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EXHIBIT 10.1
[EXECUTION COPY]
AMENDMENT NO. 5, WAIVER
AND CONSENT
to
Amended and Restated
Loan and Security Agreement
dated as of December 20, 1996
AMENDMENT NO. 5, WAIVER AND CONSENT entered into as of July 14, 1998
among RIDGEVIEW, INC., a North Carolina corporation (for itself and as successor
by merger to InterKnit, Inc., an Alabama corporation) ("Ridgeview"), SENECA
KNITTING MILLS CORPORATION, a New York corporation ("Seneca"), TRI-STAR HOSIERY
MILLS, INC., a North Carolina corporation ("THM", and, together with Ridgeview
and Seneca, the "Borrowers"), and NATIONSBANK, N.A., a national banking
association (the "Lender").
Preliminary Statement
The Borrowers and the Lender are parties to that certain Amended and
Restated Loan and Security Agreement dated as of December 20, 1996, as amended
by Amendment No.1 dated as of January 31, 1997, Amendment No.2 dated as of March
13, 1997, Amendment No. 3 dated as of July 31, 1997 and Amendment No. 4 dated as
of March 13, 1998 (as so amended, the "Loan Agreement," terms defined therein,
unless otherwise defined herein, being used herein as therein defined).
The Borrowers have informed the Lender that Ridgeview has entered into
a certain Stock Purchase Agreement dated as of July 14, 1998 (the "THM
Acquisition Agreement") by and between Ridgeview, as purchaser, and James W.
Daniel, William W. Burke, and J. Brad Peavy, each an individual, as sellers
(collectively, the "THM Acquisition Parties"), pursuant to which Ridgeview shall
acquire all of the issued and outstanding stock of Tri-Star Hosiery Mills, Inc.,
a North Carolina corporation (the "THM Acquisition").
The Borrowers have requested an increase in the Revolving Credit
Facility, an extension of new Term Loans and certain other modifications to the
Loan Agreement, that the Lender consent to the THM Acquisition, and that the
Lender waive certain Defaults under the Loan Agreement, and the Lender has
agreed to such request, upon and subject to all of the terms, conditions and
provisions hereinafter set forth.
NOW, THEREFORE, in consideration of the Loan Agreement, the mutual
covenants set forth therein and herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
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Section 1. Amendment to Loan Agreement. Subject to the provisions of
Section 4, the Loan Agreement is hereby amended:
(a) by amending the provisions of Section 1.1 Definitions as
follows:
(i) by amending the definition "Borrower" in its entirety to read as
follows:
"Borrower" means each of Ridgeview, Seneca and THM, and
"Borrowers" means all of Ridgeview, Seneca and THM.
(ii) by amending the definition "Borrowing Base" in its entirety to
read as follows:
"Borrowing Base" means at any time an amount equal to the sum
of:
(a) 80% (or such lesser percentage as the Lender may in its sole and
absolute discretion determine from time to time) of the face value of
Eligible Receivables due and owing at such time, PLUS
(b) the lesser of
(i) subject to the proviso below, 60% (or such lesser
percentage as the Lender may in its sole and absolute discretion
determine from time to time) of the lesser of cost (computed on a
first-in-first-out basis) and fair market value of Eligible Inventory
at such time, and
(ii) (A) during the period April 1 through September 30 of
each calendar year, $18,000,000, and (B) during the period October 1 of
one calendar year through March 31 of the following calendar year,
$14,000,000, MINUS
(c) the Letter of Credit Obligations and such other reserves as the
Lender may determine from time to time in the exercise of its
reasonable credit judgment;
PROVIDED, that the stated advance rate (subject to the Lender's
discretion) against Eligible Inventory may be 65% during the period
April 1 through September 30 of each calendar year.
(iv) by deleting the definitions "CAPEX Loan", "CAPEX Loan Facility",
"CAPEX Lock-in Date", "CAPEX Note" and "Hard Cost Capital Expenditures" in their
entirety.
