February 12, 1996
Delta Woodside Industries, Inc.
000 Xxxxx Xxxx Xxxxxx
Xxxxx 000
Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: President
RE: Credit Agreement dated as of September 7, 1994 (the "Credit
Agreement") by and among Delta Woodside Industries, Inc. (the
"Borrower"), the Lenders described therein, NationsBank, N.A.
(formerly known as NationsBank of North Carolina, N.A.), as
Agent, and Bank of America National Trust and Savings Association
and The Bank of New York, as Co-Agents
Dear Sirs:
You have informed us that the Borrower will be in violation of Section 9.1(d)
of the above referenced Credit Agreement for the Fiscal Quarter ended
December 31, 1995, and you have requested that the Lenders waive such
violation.
The defined terms in the Credit Agreement are incorporated herein by
reference.
In accordance with your request, the undersigned Xxxxxxx hereby agree to
waive through and including March 15, 1996 the violation of Section 9.1(d)
of the Credit Agreement resulting from the failure of the Borrower to
maintain the required Interest Coverage Ratio for the Fiscal Quarter ended
December 31, 1995. Unless further waived by the Lenders, such violation of
Section 9.1(d) shall, immediately on and as of March 16, 1996 (without any
further notice or lapse of time), constitute an Event of Default under the
Credit Agreement.
In consideration of the waiver provided by the Lenders pursuant hereto, the
Borrower hereby agrees that:
(i) nothwithstanding any provision to the contrary set forth
in the Credit Agreement, on and after the date hereof, the Applicable
Margin shall equal 225 basis points; and
(ii) on or before March 15, 1996, the Borrower shall cause
all of the accounts receivable, inventory and equipment of the
Borrower and each of the Subsidiary Guarantors to become subject to
first priority, perfected liens in favor of the Agent, for the benefit
of the Lenders, pursuant to such security documents as the Agent may
require, and, in connection therewith, the Borrower shall cause to be
delivered to the Agent such other documentation as the Agent may
reasonably request, including without limitation appropriate UCC-1
financing statements, certified corporate resolutions and favorable
opinions of counsel, all in form, content and scope reasonably
satisfactory to the Agent.
The waiver set forth above shall be effective only in the specific instance
provided for above and only for the purpose for which given and shall not
entitle the Borrower to any other or further waivers in similar or other
circumstances.
Except as waived hereby, all of the terms and provisions of the Credit
Agreement remain in full force and effect.
This letter may be executed in any number of counterparts, each of which
shall constitute an original but all of which when taken together shall
constitute but one contract.
[The remainder of this page has been left blank intentionally.]
NATIONSBANK, N.A.
By: /s/ X. Xxxxxx Xxxxx
Title: Senior Vice-President
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
By: /s/ Xxxxxxx X. XxXxxxxx
Title: Vice President
THE BANK OF NEW YORK
By: /s/ X. Xxxxxxx Xxxxxxxx
Title: Senior Vice President
FIRST UNION NATIONAL BANK OF
SOUTH CAROLINA
By: /s/ Xxxxx X. Xxxxxxxx
Title: Vice President
WACHOVIA BANK OF SOUTH CAROLINA
By: /s/ Xxxxxxx X. Xxxxxxxx
Title: Corporate Banking Officer
THE BANK OF NOVA SCOTIA
By: /s/ X. X. Xxxxxxx
Title: Senior Relationship Manager
PNC BANK, NATIONAL ASSOCIATION
By: /s/ Xxxxxx X. Xxxxxxxx, Xx.
Title: Vice President
NATWEST BANK N.A.
By: /s/ Xxxx X. Xxxxxx
Title: Assistant Vice President
ACCEPTED AND AGREED:
DELTA WOODSIDE INDUSTRIES, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
Title: Executive Vice President
ACKNOWLEDGED AND CONSENTED TO:
ALCHEM CAPITAL CORPORATION
DELTA XXXXX, INC.
DUCK HEAD APPAREL COMPANY, INC.
CARGUD, SOCIEDAD ANONIMA
ARMONIA TEXTIL, SOCIEDAD ANONIMA
NAUTILUS INTERNATIONAL, INC.
NAUTILUS DIRECT, INC.
DELTA CONSOLDIATED CORPORATION
DELTA MERCHANDISING, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
Xxxxxx X. Xxxxxxxxx
Executive Vice President for
each of the above corporations
cc: Xxxx X. Xxxxxxx, Esq.
