SIXTH AMENDMENT TO
FIRST AMENDED AND RESTATED CREDIT AGREEMENT
This SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT
(this "AGREEMENT") is entered into as of May 28, 1999 (the "EFFECTIVE DATE"),
by and among Haggar Clothing Co., a Nevada corporation, f/k/a Haggar Apparel
Company (the "COMPANY"), Haggar Corp., a Nevada corporation ("HAGGAR"), the
banks listed on the signature pages of this Agreement (collectively, the
"BANKS"), Chase Bank of Texas, National Association, a national banking
association, f/k/a Texas Commerce Bank National Association, individually and
as agent (the "AGENT") for the Banks, and is consented to by Haggar and the
domestic subsidiaries of the Company listed on the signature pages of this
Agreement (collectively, the "SUBSIDIARIES").
R E C I T A L S :
WHEREAS, pursuant to that certain First Amended and Restated Credit
Agreement (as heretofore and herein amended, the "CREDIT AGREEMENT") dated as
of September 18, 1996, executed by and among the Company, Haggar, the Banks
and the Agent, the Banks agreed to make advances to the Company on certain
terms and conditions set forth therein (each capitalized term used but not
defined herein shall have the meaning given to such term in the Credit
Agreement, as amended); and
WHEREAS, the Credit Agreement has been amended by that certain First
Amendment to First Amended and Restated Credit Agreement dated as of December
31, 1996, that certain Second Amendment to First Amended and Restated Credit
Agreement dated as of June 30, 1998, that certain Third Amendment to First
Amended and Restated Credit Agreement dated as of December 15, 1997, that
certain Fourth Amendment to First Amended and Restated Credit Agreement dated
as of June 30, 1998, and that certain Fifth Amended and Restated Credit
Agreement dated as of December 29, 1998; and
WHEREAS, the Company has requested that the Credit Agreement be
amended to, among other things, modify the Tangible Net Worth Covenant; and
WHEREAS, the Agent and the Banks are agreeable to such request under
the present circumstances and upon the terms and conditions as set forth
below.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged and confessed, the
Company, Haggar, the Banks and the Agent hereby agree as follows:
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 1
A G R E E M E N T:
1. AMENDMENT TO DEFINITIONS. The definition of Tangible Net Worth is
hereby deleted in its entirety from Section 1.1 of the Credit Agreement:
2. NET WORTH. SECTION 7.8 of the Credit Agreement is hereby amended
and restated in its entirety to read as follows:
7.8 NET WORTH.
(a) Permit Net Worth of the Company Group to be or
become less than an amount equal to the sum of (1)
$144,806,000, plus (2) fifty percent (50%) of the cumulative
net income of the Company Group, on a consolidated basis, for
the period commencing March 31, 1999, and ending September 30,
1999, and each subsequently completed fiscal year, plus (3) in
the event Haggar or the Company shall make a registered public
offering of its capital stock, sixty-six and two-thirds
percent (66-2/3%) of that portion of the net proceeds from
such offering attributable to the primary issuance of new
shares (but not the secondary issuance of existing shares).
(b) Permit Net Worth of the Company to be or become
less than $55,000,000.
(c) Notwithstanding the foregoing, in the event that
Net Worth is less than the amount required hereby, the Company
shall have a period of ten (10) days from the earlier of the
date on which Net Worth is disclosed to the Agent or is to be
disclosed to the Agent under Section 6.1 in which to cause Net
Worth to be in compliance with the terms hereof. Cumulative
net income shall be determined by reference to the statements
of income described in Section 6.1(a) and shall not be
decreased by any losses occurring during any fiscal year.
3. COMPLIANCE CERTIFICATE. The first annex to the Compliance
Certificate attached to the Credit Agreement as EXHIBIT G is hereby deleted
and replaced in its entirety with SCHEDULE I attached hereto.
