Exhibit 10.26
 
LIMITED WAIVER AND AMENDMENT NO. 9 TO CREDIT AGREEMENT
 
This LIMITED WAIVER AND AMENDMENT NO. 9 TO CREDIT AGREEMENT (this “Amendment”)
is dated as of March 12, 2013 by and among INTERNATIONAL TEXTILE GROUP, INC., a
Delaware corporation (“ITG”), the other Borrowers and Credit Parties signatory
hereto, GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation (“GE
Capital”), for itself and as Agent (“Agent”), and the other Lenders signatory
hereto.  Unless otherwise specified herein, capitalized terms used in this
Amendment shall have the meanings ascribed to them in the Credit Agreement (as
hereinafter defined).
 
R E C I T A L S:
 
WHEREAS, Borrowers, the other Credit Parties, the Agent and the Lenders entered
into that certain Amended and Restated Credit Agreement dated as of March 30,
2011 (as amended, supplemented, restated or otherwise modified from time to
time, the “Credit Agreement”); and
 
WHEREAS, the parties to the Credit Agreement have agreed to a limited waiver of,
and an amendment to, the Credit Agreement as set forth herein.
 
NOW, THEREFORE, in consideration of the premises contained herein, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
 
1           Limited Waiver.  Agent and the Lenders hereby waive any Event of
Default that has occurred under Section 7.1(i) of the Credit Agreement solely to
the extent any such Event of Default occurred on or prior to the Ninth Amendment
Effective Date.
 
2           Amendments to Credit Agreement.
 
2.1           Section 5.4(f) of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:
 
“(f) the Investment by ITG in ITG – Phong Phu Limited Company, a joint venture
organized under the laws of Vietnam (“Phong Phu”), in the form of an unsecured
subordinated loan from ITG (either directly or through one of its Subsidiaries)
to Phong Phu (the “Phong Phu JV Loan”); provided that (v) such Investment shall
be made by no later than June 24, 2011, (w) such Investment shall not exceed
$3,500,000, (x) at the time such Investment is made, no Default or Event of
Default shall have occurred and be continuing, (y) such Phong Phu JV Loan shall
be evidenced by a promissory note in form and substance satisfactory to the
Agent and delivered to the Agent in original copy together with instruments of
transfer executed in blank and (z) either (i) such Phong Phu JV Loan shall have
been repaid in full in cash by Phong Phu by no later than the date one month
prior to the stated expiry date, non-renewal date or termination date of the
WLR/RBS Letter of Credit (the “WLR/RBS Letter of Credit Trigger Date”) (which
repayment shall have been evidenced by a certificate of a Responsible Officer of
the Borrower Representative delivered to Agent certifying that such amounts have
been repaid by Phong Phu by no later than such date) or (ii) Agent, for the
benefit of the Lenders, shall have received payment under the WLR/RBS Letter of
Credit in the full amount thereof on or before expiration, non-renewal or
termination of the WLR/RBS Letter of Credit in accordance with its terms (which
amounts shall have been applied by Agent first to prepay outstanding Swing
Loans, and second to prepay outstanding Revolving Loans owing by the Borrowers
without a permanent reduction of the Aggregate Revolving Loan Commitment);
provided that, to the extent the Phong Phu JV Loan shall have been repaid in
full in cash by Phong Phu to ITG on or prior to the WLR/RBS Letter of Credit
Trigger Date, Agent shall, on behalf of the Lenders, terminate the WLR/RBS
Letter of Credit in accordance with its terms;”
 
 
 

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2.2           Section 7.1(i) of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:
 
“(i)           Secured Note Indebtedness.  If the final stated maturity date of
the Secured Note Indebtedness has not been extended to a date no earlier than
ninety-five (95) days after the later of the Revolving Termination Date and the
final scheduled installment payment date for the Term Loan, the occurrence of
the date sixty-nine (69) days prior to the final stated maturity date of the
Secured Note Indebtedness; or”
 
2.3           Section 11.1 of the Credit Agreement is hereby amended by
inserting the following new defined terms in proper alphabetical order thereto:
 
““Ninth Amendment Effective Date” has the meaning assigned to such term in that
certain Limited Waiver and Amendment No. 9 to Credit Agreement dated as of March
12, 2013 among Borrowers, the other Credit Parties signatory thereto, Agent and
the Lenders signatory thereto.”
 