(v) by amending the definition "Permitted Investments" by (A) deleting
the word "and" appearing immediately before clause (d) appearing therein, and
(B) by inserting the phrase ", and (e) the THM Acquisition" immediately before
the period appearing at the end thereof;
(vi) by amending the definition "Revolving Credit Facility" by deleting
the figure "$28,000,000" appearing therein and substituting therefor the figure
"$34,000,000";
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(vii) by amending the definition "Term Note" in its entirety to read as
follows:
"Term Note" means any of (a) the Amended, Restated and Consolidated
Term Note, substantially in the form of EXHIBIT A-2 hereto, and (b) any other
Term Note, substantially in the form of EXHIBIT A-3 hereto, in each case made by
the Borrowers payable to the order of the Lender evidencing the joint and
several obligation of the Borrowers to pay the aggregate unpaid principal amount
of the Term Loan made to it by the Lender (and any promissory note or notes that
may be issued from time to time in substitution, renewal, extension, replacement
or exchange therefor, whether payable to the Lender or a different lender,
whether issued in connection with a Person becoming a lender after the Effective
Date or otherwise), in each case with all blanks properly completed.
(b) by further amending Section 1.1 Definitions by adding
thereto in appropriate alphabetical order the following additional definitions:
"Amendment No. 5" means Amendment No. 5, Waiver and Consent
dated as of July 14, 1998 to this Agreement.
"Amendment No. 5 Effective Date" means the date on which
Amendment No. 5 shall have become effective in accordance with its
terms.
"Term Loan A" means the Term Loan made to the Borrowers
pursuant to SECTION 2B.1(a).
"Term Loan B" means the Term Loan made to the Borrowers
pursuant to SECTION 2B.1(b)(i).
"Term Loan C" means the Term Loan made to the Borrowers
pursuant to SECTION 2B.1(b)(ii).
"THM" means Tri-Star Hosiery Mills, Inc., a North Carolina
corporation.
"THM Acquisition" means the Acquisition by Ridgeview of 100%
of the issued and outstanding capital stock of THM pursuant to that
certain Stock Purchase Agreement dated as of July 14, 1998 by and
between Ridgeview, as purchaser, and James W. Daniel, William W. Burke,
and J. Brad Peavy, each an individual, as sellers, in the form
delivered to the Lender on or prior to the Amendment No. 5 Effective
Date.
(c) by amending Section 2B.1 Term Loan in its entirety to read
as follows:
Section 2B.1 Term Loans. (a) The Lender has made the Term Loan
A to the Borrowers prior to the Effective Date pursuant to Section 2.1
of the Existing Term Loan Agreement in the original principal amount of
$5,000,000 and pursuant to Section 2.7(a) of the Existing Revolving
Agreement in the original principal amount of $1,000,000. As of
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the Agreement Date, the aggregate outstanding principal balance of Term
Loan A is $4,969,659.
(b) Upon the terms and subject to the conditions of, and in reliance upon
the representations and warranties made under, this Agreement and
Amendment No. 5, the Lender shall make to the Borrowers on the
Amendment No. 5 Effective Date (i) a Term Loan B in the original
principal amount of $500,000 and (ii) a Term Loan C in the original
principal amount of $615,000.
(d) by amending Section 2B.2 Repayment of Term Loan in its
entirety to read as follows:
Section 2B.2 Repayment of Term Loans. The Term Loans are due
and payable, and shall be repaid in full by the Borrowers as follows:
(a) as to Term Loan A, in 43 installments, the first 42 installments,
payable on January 1, 1997 and on the first day of each calendar month
thereafter, shall be in the amount of $53,667 each and the final
installment payable on June 30, 2000 shall be in the amount of the then
unpaid balance of such Term Loan A, (b) as to Term Loan B, in 24
installments, the first 23 installments payable on August 1, 1998 and
on the first day of each calendar month thereafter, shall be in the
amount of $20,833 each and the final installment payable on June 30,
2000 shall be in the amount of the then unpaid balance of such Term
Loan B, and (c) as to Term Loan C, in 24 installments, the first 23
installments payable on August 1, 1998 and on the first day of each
calendar month thereafter, shall be in the amount of $7,321 each and
the final installment payable on June 30, 2000 shall be in the amount
of the then unpaid balance of such Term Loan C.
