-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MxIwaQQIvwGkeVwQTby5qZaBuA07k97nkC3xDA0J7XszOyTm/EAjv7HfFIgxKVTb j0eM3jtab1YT2KluhhR+Xg== 0001157523-06-001213.txt : 20060207 0001157523-06-001213.hdr.sgml : 20060207 20060207083706 ACCESSION NUMBER: 0001157523-06-001213 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060203 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060207 DATE AS OF CHANGE: 20060207 FILER: COMPANY DATA: COMPANY CONFORMED NAME: QUAKER FABRIC CORP /DE/ CENTRAL INDEX KEY: 0000103341 STANDARD INDUSTRIAL CLASSIFICATION: BROADWOVEN FABRIC MILS, MAN MADE FIBER & SILK [2221] IRS NUMBER: 041933106 STATE OF INCORPORATION: DE FISCAL YEAR END: 0102 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-07023 FILM NUMBER: 06583657 BUSINESS ADDRESS: STREET 1: 941 GRINNELL ST. CITY: FALL RIVER STATE: MA ZIP: 02721 BUSINESS PHONE: 5086781951 MAIL ADDRESS: STREET 1: 941 GRINNELL ST CITY: FALL RIVER STATE: MA ZIP: 02721 FORMER COMPANY: FORMER CONFORMED NAME: VERTIPILE INC DATE OF NAME CHANGE: 19870811 8-K 1 a5073851.txt QUAKER FABRIC CORPORATION 8K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 February 3, 2006 Date of Report (Date of earliest event reported) QUAKER FABRIC CORPORATION - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 1-7023 04-1933106 (State of incorporation) (Commission File Number) (I.R.S. Employer Identification No.) 941 Grinnell Street, Fall River, Massachusetts 02721 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (508) 678-1951 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report.) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [_] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [_] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17CFR 240.14a-12) [_] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [_] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 1.01 Entry into a Material Definitive Agreement Credit Agreement Amendment On May 18, 2005, Quaker Fabric Corporation of Fall River ("Quaker"), a wholly-owned subsidiary of Quaker Fabric Corporation (the "Company"), entered into a five-year, $70.0 million senior secured revolving credit and term loan agreement with Bank of America, N.A. and two other lenders (the "2005 Credit Agreement"). The 2005 Credit Agreement provides for a $20.0 million term loan (the "Term Loan") and a $50.0 million revolving credit and letter of credit facility (the "Revolving Credit Facility"). Quaker's obligations under the 2005 Credit Agreement are guaranteed by the Company and two Quaker subsidiaries (the "Guaranty"). Pursuant to a Security Agreement (also dated as of May 18, 2005) executed by Quaker, the Company, and two subsidiaries of Quaker, all of Quaker's obligations under the 2005 Credit Agreement are secured by first priority liens upon all of Quaker's and the Company's assets and on the assets of the two Quaker subsidiaries acting as guarantors (the "Security Agreement"). Advances to Quaker under the Revolving Credit Facility are limited to a formula based on Quaker's accounts receivable and inventory minus an "Availability Reserve" (and such other reserves as the lenders may establish from time to time in its reasonable credit judgment.) Amortization of the Term Loan is over a five-year period beginning November 1, 2005, with payments of principal and interest to be made on a quarterly basis. The 2005 Credit Agreement includes customary financial covenants (including fixed charge coverage ratios and minimum consolidated EBITDA requirements), reporting obligations, and affirmative and negative covenants including, but not limited to, limitations on certain business activities of the Company and Quaker and restrictions on the Company's and/or Quaker's ability to declare and pay dividends, incur additional indebtedness, create certain liens, make capital expenditures, incur capital lease obligations, make certain investments, engage in certain transactions with stockholders and affiliates, and purchase, merge, or consolidate with or into any other corporation. Quaker's initial borrowing under the 2005 Credit Agreement was approximately $46.0 million, of which approximately $42.3 million was used to repay, in full, all of Quaker's outstanding obligations under the Senior Notes due October 2005 and 2007 that Quaker issued to an insurance company during 1997 and the Series A Notes due February 2009 that Quaker issued to the same insurance company during 2002, with such repayment including a yield maintenance premium of approximately $2.0 million. The balance of the initial borrowing was used to cover approximately $1.0 million of closing costs and to repay, in full, all of Quaker's outstanding obligations to Fleet National Bank ("Fleet") under the Second Amended and Restated Credit Agreement dated February 14, 2002 by and between Fleet and Quaker. -2- On July 26, 2005, the Company and the other parties to the 2005 Credit Agreement