FIRST AMENDMENT TO CREDIT AGREEMENT
dated as of August 10, 1995
Among
SIGNAL APPAREL COMPANY, INC.,
THE SHIRT SHED, INC.,
AMERICAN MARKETING WORKS, INC.,
and
WALSH GREENWOOD & CO.
Index of Closing Documents
--------------------------
1. First Amendment to Credit Agreement
a. Signal Apparel Company, Inc. Officers' Certificate
b. The Shirt Shed, Inc. Officers' Certificate
c. American Marketing Works, Inc. Officers'
Certificate
2. Promissory Note
3. Fixed Rate Warrant Certificate
4. Floating Rate Warrant certificate
5. First Amendment to Tennessee Deed of Trust and Security
Agreement
6. First Amendment to Deed to Secure Debt and Security Interest
7. First Amendment to Real Estate Mortgage, Security Agreement,
Assignment Leases and Rents and Fixture Filing
8. UCC-3 Amendment for Signal Apparel Company, Inc. (as filed
with the Tennessee Secretary of State)
9. UCC-3 Amendment for The Shirt Shed, Inc. (as filed with the
Tennessee Secretary of State)
10. UCC-3 Amendment for American Marketing Works, Inc. (as filed
with the Tennessee Secretary of State)
11. UCC-3 Amendment for Signal Apparel Company, Inc. (as with
the Register of Deeds of Claiborne County)
FIRST AMENDMENT TO CREDIT AGREEMENT
dated as of August 10, 1995
Among
SIGNAL APPAREL COMPANY, INC.,
THE SHIRT SHED, INC.,
AMERICAN MARKETING WORKS, INC.,
and
WALSH GREENWOOD & CO
FIRST AMENDMENT TO CREDIT AGREEMENT
AGREEMENT, entered as of the 10th day of August, 1995
by and among SIGNAL APPAREL COMPANY, INC., an Indiana
corporation ("Signal"), THE SHIRT SHED, INC., a Delaware
corporation ("SSI"), AMERICAN MARKETING WORKS, INC., a
Delaware corporation ("AMW") and WALSH GREENWOOD & CO., a
New York limited partnership (the "Lender").
WHEREAS, the parties entered a Credit Agreement, dated
as of March 31, 1995, (the "Credit Agreement") and certain
other documents defined in the Credit Agreement as the "Loan
Documents" by which the Lender extended to Signal, SSI and
AMW loans in the amount of $15,000,000; and
WHEREAS, Signal, SSI and AMW desire to borrow an
additional Five Million Dollars ($5,000,000), in excess of
the Commitment, as defined in the Credit Agreement, and
desires to amend the Credit Agreement to effect such
borrowing; and
WHEREAS, Lender is willing to loan to Signal, SSI and
AMW an additional Five Million Dollars ($5,000,000) (the
"Additional Loan") and to amend the Credit Agreement in
accordance with the terms of this First Amendment to Credit
Agreement (the "First Amendment").
NOW, THEREFORE, for and in consideration of the
foregoing, the parties agree as follows:
1. All terms not specifically defined herein shall
have the meaning ascribed to them in the Credit Agreement or
the Loan Documents, as defined in the Credit Agreement.
2. The definitions of "Commitment" and "Loan
Documents" contained in Section 1.1 of the Credit Agreement
shall be replaced with the following:
Commitment: the obligation of the Lender to
make Loans to Signal pursuant to Section 2.1, in a
maximum principal amount of $20,000,000, as such amount
may be reduced from time to time pursuant to this
Agreement.
Loan Documents: this First Amendment; the
Agreement; the Fixed Rate Warrants; the Discount Rate
Warrant; the Note; the Replacement Note; the Real Estate
Mortgage, Security Agreement, Assignment of Leases,
Rents and Fixture Filing; the Tennessee Deed of Trust
and Security Agreement; the Deed to Secure Debt and
Security Interest; UCC financing statements covering
both personalty and fixtures; the Intercreditor
Agreement; the Shareholders' Agreement and other
documents, agreements, certificates, schedules or
exhibits called for in any of the foregoing or otherwise
required of the Company to effect the purposes hereof.