(e) by amending Section 2B.3 Term Note in its entirety to read
as follows:
Section 2B.3 Term Notes. The Term Loans and the joint and several obligations of
the Borrowers to repay such Loans shall be evidenced by three Term
Notes payable to the order of Lender. The Term Note in respect of Term
Loan A shall be dated the Effective Date and the Term Notes in respect
of Term Loan B and Term Loan C shall be dated the Amendment No. 5
Effective Date; each such Term Note shall be duly and validly executed
and delivered by the Borrowers.
(f) by amending Section 2B.4 Prepayment of Term Loan in its
entirety to read as follows:
Section 2B.4 Prepayment of Term Loans.
(a) Voluntary Prepayment. The Borrowers shall have the right
at any time and from time to time, upon at least 60 days' prior written
notice to the Lender in the case of a prepayment in full and upon at
least five days' prior written notice to the Lender in the case of a
partial prepayment, to prepay the Term Loans in whole or in part on any
Business Day. Each partial prepayment of the Term Loans shall be in a
principal amount equal to $100,000 or any integral multiple thereof and
shall be applied (x) first to the principal installments of Term Loan B
in the inverse order of their maturities, and (y) then to the
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principal installments of each other Term Loan ratably in the inverse
order of their maturities. On the prepayment date, the Borrowers shall
pay interest on the amount prepaid, accrued to the prepayment date and
any amounts which may become due pursuant to SECTION 3.10 as a result
of such prepayment. Any notice of prepayment given by the Borrowers
hereunder shall be irrevocable, and the amount to be prepaid (including
accrued interest and any fees) shall be due and payable on the date
designated in the notice.
(b) Mandatory Prepayment. (i) Any and all amounts received by
a Borrower as proceeds from the sale of any Equipment or Real Estate to
the extent such proceeds exceed (i) $5,000 in the case of any single
item of Equipment or parcel of Real Estate, or (ii) $25,000 in the
aggregate for all such Equipment and Real Estate sold during any
twelve-month period shall be paid, immediately upon receipt by the
applicable Borrower to the Lender and shall be applied (x) first to the
principal installments of Term Loan B in the inverse order of their
maturities, and (y) then to the principal installments of each other
Term Loan ratably in the inverse order of their maturities, with any
balance remaining after prepayment in full of the Term Loans to be
applied to repay any amounts due under the Revolving Credit Loan. The
Borrowers shall also be obligated to prepay the Term Loans in full
together with accrued and unpaid interest thereon upon any termination
of this Agreement pursuant to SECTION 3.5 or otherwise or upon any
acceleration of the Term Loans pursuant to ARTICLE 11.
(g) by deleting ARTICLE 2C. CAPEX LOAN FACILITY in its entirety;
(h) by amending Section 3.1 Interest by (i) amending clause
(a) appearing therein by inserting the phrase "(PLUS, with regard to Term Loan
B, 0.75%)" immediately after the phrase "PLUS the Applicable Margin" appearing
therein, and (ii) amending clause (b) appearing therein by inserting the phrase
"(PLUS, with regard to Term Loan B, 0.75%)" immediately after the phrase "PLUS
the Applicable Margin" appearing therein;
(i) by amending Section 10.1(b)(ii) in its entirety to read as
follows:
(ii) Minimum Tangible Net Worth. Permit the Tangible Net Worth of the
Domestic Business of Ridgeview and its U.S. Subsidiaries (A) to be less
than $13,800,000 at any time during the fiscal quarter of Ridgeview
ending on September 29, 1998, (B) to be less than $14,750,000 at any
time during the fiscal quarter of Ridgeview ending on December 30,
1998, (C) to be less than $15,500,000 at any time during the fiscal
quarter of Ridgeview ending on March 30, 1998, and (D) from January 1,
1997 to and including June 29, 1998, and from and after March 31, 1999
to be less than the following amounts at any time during the following
periods:
Minimum Domestic Business
Period Tangible Net Worth
------ -------------------------
January 1 through such Tangible Net Worth as of December 31
through June 29 of the fiscal year immediately preceding
the date of determination
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June 30 sum of such Tangible Net Worth as of
