Exhibit 10.6
AMENDMENT AND WAIVER AGREEMENT
THIS AMENDMENT AND WAIVER AGREEMENT (this "Agreement") is made and
entered into as of this 30th day of April, 1999, among ITHACA INDUSTRIES, INC.,
a Delaware corporation ("Borrower"), the Lenders party to this Agreement (the
"Lenders"), and NATIONSBANK, N.A., a national banking association, as agent for
the Lenders (the "Agent").
W I T N E S S E T H :
WHEREAS, Borrower, the Lenders, the Agent, NationsBanc Montgomery
Securities LLC, as Syndication Agent and Arranger, and BankAmerica Business
Credit, Inc., as Documentation Agent, entered into that certain Loan and
Security Agreement, dated as of March 24, 1998, pursuant to which the Lenders
agreed to make certain loans to Borrower (as amended, modified, supplemented and
restated from time to time, the "Loan Agreement"); and
WHEREAS, Borrower has entered into an Asset Purchase Agreement, dated
as of April 29, 1999, with Glendale Group, Ltd., a North Carolina corporation
("Buyer"), pursuant to which Borrower has agreed to sell, and Buyer has agreed
to purchase, Borrower's women's hosiery business (as amended, the "Purchase
Agreement"); and
WHEREAS, the consummation of the transactions contemplated by the
Purchase Agreement would constitute a violation of certain covenants set forth
in the Loan Agreement; and
WHEREAS, Borrower has asked the Agent and the Lenders to consent to the
consummation of the transactions contemplated by the Purchase Agreement and to
waive certain Events of Default under the Loan Agreement; and
WHEREAS, the Agent and the Lenders are willing to grant such consent
and waiver, subject to the terms and conditions set forth herein, including the
amendments to the Loan Agreement set forth herein; and
NOW, THEREFORE, in consideration of the foregoing premises, and other
good and valuable consideration, the receipt and legal sufficiency of which is
hereby acknowledged, the parties hereto hereby agree as follows:
1. All capitalized terms used herein and not otherwise expressly
defined herein shall have the respective meanings given to such terms in the
Loan Agreement.
2. In reliance upon the representations, warranties, agreements and
covenants of
Borrower set forth herein and in the Loan Agreement, as amended hereby, the
Agent and the Lenders agree to waive the following defaults (the "Specified
Defaults"): (a) the default under SECTIONS 12.1(A), (C) and (D) of the Loan
Agreement for the fiscal year ended January 30, 1999 and the anticipated default
under SECTIONS 12.1(A), (C) and (D) of the Loan Agreement for the fiscal quarter
ending May 1, 1999, (b) the default under SECTION 11.1(B) of the Loan Agreement
arising from the failure of Borrower to deliver to the Agent and the Lenders its
audited year-end financial statements for the fiscal year ended January 30, 1999
within the timeframe required thereunder, and (c) any default arising directly
from the consummation of the transactions contemplated by the Purchase
Agreement, including the sale of the Assets (as defined in the Purchase
Agreement) and the repurchase by Borrower of 400,000 shares of its capital stock
from Buyer on the effective date of the consummation of the transactions
contemplated by the Purchase Agreement, including any default under SECTIONS
5.9, 11.1(B), 12.6 and 12.7 thereof (collectively, the "Specified Defaults");
provided, however, the waiver of the Specified Default under SECTION 11.1(B)
shall no longer be effective (and the default thereunder shall no longer
constitute a Specified Default) after May 17, 1999 unless Borrower has complied
with the terms thereof on or before May 17, 1999. However, the Agent and the
Lenders reserve all of their rights and remedies at all times with respect to
any Default or Event of Default, other than the Specified Defaults, whether
presently existing or occurring hereafter
3. In order to induce the Agent and the Lenders to enter into this
Agreement and grant the accommodations set forth herein, Borrower hereby
represents, warrants, agrees and covenants that (a) Borrower has heretofore
furnished to the Agent true, complete and correct copies of the Purchase
Agreement (including any schedules, exhibits and annexes thereto) and each other
agreement, document and certificate executed (or to be executed) in connection
therewith (collectively, the "Purchase Documents"), (b) the Purchase Agreement
has not been amended, supplemented or modified except as previously disclosed in
writing to the Agent and, together with the other Purchase Documents,
constitutes the complete understanding between Borrower and Buyer in respect of
the acquisition of the Assets and the other matters and transactions covered
thereby, (c) to Borrower's knowledge, the Purchase Agreement and each of the
other Purchase Documents has been duly executed and delivered by Buyer and is a
