UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, S.C. 20549
FORM 10-Q
( X ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 1, 1995
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________ to ____________
Commission File Number: 1-9734
ONEITA INDUSTRIES, INC.
----------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 57-0351045
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4130 FABER PLACE DRIVE, SUITE 200, CHARLESTON, SC 29405
(Address of principal executive offices) (Zip Code)
(803) 529 - 5225
----------------------------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months, and (2) has been subject to such filing for
the past 90 days.
[X] Yes [ ] No
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date. 6,867,821 shares of Common
Stock as of April 28, 1995.
<PAGE>
<TABLE>
<CAPTION>
FORM 10-Q
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION (Unaudited)
--------- -----------
<S> <C>
Condensed Consolidated Balance Sheets at
April 1, 1995 and September 30, 1994 .................... 1
Condensed Consolidated Statements of Income for the
Three Months Ended April 1, 1995 and March 31, 1994 ..... 3
Condensed Consolidated Statements of Income for the
Six Months Ended April 1, 1995 and March 31, 1994 ....... 4
Condensed Consolidated Statements of Cash Flows for
the Six Months Ended April 1, 1995 and March 31, 1994 ... 5
Notes to Condensed Consolidated Financial Statements .... 6
Management's Discussion and Analysis of Financial
Condition and Results of Operations ..................... 8
PART II - OTHER INFORMATION
Item 1: Legal Proceedings ............................. 11
Item 2: Changes in Securities ......................... 11
Item 3: Defaults upon Senior Securities ............... 11
Item 4: Submission of Matters to a Vote of Security
Holders ....................................... 11
Item 5: Other Information ............................. 12
Item 6: Exhibits and Reports on Form 8-K .............. 12
Signature ....................................................... 13
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
ONEITA INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
April 1, September 30,
1995 1994
(Unaudited) (Note 1)
ASSETS
CURRENT ASSETS:
<S> <C> <C>
Cash $ 2,333 $ 967
Accounts receivable, less
allowance for doubtful accounts 47,745 35,757
Inventories (Note 2) 60,279 44,720
Prepaid expenses and other
current assets 3,177 4,963
------- -------
Total current assets 113,534 86,407
PROPERTY, PLANT AND EQUIPMENT,
at cost, less accumulated
depreciation and amortization 33,093 30,435
FUNDS RESTRICTED FOR CAPITAL PROJECTS 2,479 2,342
OTHER ASSETS 1,777 1,733
------- -------
$150,883 $120,917
======== ========
</TABLE>
[FN]
See notes to condensed consolidated financial statements
[/FN]
1
<PAGE>
<TABLE>
<CAPTION>
ONEITA INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
April 1, September 30,
1994 1994
-------- -------------
(Unaudited) (Note 1)
LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C>
CURRENT LIABILITIES:
Notes payable $ 26,500 $ ---
Current portion of long term debt
and capital lease obligations 4,829 5,377
Accounts payable 9,490 10,485
Accrued liabilities 13,651 9,660
------- -------
Total current liabilities 54,470 25,522
LONG TERM DEBT AND CAPITAL
LEASE OBLIGATIONS 14,811 17,133
DEFERRED INCOME TAXES 2,310 2,240
SHAREHOLDERS' EQUITY:
Preferred Stock, Series I, par
value $1.00 per share, 2,000,000
shares authorized, none issued --- ---
Common Stock, $.25 par value,
15,000,000 shares authorized,
6,997,838 and 6,960,821 shares
issued and outstanding at April 1,
1995 and September 30, 1994,
respectively 1,749 1,740
Other shareholders' equity 77,543 74,282
------- -------
$150,883 $120,917
======== ========
</TABLE>
[FN]
See notes to condensed consolidated financial statements.
[/FN]
2
<PAGE>
<TABLE>
<CAPTION>
ONEITA INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share data)
THREE MONTHS ENDED,
April 1, March 31,
1995 1994
------- ------
<S> <C> <C>
Net sales $ 51,952 $ 44,179
Cost of sales 41,965 37,516
-------- --------
Gross profit 9,987 6,663
Selling, general and administrative
expenses 5,673 5,059
-------- --------
Income from operations 4,314 1,604
Interest expense, net of interest
income of $57 in 1995 and $32
in 1994 839 1,059
-------- --------
Income before provision for
income taxes 3,475 545
Provision for income taxes 1,366 218
-------- --------
Net income $ 2,109 $ 327
======== ========
Net income per share (Note 3) $.30 $.05
======== ========
</TABLE>
[FN]
See notes to condensed consolidated financial statements.
[/FN]
3
<PAGE>
<TABLE>
<CAPTION>
ONEITA INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share data)
SIX MONTHS ENDED,
April 1, March 31,
1995 1994
------- ------
<S> <C> <C>
Net sales $ 92,058 $ 78,404
Cost of sales 74,207 66,198
------- -------
Gross profit 17,851 12,206
Selling, general and administrative
expenses 10,722 9,098
------- -------
Income from operations 7,129 3,108
Interest expense, net of interest
income of $185 in 1995 and $99
in 1994 1,358 1,975
------- -------
Income before provision for
income taxes 5,771 1,133
Provision for income taxes 2,284 453
------- -------
Net income $ 3,487 $ 680
======== ========
Net income per share (Note 3) $.50 $.10
==== ====
</TABLE>
[FN]
See notes to condensed consolidated financial statements.
[/FN]
4
<PAGE>
<TABLE>
<CAPTION>
ONEITA INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
SIX MONTHS ENDED,
April 1, March 31,
1995 1994
-------- --------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net income $ 3,487 $ 680
Adjustments to reconcile net income to
cash used in operating activities:
Depreciation and amortization 2,808 2,572
Provision for losses on accounts receivable 300 166
Increase in deferred income taxes 70 396
Other 54 83
Change in assets and liabilities (23,595) (9,739)
-------- -------
Net cash used in operating activities (16.876) (5,842)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property, plant and equipment (5,451) (3,402)
Decrease (increase)in equipment
lease deposits 408 (95)
Proceeds from sale of property, plant
and equipment 9 198
------- -------
Net cash used in investing activities (5,034) (3,299)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Short-term borrowings 26,500 6,000
Proceeds from issuance of long term debt --- 119
Purchase of treasury shares (547) ---
Sale of common stock 330 21
Increase in funds restricted
for capital projects (137) (64)
Payment of long term debt and capital
lease obligations (2,870) (2,377)
------- -------
Net cash provided by financing activies 23,276 3,699
------- -------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 1,366 (5,442)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 967 6,716
------- -------
CASH AT END OF PERIOD $ 2,333 $ 1,274
======= =======
</TABLE>
[FN]
See notes to condensed consolidated financial statements.