3. The Additional Loan shall be evidenced by a
replacement promissory note of the Company , Substantially
in the form of Exhibit A (the "Replacement Note") evidencing
the obligation of the Company to pay a principal amount
equal to the lesser of (a) the amount of the Commitment and
(b) the Principal Amount, on the Maturity Date, together
with any accrued and unpaid interest. The Replacement Note
shall (x) be dated as of the Closing Date, (y) be stated to
mature on the Maturity Date, and (z) bear interest on the
unpaid Principal Amount thereof from time to time
outstanding as provided in Section 2.5. Interest on the
Replacement Note shall be paid in accordance with Section
2.5(c). All Additional Loans pursuant to the Commitment as
amended by this First Amendment, the Replacement Note and
all obligations of the Company under this First Amendment
shall be Obligations of the Company the payment of which is
secured by the security interests in the Collateral granted
Lender by the Company pursuant to Section 3. Upon the
execution and delivery of the Replacement Note, all
references to the "Note" in any of the Loan Documents shall
mean the Replacement Note without the need for further
amendment of any of the Loan Documents.
4. Upon the execution hereof by all parties, Signal
shall issue to Lender an additional 500,000 Fixed Rate
Warrants, for a total of 2,000,000 Fixed Rate Warrants,
which shall be treated in all respects as Fixed Rate
Warrants issued pursuant to Section 4.1.
5. Upon the execution hereof by all parties, Signal
shall issue to Lender an additional 500,000 Discount Rate
Warrants, for a total of 2,000,000 Discount Rate Warrants,
which will vest immediately and which otherwise will be
treated in all respects as Discount Rate Warrants issued
pursuant to Section 4.2.
6. In order to induce the Lender to enter into this
First Amendment and to make the Additional Loan, the Company
hereby represents and warrants to the Lender that, except as
reflected in the most recent Form 10-K and the most recent
Form 10-Q filed by Signal with the Untied States Securities
and Exchange Commission, and except as further qualified in
the Agreement (including any amendments to Schedules
provided thereunder), all of the representations and
warranties of the Company contained in Section 5 of the
Agreement are true and accurate as of the date hereof;
provided, however, the financial statements referred to in
Sections 5.1 and 5.2 shall be the audited year end financial
statements as of December 31, 1994.
7. The agreement of the Lender to make the Additional
Loan and the effectiveness and of this First Amendment shall
be subject to the satisfaction, immediately prior to or
concurrently with the making of such Additional Loan of the
following conditions precedent:
(a) Loan Documents. The Lender shall have
received each Loan Document, including, without
limitation, this First Amendment, the Replacement Note,
and the additional Fixed Rate Warrants and Discount Rate
Warrants, in each case executed and delivered by a duly
authorized officer of the Company.
(b) Corporate Proceedings of the Company. The
Lender shall have received a copy of the resolutions in
form and substance reasonably satisfactory to the
Lender, of the Board of Directors of each of Signal, SSI
and AMW authorizing (i) the execution, delivery and
performance of the First Amendment, the Replacement
Note, the additional Fixed Rate Warrants and Discount
Rate Warrants and all other documents and agreements
required of the Company required hereunder and (ii) the
borrowing contemplated hereunder, certified by the
Secretary of each of SSI, AMW and Signal, as of the
effective date of this First Amendment, which
certificate shall state that the resolutions thereby
certified have not been amended, modified, revoked or
rescinded as of the date of such certificate.
(c) Corporate Documents. Lender shall have
received a certificate from the Secretary of each of
AMW, SSI and Signal that the copies of the Restated
Articles of Incorporation and By-Laws of Signal, SSI and
AMW delivered as of the Closing Date remain true,
complete and correct copies thereof as of the date
hereof and have not been amended, restated or revoked.
(d) Financial Information. The Lender shall have
received a copy of each of the financial statements
referred to in Section 5.1.
(e) Litigation. No suit, action, investigation,
inquiry or other proceeding except as disclosed herein
(including, without limitation, the enactment or
promulgation of a statute or rule) by or before any
arbitrator or any Governmental Authority shall be
pending and no preliminary or permanent injunction or
order by a state or federal court shall have been
entered (i) in connection with this First Amendment, or
(ii) which, in any such case, in the reasonable judgment
of the Lender, would have a material adverse effect on
(A) the transactions contemplated by this First
Amendment or (B) the business, operations, properties,
prospects or financial or other condition of Signal and
its Subsidiaries taken as a whole.