4. CERTIFICATES. This Agreement shall be effective as of the date
first above written when executed by all parties hereto and consented to by
the Guarantors as provided on the signature pages hereto, and upon receipt by
the Agent of the following, each in form, substance and bearing a date
satisfactory to the Agent and its counsel:
(a) A certificate of the Secretary or Assistant Secretary of
the Company and the Guarantors, respectively, certifying (i) that,
except as indicated therein, there has been no change to the articles
of incorporation or bylaws of the Company or the Guarantors since the
same were furnished to the Agent in connection with the execution of
the Credit Agreement,
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 2
(ii) as to the name and title of the officers of the Company and the
Guarantors and the authority of such officers to execute this
Agreement; and (iii) as to the existence and good standing in their
respective states of incorporation of the Company and the Guarantors.
(b) A certificate, signed by the Treasurer of the Company or
the Chief Financial Officer of the Company, stating that as of the date
of this Agreement and after giving effect to this Agreement the
statements set forth in Sections 4.2(a), (b) and (g) of the Credit
Agreement are true and correct.
5. EFFECTIVENESS OF DOCUMENTS. Except as expressly modified hereby,
all terms, provisions, representations, warranties, covenants and agreements
of the Company and Haggar related to the Loans, whether contained in the
Notes, the Credit Agreement and/or any of the other Loan Documents, are
hereby ratified and confirmed by the Company and Haggar, and all such
agreements shall be and shall remain in full force and effect, enforceable in
accordance with their terms.
6. NO CLAIMS OR DEFENSES. Each of the Company and Haggar, by the
execution of this Agreement, hereby declares that it has no offsets, claims,
counterclaims, defenses or other causes of action against the Agent or the
Banks related to any Loan, the Credit Agreement, any of the other Loan
Documents or the modification of the Credit Agreement pursuant to this
Agreement.
7. AUTHORITY. Each of the Company and Haggar represents and warrants
that all requisite corporate action necessary for it to enter into this
Agreement has been taken.
8. BINDING AGREEMENT. This Agreement shall be binding upon, and
shall inure to the benefit of, each party hereto and such party's legal
representatives, successors and assigns.
9. ENTIRE AGREEMENT. THIS AGREEMENT AND THE LOAN DOCUMENTS REPRESENT
THE FINAL AGREEMENT AMONG THE PARTIES HERETO AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS AMONG THE
PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES
HERETO.
10. CHOICE OF LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF TEXAS,
BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
11. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one agreement, and
any of the parties hereto may execute this Agreement by signing any such
counterpart.
[SEE SIGNATURES ON ATTACHED PAGES]
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 3
EXECUTED as of the date first above written.
HAGGAR CLOTHING CO., a Nevada corporation,
f/k/a Haggar Apparel Company
By: /s/ X.X. Xxxxxx
---------------------------------------
X.X. Xxxxxx, III
Chief Executive Officer
HAGGAR CORP., a Nevada corporation
By: /s/ X.X. Xxxxxx
---------------------------------------
X.X. Xxxxxx, III
Chief Executive Officer
THE BANKS CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,
f/k/a TEXAS COMMERCE BANK National Association,
$22,222,222.22 Individually, as the Agent
By:
---------------------------------------
Xxx Xxxxxxxxx-Xxxxxx
Vice President
$22,222,222.22 NATIONSBANK, N.A.,
successor-in-interest by merger to
NationsBank of Texas, N.A.
By:
---------------------------------------
Xxxxx X. Xxxxxx
Senior Vice President
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 4
$18,518,518.51 COMERICA BANK - TEXAS
By:
---------------------------------------
Xxxx X. Xxxxxxx
Vice President
$11,111,111.12 THE FIRST NATIONAL BANK OF CHICAGO
By:
---------------------------------------
Xxxxxx Xxxxx
Vice President
$14,814,814.81 THE BANK OF TOKYO-MITSUBISHI, LTD.,
DALLAS OFFICE
By:
---------------------------------------
Xxxxxxx X. Xxxxxxx
Vice President
$11,111,111.12 NATIONAL CITY BANK, KENTUCKY,
f/k/a First National Bank of Louisville
By:
---------------------------------------
Xxxxxx X. Xxxxxx, Xx.