[/FN]
5
<PAGE>
ONEITA INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(1) Basis of Presentation -
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and Article
10 of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements. The balance sheet at September 30, 1994 has been derived
from the audited financial statements at that date. In the opinion of
management, all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. Operating results for the
three month and six month periods ended April 1, 1995 are not necessarily
indicative of the results that may be expected for the year ended September 30,
1995. For further information, refer to the consolidated financial statements
and footnotes thereto included in the Company's annual report to shareholders
for the year ended September 30, 1994.
(2) Inventories -
Inventories, stated at the lower of cost (primarily last-in, first-out) or
market, are comprised of the following:
<TABLE>
<CAPTION>
April 1, September 30,
1995 1994
------- -------------
<S> <C> <C>
Finished ...................... $41,959 $31,754
Work in p...................... 14,589 10,249
Raw materials and supplies..... 3,731 2,717
------- -------
$60,279 $44,720
======= =======
</TABLE>
(3) Net Income Per Share -
Earnings per share are calculated using the weighted average number of
shares of common stock, and where dilutive, common stock equivalents outstanding
during each period. Shares used in computing per share results were 7,029,326
and 6,962,625 for the three months ended April 1, 1995 and March 31, 1994,
respectively and 7,027,664 and 6,962,328 for the six months ended April 1, 1995
and March 31, 1994, respectively.
6
<PAGE>
(4) Fiscal Year End
Effective October 1, 1994, the Company changed its year end from a calendar
year ending September 30 to a 52/53 week year ending on the closest Saturday to
September 30. Accordingly, the interim periods will also be reported on the
Saturday closest to the calendar quarter.
7
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Results of Operations
- ---------------------
Three Months Ended April 1, 1995 Compared to Three Months Ended March 31,
1994.
Net sales for the three months ended April 1, 1995 were $52.0 million as
compared to $44.2 million in the comparable period of the prior year, an
increase of $7.8 million or 17.6%. The increase was due to an increase in
customer orders and average price increases over the last 12 months of
approximately 6%.
Net sales of activewear were $43.3 million for the three months ended April
1, 1995 as compared to $34.5 million in the comparable period of the prior year,
an increase of $8.8 million or 25.5%. Net sales of T-shirts and sweat shirts
increased by $7.7 million and $1.1 million, respectively. These increases were
principally due to increased unit sales of T-shirts of $4.8 million and sweat
shirts of $1.0 million, as well as $3.0 million of additional revenue
attributable to increased prices.
Net sales of infantswear were $8.7 million for the three months ended April
1, 1995 as compared to $9.7 million in the comparable period of 1994, a decrease
of $1.0 million or 10.3%. The reduced sales are principally the result of lower
unit sales of higher priced playwear lines caused by increased competition
including promotional pricing.
Gross profit for the quarter ended April 1, 1995 was $10.0 million, an
increase of $3.3 million or 49.3% from the comparable period of the prior year.
Gross profit, as a percentage of net sales, increased to 19.2% compared to 15.1%
in the comparable period of the prior year due to the price increases mentioned
above (6.0%) and overall reduced per unit operating costs (0.8%), offset in part
by increased raw material prices (2.7%).
Selling, general and administrative expenses for the three months ended
April 1, 1995 increased $1.0 million or 19.5% from the comparable period of the
prior year, due to a higher number of selling and administrative personnel and
other related personnel costs. The increased personnel were added to support
anticipated increased sales in fiscal 1995.
8
<PAGE>
Interest expense, net of interest income, for the first quarter of 1995 was
$0.8 million compared to $1.1 million for the corresponding period last year.
The decrease was due primarily to lower average borrowings.
Six Months Ended April 1, 1995 Compared to Six Months Ended March 31, 1994.
Net sales for the six months ended April 1, 1995 were $92.1 million as
compared to $78.4 million in the prior year, an increase of $13.7 million or
17.5%. The increase was due to an increase in customer orders and average price
increases over the last 12 months of approximately 4.9%
Net sales of activewear were $76.3 million for the six months ended April
1, 1995 compared to $61.6 million in the prior year, an increase of $14.7
million or 23.9%. Net sales of T-shirts and sweatshirts increased by $12.0
million and $2.7 million, respectively. These increases were principally due to
increased unit sales of T-shirts of $7.6 million and sweatshirts of $2.4
million, as well as $4.5 million of additional revenue attributable to increased
prices.
Net sales of infantswear were $15.8 million for the six months ended April
1, 1995 as compared to $16.8 million in the comparable period of the prior year,
a decrease of $1.0 million or 6.0%. The reduced sales are principally the result
of lower unit sales of higher priced playwear lines caused by increased
competition including promotional pricing.
Gross profit for the six months ended April 1, 1995 was $17.9 million, an
increase of $5.7 million or 46.7% from the comparable period of the prior year.
Gross profit as a percentage of net sales increased to 19.4% compared to 15.6%
in the comparable period of the prior year due to the price increases mentioned
above (4.9%) and overall reduced per unit operating costs (1.1%), offset in part
by increased raw material prices (2.2%)
Selling, general and administrative expenses for the six months ended April
1, 1995 increased $1.6 million or 17.9% from the comparable period of the prior
year, due to a higher number of selling and administrative personnel and other
personnel related costs. The increased personnel were added to support
anticipated increased sales in fiscal 1995.
Interest expense, net of interest income, for the six months ended April 1,
1995 was $1.4 million compared to $2.0 million for the corresponding period last
year. The decrease was due primarily to lower average borrowings.
9
<PAGE>
The Company announced in May 1995 the implementation of a rebate program to
be effective for most of the third quarter ending July 1, 1995, under which
screenprinters will be eligible for certain rebates. The impact on third quarter
pretax profits is estimated to be between $1.5 and $2.0 million.
Liquidity and Capital Resources
- -------------------------------
Working capital was $59.1 million at April 1, 1995 compared to $60.9
million at September 30, 1994. The decrease was due primarily to current
maturities of long-term debt. The Company has available bank lines of credit of
approximately $55.0 million, including $30.0 million of uncommitted short-term
lines of credit and $25.0 million under a bank credit facility which provides
for interest at approximately the lending banks' prime rates and becomes due
between 1997 and 2000. At April 1, 1995, there were $26.5 million outstanding
under the uncommitted short-term lines. These bank lines were used to finance
planned, seasonal increases in accounts receivable and inventories. At April 1,
1995, there were no borrowings outstanding under the $25,000,0000 bank credit
facility. The Company believes that its working capital and bank lines are
sufficient to meet its liquidity needs for at least the next twelve months.
Through April 1, 1995 an aggregate 61,900 shares of the Company's Common
Stock has been purchased in connection with a previously announced 350,000 share
Stock Repurchase Plan at a total cost of $697,000.
The previously announced $16,000,000 textile expansion project at the
Fayette, Alabama facility is being accelerated in order to provide incremental
production capacity within two years rather than the originally planned three
years. The Company intends to finance this accelerated project through a debt
financing which it expects to consummate during 1995; however, no assurance can
be given that such debt financing will be consummated. In the event that this
debt financing is not consummated in a timely manner, the Company believes that
its available bank credit facility, together with operating leases and funds
generated from operations, would be sufficient to finance this project.
