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EXHIBIT 10.16
[LETTERHEAD]
[CONGRESS LOGO]
February 9, 1998
Xxxxxx'x Custom Crafted Furniture Corp.
Xxxxxx Convertible Corporation
000 Xxxxx Xxxxx Xxxxxx
Xxxx, Xxxxxxxxxx 00000
Re: Waiver of Event of Default
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Ladies and Gentlemen:
XXXXXX'X CUSTOM CRAFTED FURNITURE CORP., a California corporation, and
XXXXXX CONVERTIBLE CORPORATION, a New York corporation (jointly and severally,
"Borrower") has requested that CONGRESS FINANCIAL CORPORATION (WESTERN), a
California corporation ("Lender") waive the Event of Default under that certain
Loan and Security Agreement, dated as of January 20, 1995, as amended to date,
between Lender and Borrower (the "Loan Agreement") resulting from Borrower's
noncompliance with the financial covenant pertaining to EBITDA for the fiscal
quarter ended January 1998. Capitalized terms used herein without definition
shall have the meanings ascribed to them in the Loan Agreement.
Lender hereby waives compliance by Borrower with the financial covenant
set forth in Section 9.15 of the Loan Agreement pertaining to EBITDA for the
fiscal quarter ended January 1998, and shall not exercise its rights and
remedies under the Loan Agreement or applicable law in respect of such Event of
Default; provided, however, that Lender shall be free to exercise all of its
rights and remedies under the Loan Agreement in the event of Xxxxxxxx's
violation or breach after the fiscal quarter ended January 1998 of Section 9.15
of the Loan Agreement.
The foregoing waiver is not a continuing waiver, and Lender does not
hereby amend the terms and provisions of the Loan Agreement. Upon the
occurrence of any Event of Default after the date hereof, or in the event that
Xxxxxx learns of any Event of Default which occurred prior to the date hereof
(other than a breach of the financial covenant set forth in Section 9.15 of the
Loan Agreement for the fiscal quarter ended January 1998), Lender shall be free
to exercise any and all of its various rights and remedies under the Loan
Agreement and applicable law.
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Xxxxxx'x Custom Crafted Furniture Corp.
Xxxxxx Convertible Corporation
February 9, 1998
Page 2
In consideration of Xxxxxx's waiver of the foregoing Event of Default,
Borrower shall pay to Lender a waiver fee of One Thousand Five Hundred Dollars
($1,500), which fee shall be fully earned and payable as of the date hereof.
Please indicate your agreement with the foregoing by signing in the
space provided below.
Very truly yours,
CONGRESS FINANCIAL CORPORATION
(WESTERN)
a California corporation
By: /s/ Xxxxx Xx 2/10/98
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Title: Assistant Vice President
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ACKNOWLEDGED AND AGREED:
XXXXXX'X CUSTOM CRAFTED FURNITURE CORP.,
a California corporation
By: /s/ Xxxxxx X. Xxxxxx
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Title: Senior Vice President CFO
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XXXXXX CONVERTIBLE CORPORATION,
a New York corporation
By: /s/ Xxxxxx X. Xxxxxx
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Title: Senior Vice President CFO
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