EXHIBIT 10.35
February 18, 1997
Xx. Xxxx X. Xxxxxx
Chief Financial Officer
Xxxxxx Color-Fi, Inc.
Star Fibers Corp.
Custom Colorants, Inc.
Xxxxxxxx Industries, Inc.
Palmetto Spinning Corporation
P.O. Box 469
Edgefield, SC 29824
Re: Modification of Revolving Credit Loan having a current maximum
principal availability of up to $25,000,000 extended by
NationsBank, N.A.
Dear Xxxx:
This letter shall serve as a written modification to that certain Second
Amended and Restated Loan and Security Agreement dated to be effective as of
December 16, 1996 (as amended or modified the "Loan Agreement") by and between
Xxxxxx Color-Fi, Inc., Star Fibers Corp., Custom Colorants, Inc., Xxxxxxxx
Industries, Inc. and Palmetto Spinning Corporation (collectively, the
"Borrowers") and NationsBank, N.A. ("NationsBank").
The Loan Agreement is amended by deleting the provision that reads "(ii)
sixty percent (60%) of the total principal outstanding under the Revolving
Credit Loan during the period of time commencing on any December 16, 1996 and
ending on January 31, 1997" at the end of the next to the last sentence of
Section 2.5 which appears on lines 4,5 and 6 of page 14 and substituting in lieu
thereof the following:
(ii) sixty percent (60%) of the total principal outstanding under
Revolving Credit Loan during the period of time commencing on
December 16, 1996 and ending on April 30, 1997.
The intent of the modification described in this letter is to provide Borrowers
a period of time commencing on December 16, 1996 and ending on April 30, 1997
during which the inventory "cap" will be raised from 50% of the total principal
outstanding under the Revolving Credit Loan to 60% of the total principal
outstanding under the Revolving Credit Loan. From and after May 1, 1997, the
maximum principal advanced and outstanding under the Revolving Credit Loan
against Eligible Inventory shall not exceed, at any time, fifty percent (50%) of
the total principal outstanding under the Revolving Credit Loan.
All capitalized terms not otherwise defined in this letter shall have the
meaning ascribed to such term in the Loan Agreement. All other terms and
conditions of the Loan Agreement and any other document executed in connection
with the Revolving Credit Loan (collectively, the "Loan Documents") shall remain
in full force and effect. Borrowers represent and warrant that, as of the date
of this letter; (i) all representations contained in the Loan Agreement or the
Loan Documents are true and accurate; (ii) all covenants contained in the Loan
Agreement and the Loan Documents have been and remain satisfied; and (iii) no
Event of Default exists or no condition exists which with the giving of notice
for the passage of time, or both, would constitute an Event of Default under
Loan Agreement or the Loan Documents.
As a condition to NationsBank providing the modification to the inventory
"cap" as described herein, Borrowers shall pay to NationsBank a fee equal to
$15,000.00 which is due and payable upon acceptance of this letter by the
Borrowers and must be received by NationsBank prior to NationsBank being bound
by the terms and conditions of this letter agreement.
98
Xx. Xxxx X. Xxxxxx
February 18, 1997
Please have all parties execute the original of this letter to indicate
each of the Borrower's agreement to be bound by the terms and conditions of this
letter and return the original fully-executed letter to me as soon as possible.
This letter agreement will be binding on all parties upon our receipt of the
original fully-executed and dated letter and our fee.
Kindest regards,
NationsBank, N.A.
Xxxx X. "Mze" Xxxxxxx
Senior Vice President
Xx. Xxxx X. Xxxxxx
February 18, 1997
Page 96
99
Agreed to on this day of February, 1997.
BORROWERS:
XXXXXX COLOR-FI, INC.
STAR FIBERS CORP.
CUSTOM COLORANTS, INC.
XXXXXXXX INDUSTRIES, INC.
PALMETTO SPINNING CORPORATION
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