entered into Amendment No. 1, effective as of July 1, 2005, to the 2005 Credit Agreement ("Amendment No. 1") to: (i) increase the Availability Reserve, (ii) reduce the minimum consolidated EBITDA and fixed charge coverage ratio requirements in the financial covenants, (iii) reduce the limits on the Company's annual capital expenditure programs, and (iv) under certain circumstances, require the Company to retain a consultant. On October 20, 2005, the Company and the other parties to the 2005 Credit Agreement entered into Amendment No. 2, effective as of October 20, 2005, to the 2005 Credit Agreement ( "Amendment No. 2") to: (i) reduce the Availability Reserve, (ii) reduce the minimum consolidated EBITDA requirement for the fourth quarter of fiscal 2005 in the financial covenants, (iii) eliminate the minimum consolidated EBITDA requirement in its entirety for all periods after the fourth quarter of fiscal 2005, (iv) add a new "Two Quarter Fixed Charge Coverage Ratio" requirement to the financial covenants applicable to the five fiscal quarters beginning with the first quarter of fiscal 2006 and ending with the first quarter of fiscal 2007, and (v) reduce the Minimum Fixed Charge Coverage Ratio in the financial covenants for the first fiscal quarter of 2006. On February 3, 2006, the Company and the other parties to the 2005 Credit Agreement entered into Amendment No. 3, effective as of December 30, 2005, to the 2005 Credit Agreement ( "Amendment No. 3") to (i) make certain amendments to the definitions of "Consolidated EBITDA" and "Consolidated Interest Expense," (ii) add a new provision with respect to the Company's retention of a Financial Consultant (as defined in Amendment No. 3), (iii) eliminate the minimum consolidated EBITDA requirement for the fourth quarter of fiscal 2005, (iv) add a new two (2) consecutive month minimum consolidated EBITDA covenant, (v) eliminate the Minimum Fixed Charge Coverage Ratio for the first two fiscal quarters of 2006 and reduce the Minimum Fixed Charge Coverage Ratio for the third quarter of 2006, and (vi) eliminate the Two Quarter Fixed Charge Coverage Ratio requirement for the first quarter of 2006. In addition, the Company also agreed to pay a fee of $175,000 in exchange for a $17.5 million reduction in the Total Commitment (as defined in the 2005 Credit Agreement,) bringing the Total Commitment down to $32.5 million, effective February 2, 2006. As of February 6, 2006, there were $37.8 million of loans outstanding under the 2005 Credit Agreement, including the remaining $18.0 million term loan component, approximately $4.6 million of letters of credit and unused availability of $2.2 million, net of the $7.5 million Availability Reserve required. -3- The Company's ability to meet its current obligations is dependent on: (i) its access to trade credit, (ii) its operating cash flow and (iii) its Availability under the 2005 Credit Agreement, which is a function of Eligible Accounts Receivable, Eligible Inventory, and the Availability Reserve as those terms are defined in the 2005 Credit Agreement. Increases in the Availability Reserve such as those reflected in Amendment No. 1 to the 2005 Credit Agreement, discussed above, reduce Availability and thus the Company's ability to borrow. In like manner, decreases in the Availability Reserve such as those reflected in Amendment No. 2 to the 2005 Credit Agreement discussed above increase Availability and thus the Company's ability to borrow. The Company manages its inventory levels, accounts receivable, accounts payable and capital expenditures to provide adequate resources to meet its operating needs, maximize its cash flow and reduce the need to borrow under the 2005 Credit Agreement. However, its cash position may be adversely affected by factors it cannot completely control, including but not limited to, a reduction in incoming order rates, production rates, sales, and accounts receivable, as well as delays in receipt of payment of accounts receivable and limitations of trade credit. The Company has implemented a plan to carefully monitor and manage its investment in inventory and is seeking to dispose of certain manufacturing and warehousing facilities no longer needed as a result of the consolidation of some of its facilities. In addition, management adjusts the Company's cost structure on a continuing basis to reflect changes in demand. Management believes that the 2005 Credit Agreement, as amended, together with the Company's operating cash flow are adequate to meet the Company's foreseeable liquidity needs. The foregoing descriptions of the 2005 Credit Agreement, as amended, the Security Agreement and the Guaranty are qualified in their entirety by reference to the 2005 Credit Agreement, the Security Agreement and the Guaranty previously filed with the SEC, the Amendment filed as Exhibit 10.27 to the Form 8-K filed by the Company with the SEC on July 29, 