through September 29 December 31 of the fiscal year
immediately preceding the date of
determination and the greater of (x)
$250,000 and (y) 70% of earnings of
Ridgeview and its U.S. Subsidiaries for
the first two fiscal quarters of the
current fiscal year
September 30 sum of such Tangible Net Worth as of
through December 30 December 31 of the fiscal year
immediately preceding the date of
determination and the greater of (x)
$750,000 and (y) 70% of earnings of
Ridgeview and its U.S. Subsidiaries for
the first three fiscal quarters of the
current fiscal year
December 31 sum of such Tangible Net Worth as of
December 31 of the fiscal year
immediately preceding the date of
determination and the greater of (x)
$1,750,000 and (y) 70% of earnings of
Ridgeview and its U.S. Subsidiaries for
the fiscal year ending on the date of
determination
(j) by amending Section 10.1(b)(iii) in its entirety to read
as follows:
(iii) Minimum Fixed Charge Ratio. Permit the Fixed Charge Ratio of the
Domestic Business of Ridgeview and its U.S. Subsidiaries to be less
than 1.25 to 1.0 as of the last day of each month from December 31,
1996 to and including June 29, 1998, and thereafter as of the last day
of each month during any period set forth below to be less than the
ratio set forth below opposite such period, in each case computed for
the period of 12 consecutive calendar months then ended:
Period Ratio
------ -----
From June 30, 1998 to and including September 29, 1998 1.00 to 1.0
From September 30, 1998 to and including December 30, 1998 0.70 to 1.0
From December 31, 1998 to and including March 30, 1999 0.85 to 1.0
From March 31, 1999 to and including September 29, 1999 1.10 to 1.0
From and after September 30, 1999 1.25 to 1.0
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(k) by amending Section 10.1(b)(iv) by deleting the ratio "1.3
to 1.0" appearing therein and substituting therefor the ratio "1.2 to 1.0"; and
(l) by deleting Exhibit A-3 to the Loan Agreement in its
entirety, and substituting therefor a new Exhibit A-3 in the form attached
hereto.
Section 2. Consent and Acknowledgment. The Lender hereby consents,
subject to the conditions of Section 4, to the THM Acquisition. By their
execution and delivery hereof, each of the Borrowers and the Lender acknowledges
and agrees that THM, as of the Amendment No. 5 Effective Date (as hereinafter
defined), will become, by its execution and delivery hereof, a Borrower under
and as defined in the Loan Agreement, bound by all of the terms and provisions
thereof.
Section 3. Waiver. The Lender hereby waives, subject to the conditions
of Section 4, compliance and the effects of noncompliance by the Borrowers with
the provisions of (i) Section 10.1(b)(ii) of the Loan Agreement, to the extent
that the Tangible Net Worth of the Borrowers as of March 31, 1998 was not less
than $17,055,660, and (ii) Section 10.1(b)(iii) of the Loan Agreement, to the
extent that the Fixed Charge Coverage Ratio of the Borrowers as of March 31,
1998 was not less than 0.15 to 1.0.
Section 4. Effectiveness. Sections 1,2 and 3 of this Amendment shall
become effective as of the date hereof on the first date (the "Amendment No. 5
Effective Date") on which the following conditions have been satisfied:
(a) Documents and Fees. The Lender shall have received the
following, in form and substance satisfactory to the Lender:
(i) payment by the Borrowers of a $40,000 origination
fee with respect to the increase in the Revolving Credit
Facility and the additional Term Loans effected by this
Amendment (which amount the Borrowers hereby irrevocably
authorize the Lender to charge to any account of the Borrowers
(or an individual Borrower)) maintained with the Lender;
(ii) counterparts of this Amendment duly executed by
the Borrowers, together with the Consent and Confirmation
attached hereto duly executed by the Guarantor;
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(iii) a Revolving Credit Note in the form attached
hereto as ANNEX 1, duly executed and delivered by each
Borrower to the order of the Lender;
(iv) the Term Notes in respect of Term Loan B and
Term Loan C in the form attached hereto as Exhibit A-3, duly
executed and delivered by the Borrowers to the order of the
Lender;
(v) certified copies of the articles of incorporation
and by-laws of each Borrower as in effect on the Amendment No.
