EXHIBIT 10.12
AMENDMENT NO. 3 TO THE
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of August 20, 1999
AMENDMENT NO. 3 AND WAIVER TO THE THIRD AMENDED AND RESTATED
CREDIT AGREEMENT dated as of February 12, 1999 among Glenoit Corporation, a
Delaware corporation (the "Borrower"), the banks, financial institutions and
other institutional lenders listed on the signature pages thereof as the
Restatement Lenders (the "Lenders"), the bank listed on the signature pages
thereof as the Issuing Bank (the "Issuing Bank"), Banque Nationale de Paris, as
the swing line bank (the "Swing Line Bank") and as administrative agent (the
"Agent") for the Lender Parties and the arranger (the "Arranger"), Fleet
National Bank, as syndication agent (the "Syndication Agent"), and LaSalle Bank
National Association, as documentation agent (the "Documentation Agent";
together with the Agent and the Syndication Agent, the "Agents").
PRELIMINARY STATEMENTS:
(1) The Borrower, the Lenders and the Agents have entered into
a Third Amended and Restated Credit Agreement dated as of February 12, 1999 (as
amended by Amendment No. 1 dated as of April 14, 1999, and Amendment No. 2 dated
as of June 29, 1999, and as further amended, supplemented or modified to date,
the "Credit Agreement"). Capitalized terms not otherwise defined in this
Amendment have the same meanings as specified in the Credit Agreement.
(2) The Borrower, the other Loan Parties and the Lenders have
agreed to amend the Credit Agreement and the Third Amended and Restated Security
Agreement as hereinafter set forth.
SECTION 1. Waiver to the Credit Agreement. The Borrower hereby
requests that the Required Lenders waive, and by their signature on the
signature pages hereto, the Required Lenders hereby waive as of the date hereof
and subject to the satisfaction of the conditions precedent set forth in Section
4: (a) maintenance of the Total Leverage Ratio less than or equal to the ratio
set forth in Section 5.04(a) for the Rolling Period ending in July 1999; and (b)
maintenance of the Senior Leverage Ratio less than or equal to the ratio set
forth in Section 5.04(a) for the Rolling Period ending in July 1999.
SECTION 2. Amendments to the Credit Agreement. The Credit
Agreement is, effective as of the date hereof and subject to the satisfaction of
the conditions precedent set forth in Section 3 below, hereby amended as
follows:
(a) Section 1.01 of the Credit Agreement is hereby amended by
adding the following defined terms thereto in the proper alphabetic order and
each such defined term shall read as follows:
"'AGGREGATE REVOLVER BORROWINGS' means the sum of the
aggregate principal of the Working Capital Advances and the
Swing Line Advances."
"'DISCOUNTED FABRIC RECEIVABLES AMOUNT' means the product of
(a) the amount of Fabric Program Receivables (as determined
based on the most recent Borrowing Base Certificate delivered
to the Lender Parties hereunder) and (b) 1.00 minus the lesser
of (i) 0.10 and (ii) the effective discount rate applied by
the Fabric Program Purchaser to the Fabric Program Receivables
purchased by such Fabric Program Purchaser."
"'REVOLVER BORROWING LIMIT' means, (a) on any date occurring
in: (i) August 1999, the lesser of (A) the Loan Value of the
Eligible Collateral and (B) $56,000,000; and
(ii) September 1999 and October 1999, the lesser of
(A) the Loan Value of Eligible Collateral and
(B) (1) $56,000,000 or (2) IF THE Borrower
shall have entered into a Fabric Factoring
Program, the difference between $60,000,000
and the Discounted Fabric Receivables Amount;
and
(b) on any date occurring (i) thereafter and on or
prior to November 5, 1999, the lesser of (A) the
Loan Value of Eligible Collateral and (B) (1)
$51,000,000 or (2) if the Borrower shall have
entered into a Fabric Factoring Program, the
difference between $55,000,000 and the Discounted
Fabric Receivables Amount;
(ii) after November 5, 1999 and on or prior to
November 12, 1999, the lesser of (A) the Loan
Value of Eligible Collateral and (B) (1)
$46,000,000 or (2) if the Borrower shall have
entered into a Fabric Factoring Program, the
difference between $50,000,000 and the
Discounted Fabric Receivables Amount;
(iii) after November 12, 1999 and on or prior to
November 19, 1999, the lesser of (A) the Loan
Value of Eligible Collateral and (B) (1)
$41,000,000 or (2) if the Borrower shall have
entered into a Fabric Factoring Program, the
difference between $45,000,000 and the
Discounted Fabric Receivables Amount; and
(iv) after November 19, 1999, the lesser of (A) the
Loan Value of Eligible Collateral and (B) (1)
$36,000,000 or (2) if the Borrower shall have
entered into a Fabric Factoring Program, the
difference between $40,000,000 and the
Discounted Fabric Receivables Amount;
in each case, such Loan Value as determined from the most recent Borrowing Base
Certificate delivered to the Lender Parties hereunder."
