Document:

Amendment #7 to the Loan Security Agreement

 EXHIBIT 10.1 
 [Execution] 
 AMENDMENT NO. 7 AND CONSENT 
 TO  
 LOAN AND SECURITY AGREEMENT 
 As of October 20, 2006 
 Wachovia Bank, National
Association 
 110 East Broward Boulevard 
 Suite 2050 

Fort Lauderdale, Florida 33301 
 Attention: Portfolio Manager 

 

	 	Re:	Loan and Security Agreement, dated October 11, 2000, as Amended 

 Ladies and Gentlemen: 
 Wachovia Bank, National Association, successor by merger to Congress Financial Corporation (Southern)
(“Lender”), Valentec Wells, LLC, formerly known as Valentec International Corporation, LLC (“Valentec”), Safety Components Fabric Technologies, Inc. (“SCFT”), Automotive Safety Components International, Inc.
(“Automotive International”), Automotive Safety Components International GmbH & Co. KG (“German Borrower”), Automotive Safety Components International Limited (“UK Borrower” and together with Valentec, SCFT,
Automotive International and German Borrower, individually each a “Borrower” and collectively, “Borrowers”), Safety Components International, Inc. (“Safety”), ASCI Holdings Germany (DE), Inc. (“ASCI Germany”),
ASCI Holdings U.K. (DE), Inc. (“ASCI UK”), ASCI Holdings Mexico (DE), Inc. (“ASCI Mexico”), ASCI Holdings Czech (DE), Inc. (“ASCI Czech”), Automotive Safety Components International, S.A. de C.V. (“Automotive
Safety Mexico”) and Automotive Safety Components International s.r.o. (“Automotive Safety Czech” and together with Safety, ASCI Germany, ASCI UK, ASCI Mexico, ASCI Czech and Automotive Safety Mexico, each individually a
“Guarantor” and collectively, “Guarantors”) have entered into financing arrangements pursuant to which Lender has made and may, subject to certain terms and conditions, hereafter make loans and advances to Borrowers as set forth
in the Loan and Security Agreement, dated October 11, 2000, by and among Lender, Borrowers and Guarantors, as amended by Amendment No. 1 and Consent to Loan and Security Agreement, dated as of November 2, 2001, Amendment No. 2 to
Loan and Security Agreement, dated as of October 11, 2002, Amendment No. 3 and Consent to Loan and Security Agreement, dated as of October 8, 2003, Amendment No. 4 to Loan and Security Agreement, dated as of July 20, 2004,
Amendment No. 5 and Consent to Loan and Security Agreement, dated as of October 1, 2004 and Amendment No. 6 and Consent to Loan and Security Agreement, dated as of October 6, 2006 (as the same now exists or may hereafter be
amended, modified, supplemented, extended, renewed, restated or replaced, the “Loan Agreement”) and other agreements, documents and 

 
instruments referred to therein or at any time executed and/or delivered in connection therewith or related thereto, together with this Amendment (all of the
foregoing, including the Loan Agreement, as the same now exist or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced, being collectively referred to herein as the “Financing Agreements”). All
capitalized terms used herein shall have the meaning assigned thereto in the Loan Agreement, unless otherwise defined herein. 
 WHEREAS,
Safety, SCI Merger Sub, Inc., a Delaware corporation which is a wholly-owned Subsidiary of Safety (“Merger Sub”) and International Textile Group, Inc., a Delaware corporation (“ITG”), have entered into the Agreement and Plan of
Merger, dated as of August 29, 2006 (the “ITG Merger Agreement” as hereinafter further defined), pursuant to which Merger Sub will merge with and into ITG with ITG being the surviving corporation (the “ITG Merger”), all in
accordance with the terms of the ITG Merger Agreement (as in effect on the date hereof); 
 WHEREAS, Borrowers and Guarantors have requested
that Lender agree to, among other things, consent to the consummation of the ITG Merger; and 
 WHEREAS, Lender is willing to consent to such
requests subject to the terms and conditions contained herein. 
 NOW THEREFORE, in consideration of the forgoing and the agreements and
covenants contained herein, and for other good and valuable consideration, the adequacy and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 
 1. Amendments. 
 (a)
Definitions. 
 Amendment to Definitions. The definition of “Subsidiary” in Section 1.09 of the
Loan Agreement is hereby amended by adding the following at the end of such definition: “Notwithstanding anything to the contrary contained herein, and solely for purposes of the Loan Agreement and the other Financing Agreements, in no event
shall any of the ITG Companies be deemed to be Subsidiaries of any Borrower or Guarantor.” 
 (i) Additional Definitions. The
following terms shall have the meanings given to them below and the Loan Agreement shall be deemed and is hereby amended to include, in addition and not in limitation, the following definitions: 
 (A) “Amendment No. 7” shall mean Amendment No. 7 and Consent to Loan and Security Agreement, dated as of October 20, 2006, by
and among Lender, Borrowers and Guarantors. 
 (B) “ITG Companies” shall mean, collectively, ITG and its direct and indirect
Subsidiaries; provided, that, in no event shall the ITG Companies include any Borrower or Guarantor. 
 (C) “ITG Merger
Agreement” shall mean the Agreement and Plan of Merger, dated as of August 29, 2006, by and among ITG, Safety and Merger Sub. 
  

