Effective as of
May 1, 1998
Congress Financial Corporation
1133 Avenue of the Americas
New York, New York 10036
Re: Fifteenth Amendment to Financing Agreements
Gentlemen:
Reference is made to the Accounts Financing Agreement
[Security Agreement] between Congress Financial Corporation ("Congress") and
I.C. Issacs & Company L.P. ("Borrower"), dated June 16, 1992 (as amended, the
"Accounts Agreement"), the Covenant Supplement to the Accounts Agreement
between Congress and Borrower, dated June 16, 1992 (as amended, the "Covenant
Supplement"), the letter re Inventory Loans between Congress and Borrower,
dated December 31, 1994 (as amended, the "Inventory Loan Letter"), the Trade
Financing Agreement Supplement to the Accounts Agreement between Congress and
Borrower, dated June 16, 1992 (as amended, the "Trade Financing Agreement
Supplement"), and all other agreements, supplements, instruments and documents
related thereto and executed in connection therewith (collectively, all of
the foregoing, as the same now exist or may hereafter be further amended,
modified, supplemented, extended, renewed, restated or replaced, the
"Financing Agreements." Capitalized terms used herein, unless otherwise
defined herein, shall have the meanings ascribed thereto in the Financing
Agreements.
Borrower has requested certain modifications and amendments to
the Financing Agreements and Congress is willing to agree to such
modifications, subject to the terms and conditions set forth herein.
In consideration of the foregoing, the mutual agreements and
covenants contained herein and for other good and valuable consideration,
Borrower and Congress hereby agree as follows:
1. Accounts Agreement. The Accounts Agreement shall be and is
hereby amended as follows, effective as of May 1, 1998:
a. In Section 2.1 of the Accounts Agreement, the percentage of
"eighty (80%) percent" shall be deleted and the
percentage of "eighty-five (85%) percent" shall be inserted in its stead;
b. The first sentence of Section 3.1 of the Accounts Agreement
is deleted and the following is inserted in its stead:
"Interest shall be payable by us to you on the first
day of each month upon the closing daily balances in our
loan account for each day during the immediately preceding
month at a rate equal to one quarter of one (.25%) percent
per annum below the rate from time to time publicly announced
by CoreStates Bank, N.A., or its successors, at its office
in Philadelphia, Pennsylvania, as its prime rate, whether
or not such announced rate is the best rate available at
such bank."
c. The term "Renewal Date" as defined in Section 9.1 of the
Accounts Agreement shall be amended to mean June 30, 1999;
d. Borrower shall only be required to provide Congress with a
schedule of Accounts, which shall be in form and substance satisfactory to
Congress, once each week based upon the end of the immediately preceding
week, provided however, if Borrower's unused loan availability under the
formulas and sublimits set forth in the Financing Agreements is less than
$5,000,000, Congress may require that it be provided with schedules of
Accounts on a more frequent basis.
2. Inventory Loan Sublimit. In Section 3 of the Inventory Loan
Letter, the figure of "$4,000,000" is deleted and the figure of "$6,000,000"
is inserted in its stead.
3. Letter of Credit Sublimit. In Section 1.5 of the Trade
Financing Agreement Supplement, the figure of "$10,000,000" is deleted and
the figure of "$12,000,000" is inserted in its stead.
4. Termination of Personal Guaranties. The personal guaranties of
Borrower's obligations and indebtedness to Congress executed by,
respectively, Ira Hechler, Robert Arnot, Gerald Lear, Eugene Wielepski, Gary
Brashers and Stanley Keller shall be and are hereby terminated, discharged and
released in their entirety.
5. Conditions Precedent. This Amendment shall be effective on May
1, 1998 and upon the satisfaction of each of the following conditions
precedent in a manner satisfactory to Congress:
a. no Event of Default shall have occurred and be continuing
and no event shall have occurred or condition be
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existing and continuing which, with notice or passage of time or both, would
constitute an Event of Default; and
b. Congress shall have received, in form and substance
satisfactory to Congress, an original of this Amendment, duly authorized,
executed and delivered by Borrower.
6. Effect of this Amendment. Except as specifically modified
pursuant hereto, no other changes or modifications to the Financing
Agreements are intended or implied and, in all other respects, the Financing
Agreements are hereby ratified and confirmed by all parties hereto as of the
date hereof. This Amendment represents and incorporates the entire
understanding and agreements of the parties with respect to the matters set
forth herein and the parties hereto agree that there are no representations,
warranties, covenants or understandings of any kind, nature or description
whatsoever made by Congress to Borrower with respect to this Amendment,
except as specifically set forth herein. This Amendment represents the final
agreement between the parties as to the subject matter hereof and may not be
contradicted by evidence or prior, contemporaneous or subsequent oral
agreements of the parties.
7. Waiver, Modification, Etc. No provision or term hereof may be
modified, altered, waived, discharged or terminated orally, but only by an
instrument in writing executed by the party against whom such modification,
alteration, waiver, discharge or termination is sought.
8. Further Assurances. The parties hereto shall execute and
deliver such additional documents and take such additional action as may be
necessary to effectuate the provisions and purposes of this Amendment.
9. Counterparts. This Amendment may be executed in one or more
counterparts which, taken together, shall constitute the agreement of the
parties.
Very truly yours,
I.C. ISAACS & COMPANY, INC., L.P.
By: I.C. ISAACS & COMPANY,
INC.,
Agreed and Accepted formerly known as
Isbuyco, Inc.,
CONGRESS FINANCIAL CORPORATION General Partner
By: /s/ Lawrence S. Forte By: /s/ Eugene C. Wielepski
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Title: First Vice President Title: Vice President
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