2005, the Amendment filed as Exhibit 10.28 to the Form 8-K filed by the Company with the SEC on October 26, 2005 and the Amendment filed as Exhibit 10.29 to this Form 8-K, all of which are incorporated by reference herein. Cautionary Statement Regarding Forward-Looking Information Statements contained in this report, as well as oral statements made by the Company that are prefaced with the words "may," "will," "expect," "anticipate," "continue," "estimate," "project," "intend," "designed" and similar expressions, are intended to identify forward-looking statements regarding events, conditions and financial trends that may affect the Company's future plans of operations, business strategy, results of operations and financial position. These statements are based on the Company's current expectations and estimates as to prospective events and circumstances about which the Company can give no firm assurance. Further, any forward-looking statement speaks only as of the date on which such statement is made, and the Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made. As it is not possible to predict every new factor that may emerge, forward-looking statements should not be relied upon as a prediction of the Company's actual future financial condition or results. These forward-looking statements like any forward-looking statements, involve risks and uncertainties that could cause actual results to differ materially from those projected or anticipated. Such risks and uncertainties include product demand and market acceptance of the Company's products, regulatory uncertainties, the effect of economic conditions, the impact of competitive products and pricing, including, but not limited to, imported furniture and furniture coverings sold into the U.S. domestic market, foreign currency exchange rates, changes in customers' ordering patterns, and the effect of uncertainties in markets outside the U.S. (including Mexico and South America) in which the Company operates. -4- Item 9.01 Financial Statements and Exhibits (c) Exhibits 10.29 Amendment No. 3 (dated as of February 3, 2006 and effective as of December 30, 2005) to Revolving Credit and Term Loan Agreement (dated as of May 18, 2005) by and among Quaker Fabric Corporation of Fall River, as Borrower; Bank of America, N.A. and the Other Lending Institutions which are or may become parties thereto; Bank of America, N.A., as Administrative Agent and Issuing Bank; Fleet National Bank, as Cash Management Bank; and Banc of America Securities LLC, as Sole Lead Arranger and Book Manager. -5- SIGNATURES 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. QUAKER FABRIC CORPORATION (Registrant) Date: February 7, 2006 /s/ Paul J. Kelly -------------------------------------------- Paul J. Kelly Vice President - Finance and Treasurer -6- EXHIBIT INDEX 10.29 Amendment No. 3 (dated as of January 3, 2006 and effective as of December 30, 2005) to Revolving Credit and Term Loan Agreement (dated as of May 18, 2005) by and among Quaker Fabric Corporation of Fall River, as Borrower; Bank of America, N.A. and the Other Lending Institutions which are or may become parties thereto; Bank of America, N.A., as Administrative Agent and Issuing Bank; Fleet National Bank, as Cash Management Bank; and Banc of America Securities LLC, as Sole Lead Arranger and Book Manager. -7- EX-10.29 2 a5073851ex1029.txt EXHIBIT 10.29 EXHIBIT 10.29 AMENDMENT NO. 3 AMENDMENT NO. 3 dated as of December 30, 2005 (this "Amendment") by and among Quaker Fabric Corporation of Fall River, a Massachusetts corporation (the "Borrower"), Quaker Fabric Corporation, a Delaware corporation (the "Parent" and together with the Borrower, the "Loan Parties"), Bank of America, N.A. and the other lenders party hereto (collectively, the "Lenders", and individually, a "Lender") and Bank of America, N.A., as Administrative Agent, Issuing Bank and Cash Management Bank. WHEREAS, the Parent, the Borrower, the Lenders party thereto, the Administrative Agent, the Issuing Bank and the Cash Management Bank are parties to that certain Revolving Credit and Term Loan Agreement, dated as of May 18, 2005 (as amended and in effect from time to time, the "Credit Agreement"); WHEREAS, on January 25, 2006, the Borrower delivered to the Administrative Agent an irrevocable notice (the "Commitment Reduction Notice") of its election to permanently reduce the Total Commitment to $32,500,000 pursuant to the provisions of Section 2.3 of the Credit Agreement; WHEREAS, the Parent has advised the Lenders of its retention of a financial consultant satisfactory to the Administrative Agent (the "Financial Consultant") to provide an evaluation of the Parent's 2006 business plan and the plan's methodologies, including the identification of strengths weaknesses, opportunities and threats related to such business plan; and WHEREAS, the Loan Parties have requested that the Administrative Agent and