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 2. Consent to ITG Merger. Subject to the terms and conditions contained herein and notwithstanding
anything to the contrary contained in Section 9.7(a) of the Loan Agreement, Lender hereby consents to the consummation of the ITG Merger in accordance with the terms of the ITG Merger Agreement (as in effect on the date hereof);
provided, that, each of the following conditions shall have been satisfied: (a) as of the effective date of the ITG Merger and after giving effect thereto, no Event of Default or act, condition or event which with notice or
passage of time would constitute an Event of Default shall exist or have occurred and be continuing, (b) Lender shall have received true, complete and correct executed copies of the ITG Merger Agreement and all other material documents,
agreements or instruments relating thereto to which any Borrower or Guarantor is a party or by which any Borrower or Guarantor (or its assets) is bound (together with the ITG Merger Agreement, the “ITG Merger Documents”), (c) no
Borrower or Guarantor shall, directly or indirectly, pay or be liable for any merger consideration or any other amounts payable in connection with the ITG Merger, except that: (i) Safety may use shares of its common stock as merger
consideration, and (ii) Safety may make cash payments for fractional shares and transaction expenses in connection with the ITG Merger up to the aggregate amount of $3,000,000, so long as, both before and after giving effect to any such cash
payment, the aggregate Excess Availability of Borrowers shall not be less than the US Dollar Equivalent of US$15,000,000, (d) notwithstanding anything to the contrary in the Loan Agreement, in no event shall any Borrower or Guarantor:
(i) become liable for any Indebtedness or other obligations (contingent or otherwise) of any of the ITG Companies or (ii) become liable for any Indebtedness or other obligations (contingent or otherwise) as a result of the ITG Merger
except (as to this clause (ii) only) as otherwise permitted under the Loan Agreement, (e) notwithstanding anything to the contrary contained in the Loan Agreement, Borrowers and Guarantors shall not, and shall not permit any of their
respective Subsidiaries (other than the ITG Companies) to, directly or indirectly, make loans or advances to, make any investments in, or pay any dividends to, any of the ITG Companies, (f) all actions and proceedings required by the ITG Merger
Agreement, applicable law or regulation and the transactions contemplated thereby shall have been duly and validly taken in accordance with the terms thereof, and all required consents thereto shall have been obtained and be in full force and
effect, and no court of competent jurisdiction shall have issued any injunction, restraining order or other order which prohibits the consummation of the transactions described in the ITG Merger Agreement or modifies such transactions, and no
governmental or other action or proceeding shall have been commenced, seeking any injunction, restraining order or other order which seeks to void or otherwise modify the transactions described in the ITG Merger Agreement; 
 3. Representations, Warranties and Covenants. Each Borrower and Guarantor, jointly and severally, represents, warrants and covenants with and to
Lender as follows, which representations, warranties and covenants are continuing and shall survive the execution and delivery hereof, the truth and accuracy of, or compliance with each, together with the representations, warranties and covenants in
the other Financing Agreements, being a continuing condition of the making or providing of any Loans or Letter of Credit Accommodations by Lender to Borrowers: 
  

