EXECUTION COPY
FIRST AMENDMENT TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
This FIRST AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT,
dated as of September 30, 1996 (the "First Amendment"), amends in certain
respects the Third Amended and Restated Credit Agreement dated as of July 30,
1996 (as amended, the "Credit Agreement"), among Foamex L.P. ("Foamex"), General
Felt Industries, Inc. ("GFI"; and together with Foamex, the "Borrowers"), Trace
Foam Company, Inc. ("Trace Foam"), FMXI, Inc. ("FMXI"), the institutions from
time to time party thereto as Lenders, the institutions from time to time party
thereto as Issuing Banks and Citibank, N.A., as collateral and documentation
agent for the Lenders and the Issuing Banks (the "Collateral Agent") and The
Bank of Nova Scotia, as funding agent for the Lenders and the Issuing Banks (the
"Funding Agent"; together with the Collateral Agent, the "Administrative
Agents").
R E C I T A L S:
Pursuant to a letter dated September 19, 1996, a copy of which is
attached as Exhibit A hereto (the "Letter"), the Borrowers have requested the
undersigned, which constitute the Requisite Lenders, to amend the Credit
Agreement along the lines set forth in the Letter. The Lenders party hereto have
agreed to amend the Credit Agreement to accommodate the request of the Borrowers
contained in the Letter, subject to the terms set forth in this First Amendment.
NOW, THEREFORE, in consideration of the above recitals each of the
Borrowers, Trace Foam, FMXI, the Lenders party hereto and the Administrative
Agents agree as follows:
SECTION 1. Defined Terms. Terms defined in the Credit Agreement not
otherwise defined herein have the meanings given such terms in the Credit
Agreement.
SECTION 2. Amendments to the Credit Agreement. The Credit Agreement is
hereby amended as follows:
2.1 The definition of "Capital Expenditures" contained in Section 1.01
of the Credit Agreement is amended by deleting clause (ii) of the proviso to
such definition in its entirety and replacing it with the following:
(ii) Capital Expenditures shall exclude, whether or not such a designation
would be in conformity with GAAP, (A) expenditures made in connection with
the replacement or restoration of Property, to the extent reimbursed or
financed from insurance or condemnation proceeds which do
not result in a permanent reduction in the Revolving Loan Commitments
pursuant to Section 3.01, (B) expenditures made during such period for the
construction of a new plant facility in Mexico City, Mexico by a member of
the Foamex Mexico Group, provided that the amount for all periods of such
expenditures does not exceed $8,000,000 in the aggregate and (C) any
portion of the purchase price accounted for as a Capital Expenditure paid
by GFI to Habitat International in consideration for the purchase by GFI of
the roll goods business of Habitat International.
2.2 The following definition is added to Section 1.01 of the Credit
Agreement immediately after the definition of "Foamex":
"Foamex Asia Group" means any direct or indirect wholly owned
Subsidiaries of Foamex created for the purpose of facilitating the Borrowers'
business in Asia.
2.3 The following definition is added to Section 1.01 of the Credit
Agreement immediately after the definition of "Governmental Authority":
"Habitat International" means Habitat International, Inc., a Georgia
corporation.
2.4 Section 9.01 of the Credit Agreement is amended by deleting the
word "and" at the end of clause (xii) thereof, by replacing the period at the
end of clause (xiii) thereof with a semicolon followed by the word "and" and by
adding the following new clause (xiv) at the end of such section:
(xiv) Indebtedness incurred by Foamex Asia Group owing to the
Borrowers not in excess of a principal amount of $5,000,000.
2.5 Clause (x) of Section 9.04 of the Credit Agreement is amended in
its entirety to read as follows:
(x) Investments in cash, loans and contributions of Equipment and in
the Equity Interests of Foamex Latin America, Inc. by Foamex; provided that
the aggregate purchase price paid to Foamex International for such Equity
Interests plus any additional Investments of cash, loans or Equipment
(valued at Fair Market Value) made by Foamex in the Foamex Mexico Group
shall in no event exceed $11,000,000 in an aggregate;
2.6 Section 9.04 of the Credit Agreement is further amended by
deleting the word "and" at the end of clause (xvi) thereof, by replacing the
period at the end of clause (xvii) thereof with a semicolon followed by the word
"and" and by adding the following new clause (xviii) at the end of such section:
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(xviii) Investments by either Borrower in the form of loans and/or
capital contributions made to members of the Foamex Asia Group by the
Borrowers up to an aggregate amount for both Borrowers not in excess of
$5,000,000 at any time outstanding.