valid, legal and binding obligation of Buyer, (d) the representations and
warranties of Borrower contained in the Purchase Agreement and each of the other
Purchase Documents are (or will be) true and correct in all material respects on
the effective date of this Agreement as if made on and as of such date, except
to the extent that any such representation or warranty relates solely to an
earlier date, and the Agent and the Lenders are entitled to rely on such
representations and warranties with the same force and effect as though they
were incorporated in this Agreement and made to the Agent and the Lenders
directly, (e) on and as of the effective date of this Agreement, Borrower knows
of no reason to believe that the representations and warranties of, and
information concerning, Buyer contained in the Purchase Agreement and each of
the other Purchase Documents are not true and correct in all material respects,
(f) upon the effective date of this Agreement, the transactions contemplated by
the Purchase Agreement and the other Purchase Documents shall have been
consummated in accordance with Applicable Laws and, except as previously
disclosed in writing to the Agent, in the manner provided therein in accordance
with the terms thereof without any material waivers or amendments thereto, and
each of the conditions to such consummation set forth in the Purchase Agreement
and the other Purchase Documents shall have been fulfilled without any material
waiver of any thereof, except with the prior written consent of the Required
Lenders, (g) attached hereto as Exhibit A are true and correct copies of the
forecasted balance sheets, income statements, cash flow statements
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and Borrowing Base availability calculations of Borrower and its Subsidiaries
for their 2000 through 2003 fiscal years, together with supporting details and a
statement of underlying assumptions (the "Projections"), (h) the Projections
have been prepared by Borrower in good faith in light of the past operations of
Borrower and its Subsidiaries and, as of the effective date of this Agreement,
reflect Borrower's good faith and reasonable estimates of the future financial
performance and of the other information projected therein for the periods set
forth therein, it being recognized by the Agent and the Lenders that such
projections as to future events are only estimates and that actual results
during the periods covered by the Projections will differ from the projected
results, (i) attached hereto as Exhibit B are true and correct copies of the pro
forma balance sheet of Borrower and its Subsidiaries as at April 30, 1999, after
giving effect to the transactions contemplated by this Agreement and the
Purchase Agreement (the "Pro Forma"), (j) the Pro Forma presents fairly, on a
pro forma basis in all material respects, the financial position of Borrower and
its Subsidiaries as at April 30, 1999, (k) attached hereto as Exhibit C is a
true and correct copy of the Amendment and Waiver Agreement, dated of even date
herewith, with respect to the Second Lienholder Amendment and Waiver (the
"Second Lienholder Amendment and Waiver"), and (l) upon the effective date of
this Agreement, the Second Lienholder Amendment and Waiver shall be in full
force and effect and all conditions precedent to the effectiveness thereof shall
have been satisfied or waived.
4. The Loan Agreement is amended by deleting the reference to
"$40,000,000" contained in clause (b)(ii)(B) of the definition of "Borrowing
Base" set forth in SECTION 1.1 and replacing it with "$35,000,000".
5. The Loan Agreement is amended by deleting clause (g) of the
definition of "Eligible Receivable" set forth in SECTION 1.1 and replacing it
with the following:
(g) such Receivable is not owing by an Account Debtor whose
then-existing accounts owing to the Borrower (together with accounts
owing from Affiliates of such Account Debtor) exceed in face amount 15%
(in the case of J.C. Penney, 60%, and in the case of Sears, 25%) of the
Borrower's total Eligible Receivables, provided this restriction shall
only exclude the amount in excess of such concentration limit,
6. The Loan Agreement is amended by deleting the definition of "Hosiery
Inventory" set forth in SECTION 1.1.
7. The Loan Agreement is amended by deleting the definition of
"Revolving Credit Facility" set forth in SECTION 1.1 and replacing it with the
following:
"Revolving Credit Facility" means (a) during the months of
January through May and October through December, the principal amount
of $50,000,000 and (b) during the months of June through September, the
principal amount of $55,000,000, or such lesser or greater amounts as
shall be agreed upon from time to time in writing by the Agent, the
Lenders and the Borrower.