(f) No Violation. The consummation of the
transactions contemplated hereby shall not contravene,
violate or conflict with, nor involve the Lender in a
violation of, any Requirement of Law.
(g) Consents, Licenses, Approvals, Etc. The
Lender shall have received a certificate of a
Responsible Officer of Signal either (i) attaching
copies of all consents, licenses and approvals required
in connection with the execution, delivery and
performance by Signal and its Subsidiaries of each Loan
Document, including, but not limited to, consents of the
Company's senior bank lenders, and such consents,
licenses and approvals shall be in full force and
effect, or (ii) stating that no such consents, license
or approval are so required (Schedule 6.1(g)).
(h) Representations and Warranties. Each of the
representations and warranties restated by the Company
in accordance with Paragraph 6 hereof shall be true and
correct in all material respects on and as of the
Effective Date as if made on and as of such date.
(i) No Default. No Default or Event of Default
shall have occurred and be continuing on such date or
after giving effect to such Loan.
(j) Security Interest. The security interests in
personal property granted by the Agreement as amended
hereby shall be duly perfected in accordance with
applicable state law, and Signal and SSI shall have
executed and presented for filing any amendments to the
Deed to Secure Debt and Security Interest, the Real
Estate Mortgage, Security Agreement, Assignment of
Leases, Rents and Fixture Filing, the Tennessee Deed of
Trust and Security Agreement, and the filings made under
the Uniform Commercial Code necessary to reflect this
amendment and the Additional Loans and shall have paid
or tendered for payment all additional taxes and fees.
8. Signal agrees (a) to pay or reimburse the Lender in
an amount up to, but not exceeding, $25,000 for all its out-
of-pocket costs and expenses incurred in connection with the
development, preparation and execution of this First
Amendment, the Replacement Note and any other documents
prepared in connection therewith, including the fees and
disbursements of counsel to the Lender, (b) to pay or
reimburse the Lender for all its costs and expenses incurred
in connection with the development, preparation and execution
of any amendment, supplement or modification thereto, or the
enforcement or preservation of any rights under any Loan
Document and any other such documents and any such amendment,
supplement or modification thereto, including, without
limitation, reasonable fees and disbursements of counsel to
the Lender, (c) to pay, indemnify, and hold the Lender
harmless from, any and all recording and filing fees and any
and all liabilities with respect to, or resulting from any
delay in paying, stamp, excise, franchise and other taxes, if
any, which may be payable or determined to be payable in
connection with the execution and delivery of, or any
amendment, supplement or modification of, or any waiver or
consent under or in respect of this First Amendment(provided
that Signal shall have the right to contest before the
relevant Governmental Authority any such tax that may be
assessed), and (d) to pay, indemnify, and hold the Lender
harmless from and against any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses and disbursements of any kind or nature
whatsoever with respect to the execution, delivery,
enforcement, performance and administration of this First
Amendment and the transactions contemplated hereby and any
such other documents (all the foregoing, collectively, the
"indemnified liabilities"), provided, that Signal shall have
no obligation hereunder to the Lender with respect to willful
misconduct of the Lender. The agreements in this Section
shall survive repayment of the Replacement Note and all other
amounts payable under the Loan Documents.
9. This First Amendment may be executed by one or more
of the parties to this First Amendment on any number of
separate counterparts and all of said counterparts taken
together shall be deemed to constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed and delivered in New York
by their proper and duly authorized officers as of the day and
year first above written.
SIGNAL APPAREL COMPANY, INC.
By /s/William H. Watts
-------------------------
Title CFO
----------------------
THE SHIRT SHED, INC.
By /s/William H. Watts
-------------------------
Title CFO
-----------------------
AMERICAN MARKETING WORKS, INC.
By /s/ William H. Watts
-------------------------
Title CFO
-----------------------
WALSH GREENWOOD & COMPANY
By /s/Paul R. Greenwood
--------------------------
Title
-----------------------
SIGNAL APPAREL COMPANY, INC. OFFICERS' CERTIFICATE
To: Walsh Greenwood & Co., party to the Credit Agreement
referred to herein.
