EXHIBIT 10.11
AMENDMENT effective as of October 1, 2004 to the Note Purchase and
Private Shelf Agreement dated as of February 14, 2002 (as amended and in effect
on the date hereof, 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. Amendments to the Agreement. The Agreement is hereby amended such that:
1.1. Subparagraph 6D. Subparagraph 6D 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 (other than the four
fiscal quarter period ending on October 2, 2004) to be less than 1.75
to 1.00. For the four fiscal quarter period ending on October 2, 2004,
the Company will not permit the Fixed Charge Ratio to be less than 1.50
to 1.00."
1.2 Subparagraph 6G. Clause (xi) of Subparagraph 6G is hereby amended
and restated as follows:
"(xi) other Liens not otherwise permitted by clauses (i)
through (x) of this paragraph 6G, provided that the Indebtedness
secured by such Lien shall be permitted by paragraph 6A and such
Indebtedness, when aggregated with Indebtedness securing Liens
permitted by clauses (i), (vii) and (viii) of this paragraph 6G and all
other Priority Debt, does not exceed 20% of Consolidated Net Worth, and
provided further that such Indebtedness (other than with respect to
clause (vii) of this paragraph 6G) does not exceed the book value, or
if less, the fair market value of the property subject to such Lien at
the time such Lien is incurred, and provided further that in no event
shall the Company or any Subsidiary create or permit to exist any Lien
securing the Revolving Credit Facility."
1.3 Subparagraph 6J. Subparagraph 6J is hereby amended and restated as
follows:
"6J. Dividends and Purchase of Stock. At any time after
October 1, 2004 and before December 31, 2004 or at any time when a
Default has occurred and is continuing, the Company will not declare or
pay any dividends (except dividends payable solely in shares of its
capital stock) on any shares of any class of its capital stock, or make
any distributions or apply any of its property or assets to the
purchase, redemption or other retirement of, or set apart any sum for
the payment of any dividends on, any class of capital stock of the
Company."
2. Conditions to Effectiveness. This Amendment shall be effective as of
the date first above written and the Agreement shall be deemed amended
hereby upon the Noteholders' receipt of (i) a true and complete copy of
a fully executed and effective amendment and/or waiver for the period
ending on October 2, 2004 to Section 5.23(b) (Debt Service Coverage
Ratio) appearing in the Revolving Credit Facility (in form and
substance acceptable to the Noteholders), and (ii) a fully executed
copy hereof by Prudential.
3. Company Representations. The Company hereby represents and warrants
that, after giving effect to the effectiveness of this Amendment, no
Default or Event of Default has occurred or is continuing. The Company
further represents and warrants that, other than the amendment referred
to in Section 2(i) of this Amendment, there have been no other
amendments and/or waivers to the Revolving Credit Facility.
4. Guarantor Confirmation. The Guarantor, by its signature below, hereby
acknowledges and consents to this Amendment, and confirms that the
Guaranty and its obligations thereunder continue to be effective with
respect to the Agreement (as amended hereby) and that such Guaranty is
and shall continue to be in full force and effect and is hereby in all
respects ratified and confirmed.
5. 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.
6. Effect on Agreement. Except as expressly provided herein, the Agreement
shall remain in full force and effect and is hereby in all respects
ratified and confirmed. This Amendment 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.
7. Counterparts. This Amendment 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:______/s/__________________
Name:
Title:
QUAKER FABRIC CORPORATION, as Guarantor
By:______/s/__________________
Name:
Title:
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA
By:______/s/___________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
PRUCO LIFE INSURANCE COMPANY
By:______/s/___________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Asst. Vice President