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8. The Loan Agreement is amended by deleting the definition of "WIP
Advance Rate" set forth in SECTION 1.1 and replacing it with the following:
"WIP Advance Rate" means the applicable advance rate set forth
below:
Period Advance Rate
------ ------------
To and including first anniversary of the 55%
Agreement Date
From first anniversary of the Agreement 50%
Date to and including second anniversary
of the Agreement Date
From second anniversary of the Agreement 45%
Date to and including third anniversary
of the Agreement Date
From third anniversary of the Agreement 40%
Date to and including fourth anniversary
of the Agreement Date
From fourth anniversary of the Agreement 35%
Date to and including fifth anniversary
of the Agreement Date
9. The Loan Agreement is amended by deleting the definition of "WIP
Deductions" set forth in SECTION 1.1 and replacing it with the following:
"WIP Deductions" means, for any fiscal year (commencing with
the fiscal year ending in January 2000), 5% of the average amount of
work-in-process Eligible Inventory during such fiscal year (determined
from the month-end Borrowing Base Certificates for such fiscal year).
10. Borrower acknowledges that (a) the outstanding principal balance of
the Term Loan as of the date hereof is $21,384,996.75, and (b) on the effective
date of this Agreement, Borrower shall make a principal payment of $6,001,993.00
for application to the Term Loan, from the proceeds of the sale of the Assets
pursuant to the Purchase Agreement, resulting in an outstanding principal
balance of $15,383,003.75. Based on the foregoing, the Loan Agreement is amended
by deleting SECTION 4.3 and replacing it with the following:
SECTION 4.. Repayment of Term Loan. The principal amount of
the Term Loan is due and payable, and shall be repaid in full by the
Borrower, in consecutive monthly installments on successive Installment
Payment Dates as set forth below, together with a final payment of all
unpaid principal on March 1, 2003:
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Amount of Each
Monthly Payment Date Monthly Payment
-------------------- ---------------
May 1, 1999 to and including $83,333.33
January 1, 2000
February 1, 2000 to and including $208,333.33
January 1, 2001
February 1, 2001 to and including $375,000.00
January 1, 2002
February 1, 2002 to and including $535,916.66
January 1, 2003
February 1, 2003 $601,001.96
March 1, 2003 All remaining principal
The Borrower hereby irrevocably instructs the Agent to charge the
Borrower's Loan Account, on each Installment Payment Date and Interest
Payment Date, for all principal and interest due on the Term Loan, and
each such charge shall be deemed a Prime Rate Revolving Credit Loan.
11. The Loan Agreement is amended by deleting SECTIONS 5.9(A)(II) and
(III) and replacing them with the following:
(ii) Within 2 Business Days of receipt by the Borrower or any
of its Subsidiaries of the Net Proceeds of any other permitted Asset
Disposition (including the disposition of plant and equipment held for
disposal as of the Agreement Date and the disposition of Borrower's
plant and equipment located in Cairo, Georgia and Swainsboro, Georgia),
the Borrower shall apply the Net Proceeds to the outstanding balance of
the Revolving Credit Loans. Within 5 Business Days of the date of the
Borrower's or any Subsidiary's receipt of the Net Proceeds from such
sale, if such sale was of assets other than Equipment, or within 15
Business Days of the end of the fiscal month in which such Equipment
was sold, if such sale was of Equipment, the Borrower shall make a
prepayment of principal on the Term Loan in an amount equal to 80% of
the Net Proceeds from such Asset Disposition or, if greater, the amount
originally loaned to the Borrower under the Term Loan with respect to
the disposed assets, which Term Loan prepayment shall be advanced by
the Agent as a Revolving Credit Loan; provided no such repayment of the
Revolving Credit Loan or prepayment of the Term Loan shall be required
with respect to Net Proceeds not in excess of $250,000 during any
fiscal year from permitted Asset Dispositions (other than the sale of
Borrower's narrow fabrics business, the disposition of plant and
equipment held for disposal as of the Agreement Date and the
disposition of Borrower's plant
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and equipment located in Cairo, Georgia and Swainsboro, Georgia). In
the event a Contingent Liability Reserve was deducted from the sale
proceeds in order to calculate Net Proceeds, the amount of such
Contingent Liability Reserve shall be reserved against the Borrowing
Base by the Agent until such time as the actual amount of liability is
determined.