This Officers' Certificate is given in connection with the First
Amendment to Credit Agreement dated as of August 10, 1995 (the
"Amendment") among Signal Apparel Company, Inc. (the "Company"),
American Marketing Works, Inc., The Shirt Shed Inc. and Walsh
Greenwood & Co. (the "Lender"). The Amendment modifies
provisions of a Credit Agreement, dated as of March 31, 1995 by
and among the Lender, the Company, American Marketing Works, Inc.
and The Shirt Shed, Inc. (the "Credit Agreement"). Capitalized
terms used herein and not defined herein have the meanings
assigned to them by or pursuant to the terms of the Credit
Agreement and the Amendment.
I.
We, Robert Powell and William Watts, Chief Financial Officer of
the Company, do hereby certify as follows:
1. Attached hereto as Exhibit A is a true, correct, and
complete copy of the resolutions duly adopted by the Board of
Directors of the Company at a meeting held on August 10, 1995 at
which a quorum was present and acting throughout. Such
resolutions have not been amended, modified or rescinded, are in
full force and effect on the date hereof in the form adopted, and
are the only resolutions adopted by the Board of Directors or any
committee thereof relating to the Loan Documents.
II.
Robert Powell, as the Secretary of the Company, certifies that
William Watts, as Chief Financial Officer of the Company is a
duly elected or appointed officer of the Company and is
authorized to execute and deliver the Amendment, the Replacement
Note and the other Loan Documents on behalf of the Company.
III.
This portion of the Officers' Certificate is given by William
Watts, as Chief Financial Officer of the Company (the "Executive
Officer").
The Executive Officer hereby certifies that:
1. No Default has occurred and is continuing, nor will the
Amendment or the Loan being requested on the date hereof create a
Default; and
2. The representations and warranties made by the Company in
the Amendment are true and correct in all material respects on
and as of the date of this certificate;
The Executive Officer also certifies that:
A. Robert Powell is the duly elected Secretary of the Company
and is authorized to execute and deliver the Credit Agreement and
the Notes on behalf of the Company.
In making the foregoing certification, the Executive Officer has
read, in particular, Paragraphs 6 and 7 of the Amendment and all
Sections of the Credit Agreement incorporated or referenced by
such paragraphs and all definitions used in that Amendment and in
the Credit Agreement to the extent unchanged by the Amendment.
The Executive Officer states that he has made such examination or
investigation as is necessary to enable him to express an
informed opinion as to whether or not each such covenant or
condition has been complied with.
In rendering this certification, the Executive Officer made
inquiries of the appropriate employees of the Company and of
advisors to the Company, including but not limited to, its
accountants, actuaries, and attorneys.
IN WITNESS WHEREOF, I have signed this Officers' Certificate and
affixed the corporate seal of the Company.
Dated August 10, 1995.
----------------
/s/Robert Powell
- ----------------------
Robert Powell
Secretary
IN WITNESS WHEREOF, each of the undersigned officers of the
Company has signed this Officers' Certificate.
Dated August 10, 1995.
----------------
/s/William Watts
- ----------------------
William Watts
Chief Financial Officer
RESOLUTIONS
OF THE
BOARD OF DIRECTORS
OF
SIGNAL APPAREL COMPANY, INC.