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 (a) neither the execution and delivery of this Amendment, or the documents, agreements or instruments
executed or delivered in connection therewith or related thereto including, without limitation the ITG Merger Agreement (collectively, together with this Amendment, the “Amendment Documents”) nor the consummation of the transactions herein
or therein contemplated, nor compliance with the provisions hereof or thereof are in contravention of any law or regulation or any order or decree of any court or Governmental Authority applicable to Borrowers or Guarantors or any of their
respective Subsidiaries, or conflict with or result in the breach of, or constitutes a default under any mortgage, deed of trust, security agreement, agreement or instrument to which any Borrower or Guarantor is a party or may be bound, or violates
any provision of the Certificate of Incorporation, Certificate of Formation, Operating Agreement or By-Laws (or similar organizational documents) of any Borrower or Guarantor; 
 (b) the Amendment Documents have been duly authorized, executed and delivered by all necessary action on the part of each Borrower and Guarantor which is
a party hereto and thereto and, if necessary, their respective equity holders, and the agreements and obligations of each Borrower and Guarantor contained herein and therein constitute legal, valid and binding obligations of each Borrower and
Guarantor enforceable against such entities in accordance with their respective terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium or similar laws limiting creditors’ rights generally and by general
equitable principles; 
 (c) no consent, approval or other action of, or filing with or notice to any Governmental Authority is required in
connection with the execution, delivery and performance of any of the Amendment Documents by any Borrower or Guarantor, except for those which have been made or obtained and are in full force and effect; 
 (d) all of the representations and warranties set forth in the Loan Agreement and the other Financing Agreements, each as amended hereby, are true and
correct in all respects on and as of the date hereof as if made on the date hereof, except to the extent any such representation or warranty is made as of a specified date, in which case such representation or warranty shall have been true and
correct as of such date; 
 (e) Borrowers and Guarantors have delivered to Lender true, complete and correct copies of all ITG Merger
Documents; 
 (f) after giving effect to the consummation of the ITG Merger, Safety is Solvent; and 
 (g) no Event of Default or act, condition or event which with notice or passage or time or both would constitute an Event of Default, exists or has
occurred and is continuing. 
 4. Conditions Precedent. The amendments and consents set forth herein shall be effective upon the
satisfaction of each of the following conditions precedent in a manner satisfactory to Lender: 
 (a) Lender shall have received an original
of this Amendment, duly authorized, executed and delivered by each of the parties hereto; 
  

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 (b) all requisite corporate action and proceedings in connection with this Amendment and the other
Amendment Documents shall be in form and substance satisfactory to Lender, and Lender shall have received all information and copies of all documents, including records of requisite corporate action and proceedings which Lender may have requested in
connection therewith, such documents where requested by Lender or its counsel to be certified by appropriate corporate officers or governmental authorities; 
 (c) no Event of Default or act, condition or event which with notice or passage of time or both would constitute an Event of Default shall exist or have occurred and be continuing; and 
 (d) Lender shall have received a true and correct copy of any consent, waiver or approval to or of this Amendment or any of the other Amendment
Documents, which any Borrower or Guarantor is required to obtain from any other Person, and such consent, approval or waiver shall be in form and substance satisfactory to Lender. 
 5. General. 
 (a) Effect of this
Amendment. Except as expressly provided herein, no other changes or modifications to the Financing Agreements are intended or implied, and in all other respects the Financing Agreements are hereby specifically ratified, restated and confirmed by
all parties hereto as of the date hereof. To the extent any conflict exists between the terms of this Amendment and the Financing Agreements, the terms of this Amendment shall control. 
 (b) Further Assurances. The parties hereto shall execute and deliver such additional documents and take such additional actions as may be
necessary to effectuate the provisions and purposes of this Amendment. 
 (c) Governing Law. The rights and obligations hereunder of
each of the parties hereto shall be governed by and interpreted and determined in accordance with the internal laws of the State of New York (without giving effect to principles of conflicts of laws or other rules of law that would result in the
application of the law of any jurisdiction other than the State of New York). 
 (d) Binding Effect. This Amendment is binding upon
and shall inure to the benefit of Lender, Borrowers, Guarantors and their respective successors and assigns. Any amendment or consent contained herein shall not be construed to constitute an amendment or consent to any other or further action by
Borrowers or Guarantors or to entitle Borrowers or Guarantors to any other amendment or consent. The Loan Agreement and this Amendment shall be read and construed as one agreement. 
 (e) Counterparts, etc. This Amendment may be executed in one or more counterparts, each of which when so executed shall be deemed to be an
original but all of which when taken together shall constitute one and the same instrument. In making proof of this Amendment, it shall not be necessary to produce or account for more than one counterpart hereof signed by each of the parties hereto.
This Amendment may be executed and delivered by telecopier or other method of electronic transmission with the same force and effect as if it were a manually executed and delivered counterpart. 
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 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by
their respective duly authorized officers as of the date first written above. 
  

			
	SAFETY COMPONENTS FABRIC TECHNOLOGIES, INC.
		
	By:	 	 /s/

	Title:	 	  

	
	AUTOMOTIVE SAFETY COMPONENTS INTERNATIONAL, INC.
		
	By:	 	 /s/

	Title:	 	  

	
	AUTOMOTIVE SAFETY COMPONENTS INTERNATIONAL GmbH & CO. KG
		
	By:	 	 /s/

	Title:	 	  

	
	AUTOMOTIVE SAFETY COMPONENTS INTERNATIONAL LIMITED
		
	By:	 	 /s/

	Title:	 	  

	
	VALENTEC WELLS, LLC (formerly known as Valentec International Corporation, LLC)
		
	By:	 	 /s/

	Title:	 	  

 [SIGNATURES CONTINUED ON NEXT PAGE] 
  

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 [SIGNATURES CONTINUED FROM PREVIOUS PAGE] 
  

			
	SAFETY COMPONENTS INTERNATIONAL, INC.
		