Effects of Inflation
- --------------------
The Company believes that the relatively moderate rates of inflation in
recent years have not had a significant impact on its sales and profitability.
10
<PAGE>
ONEITA INDUSTRIES, INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
Item 1 Legal Proceedings
-----------------
None
Item 2 Changes in Securities
---------------------
None
Item 3 Defaults upon Senior Securities
-------------------------------
None
Item 4 Submission of Matters to a Vote of Security Holders
---------------------------------------------------
(a) The Registrant held its Annual Meeting of Stockholders on
February 24, 1995.
(b) Seven directors were elected at the Annual Meeting to
serve until the Annual Meeting of Stockholders in 1996.
The names of these Directors and votes cast in favor of
their election and shares withheld are as follows:
<TABLE>
<CAPTION>
NAME VOTES FOR VOTES WITHHELD
------ --------- --------------
<S> <C> <C>
Robert M. Gintel 5,113,091 373,140
Albert Fried, Jr. 5,115,116 371,115
Herbert J. Fleming 5,115,116 371,115
Meyer A. Gross 5,115,273 369,958
Lewis Rubin 5,115,116 371,115
John G. Hudson 5,115,116 371,115
H. Varnell Moore 5,115,116 371,115
</TABLE>
In the stockholders approved a proposal to approve and
adopt the Company's Outside Director Stock Option Plan:
<TABLE>
<CAPTION>
VOTES FOR VOTES AGAINST ABSTAIN
--------- ------------- -------
<C> <C> <C>
4,834,148 532,429 37,325
</TABLE>
11
<PAGE>
Item 5 Other Information
-----------------
None
Item 6 Exhibits and Reports on Form 8-K
--------------------------------
10.6 Agreement dated April 3, 1995, between Registrant and
First Union National Bank of South Carolina
10.7 Promissory Note dated April 25, 1995, between Registrant
and National Westminster Bank, USA
10.8 Multiple Disbursement Revolving Note dated January 1,
1995 between Registrant and Trust Company Bank
27 Financial Data Schedules
12
<PAGE>
SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ONEITA INDUSTRIES, INC.
By: /s/ Herbert J. Fleming
------------------------
Herbert J. Fleming
President
By: /s/ James L. Ford
------------------------
James L. Ford
Executive Vice-President
of Finance and
Chief Financial Officer
Date: May 15, 1995
13
OFFERING BASIS LOAN AGREEMENT
This offering Basis Loan Agreement ("Agreement") is entered into this 3rd
day of April 1995 , by and between First Union National Bank of South Carolina
("Bank"), 177 Meeting Street, Charleston, SC and Oneita Industries, Inc., PO
Drawer 40909, Charleston, SC 29423.
In consideration of the mutual agreements contained herein, Bank may, in
its sole and absolute discretion, make available to Borrower, loan funds, the
aggregate principal amount of which shall not exceed Ten Million Dollars
($10,000,000.00) at any time (the "Line of Credit"), upon the following terms
and conditions:
1. Method of Borrower. Each advance under the Line of Credit (the
"Advance") shall be offered to the Borrower through its representative(s) by a
duly authorized representative of the Bank at a specific interest rate for a
specific maturity. Requests for, offers of, and acceptance of Advances between
the Bank and the Borrower may be made in writing (including facsimile
transmission) or orally (including telephonic communication). All Advances shall
be in immediately available funds. The terms of an offered Advance shall be open
for acceptance by the Borrower for a period of 30 minutes immediately following
notification to the Borrower by the Bank of such offering and the offering shall
be deemed withdrawn if not accepted within that time period. All terms offered
with respect to the Advances shall be determined by Bank in its sole discretion.
Any Advance shall be conclusively presumed to have been made to, for the
benefit of, and at the request of the Borrower when: (1)(a) the Advance is
deposited or credited to an account of the Borrower with the Bank,
notwithstanding that such Advance was requested, orally or in writing, by
someone other than a representative of Borrower, and (b) any part of such
Advance is withdrawn from the account; or (2) the Advance is made in accordance
with oral or written instructions of a representative of the Borrower.
2. Interest Rate. Each Advance shall bear interest at an "Offering Rate",
which shall mean such interest rates and terms offered by the Bank and accepted
by the Borrower. The term for Advances at the Offering Rate (the "Offering
Interest Period") shall not exceed 180 days. Interest on Advances at an Offering
Rate shall be payable upon the last day of the respective Offering Interest
Period, and at as such other time or times as may be agreed to by the Bank and
the Borrower. Interest shall be computed on the basis of a 360 day year for the
actual number of days in the interest period ("Actual/360 Computation"). Bank's
Actual/360 computation determines the annual effective interest yield by taking
the stated (nominal) interest rate for a year's period and then dividing said
rate by 360 to determine the daily periodic rate to be applied for each day in
the interest period.
<PAGE>
3. Recordation of Advances. Bank will maintain records of the date, amount,
maturity, payment schedule, and interest rate applicable to each Advance, the
date and amount of any payment of principal or interest, and the principal
balance then remaining unpaid. The Borrower hereby agrees that the Advances so
evidenced in such records shall, for all purposes, constitute prima facie
evidence thereof and shall be binding upon the Borrower.
4. Payment of Advances. Borrower promises to pay to the order of the Bank
at Bank's offices located at 177 Meeting Street, Charleston, SC, or at such
other place as the Bank may designate in writing, the unpaid principal amount of
each Advance made by the Bank, and accrued interest, on the maturity date of
each respective Advance and such other dates and terms as may be set forth in
the Bank records. All payments shall be made in immediately available lawful
money of the United States.
5. Prepayments. An Advance may be prepaid in whole or in part at any time;
provided however, that if the Advance is prepaid in whole or in part, whether
voluntary, mandatory, upon acceleration or otherwise, the prepayment shall be
accompanied by an additional amount deemed necessary by Bank to compensate Bank
for any losses, costs or expenses which Bank may incur as a result of such
prepayment, pursuant to the following formula:
Prepayment Compensation = (A-B) x C x D
A = The sum, determined as of the funding date of the
Advance, of (i) the Bond equivalent bid side yield of
the U.S. Treasury Note with a maturity closest to the
maturity of the fixed rate period (defined below) as
quoted by the Wall Street Journal (or other published
source), plus (ii) the corresponding bid side market
swap spread as determined by Bank from quotes generally
available in the interbank dealer market for interest
rate swaps, plus (iii) one-half percent (1/2%).
B = The sum, determined as of the prepayment date of the
Advance, of (i) the Bond equivalent bid side yield of
the U.S. Treasury Note with a maturity closest to the
remaining maturity of the fixed rate period as quoted by
the Wall Street Journal (or other published source),
plus (ii) the corresponding bid side market swap spread
as determined by Bank from quotes generally available in
the interbank dealer market for interest rate swaps.