the Lenders amend certain of the terms and provisions of the Credit Agreement, as specifically set forth in this Amendment. NOW THEREFORE, in consideration of the premises and the mutual agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: Section l. Definitions. Except as otherwise defined in this Amendment, terms defined in the Credit Agreement are used herein as defined therein. Section 2. Amendments. Subject to the satisfaction of the conditions precedent specified in Section 3 herein, the Credit Agreement shall be amended as follows: -8- (a) Section 1.1 of the Credit Agreement is hereby amended by deleting the word "and" contained in clause (b)(iv) of the definition of "Consolidated EBITDA" contained therein and adding the following text immediately prior to the comma contained at the end of clause (b)(v) of the definition of "Consolidated EBITDA": ", (vi) costs and expenses incurred by the Loan Parties and their Subsidiaries in connection with the Parent's retention of the Financial Consultant (as defined in ss.7.20) and (vii) up to an aggregate amount of $300,000 of severance charges incurred by the Loan Parties in FQ1 of 2006" (b) Section 1.1 of the Credit Agreement is hereby further amended by deleting clause (c) contained in the definition of "Consolidated Interest Expense" contained therein and substituting in lieu thereof the following: "(c) all fees, including letter of credit fees and expenses (but excluding reimbursement of legal fees and any early termination fee paid by the Borrower pursuant to ss.2.3 hereof in connection with the Borrower's reduction of the Total Commitment effective as of February 3, 2006) incurred hereunder during such period." (c) Section 7 of the Credit Agreement is hereby amended by adding the following new section immediately after Section 7.19 contained therein: 7.20. Financial Consultant. Parent shall retain, at the Loan Parties' expense, a financial consultant acceptable to the Administrative Agent (the "Financial Consultant"), (a) the scope of which shall be reasonably satisfactory to the Administrative Agent and (b) which shall not be amended, supplemented or otherwise modified (other than to expand the scope thereof) without the prior written consent of the Administrative Agent. Parent acknowledges that the Financial Consultant shall be chosen solely by Parent and the Financial Consultant will be an agent only of Parent, and not of the Administrative Agent or any Lender, in all respects. At any time and from time to time, the Loan Parties shall make the Financial Consultant, its officers and other consultants of the Loan Parties and their Subsidiaries available, whether by telephone or in person, to review and discuss the Loan Parties' and their Subsidiaries' financial condition; provided that the Parent shall have the option to participate in such communications. (d) The Credit Agreement is hereby further amended by deleting Section 9.1 thereof and substituting in lieu thereof the following: -9- "9.1. Minimum Consolidated EBITDA. The Parent and the Borrower shall not permit Consolidated EBITDA, determined as at the end of each month set forth in the table below for the period of the two (2) consecutive prior months then ending, to be less than the amount set forth opposite such month in such table: ---------------------------------------------------------- Month Minimum Consolidated EBITDA ---------------------------------------------------------- February of 2006 $825,000 ---------------------------------------------------------- March of 2006 $770,000 ---------------------------------------------------------- April of 2006 $1,475,000 ---------------------------------------------------------- May of 2006 $1,975,000 ---------------------------------------------------------- (e) The Credit Agreement is hereby further amended by deleting Section 9.2 thereof and substituting in lieu thereof the following: "9.2. Fixed Charge Coverage Ratios. (a) Fixed Charge Coverage Ratio. The Parent and the Borrower shall not permit the Fixed Charge Coverage Ratio, determined as of the end of each Fiscal Quarter set forth in the table below, to be less than the ratio set forth opposite such Fiscal Quarter in such table:
---------------------------------------------------------------------------------- Fiscal Quarter Minimum Fixed Charge Coverage Ratio ---------------------------------------------------------------------------------- FQ3 of 2006 1.00:1.00 ---------------------------------------------------------------------------------- FQ4 of 2006 1.10:1.00 ---------------------------------------------------------------------------------- FQ1 of 2007 and each Fiscal Quarter ending 1.15:1.00 thereafter ----------------------------------------------------------------------------------