(b) Section 2.06(b)(iii) is hereby amended and restated
in its entirety to read as follows:
"(iii) The Borrower shall, on each Business Day, prepay an aggregate principal
amount of Working Capital Advances comprising part of the same Borrowings, the
Swing Line Advances and the Letter of Credit Advances equal to an amount
(without duplication of amounts payable under both clauses (A) and (B) below) by
which (A) (1) the sum of the aggregate principal amount of (x) the Working
Capital Advances, (y) the Swing Line Advances and (z) the Letter of Credit
Advances then outstanding plus the aggregate Available Amounts of all Letters of
Credit then outstanding exceeds (2) the lesser of the Working Capital Facility
and the Loan Value of Eligible Collateral on such Business Day (as determined
based on the most recent Borrowing Base Certificate delivered to the Lender
Parties hereunder) and (B) (1) the outstanding Aggregate Revolver Borrowings
exceed (2) the Revolver Borrowings Limit on such Business Day, provided, that on
each Business Day occurring on or after August 24, 1999 and on or prior to
October 22, 1999, for the purposes of making the calculation in this clause (B),
the outstanding Aggregate
Revolver Borrowings shall be reduced by the amount of interest accrued and paid
pursuant to Section2.07 in full in cash on or after August 24, 1999 and on or
prior to October 22, 1999."
(c) Section 3.02 is hereby amended by (i) deleting the
word "and" immediately preceding clause (b) thereof
and (i) deleting the punctuation"." at the end
thereof and substituting therefor the phrase:
", and (c) the amount of the Aggregate Revolver Borrowings,
before and after giving effect to each Working Capital
Advance, Swing Line Advance and Letter of Credit Advance
requested in any Notice of Borrowing and Notice of Issuance,
as the case may be, shall be less than or equal to the
applicable Revolver Borrowings Limit."
(d) Section 5.02(f) is hereby amended by (i) deleting
the word "and" at the end of clause (vi) thereof,
(ii) inserting the phrase "clauses (i) through (vi)
of" immediately after the phrase "Investments not
otherwise permitted under" in clause (vii) thereof,
and (iii) deleting the punctuation "." from the end
of clause (vii) thereof and replacing it with the
phrase:
", and (viii) Investments in Cash Equivalents in an aggregate
amount not to exceed $2,000,000 at anytime."
(e) Section 5.04(a)(i) is hereby amended by: (i)
deleting the ratio "6.00:1.00" set forth in respect
of Fiscal Month August 1999 and substituting
therefor the ratio "6.60:1.00"; (ii) deleting the
ration "5.85:1.00" set forth in respect of Fiscal
Month September 1999 and substituting therefor the
ratio "6.75:1.00"; (iii) inserting immediately
after the Fiscal Month September 1999 the
following:
---------------------------- --------------------
Fiscal Month Ratio
---------------------------- --------------------
October 1999 5.85:1.00
---------------------------- --------------------
November 1999 5.85:1.00
---------------------------- --------------------
(f) Section 5.04(a)(ii) is hereby amended by: (i)
deleting the ratio "3.70:1.00" set forth in
respect of Fiscal Month August 1999 and
substituting therefor the ratio "4.05:1.00"; (ii)
deleting the ratio "3.70:1.00: set forth in
respect of Fiscal Month 1999 and substituting
therefor the ratio "4.15:1.00"; (iii) inserting
immediately after the Fiscal Month September 1999
the following:
---------------------------- -------------------
Fiscal Month Ratio
---------------------------- -------------------
---------------------------- -------------------
October 1999 3.70:1.00
---------------------------- -------------------
---------------------------- -------------------
November 1999 3.70:1.00
---------------------------- -------------------
(g) Section 5.04(c) is hereby amended by deleting the
ratio "1.65:1.00" set forth in respect of Fiscal
Month September 1999 and substituting therefor the
ratio "1.4:1.00".
SECTION 3. Conditions of Effectiveness. This Amendment shall
become effective as of the date first above written when, and only when the
Agent shall have received:
(a) counterparts of this Amendment executed by the Borrower
and the Required Lenders or, as to any of the Lenders, advice satisfactory to
the Agent that such Lender has executed this Amendment, and the consent attached
hereto executed by each of the Guarantors and each of the Grantors;
(b) for the benefit of each Lender, an amendment fee for the
account of each Lender in an amount equal to 0.25% of such Lender's aggregate
Commitments; and
(c) for the benefit of the Working Capital Lenders, $1,500,000
as a prepayment under Section 2.06(a).
Furthermore, this Amendment is subject to the provisions of Section 8.01 of the
Credit Agreement.
SECTION 4. Representations and Warranties of the Borrower. The
Borrower represents and warrants as follows:
(a) the representations and warranties contained in each
Loan Document are correct on and as of the date hereof,
after giving effect to this Amendment, as though made on
and as of the date hereof, other than any such
representations or warranties that by their terms, refer
to a specific date, in which case, as of such specific
date: and
(b) no Default has occurred and is continuing under the
Credit Agreement, as amended hereby, or would result
from this Amendment or the consummation of the
transactions contemplated hereby.