C = Principal Amount Prepaid
D = Number of days from the date of prepayment to the end of
the fixed period divided by a year base of 360 days.
<PAGE>
As used herein, "the fixed rate period" shall be the period during which
the applicable fixed rate of interest on the Advance is to be in effect. In the
event that amount determined as variable B above is greater than the amount
determined as variable A above, no prepayment compensation shall be due
hereunder. the determination of prepayment compensation due Bank hereunder shall
be made by Bank in good faith using such methodology as Bank deems appropriate
and customary under the circumstances and shall be conclusive absent manifest
error.
Any prepayment in whole or in part shall include interest and all other
sums then due with respect to the Advance. No partial prepayment shall affect
the obligation of Borrower to make any payment of principal or interest due with
respect to the Advance until the Advance has been paid in full.
6. Conditions Precedent. The obligation of the Bank to disburse Advances as
offered and accepted pursuant to this Agreement is subject to the following
conditions president:
a. Non-default. The Borrower shall be in compliance with all of the
terms and conditions set forth herein and an Event of Default as
specified herein, or an event which upon notice or lapse of
time or both would constitute such an Event of Default shall not
have occurred or be continuing at the time of such Advance.
b. Additional Documents. Receipt of such additional supporting
documents as the Bank may request.
7. Termination Agreement. Either party may terminate this Agreement
immediately upon written notice to the other, provided, however, the terms of
this Agreement with respect to the obligations then outstanding of the Borrower
under this Agreement as of the date of termination shall survive until the
obligations are fully satisfied.
8. Events of Default. Notwithstanding the term of an Advance or Advances as
set forth herein, the Bank, at is sole option and without notice, may accelerate
the maturity of the Advances and all Advances shall be immediately due and
payable, including interest thereon, upon the occurrence of any of the following
events ("Events of Default"):
a. If the Borrower shall fail to pay any amounts when due or shall
fail to observe or perform any obligation or covenant, as required
under this Agreement, or any other document furnished in
connection herewith, or contained in any other agreement between
Bank and Borrower.
b. If any representation or warranty made by Borrower in connection
with this Agreement shall be determinted by Bank to have been or
<PAGE>
become false or misleading in any material respect.
c. If the Borrower shall default in the payment of interest, principal
or fees on any obligation to any other party for borrowed money,
or Borrower fails to perform or observe any term contained in any
agreement governing such other obligation for borrowed money
and the effect of such failure as to allow the holders of such
obligation to accelerate payment.
d. Final judgement for the payment of money shall be rendered against
the Borrower and shall remain undischarged for a period of 30 days
unless such judgement and execution thereon shall be effectively
stayed.
e. If the Borrower shall (i) become, either voluntarily or
involuntarily, a debtor under the Bankruptcy Code, (ii) becomes the
object of insolvency proceedings, or (iii) makes an assignment for
the benefit of creditors.
f. The expiration of five (5) days after the Bank has given the
Borrower notice of the Bank's good faith determination that a
material adverse change in the financial condition of the Borrower
has occurred since the date hereof.
9. Acceleration Upon Default. Upon any Event of Default, Bank may, at
Bank's discretion and without notice, accelerate the maturity of all Advances
and all other obligations of Borrower to Bank and all such Advances and other
obligations shall be immediately due and payable.
10. Right of Setoff. Borrower grants Bank a security interest in all of
Borrower's accounts with Bank. Upon the occurrence and during the continuance of
any Even of Default, the Bank is hereby authorized at any time to exercise its
right of setoff or banker's lien as to Borrower's demand, checking, time
savings, certificate of deposit or other accounts of any nature maintained with
Bank, without advance notice, against any and all of the obligations due under
this Agreement, or any other agreement with the bank, irrespective of whether or
not the Bank shall have made any demand hereunder and although such obligations
may be unmatured. The rights of the Bank under this section are in addition to
other rights and remedies which the Bank may have. The Bank agrees to notify the
borrower promptly after it exercises any such right of setoff.
11. Default Rate. In addition to all other rights continued in this
Agreement, upon the occurrence and during the continuance of an Event of
Default, all outstanding Advances shall bear interest at the Offering Rate plus
three percent (3%) (Default Rate). The Default rate shall apply from the
<PAGE>
occurrence of an Event of Default until the Advances or any judgment thereon
is paid in full.
12. Attorney's Fees. Debtor shall pay all of Bank's reasonable expenses
incurred to enforce or collect any of the Advances, including, without
limitation, reasonable, attorneys' and experts' fees and expenses, whether
incurred without the commencement of a suit, in any trial, arbitration, or
administrative proceeding, or in any appellate or bankruptcy proceeding.
13. Posting of Payments. All payments received during normal banking hours
after 2: 00 PM Eastern time shall be deemed received at the opening of the next
banking day. Payments received by Bank under this Agreement may be applied in
any manner or order deemed appropriate by Bank.
14. Usuary. Anything contained herein to the contrary notwithstanding, if
for any reason the effective rate of interest on any Advance should exceed the
maximum lawful rate, the effective rate shall be deemed reduced to and shall be
such maximum lawful rate, and (i) the amount which would be excessive interest
shall be deemed applied to the reduction of the principal balance of the Advance
and not to the payment of interest, and (ii) if the Advance has been or is
thereby paid in full, the excess shall be returned to the party paying same,
such application to the principal balance of the Advance or the refunding of the
excess to a complete settlement and acquittance thereof.
15. Waivers. Borrower hereby waives presentment, protest, notice of
dishonor, demand for payment, notice of intention to accelerate maturity, notice
of acceleration of maturity, notice of sale and all other notices of any kind
whatsoever.
16. Amendment and Waiver. Any failure by the Bank to exercise any right
hereunder shall not be construed as a waiver of the right to exercise the same
or any other right at any time. No amendment to or modification of this
Agreement shall be binding upon the Bank unless in writing and signed by it. If
any provision of this Agreement shall be prohibited or invalid under applicable
law, such provision shall be ineffective but only to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Agreement.
17. Severability. If any provisions of this Agreement shall be prohibited
or invalid under applicable law, such provision shall be ineffective but only to
the extent of such prohibition or invalidity, without invalidating the remainder
of such provision or the remaining provisions of this Agreement or such
document.
<PAGE>
18. Miscellaneous. This Agreement and Note are fully assignable by Bank and
all rights of Bank thereunder shall inure to the benefit of its successors and
assigns. This Agreement and Note shall be binding upon the Debtor and its
successors and assigns. The captions contained in this Agreement are inserted
for convenience only and shall not affect the meaning or interpretation of the
Agreement. This Agreement shall be governed by and interpreted in accordance
with the laws of South Carolina without regard to its conflict of laws
principles.
In Witness Whereof, the parties hereto have duly executed this agreement as
of the date stated above.