2.4           Section 11.1 of the Credit Agreement is hereby amended by amending
and restating the following defined terms in their entirety to read as follows:
 
““WLR/RBS Letter of Credit” means (A) prior to the Ninth Amendment Effective
Date, an irrevocable standby letter of credit in form and substance satisfactory
to Agent that (i) is issued by RBS Citizens, N.A. in an amount equal to
$3,675,000, (ii) names GE Capital, in its capacity as Agent for itself and the
Lenders, as the beneficiary thereof and (iii) names WLR Recovery Fund IV L.P. as
the applicant, which letter of credit shall have been delivered in original copy
to Agent on the Second Amendment Effective Date and (A) which letter of credit
shall have been amended (the “WLR/RBS LC Amendment”) on or prior to the Sixth
Amendment Effective Date in a manner satisfactory to Agent to (x) extend the
expiration date thereof from June 13, 2012 to December 22, 2012, (y) change the
reference to May 14, 2012 therein to November 22, 2012 and (z) provide that
Agent may request payment thereunder to the extent an Event of Default shall
have occurred and be continuing and (B) which letter of credit shall have been
further amended (the “Second WLR/RBS LC Amendment”) on or prior to the Eighth
Amendment Effective Date in a manner satisfactory to Agent to (x) extend the
expiration date thereof from December 31, 2012 to March 31, 2013 and (y) change
the reference to November 22, 2012 therein to February 28, 2013 and (B) from and
after the Ninth Amendment Effective Date, an evergreen standby letter of credit
in form and substance satisfactory to Agent (the “Replacement WLR/RBS Letter of
Credit”) that (i) is issued by RBS Citizens, N.A. in an amount equal to
$3,675,000, (ii) names GE Capital, in its capacity as Agent for itself and the
Lenders, as the beneficiary thereof, and (iii) names WLR Recovery Fund IV, L.P.
as the applicant, which letter of credit shall have been delivered in original
copy to Agent on or prior to the Ninth Amendment Effective Date.”
 
 
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““WLR/RBS Letter of Credit II” means (A) prior to the Eighth Amendment Effective
Date, (x) an evergreen standby letter of credit in form and substance
satisfactory to Agent that (i) is issued by RBS Citizens, N.A. in an amount
equal to $20,000,000, (ii) names GE Capital, in its capacity as Agent for itself
and the Lenders, as the beneficiary thereof, and (iii) names WLR Recovery Fund
IV, L.P. as the applicant, which letter of credit shall have been delivered in
original copy to Agent on or prior to the Fourth Amendment Effective Date, as
amended from time to time, or (y) any replacement evergreen standby letter of
credit that names GE Capital, in its capacity as Agent for itself and the
Lenders, as the beneficiary thereof, and WLR Recovery Fund IV, L.P. as the
applicant, which letter of credit shall have been issued in accordance with
Section 1 of the Support Agreement and which letter of credit shall have been
delivered in original copy to Agent, (B) from and after the Eighth Amendment
Effective Date but prior to the Ninth Amendment Effective Date, an irrevocable
standby letter of credit in form and substance satisfactory to Agent (the
“Replacement WLR/RBS Letter of Credit II”) that (i) is issued by RBS Citizens,
N.A. in an amount equal to $20,000,000, (ii) names GE Capital, in its capacity
as Agent for itself and the Lenders, as the beneficiary thereof, and (iii) names
WLR Recovery Fund IV, L.P. as the applicant, which letter of credit shall have
been delivered in original copy to Agent on or prior to the Eighth Amendment
Effective Date and (C) from and after the Ninth Amendment Effective Date, (x) an
evergreen standby letter of credit in form and substance satisfactory to Agent
(the “Second Replacement WLR/RBS Letter of Credit II”) that (i) is issued by RBS
Citizens, N.A. in an amount equal to $20,000,000, (ii) names GE Capital, in its
capacity as Agent for itself and the Lenders, as the beneficiary thereof, and
(iii) names WLR Recovery Fund IV, L.P. as the applicant, which letter of credit
shall have been delivered in original copy to Agent on or prior to the Ninth
Amendment Effective Date, as amended from time to time, or (y) any replacement
evergreen standby letter of credit that names GE Capital, in its capacity as
Agent for itself and the Lenders, as the beneficiary thereof, and WLR Recovery
Fund IV, L.P. as the applicant, which letter of credit shall have been issued in
accordance with Section 1 of the Support Agreement and which letter of credit
shall have been delivered in original copy to Agent.”
 
3           Representations and Warranties.  In order to induce Agent and the
Lenders to enter into this Amendment, each Borrower and each other Credit Party
represents and warrants to Agent and each Lender (which representations and
warranties shall survive the execution and delivery of this Amendment), that:
 
(a)           the execution, delivery and performance by each Credit Party of
this Amendment has been duly authorized by all necessary corporate and
partnership action and this Amendment is a legal, valid and binding obligation
of such Credit Party enforceable against such Credit Party in accordance with
its terms; and
 
(b)           upon the effectiveness of this Amendment, all of the
representations and warranties contained in the Credit Agreement and in the
other Loan Documents (other than those which speak expressly only as of an
earlier date) are true and correct in all material respects on and as of the
date of the effectiveness of this Amendment after giving effect to this
Amendment and the transactions contemplated hereby.
 
 
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4           Conditions to Effectiveness.  This Amendment shall be effective on
the date when each of the following conditions has been satisfied (the “Ninth
Amendment Effective Date”):
 
(a)           This Amendment shall have been duly executed and delivered by each
Borrower, each other Credit Party party hereto, Agent, the Supermajority
Revolving Lenders and the Majority Lenders;
 
(b)           Agent shall have received duly executed and delivered copies of
the Replacement WLR/RBS Letter of Credit and the Second Replacement WLR/RBS
Letter of Credit II; and
 
(c)           Agent shall have received, to the extent invoiced, payment of all
out-of-pocket expenses (including the legal fees and expenses of Latham &
Watkins LLP, counsel to Agent).
 
