any of the other
Credit Documents or in connection herewith or therewith (other
than any such Fees or other amounts relating to the Tranche C
Loans); or
(b) Representations. Any representation, warranty or statement
made or deemed to be made by any Credit Party herein, in any of the
other Credit Documents, or in any statement or certificate delivered or
required to be delivered pursuant hereto or thereto (other than the
representations, warranties and statements made in Section 2.6 and
Section 2.7) shall prove untrue in any material respect on the date as
of which it was made or deemed to have been made;
(c) Covenants. Any Credit Party shall
* * * * * * *
(ii) default in the due performance or observance by
it of any term, covenant or agreement (other than those set
forth in Section 2.6, Section 2.7 or subsections (a), (b) or
(c)(i) of this Section 9.1) contained in this Credit Agreement
and such default shall continue unremedied for a period of at
least 30 days after the earlier of a responsible officer of a
Credit Party becoming aware of such default or notice thereof
by the Agent; or
(d) Other Credit Documents. (i) Any Credit Party shall default
in the due performance or observance of any term, covenant or agreement
in any of the other Credit Documents (other than the LOC Documents
relating to Tranche C Letters of Credit) (subject to applicable grace
or cure periods, if any), or (ii) except as a result of or in
connection with a dissolution, merger or disposition of a Subsidiary
permitted under Section 8.4 or Section 8.5, any Credit Document (other
than the LOC Documents relating to Tranche C Letters of Credit) shall
fail to be in full force and effect or to give the Agent and/or the
Lenders the Liens, rights, powers and privileges purported to be
created thereby, or any Credit Party shall so state in writing; or
* * * * * * *
(h) Defaults under Other Agreements. With respect to any
Indebtedness (including the Tranche C Loans, but excluding any other
than Indebtedness outstanding under this Credit Agreement) in excess of
$2,500,000 in the aggregate for the Parent and the Consolidated Parties
taken as a whole, (i) the Parent or any Consolidated Party shall (A)
default in any payment (beyond the applicable grace period with respect
thereto, if any) with respect to any such Indebtedness, or (B) the
occurrence and continuance of a default in the observance or
performance relating to such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or
any other event or condition shall occur or condition exist, the effect
of which default or other event or condition is to cause, or permit,
the holder or holders of such Indebtedness (or trustee or agent on
behalf of such holders) to cause (determined without regard to whether
any notice or lapse of time is required), any such Indebtedness to
become due prior to its stated maturity; or (ii) any such Indebtedness
shall be declared due and payable, or required to be prepaid other than
by a regularly scheduled required prepayment, prior to the stated
maturity thereof; or
* * * * * * *
(m) Investment and Deposit Agreement. There shall occur
and be continuing any "Event of Default" under, and as
---------------------------------
defined in, Section 8.1(a) of the Investment and Deposit Agreement; or
(n) Leverage Reduction Requirements. The Shirt Group
Restructuring shall have occurred and the Leverage
---------------------------------
Reduction Requirements shall not be satisfied as of the last day of the
Leverage Reduction Period.
SUBPART 2.17 Amendments to Section 9.2. Sections 9.2(a), (b)
and (d) of the Existing Credit Agreement are amended and restated in
their entireties to read as follows:
9.2 Acceleration; Remedies.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived by the
requisite Lenders (pursuant to the voting requirements of Section
11.6) or cured to the satisfaction of the requisite Lenders (pursuant
to the voting procedures in Section 11.6), the Agent shall, upon the
request and direction of the Required Lenders, by written notice to
the Credit Parties take any of the following actions:
(a) Termination of Commitments. Declare the Commitments
(other than the Tranche C Commitment) terminated
--------------------------
whereupon such Commitments shall be immediately terminated.
(b) Acceleration. Declare the unpaid principal of and any
accrued interest in respect of all Loans (other than the Tranche C
Loans), any reimbursement obligations arising from drawings under
Letters of Credit (but not Tranche C Letters of Credit) and any and all
other indebtedness or obligations of any and every kind owing by the
Credit Parties to the Agent and/or any of the Lenders (other than the
Tranche C Lender) hereunder to be due whereupon the same shall be
immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Credit
Parties.