ADOPTED
MARCH 31, 1995
On August 10, 1995 the members of the Board of Directors of
Signal Apparel Company, Inc. (the "Company"), participating in a
duly called meeting held by telephone in accordance with the
Bylaws of the Company, approved the following resolutions:
WHEREAS, the Company desires additional working capital to
fund current operations; and
WHEREAS, Walsh Greenwood & Co. ("Walsh Greenwood") has
offered to amend the Credit Agreement, dated as of March 31, 1995
(the "Credit Agreement"), and to lend to the Company an
additional principal amount of up to $5,000,000 pursuant to the
terms of the Credit Agreement as amended by the First Amendment
to Credit Agreement presented to the Board (the "Amendment"), the
principle terms of which include:
1. a maximum borrowing of an additional $5 million for a
total of up to $20 million which shall be drawn in increments of
not less than $1 million upon notice received two business days
prior to each draw;
2. the issuance to Walsh Greenwood of warrants to purchase
500,000 shares of the Company's Common Stock at $2.25 per share,
which warrants will vest on the basis of 100,000 warrants for
each $1 million drawn and which will be exercisable for three
years from vesting, such warrants containing provisions
substantially similar to those of the Fixed Rate Warrants issued
under the Credit Agreement;
3. the issuance to Walsh Greenwood of warrants to purchase
500,000 shares of the Company's Common Stock at a 25% discount to
the 20 day average trade price in December, 1996, which warrants
will vest immediately upon the commitment by Walsh Greenwood of
the full amount of the additional credit and which will be
exercisable for three years beginning January 1, 1997, such
warrants containing provisions substantially similar to the
Discount Rate Warrants issued under the Credit Agreement;
4. a Replacement Note in the face amount of $20 million will
evidence the borrowing and will be upon terms substantially
similar to the Note issued pursuant to the Credit Agreement;
7. all borrowings will continue to be secured by a security
interest in all assets of the Company currently pledged to its
senior lenders, but will be subordinate to the security interests
of such lenders;
8. all borrowings shall be used only for working capital and
shall not be used to repay any principal of any bank debt;
9. such covenants as are contained in the Credit Agreement
WHEREAS, Messrs. Greenwood and Walsh have informed the Board
that they may be deemed to have financial or management
interests, which they have fully disclosed to the Board, in Walsh
Greenwood sufficient to create the possibility of a conflict of
interest as contemplated by Section 23-1-35-2 of the Indiana
Business Corporation Law; and
WHEREAS, pursuant to the terms of Section 23-1-35-2 of the
Indiana Business Corporation Law, approval of the aforementioned
transactions by a majority of the members of the Board of
Directors other than Messrs. Greenwood and Walsh will result in
the approval of the transactions by a majority of disinterested
directors; and
WHEREAS, in connection with the Credit Agreement, the
Company received an opinion from the firm of Value Research
Corporation concerning the Credit Agreement and related
transactions, to the effect that the transactions were fair, from
a financial point of view, to the existing investors in the
Company's Common Stock and to the creditors of the Company as a
group; and
WHEREAS, after having reviewed and considered: (i) the
information disclosed to the Board by Messrs. Greenwood and
Walsh, concerning their financial or management interests in
certain of the entities (other than the Company) which are
parties to the proposed transactions, (ii) the opinion of Value
Research Corporation that the transactions in connection with the
Credit Agreement are fair, from a financial point of view, to the
existing investors in the Company's Common Stock and to the
creditors of the Company as a group, and (iii) the recommendation
of management of the Company to the effect that the proposed
amendment of the Credit Agreement is fair to and in the best
interest of the Company, its creditors and its shareholders, the
Board has concluded that the plan submitted by management to
enter into such amendment will enable the Company adequately to
fund its working capital requirements and will enhance the value
of the Company's business,
NOW THEREFORE, be it
RESOLVED that the officers of the Company be authorized and
directed to borrow from Walsh Greenwood an additional principal
amount of up to $5,000,000 for a total of up to $20 million in
accordance with the terms of the Amendment, in all events
subordinate to security interests previously granted to the
Company's senior bank lenders; and to issue to Walsh Greenwood
the Fixed Rate Warrants and the Discount Rate Warrants; and
FURTHER RESOLVED, that the Company be authorized and
directed to issue its Common Stock in accordance with the terms
of the new Fixed Rate Warrants and the Discount Rate Warrants
and, should the Company not possess sufficient authorized and
unissued shares for such purpose, or should shareholder approval
be required as a prerequisite to the issuance of such shares
under any governmental statute or regulation or under the rules
of the New York Stock Exchange, that the Company be authorized to
present for vote of the shareholders of the Company at the next
meeting of shareholders following the discovery of such
insufficiency or requirement a proposal to (i) increase the
number of authorized shares of the Company's Common Stock, by
amendment of the Company's Restated Articles of Incorporation or
otherwise, in an amount at least sufficient to satisfy the
requirements of the warrants or (ii) approve the issuance of such
shares in accordance with the terms of the warrants, as
applicable; and
FURTHER RESOLVED, that the proper officers of the Company
are hereby authorized, directed and empowered to negotiate,
execute, deliver and perform the Amendment, warrants, notes,
amendments to mortgages and all other documents or certificates
necessary or desirable in connection with the foregoing; and that
the proper officers of the Company are directed and empowered to
take all such further actions as, in their judgment, they deem
necessary, desirable or proper to implement the foregoing
resolutions.
THE SHIRT SHED, INC. OFFICERS' CERTIFICATE
To: Walsh Greenwood & Co., party to the Credit Agreement
referred to herein.