5           Miscellaneous.
 
5.1           Effect; Ratification.
 
(a)           Except as specifically set forth above, the Credit Agreement and
the other Loan Documents shall remain in full force and effect and are hereby
ratified and confirmed.  Without limiting the generality of the foregoing, each
Credit Party reaffirms its guaranty of the Obligations and the Liens securing
those guaranties.
 
(b)           The execution, delivery and effectiveness of this Amendment shall
not operate as a waiver of any right, power or remedy of Agent or any Lender
under the Credit Agreement or any other Loan Document, nor constitute amendment
of any provision of the Credit Agreement or any other Loan Document, except as
specifically set forth herein.  Upon the effectiveness of this Amendment, each
reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”,
“herein” or words of similar import shall mean and be a reference to the Credit
Agreement as amended hereby.
 
(c)           Each Credit Party acknowledges and agrees that the amendments set
forth herein are effective solely for the purposes set forth herein and that the
execution and delivery by Agent and the Lenders of this Amendment shall not be
deemed (i) except as expressly provided in this Amendment, to be a consent to
any amendment, waiver or modification of any term or condition of the Credit
Agreement or of any other Loan Document, (ii) to create a course of dealing or
otherwise obligate Agent or Lenders to forbear, waive, consent or execute
similar amendments under the same or similar circumstances in the future, or
(iii) to amend, prejudice, relinquish or impair any right of Agent or Lenders to
receive any indemnity or similar payment from any Person or entity as a result
of any matter arising from or relating to this Amendment.
 
 
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5.2           Counterparts and Signatures by Fax.  This Amendment may be
executed in any number of counterparts, each such counterpart constituting an
original but all together one and the same instrument.  Any party delivering an
executed counterpart of this Amendment by fax shall also deliver an original
executed counterpart, but the failure to do so shall not affect the validity,
enforceability or binding effect of this Amendment.
 
5.3           Severability.  In case any provision in or obligation under this
Amendment shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
 
5.4           Loan Document.  This Amendment shall constitute a Loan Document.
 
5.5           GOVERNING LAW.  THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL, IN ALL RESPECTS, INCLUDING MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE, BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND PERFORMED IN THAT STATE AND ANY APPLICABLE LAWS OF THE UNITED
STATES OF AMERICA.
 
[Signature Pages Follow]
 
 
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the
date first above written.
 

 
BORROWERS:

INTERNATIONAL TEXTILE GROUP, INC.
BURLINGTON INDUSTRIES LLC
CONE JACQUARDS LLC
CONE DENIM LLC
CARLISLE FINISHING LLC
SAFETY COMPONENTS FABRIC
   TECHNOLOGIES, INC.

By: /s/ Craig J. Hart                                    
Name: Craig J. Hart
Title: Vice President and Treasurer

NARRICOT INDUSTRIES LLC

By: International Textile Group, Inc., its sole member

By: /s/ Craig J. Hart                                    
Name: Craig J. Hart
Title: Vice President and Treasurer

 
 

[Signature Page to Amendment No. 9 to Amended and Restated Credit Agreement]
 
 

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OTHER CREDIT PARTIES:
 
APPAREL FABRICS PROPERTIES, INC.
BURLINGTON INDUSTRIES V, LLC
CONE ADMINISTRATIVE AND SALES LLC
CONE INTERNATIONAL HOLDINGS II, INC.
INTERNATIONAL TEXTILE GROUP ACQUISITION
   GROUP LLC
BURLINGTON WORLDWIDE INC.
CONE DENIM WHITE OAK LLC
CONE INTERNATIONAL HOLDINGS, INC.
CONE ACQUISITION LLC
WLR CONE MILLS IP, INC.

By: /s/ Craig J. Hart                                    
Name: Craig J. Hart
Title: Vice President and Treasurer

 

 
VALENTEC WELLS, LLC
By: International Textile Group, Inc., its sole member

By: /s/ Craig J. Hart                                    
Name: Craig J. Hart
Title: Vice President and Treasurer

 
 
 
[Signature Page to Amendment No. 9 to Amended and Restated Credit Agreement]
 
 

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AGENT AND LENDERS:

 
GENERAL ELECTRIC CAPITAL CORPORATION,
as the Agent and a Lender
 
By: /s/ Philip Carfora                                                         
Name: Philip Carfora
Title:  Its Duly Authorized Signatory

 
 
 
[Signature Page to Amendment No. 9 to Amended and Restated Credit Agreement]
 
 

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TD BANK, N.A., as a Lender

By: /s/ Jang Kim                            
Name: Jang Kim
Title: Vice President

 
 
 
[Signature Page to Amendment No. 9 to Amended and Restated Credit Agreement]
 
 

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BANK OF AMERICA, N.A., as a Lender

By: /s/ John Yankauskas                            
Name: John Yankauskas
Title: Sr. Vice President

[Signature Page to Amendment No. 9 to Amended and Restated Credit Agreement]