* * * * * * *
(d) Enforcement of Rights. Enforce any and all rights and
interests created and existing under the Credit Documents including,
without limitation, all rights and remedies existing under the
Collateral Documents, all rights and remedies against a Guarantor and
all rights of set-off, but excluding, all rights and remedies of the
Tranche C Lender arising under Section 2.6, Section 2.7, the LOC
Documents relating to the Tranche C Letters of Credit or the Tranche C
Guaranty.
SUBPART 2.18 Amendments to Section 11.1. Section 11.1 of the
Existing Credit Agreement is amended and restated in its entirety to
read as follows:
11.1 Notices.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a)
when delivered, (b) when transmitted via telecopy (or other facsimile
device) to the number set out below, (c) the Business Day following
the day on which the same has been delivered prepaid to a reputable
national overnight air courier service, or (d) the third Business Day
following the day on which the same is sent by certified or registered
mail, postage prepaid, in each case to the respective parties at the
address, in the case of the Credit Parties and the Agent, set forth
below, and, in the case of the Lenders, set forth on Schedule 2.1(a),
or at such other address as such party may specify by written notice
to the other parties hereto:
if to any Credit Party:
Xxxxxx American Corp.
00 X. 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: President and Chief Executive Officer
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with copies to:
Vestar Capital Partners III, L.P.
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
and
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
if to the Sponsor:
Vestar Capital Partners III, L.P.
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with copies to:
Vestar Capital Partners III, L.P.
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
and
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
if to the Agent:
Bank of America, N.A.
Independence Center, 15th Floor
NC1-001-15-04
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Agency Services
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to:
Bank of America, N.A.
NY1-503-06-07
000 Xxxxxxx Xxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
SUBPART 2.19 Amendments to Section 11.3. The following new
subsection (h) is added to Section 11.3 of the Existing Credit
Agreement immediately following existing subsection (g) thereof:
11.3 Benefit of Agreement.
* * * * * * *
(h) The Tranche C Lender may not assign or transfer any of its
interests and obligations hereunder without prior written consent of
the Borrower except during the continuance of an Event of Default.
SUBPART 2.20 Amendments to Section 11.6. Section 11.6 of the
Existing Credit Agreement is amended and restated in its entirety to
read as follows:
11.6 Amendments, Waivers and Consents.
Neither this Credit Agreement nor any other Credit Document nor any of
the terms hereof or thereof may be amended, changed, waived,
discharged or terminated unless such amendment, change, waiver,
discharge or termination is in writing entered into by, or approved in
writing by, the Required Lenders and the Borrower, provided, however,
that:
(i) without the consent of each Lender affected thereby,
neither this Credit Agreement nor any other Credit Document
may be amended to
(a) extend the final maturity of any Loan or of any
reimbursement obligation, or any portion thereof, arising from
drawings under Letters of Credit, or extend or waive any
Principal Amortization Payment of any Loan, or any portion
thereof,
(b) reduce the rate or extend the time of payment of
interest (other than as a result of waiving the applicability
of any post-default increase in interest rates) thereon or
Fees hereunder,
(c) reduce or waive the principal amount of any
Loan or of any reimbursement obligation, or any portion
thereof, arising from drawings under Letters of Credit,
(d) increase the Commitment of a Lender over the amount
thereof in effect (it being understood and agreed that a
waiver of any Default or Event of Default or mandatory
reduction in the Commitments shall not constitute a change in
the terms of any Commitment of any Lender),
(e) except as the result of or in connection with
an Asset Disposition permitted by Section 8.5, release all
or substantially all of the Collateral,
(f) except as the result of or in connection with a
dissolution, merger or disposition of a Consolidated Party
permitted under Section 8.4, release the Borrower or
substantially all of the other Credit Parties from its or
their obligations under the Credit Documents,
(g) amend, modify or waive any provision of this Section
11.6 or Section 3.6, 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13,
3.14, 3.15, 9.1(a), 11.2, 11.3, 11.5, 11.9 or 11.16,
(h) reduce any percentage specified in, or otherwise
modify, the definition of Required Lenders, or
(i) consent to the assignment or transfer by the
