Exhibit 10.2
THIRD AMENDMENT TO
CREDIT AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AGREEMENT ("Third Amendment") is dated as of
December 16, 2004 by and among Xxxxxxx Fabrics, Inc. ("Borrower"); and Xxxxxxx
Fabrics of Mi, Inc., HF Merchandising, Inc., HF Resources, Inc., HF Enterprises,
Inc., Xxxxxxx Fabrics, LLC and XxxxxxxXxxxxxx.xxx, Inc. ("Guarantors"); Union
Planters Bank, National Association ("Union Planters"); and BancorpSouth Bank
("Bancorp").
RECITALS
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The parties hereto, along with Wachovia Bank, N.A. ("Wachovia"), executed
that certain Credit Agreement ("Credit Agreement") dated as of April 16, 1999.
The Credit Agreement provided for a revolving credit facility in the
principal amount of Sixty Million and No/100 Dollars ($60,000,000.00).
The Credit Agreement was amended by that certain First Amendment to Credit
Agreement dated March 26, 2002, by and among Borrower, Union Planters and
Bancorp (the "First Amendment").
Pursuant to the First Amendment, Union Planters agreed to serve as Agent
under the terms of the Credit Agreement, the amount of the revolving credit
facility was reduced to $25,000,000.00 and South Trust Bank and Wachovia ceased
participation in the credit facility.
The Credit Agreement was further amended by that certain Second Amendment,
whereby, among other things, the Termination Date of the Credit Agreement was
extended to March 26, 2007 and the Guarantors agreed to unconditionally
guarantee the obligation of Borrower to Union Planters and Bancorp.
Section 5.06 of the Credit Agreement requires that Borrower maintain the
ratio of Income Available for Fixed Charges for the period of four consecutive
Fiscal Quarters then ended to Consolidated Fixed Charges for such period to be
greater than 1.50 to 1.0.
Borrower has requested that Section 5.06 be modified.
Union Planters and Bancorp have agreed to the modification upon the terms
and conditions hereafter set forth.
The parties have agreed to execute this Third Amendment to set forth their
understandings with respect to the modification of the revolving credit
facility.
NOW, THEREFORE, the parties do mutually covenant and agree as follow
1. Amendment. Section 5.06 is hereby amended by striking the language thereof in
its entirety and substituting the following:
Section 5.06. Fixed Charges Coverage. At the end of each Fiscal Quarter,
beginning with the Fiscal Quarter ending October 31, 2004, the ratio of
Income Available for Fixed Charges for the period of four (4) consecutive
Fiscal Quarters then ended to Consolidated Fixed Charges for the period of
four (4) consecutive Fiscal Quarters then ended, shall be greater than (a)
1.35 to 1.00 for each Fiscal Quarter ending on or before January 31, 2006
and (b) 1.40 to 1.00 for each Fiscal Quarter thereafter.
2. Terms of Credit Agreement. All terms under the Credit Agreement, as
previously amended, and related loan documents not herein specifically modified
or amended shall remain in full force and effect and are hereby reaffirmed by
Borrower and incorporated herein by reference as if fully set forth. Borrower
specifically affirms that all representations and warranties made pursuant to
Article IV of the Credit Agreement as well as all covenants made pursuant to
Article V of the Credit Agreement, not herein amended, or previously amended are
true and accurate as if made as of the date hereof.
3. Fee. For and in consideration of modifying the Credit Agreement as herein set
out, Borrower agrees to pay Union Planters and Bancorp a one-time fee of
$62,500.00, due on the execution of this Amendment.
4. Capitalized Terms. Except as otherwise set forth herein, all capitalized
terms shall have the meanings as set forth in the Credit Agreement, as amended.
5. Binding Agreement. This Third Amendment to the Credit Agreement shall be
binding upon and inure to the benefit of the parties hereto, their respective
heirs, next of kin, successors, permitted assigns, transferees and grantees.
IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to
the Credit Agreement to be duly executed by their respective authorized officers
as of the day and year first above written.
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XXXXXXX FABRICS, INC.
By: /s/ Xxxxx X. Xxxxx
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Title: Senior Vice President and CFO
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0 Xxxxxxx Xxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Telecopy number
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Telephone number
--------------------------
3
XXXXXXX FABRICS OF MI, INC.
By: /s/ Xxxxx X. Xxxxx
---------------------------------------
Title: Vice President
------------------------------------
0 Xxxxxxx Xxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Telecopy number
---------------------------
Telephone number
--------------------------
4
HF MERCHANDISING, INC.
By: /s/ Xxxxx X. Xxxxx
---------------------------------------
Title: Vice President
------------------------------------
0 Xxxxxxx Xxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Telecopy number
---------------------------
Telephone number
--------------------------
5
HF RESOURCES, INC.
By: /s/ Xxxxx X. Xxxxx
---------------------------------------
Title: Vice President
------------------------------------
0 Xxxxxxx Xxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Telecopy number
---------------------------
Telephone number
--------------------------
6
HF ENTERPRISES, INC.
By: /s/ Xxxxx X. Xxxxx
---------------------------------------
Title: Vice President
------------------------------------
0 Xxxxxxx Xxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Telecopy number
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Telephone number
--------------------------
7
XXXXXXX FABRICS, L.L.C.
By: /s/ Xxxxx X. Xxxxx
---------------------------------------
Title: Vice President
------------------------------------
0 Xxxxxxx Xxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Telecopy number
---------------------------
Telephone number
--------------------------
8
XxxxxxxXxxxxxx.xxx, INC.
By: /s/ B. Xxxxxxx Xxxxxxxx
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Title: President
------------------------------------
0 Xxxxxxx Xxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Telecopy number
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Telephone number
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9
Commitment UNION PLANTERS BANK,
$20,000,000.00 NATIONAL ASSOCIATION
By: /s/ Coney Burgess
---------------------------------------
Title: Vice President
------------------------------------
Lending Office
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0000 Xxxxxx Xxxxxx
XX0
Xxxxxxx, Xxxxxxxxx 00000
Attention: Coney Burgess
Telecopy number: (000) 000-0000
Telephone number: (000) 000-0000
10
Commitment BANCORPSOUTH BANK
$5,000,000.00
By: /s/ Xxx Xxxxxxxxxx
---------------------------------------
Title:
------------------------------------
Lending Office
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Xxx Xxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxx 00000
Attention:
--------------------------------
Telecopy number:
--------------------------
Telephone number:
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