	By:	 	 /s/

	Title:	 	  

	
	ASCI HOLDINGS GERMANY (DE), INC.
		
	By:	 	 /s/

	Title:	 	  

	
	ASCI HOLDINGS U.K. (DE), INC.
		
	By:	 	 /s/

	Title:	 	  

	
	ASCI HOLDINGS MEXICO (DE), INC.
		
	By:	 	 /s/

	Title:	 	  

	
	ASCI HOLDINGS CZECH (DE), INC.
		
	By:	 	 /s/

	Title:	 	  

	
	AUTOMOTIVE SAFETY COMPONENTS INTERNATIONAL, S.A. de C.V.
		
	By:	 	 /s/

	Title:	 	  

 [SIGNATURES CONTINUED ON NEXT PAGE] 
  

 B-2 

 [SIGNATURES CONTINUED FROM PREVIOUS PAGE] 
  

			
	AUTOMOTIVE SAFETY COMPONENTS INTERNATIONAL S.R.O.
		
	By:	 	 /s/

	Title:	 	  

  

			
	 AGREED:

	
	WACHOVIA BANK, NATIONAL ASSOCIATION, successor by merger to Congress Financial Corporation (Southern)
		
	By:	 	 /s/

	Title:	 	Managing Director

  

 B-3Employment Agreement, Stephen B. Duerk

 EXHIBIT 10.2 
 EMPLOYMENT AGREEMENT 
 In the context of the proposed merger of Safety Components International, Inc. and
International Textile Group, Inc. evidenced by a merger agreement dated August 20, 2006 (“Merger Agreement”), the parties hereto agree to enter into this Employment Agreement. This Agreement is subject to the condition of the
conclusion and approval of the Merger Agreement and shall become effective (“Effective Date”) as of the Closing Date, as such term “Closing Date” is to be construed as defined in the Merger Agreement. 
 THIS EMPLOYMENT AGREEMENT (“Agreement”) is entered into as of the Effective Date by and between Stephen B. Duerk (“Executive”)
and International Textile Group, Inc. (“Company” or “ITG”), a Delaware corporation. 
 R E C I T A L S: 
 A. Executive serves as the President – Safety Textiles International division of ITG and is a key executive of ITG and is expected to make major
contributions to the profitability, growth and financial strength of the ITG. 
 B. ITG desires to employ Executive, and Executive desires to
accept such employment, under the terms and conditions of this Agreement. 
 C. The Board of Directors has also determined that it is in the
best interests of the stockholders and ITG to promote stability among key executive. 
 IN CONSIDERATION OF THE FOREGOING, the mutual
covenants contained herein, and other good and valuable consideration, receipt of which is hereby acknowledged, the parties agree as follows: 
 1.
Definitions. 
 1.1 “Base Salary” has the meaning set forth in Section 6.1. 
 1.2 “Board” means the board of directors of ITG. 
 1.3 “Cause” means, in the Company’s judgment, (A) the commission by Executive of (i) a felony or (ii) any serious crime involving fraud, dishonesty or breach of trust;
(B) gross negligence or intentional misconduct by Executive with respect to ITG or in the performance of his duties to ITG; (C) failure to follow a reasonable and lawful direction of the President and CEO of ITG; (D) failure by
Executive to cooperate in any corporate investigation, (E) breach by Executive of any material provision of this Agreement, which breach, if curable, is not cured by Executive within ten (10) calendar days after receipt by Executive of
written notice from ITG of such breach, or (F) failure to follow Company policy or procedures. For purposes of this definition, no act or failure to act by the Executive shall be considered “intentional” unless done or omitted to be
done by the Executive in bad faith and without reasonable belief that the Executive’s action or omission was in the best interests of ITG. 