Borrower or all or substantially all of the other Credit
Parties of any of its or their rights and obligations under
(or in respect of) the Credit Documents except as permitted
thereby;
(ii) without the consent of Lenders holding in the aggregate
more than 50% of the outstanding Tranche A Term Loans and more than 50%
of the outstanding Tranche B Term Loans, extend the time for or the
amount or the manner of application of proceeds of (A) any mandatory
prepayment required by Section 3.3(b)(ii), (iii), (iv) or (v) hereof or
(B) any payment by, or on behalf of, the Sponsor to purchase a
participation interest in the Credit Party Obligations pursuant to
Section 2.1(c) or Section 2.2(c) of the Investment and Deposit
Agreement;
(iii) without the consent of the Agent, no provision of
Section 10 may be amended;
(iv) without the consent of the Issuing Lender, no provi-
sion of Section 2.2 may be amended;
(v) without the consent of the Swingline Lender, no provi-
sion of Section 2.3 may be amended;
(vi) the Tranche C Lender shall be the only Lender entitled to
effectuate, with the Borrower, any amendment, change, waiver, discharge
or termination of any of the following: (A) Section 2.6, Section 2.7 or
Section 3.3(b)(i)(B) or (B) any of the definitions of "Tranche C
Commitment", "Tranche C Committed Amount", "Tranche C Default",
"Tranche C Event of Default", "Tranche C Guaranty", "Tranche C LOC
Obligations", "Tranche C Obligations", "Tranche C Lender", "Tranche C
Letters of Credit", "Tranche C Lender" and "Tranche C Loan" set forth
in Section 1.1; and
(vii) without the consent of the Tranche C Lender, no
amendment, change, waiver, discharge or termination of any of the
following which would have an adverse effect on the Tranche C Lender
shall be effective: (A) any of the definitions of "Commitment",
"Lender", "Loan", "LOC Documents" and "Maturity Date" (clause (iii)
thereof only) set forth in Section 1.1 or (B) Section 3.3(b)(vi)(D).
Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (x) each Lender
is entitled to vote as such Lender sees fit on any bankruptcy
reorganization plan that affects the Loans, and each Lender
acknowledges that the provisions of Section 1126(c) of the Bankruptcy
Code supersedes the unanimous consent provisions set forth herein and
(y) the Required Lenders may consent to allow a Credit Party to use
cash collateral in the context of a bankruptcy or insolvency
proceeding.
SUBPART 2.21 New Section 11.16. The following new Section
11.16 is added to the Existing Credit Agreement immediately following
existing Section 11.15 thereof:
11.16 General Provisions regarding Tranche C Obligations.
(a) Notwithstanding any provision to the contrary contained
herein or in any other of the Credit Documents, Tranche C Loans shall
not be included in the determination of the total number of outstanding
Eurodollar Loans for purposes of the limitations on the maximum number
of Eurodollar Loans set forth in Sections 2.1(a), 2.4(a), 2.5(a) and
3.2.
(b) The Lenders acknowledge and agree among themselves that,
notwithstanding any provision to the contrary contained herein or in
any other of the Credit Documents, the Tranche C Lender (in its
capacity as such) and the Tranche C Obligations shall not be entitled
to the benefit of (i) any Collateral subject to a Lien in favor of the
Agent pursuant to any of the Collateral Documents or (ii) the guarantee
of any Guarantor pursuant to Section 4. The agreement of the Lenders
set forth in this clause (b) shall not inure to the benefit of the
Borrower or any other Credit Party.
SUBPART 2.22 Additional Restrictions. Notwithstanding any
provision of the Amended Credit Agreement to the contrary (including,
without limitation, the definition of "Permitted Acquisitions",
"Permitted Investments" and "Permitted Liens" appearing in Section 1.1
of the Amended Credit Agreement and Sections 8.1 and 8.6 of the
Amended Credit Agreement), until the later of (i) the last day of the
Leverage Reduction Period and (ii) such time as the Leverage Reduction
Requirements shall have been satisfied, the Credit Parties will not
permit the Parent or any Consolidated Party to:
(i) consummate any Acquisition;
(ii) except as otherwise permitted under clause (xvi) of the
definition of "Permitted Investments" appearing in Section 1.1 of the
Amended Credit Agreement, make any additional Investments in Foreign
Subsidiaries;
(iii) make any additional advances or loans to directors,
officers, employees, agents, customers or suppliers;
(iv) except as otherwise permitted under clause (xvi) of the
definition of "Permitted Investments" appearing in Section 1.1 of the
Amended Credit Agreement, make any additional Investments in Joint
Ventures;
(v) grant or permit to exist any additional Liens pursuant
to clause (xv) of the definition of "Permitted
Liens" contained in Section 1.1 of the Amended Credit Agreement; or
(vi) incur or become liable with respect to any additional
Indebtedness of the types described in clauses (f), (g) or (l) of
Section 8.1 of the Amended Credit Agreement.