(iii) Notwithstanding the foregoing, if the Borrower
reasonably expects the Net Proceeds of any permitted Asset Disposition
(other than the sale of Borrower's narrow fabrics business, the
disposition of plant and equipment held for disposal as of the
Agreement Date and the disposition of Borrower's plant and equipment
located in Cairo, Georgia and Swainsboro, Georgia) to be reinvested
within six months in productive assets of a kind then used or useable
in the business of the Borrower and that are not subject to any Lien
other than Permitted Liens (other than Purchase Money Liens) and Liens
in favor of the Agent, for the benefit of the Secured Creditors, then
(A) to the extent such proceeds do not exceed the balance from time to
time of the Revolving Credit Loans, such proceeds shall be applied to
the repayment of the outstanding balance of the Revolving Credit Loans
and the Agent shall, until such time as the reinvestment of such
proceeds, establish a reserve against the Borrowing Base in the amount
of the proceeds so applied, and (B) to the extent such proceeds exceed
the balance from time to time of the Revolving Credit Loans, the
Borrower shall deposit such proceeds with the Agent to be held as Cash
Collateral in which the Agent, for the ratable benefit of the Secured
Creditors, shall have a first priority security interest. Upon the
Borrower's reinvestment of such Net Proceeds as described above, the
Agent shall release its security interest in such Cash Collateral in
respect of the reinvested funds and shall eliminate the reserve against
the Borrowing Base. To the extent that the Borrower fails to reinvest
such proceeds within six months as provided above, the Borrower
authorizes and directs the Agent to eliminate such reserve, to apply
the amount of the Cash Collateral in respect of the unreinvested amount
to the prepayment of the Term Loan to the extent required under CLAUSE
(II) above, to make Revolving Credit Loans in an amount equal to the
reserved amount that is not reinvested, and to apply the proceeds of
such Revolving Credit Loans to the prepayment of the Term Loan to the
extent required under CLAUSE (II) above.
12. The Loan Agreement is amended by deleting SECTION 12.1 and
replacing it with the following:
SECTION 12.1. Financial Ratios.
(a) Minimum Tangible Net Worth. Permit Consolidated Tangible
Net Worth of the Borrower and its Consolidated Subsidiaries, as of any
fiscal quarter end (commencing with the fiscal quarter ending on July
31, 1999), to be less than $12,250,000 plus 75% of Consolidated Net
Income (without deduction for any net loss) on a cumulative basis from
and including May 1, 1999 to and including such fiscal quarter end.
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(b) Minimum Fixed Charge Coverage Ratio. Permit the
Consolidated Fixed Charge Coverage Ratio, as of the end of any fiscal
quarter, calculated on a rolling four-quarter basis (except for the
calculation as of the end of the second and third fiscal quarters of
fiscal year 2000, which shall be on a fiscal year to date basis), to be
less than 1.0 to 1.
(c) Maximum Funded Indebtedness to Cash Flow Ratio. Permit the
ratio of (i) Consolidated Funded Indebtedness as of any fiscal quarter
end to (ii) Consolidated Operating Cash Flow to be greater than: 4.80
to 1.0 as of the end of the second fiscal quarter of fiscal year 2000;
4.55 to 1.0 as of the end of the third fiscal quarter of fiscal year
2000 or as of fiscal year end 2000; 4.30 to 1.0 as of any fiscal
quarter end in fiscal year 2001; or 4.05 to 1.0 as of the end of any
fiscal quarter thereafter. Consolidated Operating Cash Flow shall be
calculated on an annualized fiscal year to date basis in the case of
the calculation of this covenant as of the end of the second and third
fiscal quarters of fiscal year 2000, and on a rolling four-quarter
basis for all calculations thereafter. Consolidated Operating Cash
Flow, for the purpose of this covenant, will include, or exclude, as
applicable, the effect of acquisitions and divestitures on a proforma
basis as if such acquisitions or divestitures occurred on the first day
of such applicable period.
13. The Loan Agreement is amended by deleting SECTION 12.5 and
replacing it with the following:
SECTION 12.5. Capital Expenditures. Make or incur any Capital
Expenditures in the aggregate (for the Borrower and its Subsidiaries)
in excess of the amount set forth below for the fiscal year set forth
opposite such amount:
Fiscal Year Amount
----------- ------
1999 $9,000,000
2000 $5,500,000
2001 $4,000,000
2002 $4,000,000
2003 $4,000,000
Notwithstanding the foregoing, up to 50% of the unused portion of the
limit set forth above with respect to any fiscal year may be carried
forward and utilized in the immediately succeeding fiscal year.