5 Effective Date and all corporate action, including
shareholder approval, if necessary, taken by each Borrower or
its shareholders to authorize the transactions contemplated by
this Amendment and the THM Acquisition and the incumbency of
officers of each Borrower;
(vi) a certificate of the chief operating officer,
president, vice president-finance or other officers reasonably
acceptable to the Lender of each of the Borrowers stating
that, to the best of his knowledge and based on an examination
sufficient to enable him to make an informed statement,
(A) both before and after giving effect to this
Amendment and the THM Acquisition, all of the
representations and warranties made or deemed to be
made under the Loan Agreement are true and correct as
of the Amendment No. 5 Effective Date,
(B) both before and after giving effect to this
Amendment and the THM Acquisition, no Default or
Event of Default exists;
(C) there has not occurred any material adverse
change since December 31, 1997 in the business,
assets, operations, condition (financial or
otherwise) or prospects of any Borrower prior to the
Amendment No. 5 Effective Date; and
(D) there does not exist any action, suit,
investigation or proceeding pending or threatened in
any court or before any arbitrator or governmental
authority that purports to affect adversely any
Borrower or the THM Acquisition, or that could have a
material adverse effect on any Borrower or the THM
Acquisition or on the ability of the Borrowers to
perform their obligations under the Loan Documents as
amended.
(vii) a certificate evidencing the good standing of
THM in the jurisdiction of its incorporation and in each other
jurisdiction in which it is qualified as a foreign corporation
to transact business;
(viii) Financing Statements duly executed and
delivered by THM;
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(ix) a Mortgage duly executed and delivered by THM
with respect to property of THM located at 300 West Crawford
Street, Mebane, North Carolina in proper form for the
recording of such instrument in Alamance County, North
Carolina;
(x) a fully paid endorsement to the mortgagee title
insurance policy relating to such Mortgage of THM or, at the
option of the Lender, an unconditional commitment for the
issuance thereof with all requirements and conditions to the
issuance of the final endorsement deleted or marked satisfied,
issued by a title insurance company satisfactory to the
Lender, confirming that such Mortgage creates a valid first
lien on, and security title to, all Real Estate described
therein as security for the Secured Obligations;
(xi) certificates or binders of insurance relating to
each of the policies of insurance covering any of the
Collateral owned by THM together with loss payable clauses
which comply with the terms of Section 7.9 of the Loan
Agreement;
(xii) evidence satisfactory to the Lender of the
release and termination of (or agreement to release and
terminate) all Liens relating to THM's property other than
Permitted Liens;
(xiii) a signed opinion of Moore & Van Allen, counsel
for the Borrowers, and such local counsel as the Lender shall
deem necessary and desirable, opining as to such matters in
connection with this Amendment as the Lender or its counsel
may reasonably request; and
(xiv) updated Schedules to the Loan Agreement and the
Loan Documents, as necessary, revised to reflect the THM
Acquisition and any other changes since March 13, 1998; and
(xv) such other documents and instruments as the
Lender may reasonably request.
(b) THM Acquisition. On the Amendment No. 5 Effective Date (i)
the Lender shall have received true and complete executed or conformed
copies of the THM Acquisition Agreement, and any other agreement,
document, certificate or instrument to be delivered in connection with
the THM Acquisition (collectively, the "THM Acquisition Documents") and
any amendments thereto; (ii) the THM Acquisition 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 THM Acquisition is
required to occur) except with the prior written consent of the Lender,
(iii) none of the parties to any of the THM Acquisition Documents shall
have failed to perform any material obligation or covenant required by
such THM Acquisition Document to be performed or complied with by it on
or before the Amendment No. 5 Effective Date; (iv) certificates shall
have been executed and delivered
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by the THM Acquisition Parties to each other confirming (and such
confirmation shall be accurate) that all representations and warranties
of the THM contained in the THM Acquisition Agreement and the other THM
Acquisition Documents are true and correct in all material respects
with the same effect as though made on and as of the Amendment No. 5
Effective Date; (v) all requisite approvals by governmental authorities
and regulatory bodies having jurisdiction over the THM Acquisition
Parties in respect of the THM Acquisition shall have been obtained by
such parties, and no such approvals shall impose any conditions to the
consummation of the THM Acquisition; (vi) the THM Acquisition shall
have been consummated in accordance with the terms and provisions of
the THM Acquisition Agreement and the other THM Acquisition Documents,
without any amendment or waiver of any material provision thereof;
(vii) the Agent shall have received in form and substance satisfactory
to it financial statements of THM and the pro forma consolidated
balance sheet of the Borrowers as of January 1, 1998; (viii) the Lender
shall have received evidence satisfactory to it and confirmed by a
certificate of the chief financial officer of Ridgeview, that as of the
Amendment No. 5 Effective Date, availability under the Revolving Credit
Facility, after giving effect to the estimated fees and expenses in
connection with the consummation of the transactions contemplated by
this Amendment and the THM Acquisition to be paid on the Amendment No.