The Credit Parties hereby acknowledge and agree that, notwithstanding
any provision of the Amended Credit Agreement to the contrary, the
failure of the Credit Parties to comply with any of the terms of this
Subpart 2.22 shall constitute an Event of Default under the Credit
Agreement without the need for the giving of any notice or the lapse
of any period of time.
SUBPART 2.23 New Schedule 1.1E. A new schedule in the form
of Schedule 1.1E attached hereto is added to the Existing Credit
Agreement immediately following existing Schedule 1.1D thereof.
PART 3
WAIVER
Subject to the occurrence of the Amendment No. 5 Effective
Date, the Lenders hereby waive the requirements that the Credit
Parties comply with Sections 7.11(a) through (d) of the Credit
Agreement for the fiscal quarter ended December 31, 1999. This is a
one-time waiver and is granted only for the limited purposes set forth
herein and shall be effective only in the specific circumstances
provided for above and only for the purpose for which given. Except as
waived pursuant to the terms of this Part 3 or amended pursuant to
Part 2, the Existing Credit Agreement and all other Credit Documents
shall continue in full force and effect. The waiver pursuant to this
Part 3 shall be deemed to be effective as of December 30, 1999.
PART 4
CONDITIONS TO EFFECTIVENESS
SUBPART 4.1 Amendment No. 5 Effective Date. This Amendment
shall be and become effective as of the date hereof (the "Amendment
No. 5 Effective Date") when all of the conditions set forth in this
Part 4 shall have been satisfied, and thereafter this Amendment shall
be known, and may be referred to, as "Amendment No. 5."
SUBPART 4.1.1 Execution of Counterparts of Amendment. The
Agent shall have received counterparts of this Amendment which
collectively shall have been duly executed on behalf of each of the
Borrower, the Guarantors, the Tranche C Lender and the Required
Lenders.
SUBPART 4.1.2 Tranche C Guaranty. The Tranche C Lender shall
have received an original copy of the Tranche C Guaranty which shall
have been duly executed on behalf of the Sponsor.
SUBPART 4.1.3 Legal Opinions. The Agent shall have received a
legal opinion of legal counsel to the Credit Parties and the Sponsor in
form and substance reasonably satisfactory to it, and the Tranche C
Lender shall have received a legal opinion of legal counsel to the
Borrower and the Sponsor in form and substance reasonably satisfactory
to it.
SUBPART 4.1.4 Other Items. The Agent shall have received such
other documents, agreements or information which may be reasonably
requested by the Agent.
SUBPART 4.1.5 Payment of Amendment Fees. The Agent shall have
received, for the account of each Lender that has delivered an executed
counterpart of this Amendment to the Agent on or before 12:00 Noon
(Charlotte, North Carolina time) on the Amendment No. 5 Effective Date,
an amendment fee equal to 0.25% of the Commitment of each such Lender.
PART 5
MISCELLANEOUS
SUBPART 5.1 Representations and Warranties. Borrower hereby
represents and warrants to the Agent and the Lenders that, after
giving effect to this Amendment, (a) no Default or Event of Default
exists under the Credit Agreement or any of the other Credit Documents
and (b) the representations and warranties set forth in Section 6 of
the Existing Credit Agreement are, subject to the limitations set
forth therein, true and correct in all material respects as of the
date hereof (except for those which expressly relate to an earlier
date).
SUBPART 5.2 Reaffirmation of Credit Party Obligations. Each
Credit Party hereby ratifies the Credit Agreement and acknowledges and
reaffirms (a) that it is bound by all terms of the Credit Agreement
applicable to it and (b) that it is responsible for the observance and
full performance of its respective Credit Party Obligations.
SUBPART 5.3 Cross-References. References in this Amendment
to any Part or Subpart are, unless otherwise specified, to such Part
or Subpart of this Amendment.