14. The Loan Agreement is amended by deleting clause (d) of SECTION
12.7 and replacing it with the following:
(d) the sale of Borrower's narrow fabrics business, the
disposition of plant and equipment held for disposal as of the
Agreement Date and the disposition of Borrower's plant and equipment
located in Cairo, Georgia and Swainsboro, Georgia, provided the Net
Proceeds of any such sale or disposition are applied as set forth in
SECTION 5.9;
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15. The Loan Agreement is amended by deleting SECTION 12.10 and
replacing it with the following:
SECTION 12.10. Capitalized Lease Obligations. Incur or permit
to exist any Capitalized Lease Obligation if such Capitalized Lease
Obligation, when added to existing Capitalized Lease Obligations and
Permitted Purchase Money Indebtedness, would exceed $8,000,000 in the
aggregate.
16. The Loan Agreement is amended by deleting SECTION 12.11 and
replacing it with the following:
SECTION 12.11. Operating Lease Obligations. Enter into any
Operating Lease if the aggregate annual rental payable under all
Operating Leases of the Borrower and its Subsidiaries would exceed
$12,000,000 in the aggregate.
17. The Loan Agreement is amended by deleting SECTION 12.14 and
replacing it with the following:
SECTION 12.14. Minimum Availability. Except as permitted by
the Agent under SECTION 5.7(D), permit Availability to be less than (a)
$3,000,000 at any time on or prior to August 1, 1999, or (b) $4,000,000
at any time thereafter.
18. The Loan Agreement is amended by deleting ANNEX II attached thereto
and replacing it with ANNEX II attached to this Agreement.
19. Borrower covenants and agrees that it will promptly deliver to the
Agent, and in any event within three Business Days after Borrower's receipt
thereof, the Closing Balance Sheet and any Notice of Disagreement (as such terms
are defined in the Purchase Agreement) or final determination of the Closing
Tangible Net Worth (as defined in the Purchase Agreement).
20. The Loan Agreement is amended by deleting Schedules 7.1(f), 7.1(h),
7.1(p), 7.1(t), 7.1(u), 7.1(v), 7.1(w), 7.1(x), 7.1(bb), 7.1(cc) and 1.1B and
replacing them with the Schedules attached to this Agreement.
21. The parties hereto acknowledge and agree that there will no longer
be a Documentation Agent under the Loan Agreement.
22. The parties hereto acknowledge and agree that, notwithstanding
anything to the contrary set forth in the Loan Agreement, including the
provisions of SECTIONS 2.3 and 9.1, all remittances and payments with respect to
Receivables shall be applied as set forth in the Glendale Intercreditor
Agreement until the Transition Date (as defined in the Glendale Intercreditor
Agreement), and thereafter shall be applied as set forth in the Loan Agreement.
As used herein, "Glendale Intercreditor Agreement" means the Agreement, dated on
or about the date hereof, among, inter alia, Borrower, the Agent, the Lenders
and Buyer, in substantially the form attached hereto as Exhibit E. Borrower
acknowledges and agrees that, in the event Borrower fails to
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provide the Agent written instructions as to the application of any Payments (as
defined in the Glendale Intercreditor Agreement) in accordance with the terms of
the Glendale Intercreditor Agreement within five Business Days after the posting
of the deposit or other receipt of such Payments in the Deposit Account (as
defined in the Glendale Intercreditor Agreement), at the election of the Agent
or the Required Lenders, all of the Loans shall bear interest at the respective
rates applicable thereto pursuant to the Loan Agreement plus the Default Margin
until and including the date upon which the Agent receives such written
instructions.
23. Each of the Lenders hereby authorizes and directs the Agent (a) to
release the Lien and Security Interest of the Agent and the Lenders in all of
the Assets, and (b) to execute and deliver to Borrower the release letter in
substantially the form attached hereto as Exhibit D and such other releases and
documents as the Agent may deem appropriate or necessary in order to evidence
and effectuate such release.