2.7 Section 9.08 of the Credit Agreement is amended by adding the
words ", Section 9.04(x)" immediately after the words "Section 9.04(ix)" in
clause (i) of such section.
2.8 Section 9.09 of the Credit Agreement is amended by deleting the
last sentence thereof in its entirety and replacing it with the following:
None of the Borrowers, the Borrowers' Subsidiaries or the General Partners
shall create any Subsidiary, except Subsidiaries constituting the Foamex
Asia Group.
2.9 Section 9.13 of the Credit Agreement is amended in its entirety to
read as follows:
9.13. Issuance of Equity Interests. None of the Borrowers nor any
of the Borrowers' Subsidiaries shall issue any Equity Interests, except (i)
Foamex may issue Equity Interests to FMXI, New Partners or Trace Foam in
connection with a cash capital contribution from FMXI, New Partners or
Trace Foam, as the case may be, (ii) Foamex may issue Equity Interests
pursuant to the Acquisition Transactions as contemplated in the Acquisition
Transaction Documents and (iii) any member of the Foamex Asia Group may
issue Equity Interests to the Borrowers or other members of the Foamex Asia
Group in connection with the creation of the Foamex Asia Group but only if
the Investment made by the Borrowers in exchange for such Equity interests
is permitted under Section 9.04 (xviii).
SECTION 3. Consent of the Requisite Lenders. The Requisite Lenders
hereby consent, pursuant to Section 9.01, 9.04 and 9.16 of the Credit Agreement,
to the purchase by GFI of all or substantially all of the assets of Habitat
International's roll goods business, including without limitation the relevant
customer list and the roll goods Inventory of Habitat International for a
purchase price not in excess of $4,000,000; provided, however, the purchase
price for such Investment (i) may be paid in installments over a period of four
years and (ii) may be paid all or in part either in cash or by setting off the
amount of each installment of the purchase price against receivables owing by
Habitat International to GFI at the time such installment becomes due and
payable.
SECTION 4. Conditions to Effectiveness. This First Amendment shall be
effective as of the date hereof, provided that the following conditions
precedent shall have been satisfied:
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4.1 Execution by Requisite Lenders. The Collateral Agent shall have
received this First Amendment duly executed by the Borrowers and the Requisite
Lenders.
4.2 No Default. After giving effect to this First Amendment, no Event
of Default or Potential Event of Default shall have occurred and be continuing
or shall result from the transactions contemplated in this First Amendment.
4.3 Representations and Warranties. All of the representations and
warranties contained in Section 6.01 of the Credit Agreement and in any of the
other Loan Documents (in each case after giving effect to this First Amendment)
shall be true and correct in all material respects on and as of the date hereof
(except for those representations and warranties which expressly speak as of a
different date).
SECTION 5. Representations and Warranties. The Borrowers and the
General Partners hereby represent and warrant to the Lenders party hereto that
(i) the execution, delivery and performance of this First Amendment by each
Borrower and the General Partners are within their respective partnership and
corporate powers and have been duly authorized by all necessary partnership and
corporate action, and (ii) this First Amendment constitutes the legal, valid and
binding obligation of each Borrower and each General Partner, enforceable
against each of them, respectively, in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium
or other laws relating to or limiting creditors' rights generally or by
equitable principles generally.
SECTION 6. Reference to and Effect on the Loan Documents.
6.1 Upon the effectiveness of this First Amendment, on and after the
date hereof each reference in the Credit Agreement to "this Agreement",
"hereunder", "hereof", "herein" or words of like import, and each reference
in the other Loan Documents to the Credit Agreement, shall mean and be a
reference to the Credit Agreement as amended hereby.