SUBPART 5.4 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 5.5 References in Other Credit Documents. At such
time as this Amendment No. 5 shall become effective pursuant to the
terms of Subpart 4.1, all references in the Credit Documents to the
"Credit Agreement" shall be deemed to refer to the Credit Agreement as
amended by this Amendment No. 5.
SUBPART 5.6 Counterparts/Telecopy. 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. Delivery of executed
counterparts of this Amendment by telecopy shall be effective as an
original and shall constitute a representation that an original shall
be delivered.
SUBPART 5.7 Governing Law. THIS AMENDMENT SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER AND GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK.
SUBPART 5.8 Successors and Assigns. This Amendment shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.
IN WITNESS WHEREOF the Borrower, the Guarantors and the Required
Lenders have caused this Amendment to be duly executed on the date first above
written.
CREDIT PARTIES: XXXXXX AMERICAN Corp.
--------------
Xxxxxx American Investment Corp.
Xxxxxx American Group, Inc.
CONSUMER DIRECT CORPORATION
ARROW FACTORY STORES, INC.
GAKM RESOURCES CORPORATION
XXXXXX PEABODY RESOURCES CORPORATION
XXXXXX XXXXXXX HOLDING CORP.
XXXXXX, PEABODY & CO., INC.
BIDERTEX SERVICES INC.
GREAT AMERICAN KNITTING XXXXX, INC.
XXXXXX DESIGNER GROUP, INC.
BIDERMANN TAILORED CLOTHING, INC.
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title:Director and Chief Executive Officer
LENDERS: BANK OF AMERICA, N.A.
-------
(formerly known as NationsBank, N. A.)
By:/s/ X.X.Xxxxx
Name: X.X. Xxxxx
Title: Managing Directory
NATIONAL WESTMINSTER BANK PLC
By:/s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: Senior Vice President
FLEET BANK, N.A.
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
BANKBOSTON, N.A.
By: /s/ Xxxxxxx X. Xxxx, Xx.
Name: Xxxxxxx X. Xxxx, Xx.
Title: Managing Director
FLEET BUSINESS CREDIT CORPORATION
(successor in interest to Sanwa Business Credit
Corporation)
By: /s/ Xxxxxx X. Xxxxxxxx
Name:Xxxxxx X. Xxxxxxxx
Title: Senior Vice President
BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Associate
By: /s/ Xxxxxxx X. XxXxxxxx, Xx.
Name: Xxxxxxx X. XxXxxxxx, Xx.
Title: Vice President
FIRST SOURCE FINANCIAL LLP,
By: First Source Financial Inc., its manager
By: /s/ Xxxx X. Xxxxxxx
Name: Xxxx X. Xxxxxxx
Title: Senior Vice President
GENERAL ELECTRIC CAPITAL
CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
Name: Xxxxxx X. Xxxxxxxxx
Title: Duly Authorized Signatory
SUMMIT BANK
By: /s/ Xxxx Xxxxxxxx
Name: Xxxx Xxxxxxxx
Title: Vice President
HSBC BANK USA
By: /s/ X.X. Xxxxx
Name: X.X. Xxxxx
Title: Senior Vice President
AG CAPITAL FUNDING PARTNERS, L.P.
By: Xxxxxx Xxxxxx & Co., L.P. as Investment Advisor
By:
Name:
Title:
NORTHWOODS CAPITAL LIMITED
By: Xxxxxx Xxxxxx & Co., L.P. as Collateral Manager
By:
Name:
Title:
NEW YORK LIFE INSURANCE COMPANY
By:
Name:
Title:
SENIOR DEBT PORTFOLIO
By: Boston Management and Research,
as Investment Advisor
By: /s/ Payson X. Xxxxxxxxx
Name: Payson X. Xxxxxxxxx
Title: Vice President
ML CLO XX PILGRIM AMERICA (CAYMAN) LTD.
By:
Name:
Title:
TORONTO DOMINION (TEXAS), INC.
By: /s/ Xxxx Xxxxxx
Name: Xxxx Xxxxxx
Title: Vice President
GREAT POINT CLO 1999-1 LTD.
By: Sankaty Advisors, Inc., as
Collateral Managers
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title:Executive Vice President, Portfolio Manager
XXXXX XXXXX SENIOR INCOME TRUST
By:
Name:
Title:
Schedule 1.1E
Existing Tranche C Letters of Credit
None.