This Officers' Certificate is given in connection with the First
Amendment to Credit Agreement dated as of August 10, 1995 (the
"Amendment") among The Shirt Shed Inc. (the "Company"), American
Marketing Works, Inc., Signal Apparel Company, Inc. and Walsh
Greenwood & Co. (the "Lender"). The Amendment modifies
provisions of a Credit Agreement, dated as of March 31, 1995 by
and among the Lender, the Company, American Marketing Works, Inc.
and Signal Apparel Company, Inc. (the "Credit Agreement").
Capitalized terms used herein and not defined herein have the
meanings assigned to them by or pursuant to the terms of the
Credit Agreement and the Amendment.
I.
We, Robert Powell and William Watts, Chief Financial Officer of
the Company, do hereby certify as follows:
1. Attached hereto as Exhibit A is a true, correct, and
complete copy of the resolutions duly adopted by the Board of
Directors of the Company at a meeting held on August 10, 1995 at
which a quorum was present and acting throughout. Such
resolutions have not been amended, modified or rescinded, are in
full force and effect on the date hereof in the form adopted, and
are the only resolutions adopted by the Board of Directors or any
committee thereof relating to the Loan Documents.
II.
Robert Powell, as the Secretary of the Company, certifies that
William Watts, as Chief Financial Officer of the Company is a
duly elected or appointed officer of the Company and is
authorized to execute and deliver the Amendment, the Replacement
Note and the other Loan Documents on behalf of the Company.
III.
This portion of the Officers' Certificate is given by William
Watts, as Chief Financial Officer of the Company (the "Executive
Officer").
The Executive Officer hereby certifies that:
1. No Default has occurred and is continuing, nor will the
Amendment of the Loan being requested on the date hereof create a
Default; and
2. The representations and warranties made by the Company in
the Amendment are true and correct in all material respects on
and as of the date of this certificate;
The Executive Officer also certifies that:
A. Robert Powell is the duly elected Secretary of the Company
and is authorized to execute and deliver the Credit Agreement and
the Notes on behalf of the Company.
In making the foregoing certification, the Executive Officer has
read, in particular, Paragraphs 6 and 7 of the Amendment and all
Sections of the Credit Agreement incorporated or referenced by
such paragraphs and all definitions used in that Amendment and in
the Credit Agreement to the extent unchanged by the Amendment.
The Executive Officer states that he has made such examination or
investigation as is necessary to enable him to express an
informed opinion as to whether or not each such covenant or
condition has been complied with.
In rendering this certification, the Executive Officer made
inquiries of the appropriate employees of the Company and of
advisors to the Company, including but not limited to, its
accountants, actuaries, and attorneys.
IN WITNESS WHEREOF, I have signed this Officers' Certificate and
affixed the corporate seal of the Company.
Dated August 10, 1995.
/s/Robert J. Powell
- --------------------------
Robert Powell
Secretary
IN WITNESS WHEREOF, each of the undersigned officers of the
Company has signed this Officers' Certificate.
Dated August 10, 1995.
/s/William Watts
- --------------------------
William Watts
Chief Financial Officer
RESOLUTIONS OF THE BOARD OF DIRECTORS
OF
THE SHIRT SHED, INC.
RESOLVED, whereas the Company requires
additional working capital to fund its operations;
whereas the Company entered a Credit Agreement, dated
March 31, 1995, with Walsh Greenwood & Co. (the "Credit
Agreement") pursuant to which the Company and its
affiliates borrowed $15,000,000; whereas Walsh Greenwood
& Co. is willing to amend the Credit Agreement to
increase the maximum of borrowing thereunder to
$20,000,000 upon the terms and conditions of a
First Amendment to Credit Agreement (the "Amendment")
presented to the Board, the Company hereby is authorized
and directed to enter the Amendment and all other
agreements and amendments referenced thereby and to borrow
up to $20,000,000 upon the terms specified in the
Amendment; and
FURTHER RESOLVED, that the officers of the Company
be authorized and directed to execute upon behalf of
the Company the Amendment, a First Amendment to Real
Estate Mortgage, Security Agreement, Assignment of Leases
and Rents and Fixture Filing and such other documents,
certificates, and agreements as may be required under the
Amendment or to effect the foregoing resolution.