 1.4 “Disability” or “Disabled” means the absence of Executive
from Executive’s duties with the Company on a full time basis for 180 consecutive days as a result of incapacity due to mental or physical illness which is determined to be total and permanent by a physician selected by the Company or its
insurers and reasonably acceptable to Executive or Executive’s legal representative. 
 1.5 “Employee Benefits”
means the “benefit plans and policies” for the limited liability companies of ITG or its predecessor that was the employer of the Executive immediately prior to the execution of this Employment Agreement and Employee Benefits shall refer
to such plans until adopted by and as subsequently amended by ITG. 
 1.6 “Good Reason” means the termination of
Executive’s employment by Executive for any of the following reasons: 
 (A) involuntary reduction in Executive’s
Base Salary unless such reduction occurs simultaneously with a reduction in officers’ salaries generally applicable on a company-wide basis; 
 (B) involuntary discontinuance or reduction in bonus award opportunities for Executive under ITG’s Incentive or Bonus Plan unless a generally applicable company-wide reduction or elimination of all officers’
bonus awards occurs simultaneously with such discontinuance or reduction; 
 (C) involuntary discontinuance of
Executive’s participation in any employee benefit plans maintained by ITG unless such plans are discontinued by reason of law or loss of tax deductibility to ITG with respect to contributions to such plans, or are discontinued as a matter of
ITG policy applied equally to all participants in such plans that are in the same classification of employees as Executive; 
 (D) failure to obtain an assumption of ITG’s obligations under this Agreement by any successor to ITG, regardless of whether such entity becomes a successor to ITG as a result of a merger, consolidation, sale of assets of ITG, or other
form of reorganization, except when the rights and obligations of ITG under this Agreement are vested in the successor to ITG by operation of law; 
 (E) involuntary relocation of Executive’s primary office to a location more than fifty (50) miles from the City of Greenville, State of South Carolina, without Executive’s consent; and 
 (F) material reduction of Executive’s duties in effect on the Effective Date; provided, however that a change in title or reporting
line will not constitute Good Reason unless such change is coupled with a material reduction in the actual duties of Executive. 
 1.7
“Incentive or Bonus Plan” has the meaning set forth in Section 6.2 hereof. 
 1.8 “ITG”
means International Textile Group Inc. and each of the affiliates of International Textile Group Inc. (meaning any entity that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with,
International Textile Group Inc.), along with all successors and assigns of each of such entities. 
  

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 1.9 “Plan” has the meaning set forth in Section 7.3. 
 1.10 “Restricted Customers” means all the specific customer accounts, whether within or outside of the Restricted Territory, with
which Executive had any contact or for which Executive had any responsibility (either direct or supervisory) at the time of termination of Executive’s employment and at any time during the two (2)-year period prior to such termination.

 1.11 “Restricted Industry” means the specific industry segment or segments for which the Executive had any
responsibility (either direct or supervisory) at the time of termination of Executive’s employment and at any time during the two (2)-year period prior to such termination. 
 1.12 “Restricted Territory” means the geographic area(s) within a 200 mile radius of any and all ITG location(s) in, to, or for
which Executive worked, to which Executive was assigned or had any responsibility (either direct or supervisory) at the time of termination of Executive’s employment and at any time during the two-year period prior to such termination.

 1.13 “Target Bonus” has the meaning set forth in the Incentive or Bonus Plan as defined in Section 6.2 hereof.

 1.14 “Term” has the meaning set forth in Section 5. 
 1.15 “Termination Date” means the date on which the termination of Executive’s employment with ITG becomes effective.

 2. Termination of Prior Agreements. 
 The parties hereto acknowledge and agree that, effective as of the date hereof, all prior employment agreements if any are terminated and each and every provision of each of such agreements is rendered void and of no further force or effect
whatsoever. 
 3. Employment. 
 ITG hereby
employs Executive, and Executive hereby accepts employment, according to the terms and conditions set forth in this Agreement and for the period specified in Section 5 of this Agreement. 
 4. Duties. 
 During the Term, Executive shall serve
ITG as its President – Safety Textiles International division in accordance with reasonable and lawful directions from ITG’s President and CEO and the Board of Directors and in accordance with ITG’s Articles of Incorporation and
Bylaws, as both may be amended from time to time. Executive will report directly to the President and Chief Executive Officer of ITG. While Executive is employed by ITG as a 
  

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 full-time employee, Executive shall serve ITG, faithfully, diligently, competently and to the best of his ability, and
will exclusively devote his full time, energy and attention to the business of ITG and to the promotion of its interests. Executive shall not, without the written consent of the President and CEO of ITG, either render services to or for any person,
firm, corporation or other entity or organization in exchange for compensation, regardless of the form in which such compensation is paid and whether or not it is paid directly or indirectly to Executive, or serve as a board member, director or
trustee of any corporation or organization regardless of whether Executive is paid for such services. Nothing in this Section 4 shall preclude Executive from managing his personal investments and affairs, provided that such activities in no way
interfere with the proper performance of his duties and responsibilities as President –Safety Textiles International division. 
 5. Term of
Employment. 
 Subject to Article 9, the term of this Agreement (the “Term”) shall commence on the Effective Date and end on
January 31, 2008. 
 6. Compensation. 
 6.1 Base Salary. While employed under this Agreement, Executive will receive as his compensation for the performance of his duties and obligations to ITG under this Agreement a Base Salary of Three Hundred Thousand Dollars
($300,000.00) per year, which will be payable in such installments established by ITG for all salaried employees, and which will be subject to annual review by the Board of Directors or any committee designated by the Board of Directors (the base
salary, as it may be modified from time to time, is referred to herein as the “Base Salary”). 
 6.2 Bonus. In addition to
the Base Salary, Executive will receive with respect to the 2007 plan year a bonus in accordance with ITG’s Incentive and Bonus Plan, a copy of which will delivered to Executive. Unless terminated prior to the end of the Term, Executive will
receive a bonus payment no less than $150,000.00. In the event of a termination prior to the end of the Term of this agreement, the provisions of Section 9 of this agreement will apply. 
 6.3 Withholding. All compensation payable to Executive pursuant to this Section 6 shall be paid net of amounts withheld for federal, state,
municipal or local income taxes, Executive’s share, if any, of any payroll taxes and such other federal, state, municipal or local taxes as may be applicable to amounts paid by an employer to its employee or to the employer/employee
relationship. 
 7. Other Benefits of Employment. 
 7.1 Employee Benefits. Executive will be entitled to participate in such hospitalization, life insurance, long and short term disability, 401(k) and other employee benefit plans and programs, if any, as may be adopted by ITG from
time to time, in accordance with the provisions of such plans and programs and on the same basis as other full-time salaried employees of ITG who participate in such employee benefit plans (except to the extent that the benefits provided under any
of such plans or programs are expressly offset by any of the benefits provided under or pursuant to this Agreement). 
  