Witness/Attest:
s/s Elizabeth A. Oliver By: Oneita Industries, Inc.
_________________________ Name: s/s William H. Boyd
------------------------
Title: Vice President
First Union National Bank of South Carolina
By: _____________________________
Name: ___________________________
Title: __________________________
NATWEST BANK N.A.
PROMISSORY NOTE
$10,000,0O Office 100 Jericho Quadrangle As of
Address: Jericho, New York 11753 April 25, 1995
On the maturity dates set forth in the next succeeding paragraph, for value
received, ONEITA INDUSTRIES, INC., (the "Borrower") promises to pay to the order
of NATWEST BANK N.A. (the "Bank") at the office of the Bank located at the place
first above stated or at such other place as the holder hereof may from time to
time appoint in writing, in lawful money of the United States of America in
immediately available funds, the principal sum of Ten Million ($10,000,000)
Dollars or such lesser amount as may then be the aggregate unpaid principal
balance of all loans made by the Bank to the Borrower hereunder (each a "Loan"
and collectively the "Loans") as shown on the schedule attached to and made a
part of this Note, on the maturity dates set forth on such schedule. The
Borrower also promises to pay interest (computed on the basis of a 360 day year
for actual days elapsed) at said office in like money on the unpaid principal
amount of each Loan from time to time outstanding at a rate per annum, to be
elected by the Borrower at the time each Loan is made, equal to either (i) a
fluctuating rate equal to the Prime Rate (the rate of interest established from
time to time by the Bank as its "prime rate"; a Loan bearing interest at this
rate is sometimes hereinafter called a "Prime Loan"), (ii) a fixed rate of 0.75%
plus the Eurodollar Rate for an Interest Period of 1, 2 or 3 months (a Loan
bearing interest at this rate is sometimes hereinafter called a "Eurodollar
Loan") or (iii) such other fixed rate as may be agreed upon between the Borrower
and the Bank for an Interest Period which is also then agreed upon (a Loan
bearing interest at this rate is sometimes hereinafter called an "Agreed Rate
Loan" - Agreed Rate Loans, and Eurodollar Loans are sometimes collectively
referred to as "Fixed Rate Loans"); provided, however, that no Interest Period
with respect to a Fixed Rate Loan shall extend beyond April 30, 1996; and
provided, further, that if prior to the end of any such Interest Period the
Borrower and the Bank fail to agree upon a new Interest Period therefor so as to
maintain such Loan as either a Eurodollar Loan, or an Agreed Rate Loan within
the pertinent time set forth in Section 2 hereof, such Fixed Rate Loan shall
automatically be converted into a Prime Rate Loan at the end of such Interest
Period and shall be maintained as such until a new Fixed Rate and a new Interest
Period therefor are agreed upon. Interest on each Loan shall be payable monthly
on the last day of each month commencing the first such day to occur after a
Loan is made hereunder and, together with principal, on the maturity thereof.
<PAGE>
Interest on Fixed Rate Loans shall also be payable on the last day of each
Interest Period applicable thereto. If any payment of principal or interest
becomes due on a day on which the banks in New York, New York, are required or
permitted by law to remain closed, such payment may be made on the next
succeeding day on which such banks are open, and such extensions shall be
included in computing interest in connection with such payment; provided,
however, that if the result of any such extension would be to extend the
maturity date of any Eurodollar Loan into another calendar month the payment
shall be made on the immediately preceding Business Day. The Borrower
further agrees that after any stated or any accelerated maturity of Loans
hereunder, all Loans shall bear interest (computed daily) at a rate of 2% per
annum in excess of the Prime Rate, payable on demand. In no event shall interest
payable hereunder be in excess of the maximum rate of interest permitted under
applicable law.
All Loans then outstanding shall be due an payable on January 31, 1996.
Fixed Rate Loans may be requested, in accordance with the provisions of Section
1 hereof, up to 1 p.m. on January 31, 1996; provided that no Interest Period for
any Fixed Rate Loan shall extend beyond April 30, 1996.
The Borrower hereby expressly authorizes the Bank to record on the attached
schedule the amount and date of each Loan, the rate of interest thereon,
Interest Period thereof and the date and amount of each payment of principal.
All such notations shall be presumptive as to the correctness thereof; provided,
however, the failure of the bank to make any such notation shall not limit or
otherwise affect the obligations of the borrower under this Note.
In consideration of the granting of the Loans evidenced by this Note, the
Borrower hereby agrees as follows:
1. Loan Requests. Requests for Eurodollar Loans shall be made not less than
three Business Days prior to the first day of the Interest Period of each such
Loan. Requests for Agreed Rate Loans and Prime Loans may be made up until 1 p.m.
on the date the Loan is to be made. Any request for a Loan may be written or
oral, but if oral, written confirmation thereof must be received by the Bank
within 3 Business Days thereafter. The Bank shall have no obligation to make any
Loan hereunder and no Loan may be requested after January 31, 1996.
Each Fixed Rate Loan shall be in an amount not less than $500,000.
<PAGE>
2. Prepayment. Subject to the indemnification agreement set forth in
paragraph 3 hereof with respect to Fixed Rate Loans, the borrower may prepay any
Loan at any time in whole or in part without premium or penalty. Each such
prepayment shall be made together with interest accrued thereon to and including
the date of prepayment.
3. Indemnity; Yield Protection. The Borrower hereby agrees to indemnify the
bank against any loss or expense which the bank may sustain or incur as a
consequence of any of the following:
(a) the failure of the Borrower to borrow a Fixed Rate Loan after agreement
shall have been reached on the amount, interest rate and Interest Period
thereof;
(b) the receipt or recovery by the Bank, whether by voluntary prepayment,
acceleration or otherwise, of all or any part of a Fixed Rate Loan prior to the
last day of an Interest Period applicable thereto; or
(c) the conversion, prior to the last day of an applicable Interest Period,
of one type of Fixed Rate Loan into another type of Fixed Rate Loan or into a
Prime Loan.
Without limiting the effect of the foregoing, the amount to be paid by the
borrower to the bank in order to so indemnify the Bank for any loss occasioned
by any of the events described in the Preceding paragraph, and as liquidated
damages therefor, shall be equal to the excess, discounted to its present value
as of the date paid to the Bank, of (i) the amount of interest which otherwise
would have accrued on the principal amount so received, recovered, converted or
not borrowed during the period (the "Indemnity Period") commencing with the date
of such receipt, recovery, conversion, or failure to borrow to the last day of
the applicable Interest Period for such Fixed Rate Loan at the rate of interest
applicable to such Loan (or the rate of interest agreed to in the case of a
failure to borrow) provided for herein (prior to default) over (ii) the amount
of interest which would be earned by the Bank during the Indemnity Period if it
invested the principal amount so received, recovered, converted or not borrowed
at the rate per annum determined by the Bank as the rate it would bid in the
London interbank market for a deposit of Eurodollars in an amount approximately
equal to such principal amount for a period of time comparable to the Indemnity
Period.