SECTION 5. Reference to and Effect on the Loan Documents. On
and after the effectiveness of this Amendment, each reference in the Credit
Agreement to "this Agreement", "hereunder", "hereof" or words of like import
referring to the Credit Agreement, and each reference in the Notes and each of
the Other Loan Documents to "the Credit Agreement", "thereunder", "thereof" or
words of like import referring to the Credit Agreement, shall mean and be a
reference to the Credit Agreement, as amended by this Amendment.
(b) the Credit Agreement, the Notes and each of the other
Loan Documents, as specifically amended by this
Amendment, are and shall continue to be in full force
and effect and are hereby in all respects ratified and
confirmed.
(c) The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided
herein, operate as a waiver of any right, power or
remedy of any Lender or the Agent under any of the Loan
Documents, not constitute a waiver of any provision of
any of the Loan Documents.
SECTION 6. Costs, Expenses and Taxes. The Borrower agrees to
pay on demand all costs and expenses of the Agent in connection with the
preparation, execution, delivery and administration, modification and amendment
of this Amendment, the Notes and the other instruments and documents to be
delivered hereunder (including, without limitation, the reasonable fees and
expenses of counsel for the Agent) in accordance with the terms of Section 8.04
of the Credit Agreement. In addition, the Borrower shall pay any and all stamp
and other taxes payable or determined to be payable in connection with the
execution and delivery of the Amendment and the other instruments and documents
to be delivered hereunder, and agree to save the Agent and each Lender harmless
from and against any and all liabilities with respect to or resulting from any
delay in paying or omission to pay such taxes.
SECTION 7. Execution in Counterparts. This Amendment may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute but one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Amendment by telecopier shall be effective as delivery of a manually executed
counterpart of this Amendment.
SECTION 8. Governing Law. This Amendment shall be governed by,
and construed in accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
GLENOIT CORPORATION
By /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Title: EVP and CFO
GLENOIT UNIVERSAL, LTD.
By /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: EVP and CFO
GLENOIT ASSETS CORP.
By /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: EVP and CFO
AMERICAN PACIFIC ENTERPRISES, INC.
By /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: EVP and CFO
GRAND AVENUE CORP.
By /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: EVP and CFO
EX-CELL HOME FASHIONS, INC.
By /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: EVP and CFO
EX-CELL OF BENTONVILLE, INC.
By /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Title:EVP and CFO
EX-CELL LINDE OF CAROLINA, INC.
By /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: EVP and CFO
AGENT
BANQUE NATIONALE DE PARIS,
as Agent
By /s/ Xxxx Xxxxxxxx
-----------------------------------------
Title: Director
By /s/ Xxxx Xxxxxxxxx
-----------------------------------------
Title: VP
LENDERS
BANQUE NATIONALE DE PARIS
By /s/ Xxxx Xxxxxxxx
-----------------------------------------
Title: Director
By /s/ Xxxx Xxxxxxxxx
-----------------------------------------
Title: VP
BOEING CAPITAL CORPORATION
By /s/ Xxxxx Xxxxxx
-----------------------------------------
Name: Xxxxx Xxxxxx
Title: Special Credits Officer
CENTURA BANK
By /s/ Xxxxx Xxxxx
-----------------------------------------
Name: Xxxxx Xxxxx
Title: VP
COMERICA
By /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Assistant Vice President
DEUTSCHE FINANCIAL SERVICES
By /s/ Xxxxxx X. Xxxxxxx, IX
-----------------------------------------
Name: Xxxxxx X. Xxxxxxx, IX
Title: Vice President
FIRST SOURCE FINANCIAL LLP,
By First Source Financial, Inc. as its
Agent/Manager
By /s/ Xxxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President
FLEET BANK, N.A.
By /s/ Xxxxxx Xxxxxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Senior Vice President
Floating Rate Porfolio
By: INVESCO Senior Secured Management,
Inc., as attorney in fact
By /s/ Xxxx X. XxXxxxxx
-----------------------------------------
Name: Xxxx X. XxXxxxxx
Title: Authorized Signatory
LASALLE BANK NATIONAL
ASSOCIATION
By /s/ Xxxxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Corporate Banking Officer
KZH ING-1 LLC
By /s/ Xxxxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxxxx Xxxxxx
Title:Authorized Agent
KZH ING-2 LLC
By /s/ Xxxxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxxxx Xxxxxx
Title:Authorized Agent
KZH ING-3 LLC
By /s/ Xxxxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxxxx Xxxxxx
Title:Authorized Agent
METROPOLITAN LIFE INSURANCE
COMPANY
By /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Director
XXX XXXXXX SENIOR FLOATING RATE FUND
By /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President and Director
XXX XXXXXX PRIME RATE INCOME TRUST
By Xxxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President and Director