5 Effective Date, is not less than $1,000,000; and (x) the Lender shall
have received a certificate of the Ridgeview's chief executive officer
or other evidence satisfactory to it that each of the foregoing
conditions has been satisfied. In addition, all opinion letters
delivered in connection with the THM Acquisition Documents and the
transactions contemplated thereby shall be addressed to the Lender, or
accompanied by a written authorization from the firm delivering such
opinion letter stating that the Lender may rely on such opinion letter
as though it were addressed to them.
Section 5. Effect of Amendment. Upon and after the effectiveness of
this Amendment as provided in Section 3 hereof, all references to the Loan
Agreement in the Loan Agreement or in any other Loan Document shall mean the
Loan Agreement as amended by this Amendment. Except as expressly provided in
this Amendment, the execution and delivery of this Amendment does not, and will
not, amend, modify or supplement any provision of or constitute a consent to or
a waiver of any noncompliance with the provisions of the Loan Agreement and,
except as specifically provided in this Amendment, the Loan Agreement shall
remain in full force and effect.
Section 6. Representations, Warranties and Covenants. Each Borrower
hereby makes the following representations and warranties to, and covenants with
the Lender, which representations, warranties and covenants shall survive the
delivery of this Amendment and the making of Loans under the Loan Agreement as
amended hereby:
(a) Organization; Power; Qualification. Each Borrower is a
corporation, duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its properties and to carry on its
business as now being and hereafter proposed to be conducted and is
duly qualified
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and authorized to do business in each jurisdiction in which failure to
be so qualified and authorized would have a Materially Adverse Effect.
(b) Authorization of Agreements. To the extent it is a party
thereto, each Borrower has the right and power and has taken all
necessary action to authorize it to execute, deliver and perform this
Amendment, the THM Mortgage, the THM Acquisition Agreement and each
other Loan Document and THM Acquisition Document executed in connection
with this Amendment and the THM Acquisition in accordance with its
terms. This Amendment has been, and the THM Mortgage, the THM
Acquisition Agreement and each other Loan Document and THM Acquisition
Document contemplated hereby when executed and delivered by the
Borrowers, will have been, duly executed and delivered by the duly
authorized officers of each Borrower and is, or at such time will be, a
legal, valid and binding obligation of such Borrower, enforceable in
accordance with its terms.
(c) Compliance of Agreements with Laws. The execution and
delivery of this Amendment, the THM Mortgage, the THM Acquisition
Agreement and each other Loan Document and THM Acquisition Document
executed in connection with this Amendment and the THM Acquisition, and
the performance of the Loan Agreement as amended by this Amendment and
of the THM Mortgage, the THM Acquisition Agreement and each other Loan
Document and THM Acquisition Document in accordance with their
respective terms, do not and will not, by the passage of time, the
giving of notice or otherwise,
(i) require any Governmental Approval or violate any
applicable law relating to such Borrower or any of its
Affiliates,
(ii) conflict with, result in a breach of or
constitute a default under (1) the articles of incorporation
or by-laws or any shareholders' agreement of such Borrower,
(2) any indenture, agreement or other instrument to which such
Borrower is a party or by which any of its property may be
bound or (3) any Governmental Approval relating to such
Borrower, or
(iii) result in or require the creation or imposition
of any Lien upon or with respect to any property now owned or
hereafter acquired by such Borrower other than the Security
Interest.