24. The effectiveness of this Agreement and the waiver and amendments
set forth herein shall be conditioned upon the receipt (a) by the Agent of at
least $15,000,000 from the proceeds of the sale of the Assets pursuant to the
Purchase Agreement for application to the outstanding Revolving Credit Loans on
a Ratable basis and $6,001,993 from the proceeds of the sale of the Assets
pursuant to the Purchase Agreement for application to the outstanding balance of
the Term Loan on a Ratable basis, and (b) by the Agent of the following
certificates, notes, agreements, acknowledgments and opinions, all of which
shall be in form and substance reasonably satisfactory to the Agent and the
Lenders:
(i) duly executed replacement Revolving Credit Notes;
(ii) a duly executed landlord waiver agreement with respect to
the real estate located at 1806 River Street, Wilkesboro, North
Carolina, to be sold by Borrower to Buyer, and leased back by Borrower
from Buyer, pursuant to the Purchase Agreement;
(iii) a certificate of the Secretary of Borrower as to such
corporate and other matters as the Agent may reasonably request, which
certificate shall contain a certified copy of Borrower's articles of
incorporation, a good standing certificate for Borrower from the State
of Delaware, a copy of Borrower's by-laws, and a copy of the
resolutions of Borrower's board of directors approving the transactions
contemplated hereby and by the Purchase Agreement;
(iv) an opinion of Borrower's counsel as to such matters as
the Agent may reasonably request;
(v) copies of the Projections and Pro Forma, together with a
certificate of the Financial Officer with respect thereto;
(vi) a certified copy of the duly executed and delivered
Second Lienholder Amendment and Waiver, including a certification of
the Financial Officer that such Second Lienholder Amendment and Waiver
is in full force and effect and all conditions precedent to the
effectiveness thereof have been satisfied or waived;
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(vii) on the effective date of this Agreement, (A) the Agent
shall have received true and complete executed or conformed copies of
the Purchase Documents and any amendments thereto; (B) the Purchase
Documents shall be in full force and effect and no material term or
condition thereof shall have been amended, modified or waived after the
execution thereof (other than solely to extend the date by which the
purchase contemplated thereby is required to occur) except with the
prior written consent of the Lenders; (C) none of the parties to any of
the Purchase Documents shall have failed to perform any material
obligation or covenant required by such Purchase Document to be
performed or complied with by it on or before the effective date of
this Agreement; (D) all representations and warranties of Borrower and
Buyer contained in the Purchase Agreement and the other Purchase
Documents shall be true and correct in all material respects with the
same effect as though made on and as of the effective date of this
Agreement; (E) all requisite approvals by governmental authorities and
regulatory bodies having jurisdiction over the parties to the Purchase
Agreement in respect of the sale of the Assets shall have been obtained
by such parties, and no such approvals shall impose any unsatisfied
conditions to the consummation of the sale of the Assets; (F) the sale
of the Assets shall have been consummated in accordance with the terms
and provisions of the Purchase Agreement and the other Purchase
Documents, without any amendment or waiver of any material provision
thereof; and (G) the Agent shall have received a certificate from an
officer of Borrower, or other evidence satisfactory to them, that each
of the conditions set forth in clauses (A) through (F) above have been
satisfied;
(vii) a duly executed Collateral Assignment of Purchase
Agreement made by Borrower in favor of the Agent, for the benefit of
the Secured Creditors, and duly acknowledged by Buyer;
(viii) the duly executed Glendale Intercreditor Agreement; and
(ix) such other certificates, notes, agreements and
acknowledgments as the Agent may reasonably request, including a
current Borrowing Base Certificate prepared on a pro forma basis giving
effect to the transactions contemplated by the Purchase Agreement.
25. As consideration for the accommodations set forth herein, on the
effective date of this Agreement, Borrower shall pay to the Lenders a
non-refundable fee as set forth in the fee letter of even date herewith between
Borrower and the Agent, such fee to be shared among the Lenders on a Ratable
basis.
26. To induce the Agent and the Lenders to enter into this Agreement,
Borrower hereby represents and warrants that, as of the date hereof, except for
the Specified Defaults, there exists no Default or Event of Default under the
Loan Agreement.