A certificate as to any additional amounts payable pursuant to this Section 3
setting forth the basis and method of determining such amounts shall be
conclusive, absent manifest error, as to the determination by the Bank set forth
<PAGE>
therein if made reasonably and in good faith. The Borrower shall pay any
amounts so certified to it by the bank within 10 days of receipt of any such
certificate. For purposes of this Section, all referenced to the "Bank"
shall be deemed to include any participant in the Commitment and/or Loans.
The indemnities set forth herein shall survive payment in full of all Fixed
Rate Loans and all other Loans made pursuant to this Agreement.
4. Increased Costs. If the Bank determines that the effect of any
applicable law or government regulation, guideline or order or the
interpretation thereof by any governmental authority charged with the
administration thereof (such as, for example, a change in official reserve
requirements which the bank is required to maintain in respect of loans or
deposits or other funds procured for funding such loans) is to increase the cost
of the Bank of making or continuing Fixed Rate Loans hereunder or to reduce the
amount of any payment of principal or interest receivable by the bank thereon,
then the Borrower will pay to the Bank on demand such additional amounts as the
Bank may determine to be required to compensate the Bank for such additional
costs or reduction. Any additional payment under this section will be computed
from the effective date at which such additional costs have to be borne by the
bank. A certificate as to any additional amounts payable pursuant to this
Section 4 setting forth the basis and method of determining such amounts shall
be conclusive, absent manifest error, as to the determination by the Bank set
forth therein if made reasonably and in good faith. The Borrower shall pay any
amounts so certified to it by the bank within 10 days of receipt of any such
certificate.
5. Alternate Rate of Interest. In the event, and on each occasion, that on
the day two Business Days prior to the commencement of any Interest Period for a
Eurodollar Loan, the Bank shall have determined (i) that dollar deposits in the
amount of the requested principal amount of such Eurodollar Loan are not
generally available in the London interbank market, (ii) that the rate at which
such dollar deposits are being offered will not adequately and fairly reflect
the cost to the Bank of making or maintaining such Eurodollar Loan during such
Interest Period, or (iii) that reasonable means do not exist for ascertaining
the Eurodollar Rate, the Bank shall, as soon as practicable thereafter, give
written or telex notice of such determination to the Borrower.
In the event of any such determination, until the circumstances giving rise to
such notice no longer exist, no Eurodollar Loans will be made hereunder. Each
determination by the Bank hereunder shall be conclusive absent manifest error.
<PAGE>
6. Change in Legality. (a) Notwithstanding anything to the contrary herein
contained, if any change in any law or regulation or in the interpretation
thereof by any governmental authority charged with the administration or
interpretation thereof shall make it unlawful for the bank to make or maintain
any Eurodollar Loan, then, by written notice to the Borrower, the Bank may:
(i) declare that Eurodollar Loans will not thereafter be made
by the Bank hereunder, whereupon the Borrower shall be
prohibited from requesting Eurodollar Loans from the Bank hereunder
unless such declaration is subsequently withdrawn; and
(ii) require that all outstanding Eurodollar Loans made by it
be converted to Prime Loans, in which event (x) all such
Eurodollar Loans shall be automatically converted to Prime Loans as of
the effective date of such notice as provided in paragraph (b) below
and (y) all payments and prepayments of principal which would otherwise
have been applied to repay the converted Eurodollar Loans shall instead
by applied to repay the Prime Loans resulting from the conversion of
such Eurodollar Loans.
(b) For purposes of this Section 6, a notice to the Borrower by
by the Bank pursuant to paragraph (a) above shall be effective, if
lawful, on the last day of the then current Interest Period; in all
other cases, such notice shall be effective on the day of receipt by
the Borrower.
7. Warranties and Representations. The Borrower represents and warrants
that: a) it is a corporation duly organized, validly existing and in good
standing under the laws of the state of its incorporation and is qualified to do
business and is in good standing under the laws of every state where its failure
to so qualify would have a material and adverse effect on the business,
operations, property or other condition of the Borrower; b) the execution,
issuance and delivery of this Note by the Borrower are within its corporate
powers and have been duly authorized, and the Note is valid, binding and
enforceable in accordance with its terms, and is not in violation of law or of
the terms of the Borrower's Certificate of Incorporation or By-Laws and does not
result in the breach of or constitute a default under any indenture, agreement
or undertaking to which the Borrower is a party or by which it or its property
may be bound or affected; c) no authorization or approval or other action by,
and no notice to or filing with, any governmental authority or regulatory body
is required for the due execution, delivery and performance by the borrower of
<PAGE>
this Note, except those as have been obtained; d) the financial statements of
the Borrower heretofore furnished to the Bank are complete and correct and
fairly represent the financial condition of the Borrower and its Subsidiaries
(as defined in Section 8) as at the dates thereof and for the periods covered
thereby, which financial condition has not materially, adversely, changed
since the date of the most recently dated balance sheet heretofore furnished
to the Bank; e) no Event of Default (as hereinafter defined) has occurred and
no event has occurred which with the giving of notice or the lapse of time or
both would constitute an Event of Default; f) the Borrower shall not use
any part of the proceeds of any Loan to purchase or carry any margin stock
within the meaning of Regulation U of the Board of Governors of the Federal
Reserve System or to extend credit to others for the purpose of purchasing or
carrying any margin stock; g) there is no pending or, to the knowledge of
the Borrower, threatened action or proceeding affecting the Borrower before any
court, governmental agency or arbitrator which, if determined adversely to the
Borrower would have a materially adverse effect on the financial condition or
operations of the Borrower except as described in the financial statements of
the Borrower heretofore furnished to the Bank; and h) on the occasion of the
granting of each Loan all representations and warranties contained herein shall
be true and correct and with the same force and effect as though such
representations and warranties had been made on and as of the date of the
making of each such Loan.
8. Events of Default. Upon the occurrence of any of the following specified
events of default (each an "Event of Default"): a) default in making any payment
of principal, interest, or any other sum payable under this Note when due; or b)
default by Borrower in the due payment of any other indebtedness for borrowed
money or default in the observance or performance of any covenant or condition
contained in any agreement or instrument evidencing, securing, or relating to
any such indebtedness, which causes or permits the acceleration of the maturity
thereof; or c) any representation or warranty made by the Borrower herein or in
any certificate furnished by the Borrower in connection with the Loans evidenced
hereby or pursuant to the provisions hereof, proves untrue in any material
respect; or d) the Borrower becomes insolvent or bankrupt, is generally not
paying its debts as they become due, or makes an assignment for the benefit or
creditors, or a trust or receiver is appointed for the Borrower or for the
greater part of the properties of the Borrower with the consent of the Borrower,
or if appointed without the consent of the Borrower, such trustee or receiver is
not discharged within 30 days, or bankruptcy, reorganization, liquidation or
similar proceedings are instituted by or against the Borrower under the laws of
any jurisdiction, and if instituted against the Borrower are consented to by it
<PAGE>
or remain undismissed for 30 days, or a writ or warrant of attachment or
similar process shall be issued against a substantial part of the property of
the Borrower and shall not be released or bonded within 30 days after levy;
or e) the Bank shall have determined, in its sole discretion, that one or more
conditions exist or events have occurred which have resulted, or may result,
in a material adverse change the business, properties or financial condition of
the Borrower; then, in any such event, and at any time thereafter, if any Event
of Default shall then be continuing, the bank may declare the principal and the
accrued interest in respect of all loans under this Note to be, whereupon the
Note shall become, immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are expressly waived by the
Borrower.
