FIRST AMENDMENT TO INTERCREDITOR AND SUBORDINATION AGREEMENT
Exhibit
10.4
FIRST
AMENDMENT TO
This
First Amendment to Intercreditor and Subordination Agreement (this
“Amendment”) is dated
as of this ___ day of October, 2007, by and between Textile Investment
International S.A. (“Junior
Creditor”) and Wachovia Bank, National
Association (“Senior
Creditor”).
BACKGROUND
A. Junior
Creditor and Senior Creditor are parties to a certain Intercreditor and
Subordination Agreement dated as of December 30, 2004 (as amended or otherwise
modified from time to time, the “Intercreditor
Agreement”). Capitalized terms used
herein and not otherwise defined shall have the respective meanings set forth
in
the Intercreditor Agreement.
B. The
parties have agreed, subject to the terms and conditions of this Amendment,
to
amend the Intercreditor Agreement.
NOW,
THEREFORE, with the foregoing Background hereinafter deemed incorporated by
this
reference, the parties hereto, intending to be legally bound, promise and agree
as follows:
1. AMENDMENTS
TO INTERCREDITOR AGREEMENT
1.1 Permitted
Payments. Section 3.2(a) of the Intercreditor Agreement is
amended and restated as follows:
(a) Senior
Creditor hereby agrees that, notwithstanding anything to the contrary contained
in Section 3.1, on and after July 31, 2008 Debtor may make, and Junior Creditor
may receive and retain from Debtor, regularly scheduled payments of principal
which, for the purposes hereof, shall include Deferred Note Payments, with
respect to the Junior Debt and interest thereon, evidenced by the License Note
on an unaccelerated basis, in accordance with the terms of the applicable Junior
Creditor Agreements as in effect on the date hereof (but not any payments
pursuant to acceleration or claims of breach (other than with respect to missed
regularly scheduled payments of principal and interest which are subsequently
cured) or to prepay any Junior Debt or otherwise), providedthat,
as of the date of any such payment and after giving effect thereto, (a) no
Default or Event of Default, under the Senior Credit Agreements, shall exist
or
have occurred and be continuing, (b) Debtor has a Fixed Charge Coverage Ratio
(as defined in the Senior Loan Agreement) of at least 1.20 to 1.00 determined
for the twelve (12) month period then ending and (c) Debtor has Excess
Availability of at least $2,500,000.
2. REAFFIRMATION
This
Amendment shall be incorporated into and made part of the Intercreditor
Agreement. Except as expressly modified by the terms hereof, all of
the terms and conditions of the Intercreditor Agreement is hereby reaffirmed
and
shall continue in full force and effect as therein written.
3. MISCELLANEOUS
3.1 GOVERNING
LAW. The validity, construction and effect of this
Amendment shall be governed by the internal laws of the Commonwealth of
Pennsylvania (without giving effect to principles of conflicts of
law).
3.2 Consent
to Jurisdiction; Waiver of Jury Trial. Each of the parties hereto
hereby irrevocably consents to the non-exclusive jurisdiction of the Courts
of
the Commonwealth of Pennsylvania, and the United States District Court for
the
Eastern District of Pennsylvania, and waives trial by jury in any action or
proceeding with respect to this Amendment.
3.3 Counterparts. This
Amendment may be executed in any number of counterparts, each of which shall
be
an original with the same force and effect as if the signatures thereto and
hereto were upon the same instrument.
SIGNATURES
ON FOLLOWING PAGE
Dated
the date and year first written
above.
ACKNOWLEDGMENT
On
this ___ day of October, 2007, the
undersigned hereby acknowledges and agrees to the foregoing terms and
provisions. By its signature below, the undersigned agrees that it
will, together with its successors and assigns, be bound by the provisions
hereof; provided that, nothing in the foregoing Amendment
shall amend, modify, change or supersede the respective terms of any
Creditor’s Agreements with the undersigned. In the event of any
conflict or inconsistencies between the terms of the foregoing Amendment and
the
Senior Creditor Agreements or the Junior Creditor Agreements, the terms of
the
Senior Creditor Agreements or the Junior Creditor Agreements, as the case may
be, shall govern as between the Creditor involved and the
undersigned.
The
undersigned agrees that any
Creditor holding Collateral does so as bailee (under the UCC) for the other
and
is hereby authorized to and may turn over to such other Creditor upon request
therefor any such Collateral, after all obligations and indebtedness of the
undersigned to the bailee Creditor have been fully paid and
performed.
The
undersigned acknowledges and agrees
that: (i) although it may sign this Amendment it is not a party hereto or to
the
Intercreditor Agreement and does not and will not receive any right, benefit,
priority or interest under or because of the existence of the foregoing
Amendment or the Intercreditor Agreement, (ii) in the event of a breach by
the
undersigned or Junior Creditor of any of the terms and provisions contained
in
the foregoing Amendment or the Intercreditor Agreement, such a breach shall
constitute an “Event of Default” as defined in and under the Senior Creditor
Agreements and (iii) it will execute and deliver such additional documents
and
take such additional action as may be necessary or desirable in the opinion
of
any Creditor to effectuate the provisions and purposes of the Intercreditor
Agreement, provided that such requests made or
instructions given for additional documents or additional actions are not
inconsistent with and do not otherwise conflict with the terms of the Senior
Creditor Agreements or the Junior Creditor Agreements.
I.C.
▇▇▇▇▇▇ & COMPANY L.P.,
a
Delaware limited partnership
By:
I.C.
▇▇▇▇▇▇ & Company, Inc., its general partner
By: /s/
▇▇▇▇▇▇ ▇.
▇▇▇▇
▇▇▇▇▇▇
▇. ▇▇▇▇, Chief Executive
Officer