27. Borrower hereby restates, ratifies, and reaffirms each and every
term, condition, representation and warranty heretofore made by it under or in
connection with the execution and delivery of the Loan Agreement, as amended
hereby, and the other Loan Documents, as fully as though such representations
and warranties had been made on the date hereof and with specific reference to
this Agreement, except to the extent that any such representation or warranty
relates solely to a prior date.
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28. Except as expressly set forth herein, the Loan Agreement and the
other Loan Documents shall be and remain in full force and effect as originally
written, and shall constitute the legal, valid, binding and enforceable
obligations of Borrower to the Agent and the Lenders.
29. In addition to any other fees described herein, Borrower agrees to
pay on demand all reasonable costs and expenses of the Agent in connection with
the preparation, execution, delivery and enforcement of this Agreement and all
other Loan Documents and any other transactions contemplated hereby, including,
without limitation, the reasonable fees and out-of-pocket expenses of legal
counsel to the Agent.
30. To induce the Agent and the Lenders to enter into this Agreement
and grant the accommodations set forth herein, Borrower (a) acknowledges and
agrees that no right of offset, defense, counterclaim, claim or objection exists
in favor of Borrower against the Agent or any Lender arising out of or with
respect to the Loan Agreement, the other Loan Documents or the Secured
Obligations, and (b) releases, acquits, remises and forever discharges the Agent
and each Lender and its affiliates and all of their past, present and future
officers, directors, employees, agents, attorneys, representatives, successors
and assigns from any and all claims, demands, actions and causes of action
(other than those based on fraud or criminal misconduct), whether at law or in
equity, whether now accrued or hereafter maturing, and whether known or unknown,
which Borrower now or hereafter may have by reason of any manner, cause or
things, in each case, to and including the date of this Agreement with respect
to matters arising out of the Loan Agreement, the other Loan Documents or the
Secured Obligations.
31. Borrower acknowledges that (a) except as expressly set forth
herein, neither the Agent nor any Lender has agreed to (and has no obligation
whatsoever to discuss, negotiate or agree to) any other restructuring,
modification, amendment, waiver or forbearance with respect to the Secured
Obligations or the Loan Agreement, (b) no understanding with respect to any
other restructuring, modification, amendment, waiver or forbearance with respect
to the Secured Obligations or the Loan Agreement shall constitute a legally
binding agreement or contract, or have any force or effect whatsoever, unless
and until reduced to writing and signed by authorized representatives of each
party hereto, and (c) the execution and delivery of this Agreement has not
established any course of dealing between the parties hereto or created any
obligation or agreement of the Agent or any Lender with respect to any future
restructuring, modification, amendment, waiver or forbearance with respect to
the Secured Obligations or the Loan Agreement.
32. Borrower agrees to take such further action as the Agent shall
reasonably request in connection herewith to evidence the agreements herein
contained.
33. This Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which, when so
executed and delivered, shall be deemed to be an original and all of which
counterparts, taken together, shall constitute but one and the same instrument.
34. This Agreement shall be binding upon and inure to the benefit of
the successors
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and permitted assigns, and legal representatives and heirs, of the parties
hereto.
35. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of Georgia.
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IN WITNESS WHEREOF, Borrower, the Agent and the Lenders have caused
this Agreement to be duly executed, all as of the date first above written.
BORROWER:
ITHACA INDUSTRIES, INC.
By: /s/ Richard P. Thrush
-------------------------
Name: Richard P. Thrush
Title: Senior Vice President
LENDERS:
NATIONSBANK, N.A.
By: /s/ Douglas E. Cowan
------------------------
Name: Douglas E. Cowan
Title: Vice President
BANKAMERICA BUSINESS CREDIT, INC.
By: /s/ Douglas E. Cowan
------------------------
Name: Douglas E. Cowan
Title: Vice President
13
NATIONAL BANK OF CANADA
By: /s/ Charles Collie
----------------------
Name: Charles Collie
Title: Vice President
THE CIT GROUP/COMMERCIAL SERVICES, INC.
By: /s/ M. Kim Carpenter
------------------------
Name: M. Kim Carpenter
Title: Vice President
FLEET BUSINESS CREDIT CORPORATION, as
successor to Sanwa Business Credit
Corporation
By: /s/ Mark Pickering
----------------------
Name: Mark Pickering
Title: Vice President
AGENT:
NATIONSBANK, N.A.
By: /s/ Douglas E. Cowan
------------------------
Name: Douglas E. Cowan
Title: Vice President
14