6.2 Except as specifically amended above, all of the terms of the
Credit Agreement and all other Loan Documents shall remain unchanged and in
full force and effect.
6.3 The execution, delivery and effectiveness of this First Amendment
shall not, except as expressly provided herein, operate as a waiver of any
right, power or remedy of any Lender or either Administrative Agent under
the Credit Agreement or any of the Loan Documents, nor constitute a waiver
of any provision of the Credit Agreement or any of the Loan Documents.
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SECTION 7. Execution in Counterparts. This First Amendment 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 taken together shall
constitute one and the same agreement.
SECTION 8. Governing Law. This First Amendment shall be governed by,
and shall be construed and enforced in accordance with, the law of the
State of New York.
SECTION 9. Guarantor Consent. By its signature below, each of Foamex
and GFI consents to this First Amendment in its separate capacity as a
guarantor under the Foamex Guaranty and the GFI Guaranty, respectively, and
each hereby affirms its obligations under such guaranties.
SECTION 10. Headings. Section headings in this First Amendment are
included herein for convenience of reference only and shall not constitute
a part of this First Amendment or be given any substantive effect.
IN WITNESS WHEREOF, this First Amendment has been duly executed as of
the date first above written.
FOAMEX L.P.
By: FMXI, Inc.
Its Managing General Partner
By: ____________________________
Title:
GENERAL FELT INDUSTRIES, INC.
By: ____________________________
Title:
TRACE FOAM COMPANY, INC.
By: ____________________________
Title:
FMXI, INC.
By: ____________________________
Title:
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XXXXXXXX, N.A., as Collateral
Agent and individually as a Lender
By: ____________________________
Title:
THE BANK OF NOVA SCOTIA, as Funding
Agent and individually as a Lender
By: ____________________________
Title:
GENERAL ELECTRIC CAPITAL
CORPORATION, as a Lender
By: ____________________________
Title:
XXXXXX FINANCIAL, INC.,
as a Lender
By: ____________________________
Title:
CREDIT LYONNAIS, New York Branch,
as a Lender
By: ____________________________
Title:
CREDIT LYONNAIS, Cayman Island
Branch, as a Lender
By: ____________________________
Title:
FLEET NATIONAL BANK,
as a Lender
By: ____________________________
Title:
NATIONSBANK OF GEORGIA, N.A.
as a Lender
By: ____________________________
Title:
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ACKNOWLEDGMENT
Reference is hereby made to that certain Amended and Restated Guaranty
dated as of June 28, 1994, as amended (the "Guaranty"), executed by the
undersigned, FOAMEX INTERNATIONAL INC., a Delaware corporation ("Foamex
International"), in favor of the Administrative Agents, the Lenders and the
Issuing Banks. Foamex International hereby consents to the terms of the
foregoing First Amendment to Third Amended and Restated Credit Agreement and
agrees that, except as provided in such First Amendment, the terms thereof shall
not affect in any way its obligations and liabilities under the Guaranty or any
other Loan Document to which its is a party, all of which obligations and
liabilities shall remain in full force and effect and each of which are hereby
reaffirmed.
FOAMEX INTERNATIONAL INC.
By: ____________________________
Title:
Dated as of September __, 1996
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ACKNOWLEDGMENT
Reference is hereby made to that certain Guaranty dated as of November 18,
1993, as amended (the "Guaranty"), executed by the undersigned, FOAMEX CAPITAL
CORPORATION, a Delaware corporation ("FCC"), in favor of the Administrative
Agents, the Lenders and the Issuing Banks. FCC hereby consents to the terms of
the foregoing First Amendment to Third Amended and Restated Credit Agreement and
agrees that, except as provided in such First Amendment, the terms thereof shall
not affect in any way its obligations and liabilities under the Guaranty or any
other Loan Document to which its is a party, all of which obligations and
liabilities shall remain in full force and effect and each of which are hereby
reaffirmed.
FOAMEX CAPITAL CORPORATION
By: ____________________________
Title:
Dated as of September __, 1996
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