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 7.2 Executive Benefits. Executive shall be entitled to participate in any employee benefit adopted
by ITG for executive level employees. 
 7.3 Stock Based Award. Executive will be eligible to receive a grant of restricted stock in
accordance with the provisions of any stock based award or long term incentive plan (“Plan”) ITG may adopt or amend or supersede from time to time. The terms of such grants shall be determined by the Board of Directors (or its designee as
provided in the Plan or as appointed by the Board of Directors) in accordance with the Plan, provided, however, that notwithstanding any provision of the Plan to the contrary, in the event of any termination of Executive’s employment for any
reason other than for Cause pursuant to Section 9.3, or for termination of employment for other than Good Reason pursuant to Section 9.5, any stock-based award granted to Executive prior to such Termination Date shall immediately vest and
be issued to the Executive under the Plan. 
 7.4 Taxes and Withholding. Executive shall be responsible for paying all federal, state,
municipal or local taxes payable by him with respect to any benefits provided under this Section 7, and ITG will, when required by law or when otherwise appropriate or customary, withhold from the benefits or other compensation amounts
sufficient to satisfy such taxes, unless taxes are to be paid by ITG as set forth in the provisions of the executive benefit plan, Employee Benefit Plan, or an agreement with the Executive. 
 7.5 Vacation. Notwithstanding any policy of the company for salaried employees, Executive will be entitled to four (4) weeks paid vacation
and ITG recognized holidays. 
 8. Termination. 
 8.1 Termination by ITG. 
 (A) This Agreement shall automatically terminate effective upon (i) the date
of Executive’s death; (ii) the date that Executive is determined to be permanently Disabled or (iii) the date of Executive’s retirement. 
 (B) ITG may terminate this Agreement, and Executive’s employment with ITG, without Cause upon ninety (90) days’ prior
written notice to Executive. 
 (C) ITG may terminate this Agreement, and Executive’s employment with ITG, with Cause
effective immediately and without the requirement of prior notice to Executive. 
 8.2 Termination by Executive. Executive may
terminate this Agreement, and his employment with ITG, with or without Good Reason, upon ninety (90) days’ prior written notice to ITG. 
 8.3 Notice. Any purported termination of this Agreement by ITG or Executive shall be communicated by written notice of termination to the other party. Such notice shall indicate the specific termination provision in this Agreement
relied upon, shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provisions so indicated, and shall specify the Termination Date (which shall not be
earlier than the date of the notice). 
  

