AMENDMENT NO. 2, effective as of December 28, 1999, to the Note Agreement
dated as of October 10, 1997, as amended, (the "Agreement") between Quaker
Fabric Corporation of Fall River (the "Company"), Pruco Life Insurance Company
("Pruco") and The Prudential Insurance Company of America ("Prudential"; and
collectively with Pruco, the "Noteholders"). Capitalized terms used herein have
the meanings ascribed to such terms in the Agreement unless otherwise defined
herein.
W I T N E S S E T H
WHEREAS, the Noteholders and the Company have executed and delivered the
Agreement; and
WHEREAS, the parties hereto wish to amend certain terms of the Agreement
and agree to such other matters, all as set forth below.
NOW THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Amendment to the Agreement. Subparagraph 6D of the Agreement is hereby
amended to read in its entirety as follows:
"6D. Maintenance of Fixed Charge Coverage. The Company will not
permit the Fixed Charge Ratio at any time to be less than the ratio
set forth opposite the applicable period below:
=======================================================
Period Ratio
=======================================================
January 3, 1999 through October 1, 1999 1.00 : 1.00
-------------------------------------------------------
October 2, 1999 through June 30, 2000 1.25 : 1.00
-------------------------------------------------------
July 1, 2000 and thereafter 1.50 : 1.00
=======================================================
2. Conditions to Effectiveness. This Amendment No. 2 shall be effective as of
the date first above written and the Agreement shall be deemed amended
hereby upon delivery of a fully executed copy hereof to Prudential.
3. Company Representations. The Company hereby represents and warrants that
no Default or Event of Default has occurred or is continuing.
4. GOVERNING LAW. THIS AMENDMENT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF PARTIES SHALL BE GOVERNED BY, THE LAWS
OF THE STATE OF NEW YORK.
5. Effect on Agreement. Except as expressly provided herein, the Agreement
shall remain in full force and effect and this Amendment No. 2 shall not
operate as a waiver of any
right, power or remedy of any holder of a Note, nor constitute a waiver
of any provision of the Agreement.
6. Counterparts. This Amendment No. 2 may be executed in two or more
counterparts, each of which shall be deemed an original, and it shall not
be necessary in making proof of this Amendment to produce or account for
more than one such counterpart.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective officers as of the date and year first above
written.
QUAKER FABRIC CORPORATION
OF FALL RIVER
By: __________________________________
Name:
Title:
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA
By: __________________________________
Name: Kevin J. Kraska
Title: Vice President
PRUCO LIFE INSURANCE COMPANY
By: __________________________________
Name: Kevin J. Kraska
Title: Vice President
7