Vice President
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 5
CONSENT OF HAGGAR
Haggar hereby (a) acknowledges its consent to this Agreement, (b)
ratifies and confirms all terms and provisions of the Parent Guaranty , (c)
agrees that the Parent Guaranty is and shall remain in full force and effect,
(d) acknowledges that there are no claims or offsets against, or defenses or
counterclaims to, the terms and provisions of and the obligations created and
evidenced by the Parent Guaranty, (e) reaffirms all agreements and
obligations under the Parent Guaranty with respect to the Loans, the Notes,
the Credit Agreement and all other documents, instruments or agreements
governing, securing or pertaining to the Loans, as the same may be modified
by this Agreement, and (f) represents and warrants that all requisite
corporate action necessary for it to execute this Agreement has been taken.
HAGGAR CORP.,
a Nevada corporation
By: /s/ X.X. Xxxxxx
---------------------------------------
X.X. Xxxxxx, III
Chief Executive Officer
Dated as of May 28, 1999.
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 6
CONSENT OF DOMESTIC SUBSIDIARIES
Each of the undersigned Subsidiaries hereby (a) acknowledges its
consent to this Agreement, (b) ratifies and confirms all terms and provisions
of the Subsidiary Guaranty to which it is a signatory, (c) agrees that the
Subsidiary Guaranty to which it is a signatory is and shall remain in full
force and effect, (d) acknowledges that there are no claims or offsets
against, or defenses or counterclaims to, the terms and provisions of and the
obligations created and evidenced by the Subsidiary Guaranty to which it is a
signatory, (e) reaffirms all agreements and obligations under the Subsidiary
Guaranty to which it is a signatory with respect to the Loans, the Notes, the
Credit Agreement and all other documents, instruments or agreements
governing, securing or pertaining to the Loans, as the same may be modified
by this Agreement, and (f) represents and warrants that all requisite
corporate action necessary for it to execute this Agreement has been taken.
BOWIE MANUFACTURING COMPANY,
a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
CORSICANA COMPANY,
a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 7
DALLAS PANT MANUFACTURING COMPANY,
a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
GREENVILLE PANT MANUFACTURING
COMPANY, a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
XXXXXXXX PANT MANUFACTURING COMPANY,
a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
OLNEY MANUFACTURING COMPANY,
a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
WAXAHACHIE GARMENT COMPANY,
a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 8
LA ROMANA MANUFACTURING CORPORATION,
a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
HAGGAR SERVICES, INC.,
a Texas corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
AIRHAGGAR, INC., f/k/a HAGAIR, INC.,
a Texas corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
DUNCAN MANUFACTURING COMPANY,
an Oklahoma corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 9
WESLACO CUTTING, INC.,
a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
WESLACO SEWING, INC.,
a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
HAGGAR DIRECT, INC.,
a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
XXXXXX, INC.,
a Nevada corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 10
SAN XXXXXXX ENTERPRISES, INC.,
a Texas corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
MULTIPLES U.S.A., INC.,
a Texas corporation
By: /s/ X.X. Xxxxxx
-------------------------------------
X.X. Xxxxxx, III
Chairman/Chief Executive Officer
Dated as of May 28, 1999.
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 11
ANNEX TO COMPLIANCE CERTIFICATE
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COVENANT REQUIRED LEVEL CURRENT STATUS
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Funded Debt Ratio 3.50 to 1.00 _______ to 1.00
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Net Worth Company Group ____________(1) $____________
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Net Worth Company $55,000,000 $____________
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Inventory Turns 2.0 _____________
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Fixed Charge Ratio 1.25 to 1.00 _______ to 1.00
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(1) Show required level based on calculations in SECTION 7.8(a).
SIXTH AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT Page 12