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 9. Compensation and Benefits Upon Termination of Employment. 
 9.1 Termination of Employment upon Death. If Executive’s employment is terminated by reason of death, his estate shall be entitled to receive
only the Base Salary to which Executive was entitled through the date of death, any accrued unpaid bonus compensation for the prior plan year, any unpaid Target Bonus compensation (calculated on a pro rata basis) due to Executive with respect to the
plan year in which the Termination Date occurs, and such other benefits as may be available to Executive or his estate through ITG’s benefit plans and policies. The payment of said bonus compensation shall be made in a lump sum within sixty
(60) days from the Termination Date. 
 9.2 Termination of Employment upon Disability. If Executive’s employment is
terminated due to his Disability, Executive shall be entitled to receive only the Base Salary to which he was entitled through the Termination Date due to Disability, any accrued unpaid bonus compensation for the prior plan year, any unpaid Target
Bonus compensation (calculated on a pro rata basis) due to Executive with respect to the plan year in which the Termination Date occurs, and such other benefits as may be available to Executive through ITG’s benefit plans and policies. The
payment of said bonus compensation shall be made in a lump sum within sixty (60) days from the Termination Date. 
 9.3 Termination
of Employment by ITG for Cause. If Executive’s employment is terminated for Cause as provided in Section 8.1(C), Executive shall be entitled to receive the Base Salary to which he was entitled through the Termination Date, and such
other benefits as may be available to him through ITG’s benefit plans and policies in effect on the Termination Date, other than any accrued but unpaid bonus compensation, which shall be forfeited. 
 9.4 Termination Without Cause or Termination For Good Reason. If ITG terminates Executive’s employment without Cause pursuant to
Section 8.1(B) or if Executive terminates his employment for Good Reason pursuant to Section 8.2, Executive shall receive severance pay equal to (A) one (1) times his Base Salary; (B) one (1) times the average of
Executive’s previous three (3) years annual bonus (or if Executive was employed for less than three (3) years, the average of Executive’s bonus during the actual employment term); and (C) medical and dental coverage under
the plan(s) in effect under the COBRA eligibility period for Executive and any eligible dependents with the costs absorbed by the Company on a tax protected basis to Executive for the period of time Executive and/or dependents(s) remain eligible for
COBRA but not to exceed one (1) years from the Termination Date. Said severance shall be in equal installments commencing in the month following termination of employment; provided, however, that if the payment to the Executive would constitute
a “deferral of compensation” under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the Executive could constitute a “specified employee” (as such phrase is defined in
Section 409A of the Code), the first six monthly installments will be delayed and be payable no sooner than the six month anniversary of the Executive’s “separation from services” with the Company (as such phrase is defined in
Section 409A of the Code) or as soon as reasonably practicable thereafter. Executive agrees that he shall not be entitled to any additional 
  

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 compensation or benefits other than what is set out in this Section 9.4. Executive and ITG agree that the receipt of
severance benefits as defined in this Section 9.4 are conditioned upon and subject to Executive and ITG executing a valid mutual release agreement releasing any and all claims which either of them have or may have against the other arising out
of Executive’s employment (other than enforcement of this Agreement). 
 9.5 Termination of Employment other than for Good
Reason. If Executive terminates employment with ITG pursuant to Section 8.2 other than for Good Reason, Executive shall be entitled to receive only the Base Salary to which he was entitled through the Termination Date, accrued unpaid bonus
compensation due to Executive for the plan year prior and such other benefits as may be available to him through ITG’s benefit plans and policies through the Termination Date. Such bonus payments shall be paid at the same time bonus payments
are made for all plan participants. 
 9.6 Effect of Termination. Upon termination of Executive’s employment, the obligations of
each of the parties under this Agreement shall expire as of the Termination Date, including, without limitation, the obligations of ITG to pay any compensation to Executive, except to the extent otherwise specifically provided in this Agreement.
Notwithstanding the foregoing, the obligations contained in Sections 9.7 and 10 of this Agreement, the provisions hereof relating to the obligations of ITG described in the preceding sentence and any other provision of this Agreement that is
intended to continue in full force and effect after the termination of Executive’s employment, shall survive the termination or expiration of this Agreement in accordance with the terms set forth therein. 
 9.7 Non-Payment Due to Breach. In the event Executive breaches any of the covenants and obligations set forth in this Agreement, including without
limitation any of the covenants set forth in Section 10 hereof, then ITG’s obligation to make any remaining payments under this Agreement that have not already been paid to Executive shall be terminated. 
 10. Confidentiality, Non-Compete, and Non-Solicitation. 
 10.1 Non-Disclosure. Executive expressly covenants and agrees that he will not reveal, use, divulge or make known to any person, firm, company or corporation any secret or confidential information of any nature concerning ITG or its
business, or anything connected therewith. 
 10.2 Return of Materials. Executive agrees to deliver or return to ITG upon termination
or expiration of this Agreement or as soon thereafter as possible, all written information and any other similar items furnished by ITG or prepared by Executive in connection with his services hereunder. Executive will retain no copies thereof after
termination of this Agreement or Executive’s employment with ITG. 
 10.3 Non-Competition. In the event of termination of this
Agreement by either ITG or Executive, for any reason, Executive shall not (except as an officer, director, employee, agent or consultant of ITG) during the one (1) year period following the Termination Date, directly or indirectly,
(a) own, manage, operate, join, or have a financial interest in, control or participate in the ownership, management, operation or control of, or be employed as an employee, agent or 
  