9. Collateral Security. As collateral security for the payment of any and
all sums owing under this Note and all other obligations, direct or contingent,
joint, several or independent, of the Borrower and of any Subsidiary and each
endorser and guarantor hereof now or hereafter existing, due or to become due
to, or held, or to be held by, the bank, whether created directly or acquired by
assignment or otherwise, (all of such obligations, including this Note, are
hereinafter called the "Obligations"), the Borrower hereby grants to the Bank a
lien on the security interest in any and all deposits or other sums at any time
credited by or due from the Bank to the Borrower, whether in regular or special
depository accounts or otherwise, and any and all monies, securities and other
property of the Borrower, and the proceeds thereof, now or hereafter held or
received by or in transit to the Bank from or for the Borrower, whether for
safekeeping, custody, pledge, transmission, collection or otherwise, and any
such deposits, sums, monies, securities and other property, nay at any time
after the occurrence of any Event of Default be set-off, appropriated and
applied by the bank against any of the Obligations whether or not such
Obligations are then due or are secured by any collateral, or, if they are so
secured, whether or not such collateral held by the Bank is considered to be
adequate. As used herein, the term "Subsidiary" or "Subsidiaries" means any
corporation or corporations of which the Borrower, along, or the Borrower and/or
any one or more if its Subsidiaries, owns, directly or indirectly, at least a
majority of securities having ordinary voting power for the election of
directors.
10. Definitions. As used herein:
(a) "Business Day" means any day other than a day on which the banks in New
York, New York are required or permitted by law to remain closed.
<PAGE>
(b) "Eurodollar Rate" means with respect to any Eurodollar Loan Interest
Period, the rate per annum determined by the bank to be the rate at which
deposits in U.S. dollars are offered by a Reference Bank (selected by the Bank)
in the London interbank market at approximately 11:00 A.M. (London time) two
Business Days before the first day of such Interest Period in any amount
approximately equal to the principal amount of the Eurodollar Loan to which such
Interest Period is to apply and for a period of time comparable to such Interest
Period divided by one minus the Eurodollar Reserve Percentage.
"Eurodollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the federal
Reserve System in New York City with deposits exceeding one billion dollars in
respect of "Eurocurrency liabilities" (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
Eurodollar Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of the Bank to United
States residents). The Eurodollar Rate shall be adjusted automatically on and as
of the effective date of any change in the Eurodollar Reserve Percentage.
"Reference Banks" means banks appearing in the display designated as page
"LIBOR" on the Reuters' Monitor Money Rates Service (or such other page as may
replace the LIBOR page on that service for the purpose of displaying London
Interbank Offered Rates of major banks); provided that if no such offered rate
shall appear on such display, "Reference Banks" shall mean one or more major
banks on the London interbank market as selected by the Bank.
(c) "Fixed Rate" means the Eurodollar Rate plus the applicable margin or
the Agreed Rate.
(d) "Interest Period" means that period selected by the Borrower, within
the limitations of the first paragraph of this Note, during which a Fixed Rate
Loan may bear interest at the applicable Fixed Rate.
11. Miscellaneous.
(a) The Borrower agrees to pay on demand all of the Bank's costs and
expenses, including reasonable counsel fees, in connection with collection of
any sums due to the Bank and enforcement of its rights under this Note.
<PAGE>
(b) No modification or waiver of any provision of this Note shall be
effective unless such modification or waiver shall be in writing and signed by a
duly authorized officer of the Bank, and the same shall then be effective only
for the period and on the conditions and for the specific instances specified in
such writing. No failure or delay by the Bank in exercising any right, power or
privilege hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any rights, power or privilege.
(c) the Borrower hereby waives presentment, demand for payment, notice of
protest, notice of dishonor, and any and all other notices or demands except as
otherwise expressly provided for herein.
(d) This Note shall be construed in accordance with and governed by the
laws of the State of New York and the Borrower consents to the jurisdiction of
the courts of New York in any action brought to enforce any rights of the Bank
under this Note.
(e) Borrower waives trial by jury and the right to interpose any set-off or
counterclaim in any litigation in any court with respect to, in connection with,
or arising our of, this Note or any instrument or document delivered pursuant
hereto or the validity, protection, interpretation, collection or enforcement
hereof or thereof.
ONEITA INDUSTRIES, INC.
By: s/s William H. Boyd
-----------------------------
Name: William H. Boyd
Title: Vice-President
<PAGE>
LOAN AND REPAYMENT SCHEDULE
PROMISSORY NOTE DATED AS OF JANUARY 31, 1995
ONEITA INDUSTRIES, INC.
to NATWEST BANK N.A.
Last Day
of Amount of Unpaid
Amount Rate of Interest Principal Principal Notation
Date of Loan Interest Period Repayment Balance Made By
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SINGLE PAYMENT NOTE
(Nondisclosure)
---------------------------------------
THE "BANK" REFERRED TO IN THIS NOTE IS ____ Single Disbursement Note :
T Trust Company Bank ___Multiple Disbursement Master Note
Center Code: 006
----------
One Park Place, N.E.
Atlanta, Georgia 30303 X Multiple Disbursement Revolving
Note
----------------------------------------
(For Explanation See Reverse Side)
Date: January 1, 1995
396 days after date, the obligor promises to pay to the order of Bank the
principal sum of $ 10,000,000.00. The obligor will also pay interest upon the
unpaid principal balance from date until maturity at the Note Rate specified
below. Interest payment will be due on the 25th of each month and upon maturity.
Should the obligor fail for any reason to pay this note in full on the maturity
date or on the date of acceleration of payment, the obligor further promises to
pay (a) interest on the unpaid amount from such date until the date of final
payment at a Default Rate equal to the Note Rate plus 4%, and (b) a late fee
equal to five percent (5%) of any amount that remains wholly or partially unpaid
for more than fifteen (15) days after such amount was due and payable, not to
exceed the sum of fifty dollars ($50.00). Should legal action or any attorney at
law be utilized to collect any amount due hereunder, the obligor further
promises to pay all costs of collection, including 15% of such unpaid amount as
attorneys' fees. All amounts due hereunder may be paid at any office of Bank.