AMERICAN MARKETING WORKS, INC. OFFICERS' CERTIFICATE
To: Walsh Greenwood & Co., party to the Credit Agreement
referred to herein.
This Officers' Certificate is given in connection with the First
Amendment to Credit Agreement dated as of August 10, 1995 (the
"Amendment") among American Marketing Works, Inc. (the
"Company"), Signal Apparel Company, Inc., The Shirt Shed Inc. and
Walsh Greenwood & Co. (the "Lender"). The Amendment modifies
provisions of a Credit Agreement, dated as of March 31, 1995 by
and among the Lender, the Company, Signal Apparel Company, Inc.
and The Shirt Shed, Inc. (the "Credit Agreement"). Capitalized
terms used herein and not defined herein have the meanings
assigned to them by or pursuant to the terms of the Credit
Agreement and the Amendment.
I.
We, Robert Powell and William Watts, Vice President/Finance of
the Company, do hereby certify as follows:
1. Attached hereto as Exhibit A is a true, correct, and
complete copy of the resolutions duly adopted by the Board of
Directors of the Company at a meeting held on August 10, 1995 at
which a quorum was present and acting throughout. Such
resolutions have not been amended, modified or rescinded, are in
full force and effect on the date hereof in the form adopted, and
are the only resolutions adopted by the Board of Directors or any
committee thereof relating to the Loan Documents.
II.
Robert Powell, as the Secretary of the Company, certifies that
William Watts, as Vice President/Finance of the Company is a duly
elected or appointed officer of the Company and is authorized to
execute and deliver the Amendment, the Replacement Note and the
other Loan Documents on behalf of the Company.
III.
This portion of the Officers' Certificate is given by William
Watts, as Chief Financial Officer of the Company (the "Executive
Officer").
The Executive Officer hereby certifies that:
1. No Default has occurred and is continuing, nor will the
Amendment or the Loan being requested on the date hereof create a
Default; and
2. The representations and warranties made by the Company in
the Amendment are true and correct in all material respects on
and as of the date of this certificate;
The Executive Officer also certifies that:
A. Robert Powell is the duly elected Secretary of the Company
and is authorized to execute and deliver the Credit Agreement and
the Notes on behalf of the Company.
In making the foregoing certification, the Executive Officer has
read, in particular, Paragraphs 6 and 7 of the Amendment and all
Sections of the Credit Agreement incorporated or referenced by
such paragraphs and all definitions used in that Amendment and in
the Credit Agreement to the extent unchanged by the Amendment.
The Executive Officer states that he has made such examination or
investigation as is necessary to enable him to express an
informed opinion as to whether or not each such covenant or
condition has been complied with.
In rendering this certification, the Executive Officer made
inquiries of the appropriate employees of the Company and of
advisors to the Company, including but not limited to, its
accountants, actuaries, and attorneys.
IN WITNESS WHEREOF, I have signed this Officers' Certificate and
affixed the corporate seal of the Company.
Dated August 10, 1995.
/s/Robert J. Powell
- -------------------------
Robert Powell
Secretary
IN WITNESS WHEREOF, each of the undersigned officers of the
Company has signed this Officers' Certificate.
Dated August 10, 1995.
/s/William Watts
- -------------------------
William Watts
Vice President/Finance
RESOLUTIONS OF THE BOARD OF DIRECTORS
OF
AMERICAN MARKETING WORKS, INC.
RESOLVED, whereas the Company requires
additional working capital to fund its operations;
whereas the Company entered a Credit Agreement, dated
March 31, 1995, with Walsh Greenwood & Co. (the "Credit
Agreement") pursuant to which the Company and its
affiliates borrowed $15,000,000; whereas Walsh Greenwood
& Co. is willing to amend the Credit Agreement to
increase the maximum of borrowing thereunder to
$20,000,000 upon the terms and conditions of a
First Amendment to Credit Agreement (the "Amendment")
presented to the Board, the Company hereby is authorized
and directed to enter the Amendment and all other
agreements and amendments referenced thereby and to borrow
up to $20,000,000 upon the terms specified in the
Amendment; and
FURTHER RESOLVED, that the officers of the Company
be authorized and directed to execute upon behalf of
the Company the Amendment and such other documents,
certificates, and agreements as may be required under
the Amendment or to effect the foregoing resolution.