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 consultant, or in any other individual or representative capacity whatsoever, or use or permit his name to be used in
connection with, or be otherwise connected in any manner with any business or enterprise that is actively engaged in any business in the Restricted Industry within the Restricted Territory; provided that the foregoing restriction shall not be
construed to prohibit the ownership by Executive of not more than one percent (1%) of any class of securities of any corporation which is engaged in any of the foregoing businesses, having a class of securities registered pursuant to the
Securities Exchange Act of 1934, which securities are publicly owned and regularly traded on any national exchange or in the over-the-counter market, provided, further, that such ownership represents a passive investment and that neither Executive
nor any group of persons including Executive in any way, either directly or indirectly, manages or exercises control of any such corporation, guarantees any of its financial obligations, otherwise takes part in its business other than exercising his
rights as a shareholder, or seeks to do any of the foregoing or (b) solicit, call upon, divert or take away any Restricted Customers for purposes of conducting a business in the Restricted Industry. 
 10.4 No Solicitation. In addition to the limitation imposed by Section 10.3, Executive hereby further agrees and covenants that during the
term of this Agreement, and for a period of one (1) year thereafter, he shall not, directly or indirectly, on his own behalf or with others (A) induce or attempt to induce any employee of ITG to leave the employ of ITG, or in any way
interfere with the relationship between ITG and any employee; (B) knowingly hire any employee of ITG; or (C) induce or attempt to induce any referral source or other business relation of ITG not to do business with ITG, or to cease doing
business with ITG, or in any way interfere with the relationship between any such referral source or business relation and ITG. 
 10.5
Injunctive Relief. Executive acknowledges that it is impossible to measure in money the damages that will accrue to ITG by reason of Executive’s failure to observe any of the obligations imposed on him by this Section 10. Accordingly,
if ITG shall institute an action to enforce the provisions hereof, Executive hereby waives the claim or defense that an adequate remedy at law is available to ITG, and Executive agrees not to urge in any such action the claim or defense that such
remedy at law exists. 
 10.6 Severability. If a final determination is made by a court having competent jurisdiction that the time or
territory or any other restriction contained in Sections 10.1, 10.3 or 10.4 is an unenforceable restriction on Executive’s activities, the provisions of Sections 10.1, 10.3 or 10.4 shall not be rendered void but shall be deemed amended to apply
such maximum time and territory and such other restrictions as such court may judicially determine or otherwise indicate to be reasonable. 
 11.
Miscellaneous. 
 11.1 Assignment. This Agreement shall be binding upon the parties hereto, their respective heirs, personal
representatives, executors, administrators and successors; provided, however, that Executive shall not assign this Agreement. 
 11.2
Section 409A Compliance. To the extent applicable, it is intended that this Agreement comply with the provisions of Section 409A of the Code. This Agreement shall be administered in a manner consistent with this intent, and any
provision that would cause the 
  

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 Agreement to fail to satisfy Section 409A of the Code shall have no force and effect until amended to comply with
Section 409A of the Code (which amendment may be retroactive to the extent permitted by Section 409A of the Code and may be made by the Company without your consent). 
 11.3 Governing Law. This Agreement shall be construed under and governed by the internal laws of the State of New York without giving effect to
any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of New York. 
 11.4 Entire Agreement. This Agreement between Executive and ITG, set forth the entire agreement of the parties concerning the employment of
Executive by ITG, and any other oral or written statements, representations, agreements, or understandings made or entered into prior to or contemporaneously with the execution of this Agreement, are hereby rescinded, revoked, and rendered null and
void by the parties. Both parties hereto have participated in the selection of the words and phrases set forth in this Agreement in order to express their joint intentions in entering into this employment relationship, and the parties hereto agree
that there shall not be strict interpretation against either party in connection with any review of this Agreement in which interpretation thereof is an issue. 
 11.5 Notices. Any notice required or permitted under this Agreement shall be deemed to have been effectively made or given if in writing and personally delivered, or mailed properly addressed in a sealed
envelope, postage prepaid by certified or registered mail, delivered by a reputable overnight delivery service or sent by facsimile. Unless otherwise changed by notice, notice shall be properly addressed to Executive if addressed to the address of
Executive on the books and records of ITG at the time of the delivery of such notice, and properly addressed to ITG if addressed to: 
 Corporate Secretary 
 International Textile Group, Inc. 
 804 Green Valley Road, Suite 300 
 Greensboro NC 27408 
 11.6 Severability. Wherever there is any conflict between any provision of this
Agreement and any statute, law regulation or judicial precedent, the latter shall prevail, but in such event the provisions of this Agreement thus affected shall be curtailed and limited only to the extent necessary to bring them within the
requirements of law. In the event that any provision of this Agreement shall be held by a court of competent jurisdiction to be indefinite, invalid, void or voidable or otherwise unenforceable, the balance of this Agreement shall continue in full
force and effect unless such construction would clearly be contrary to the intentions of the parties or would result in an unconscionable injustice. 
 11.7 Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument. 
  

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 IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed the day and year
first above written. 
  

			
	INTERNATIONAL TEXTILE GROUP, INC.
		
	By:	 	 /s/ Joseph L. Gorga

	Name:	 	 Joseph L. Gorga

	Its:	 	President and Chief Executive Officer
	
	 /s/ Stephen B. Duerk

	Stephen B. Duerk

  

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