The Note Rate hereon shall be either: 1) London Interbank Offered Rate
(LIBOR), adjusted for reserves, plus 0.75% per annum, available in borrowing
periods of 30,60,90 or 180 days; or 2) Trust Company Bank Secondary CD Rate,
adjusted for reserves and assessment, plus 0.75% per annum, available in
borrowing periods of 30, 60, 90 and 180 days.
If not stated above, the Note Rate in effect on the date this note is
executed is 6 %.
The amount of interest accruing and payable hereundershall be calculated by
multiplying the principal balance outstanding each day by 1/360th of the Note
Rate on such day and adding together the daily interest amounts. The principal
balance of this note shall conclusively be deemed to be the unpaid principal
balance appearing on the Bank's records unless such records are manifestly in
error.
As security for the payment of this and any other liability of any obligor
to the holder, direct or contingent, irrespective of the nature of such
liability or the time it arises, each obligor hereby grants a security interest
to the holder in all property of such obligor in or coming into the possession,
control or custody of the holder, or in which the holder has or hereafter
acquires a lien, security interest, or other right. Upon default, holder may,
without notice, immediately take possession of and then sell or otherwise
dispose of the collateral, signing any necessary documents as obligor's attorney
in fact, and apply the proceeds against any liability of obligor to holder. Upon
demand, each obligor will furnish such additional collateral, and execute any
appropriate documents related thereto, deemed necessary by the holder for its
security. Each obligor further authorizes the holder, without notice, to set-off
any deposit or account and apply any indebtedness due or to become due from the
holder to the obligor in satisfaction of any liability described in this
paragraph, whether or not matured. The holder may, without notice, transfer or
register any property constituting security for this note into its or its
nominee name with or without any indication of its security interest therein.
This note shall immediately mature and become due and payable, without
notice or demand, upon the filing of any petition or the commencement of any
proceeding by any Debtor for relief under bankruptcy or insolvency laws, or any
law relating to the relief of debtors, readjustment of indebtedness, debtor
reorganization, or composition or extension of debt. Furthermore, this note
shall, at the option of the holder, immediately mature and become due and
payable, without notice or demand, upon the happening of any one or more of the
following events: (1) nonpayment on the due date of any amount due hereunder;
(2) failure of any Debtor ro perform any other obligation to the holder; (3)
failure of any Debtor to pay when due any amount owed another creditor under a
<PAGE>
written agreement calling for the payment of money; (4) the death or declaration
of incompetence of any Debtor; (5) a reasonable belief on the part of the holder
that any Debtor is unable to pay his obligations when due or is otherwise
insolvent; (6) the filing of any petition or the commencement of any proceeding
against any Debtor for relief under bankruptcy or insolvency laws, or any law
relating to the relief of debtors, readjustment of indebtedness, debt or
reorganization, or composition or extension of debt, which petition or
proceeding is not dismissed within 60 days of the date of filing thereof:
7) the suspension of the transaction of the usual business of any Debtor, or the
dissolution, liquidation or transfer to another party of a significant portion
of the assets of any Debtor; (8) a reasonable belief on the part of the holder
that any Debtor has made a false representation or warranty in connection with
any loan by or other transaction with any lender, lessor or other creditor;
(9) the issuance or filing of any levy, attachment, garnishment, or lien against
the property of any Debtor which is not discharged within 15 days; (10) the
failure of any Debtor to satisfy immediately any final judgment, penalty or
fine imposed by a court or administrative agency of any government;
(11) failure of any Debtor, after demand, to furnish financial
information or to permit inspection of any books or records; (12) any other act
or circumstance leading the holder to deem itself insecure.
The failure or forbearance of the holder to exercise any right hereunder,
or otherwise granted by law or another agreement, shall not affect or release
the liability of any obligor, and shall not constitute a waiver of such right
unless so stated by the holder in writing. The holder may enforce its rights
against any Debtor or any property securing this note without enforcing its
rights against any other Debtor, property, or indebtedness due or to become due
to any Debtor. Each obligor agrees that the holder shall have no responsibility
for the collection or protection of any property securing this note, and
expressly consents that the holder may from time to time, without notice, extend
the time for payment of this note, or any part thereof, waive its rights with
respect to any property or indebtedness, and release any other Debtor from
liability, without releasing such obligor from any liability to the holder. This
note is governed by Georgia law.
The term "obligor" means any party or other person signing this note,
whether as make, endorser or otherwise. The term "Prime Rate", if used herein,
shall mean that rate of interest designated by Bank from time to time as its
"Prime Rate" which rate is not necessarily the bank's best rate. Each obligor
agrees to be both jointly and severally liable hereon. The term "holder" means
Bank and any subsequent transferee or endorsee hereof. The term "Debtor" means
any obligor or any guarantor of this note. The principal of this note will be
disbursed in accordance with the disbursement provision identified above and
further described in the additional provisions set forth on the reverse side
hereof which are incorporated herein by this reference.
PRESENTMENT AND NOTICE OF DISHONOR ARE HEREBY WAIVED BY EACH OBLIGOR
ADDRESS
4130 Faber Place; Suite 200 NAME: ONEITA INDUSTRIES, INC.
Charleston, SC 29405By: By: s/s William H. Boyd
--------------------------
Name: William H. Boyd
Title: Vice President
By: s/s James L. Ford
--------------------------
Name: James L. Ford
Title: Chief Financial Officer
- -------------------------
Credit To
January 31, 1996 006
- ------------------------- ---------------------- -------
Maturity Date Treasurer Check Number Center Code
______________ ______ $_______ $_______ D.M. Westerfield 011
Account Number Renewal Increase Reduction Officer Name Officer Number
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the condensed
consolidated financial statements for the six months ended April 1, 1995 and is
qualified in its entirety by reference to such statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-END> APR-01-1995
<CASH> 2,333,000
<SECURITIES> 0
<RECEIVABLES> 48,957,000
<ALLOWANCES> 1,212,000
<INVENTORY> 60,279,000
<CURRENT-ASSETS> 113,534,000
<PP&E> 58,545,000
<DEPRECIATION> 25,452,000
<TOTAL-ASSETS> 150,883,000
<CURRENT-LIABILITIES> 54,470,000
<BONDS> 14,811,000
<COMMON> 1,749,000
0
0
<OTHER-SE> 77,543,000
<TOTAL-LIABILITY-AND-EQUITY> 150,883,000
<SALES> 92,058,000
<TOTAL-REVENUES> 92,058,000
<CGS> 74,207,000
<TOTAL-COSTS> 74,207,000
<OTHER-EXPENSES> 10,772,000
<LOSS-PROVISION> 300,000
<INTEREST-EXPENSE> 1,358,000
<INCOME-PRETAX> 5,771,000
<INCOME-TAX> 2,284,000
<INCOME-CONTINUING> 3,487,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,487,000
<EPS-PRIMARY> 0.50
<EPS-DILUTED> 0.50
</TABLE>