(d) Ridgeview hereby makes the following representations and
warranties to the Lender, which representations and warranties shall
survive the delivery of this Amendment and the making of additional
Loans under the Loan Agreement as amended hereby: (i) it has heretofore
furnished to the Lender true, complete and correct copies of the THM
Acquisition Agreement (including any schedules, exhibits and annexes
thereto) and each THM Acquisition Document; (ii) the THM Acquisition
Agreement has not been amended supplemented or modified except as
previously disclosed in writing to the Lender and, together with the
other THM Acquisition Documents, copies of which have
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also been delivered to the Lender, constitutes the complete
understanding among the THM Acquisition Parties in respect of the THM
Acquisition and the other matters and transactions covered thereby;
(iii) the THM Acquisition Agreement has been duly executed and
delivered by the THM Acquisition Parties and is a valid, legal and
binding obligation of Ridgeview and to Ridgeview's knowledge, the other
THM Acquisition Parties; (iv) the representations and warranties of
Ridgeview contained in the THM Acquisition Agreement are true and
correct in all material respects on the Amendment No. 5 Effective Date,
and the Lender is entitled to rely on such representations and
warranties with the same force and effect as though they were
incorporated in the Loan Agreement as amended by this Amendment and
made to the Lender directly as of the Amendment No. 5 Effective Date.
(e) Landlord Waiver. The Borrowers shall deliver to the
Lender, within 30 days of the date hereof, a landlord's waiver and
consent agreement in form and substance satisfactory to Lender, duly
executed on behalf of the lessor of real property leased by THM in
Mebane, Alamance County, North Carolina.
Section 7. General Provisions.
(a) Expenses.
(i) The Borrowers agree to pay or reimburse on demand
all costs and expenses incurred by the Lender, including,
without limitation, the reasonable fees and disbursements of
counsel, in connection with (a) the negotiation, preparation,
execution, delivery, administration, enforcement and
termination of this Amendment, the Loan Agreement and each of
the other Loan Documents, whenever the same shall be executed
and delivered, including, without limitation, the
out-of-pocket costs and expenses incurred in connection with
the administration and interpretation of this Amendment, the
Loan Agreement and the other Loan Documents, (b) sums paid or
obligations incurred in connection with the payment of any
amount or taking any action required of a Borrower under this
Amendment, the Loan Agreement and the other Loan Documents
that such Borrower fails to pay or take, and (c) any other
obligations or expenses of the Borrowers under Section 12.2 of
the Loan Agreement.
(ii) The foregoing shall not be construed to limit
any other provisions of the Loan Documents regarding costs and
expenses to be paid by the Borrowers. The Borrowers hereby
irrevocably authorize the Lender to charge to any account of
the Borrowers (or any individual Borrower) maintained with the
Lender in the amount of any costs and expenses owed by the
Borrowers , as set forth in this Section or otherwise, when
such costs and expenses are due to the Lender and to deem such
amounts (but not in duplication) a request for a borrowing
under the Revolving Credit Facility pursuant to the provisions
of Section 2A.2(a)(iii) of the Loan Agreement.
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(b) Governing Law. This Amendment shall be construed
in accordance with and governed by the law of the State of
Georgia.
(c) Counterpart Execution. This Amendment may be
executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and shall be
binding upon all parties, their successors and assigns, and
all of which taken together shall constitute one and the same
agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered by their respective officers thereunto duly authorized as
of the date first above written.
RIDGEVIEW, INC.
[CORPORATE SEAL]
Attest: By: ______________________________
Hugh R. Gaither
By: President
Name:
Title:
SENECA KNITTING MILLS CORPORATION
[CORPORATE SEAL]
Attest: By: ______________________________
Hugh R. Gaither
By: President
Name:
Title:
TRI-STAR HOSIERY MILLS, INC.
[CORPORATE SEAL]
Attest: By: ______________________________
Hugh R. Gaither
By: President
Name:
Title:
NATIONSBANK, N.A.
By: ______________________________
Scott K. Goldstein
Vice President
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EXHIBIT E
CONSENT AND CONFIRMATION
The undersigned, GPM Corporation, as the maker of the Subsidiary
Guaranty, hereby acknowledges receipt of the foregoing Amendment No. 5 and
confirms, for the benefit of the Borrowers and the Lender, that the Subsidiary
Guaranty remains in full force and effect, in accordance with its terms, as to
Secured Obligations of the Borrower under the Loan Agreement as amended by the
said Amendment No. 5 and is hereby in all respects ratified and confirmed.
Dated: As of July ___, 1998
GPM CORPORATION
By: ______________________________
Hugh R. Gaither
President