(b) Two Quarter Fixed Charge Coverage Ratio. The Parent and the Borrower shall not permit the Two Quarter Fixed Charge Coverage Ratio, determined as of the end of FQ2 of 2006, FQ3 of 2006, FQ4 of 2006 and FQ1 of 2007, to be less than 1.0:1.0." Section 3. Conditions Precedent. The Administrative Agent, the Lenders, and each of the Parent and the Borrower agree that this Amendment shall become effective as of December 30, 2005 upon the satisfaction of the following conditions precedent, each in form and substance reasonably satisfactory to the Agent: (a) The Borrower, each Guarantor and the Required Lenders shall have executed and delivered to the Administrative Agent this Amendment; (b) The Administrative Agent shall have received a fully executed copy of the engagement letter with the Financial Consultant in form and substance satisfactory to the Administrative Agent; (c) The Administrative Agent shall have received payment from the Borrower for the account of each Lender executing this Amendment an amendment fee in the amount of 0.125% of the sum of (i) the Commitment of such Lender (after giving effect to the reduction of the Total Commitment evidenced by the Commitment Reduction Notice) and (ii) the outstanding principal amount of the Term Loan owning to such Lender; -10- (d) The representations and warranties of each of the Borrower and each Guarantor in each of the Loan Documents to which it is a party shall be true and correct on and as of the date hereof, except to the extent of changes resulting from transactions contemplated or permitted by the Credit Agreement and the other Loan Documents and changes occurring in the ordinary course of business that singly or in the aggregate are not materially adverse, and to the extent that such representations and warranties relate expressly to an earlier date; (e) As of the date hereof, there shall have occurred no Default or Event of Default; (f) The Administrative Agent shall have received (a) the Commitment Reduction Notice, (b) the early termination fee due to the Lenders pursuant to Section 2.3 of the Credit Agreement as a result of such reduction and (c) the full amount of any Commitment Fee then accrued on the amount of the reduction evidenced by the Commitment Reduction Notice; and (g) The Administrative Agent and the Lenders shall have received payment for all fees and expenses including, without limitation, reasonable legal fees and expenses, for which invoices or reasonable estimates therefor have been provided to the Borrower on or prior to the date hereof. Section 4. Representations and Warranties. Each of the Parent and the Borrower hereby represents and warrants to the Lenders as follows: (a) The execution and delivery by the Borrower and each Guarantor and the performance by each of the Borrower and each Guarantor of each of its obligations and agreements under this Amendment and the Credit Agreement and the other Loan Documents, as amended hereby, are within the organizational authority of each such Person, have been duly authorized by all necessary proceedings on behalf of each such Person, and do not and will not contravene any provision of law, statute, rule or regulation to which any such Person is subject or any of such Person's organizational documents or of any agreement or other instrument binding upon any such Person; (b) This Amendment and the Credit Agreement and the other Loan Documents, as amended hereby, constitute legal, valid and binding obligations of each of the Borrower and each Guarantor, enforceable in accordance with their respective terms, except as limited by bankruptcy, insolvency, reorganization, moratorium or other laws relating to or affecting generally the enforcement of creditors' rights in general, and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law); (c) No approval or consent of, or filing with, any governmental agency or authority is required to make valid and legally binding the execution, delivery or performance by the Borrower and/or each Guarantor of this Amendment or the Credit Agreement and the other Loan Documents as amended hereby, except for such filings which have been made prior to the date hereof and are in full force and effect; -11- (d) The representations and warranties contained in Section 6 of the Credit Agreement are true and correct at and as of the date made and as of the date hereof, except to the extent of changes resulting from transactions contemplated or permitted by the Credit Agreement and the other Loan Documents and changes occurring in the ordinary course of business that singly or in the aggregate are not materially adverse, and to the extent that such representations and warranties relate expressly to an earlier date; and (e) Each of the Borrower and each Guarantor has performed and complied in all material respects with all terms and conditions herein required to be performed or complied with by it prior to or at the time hereof, and as of the date hereof, after giving effect to the provisions hereof, there exists no Event of Default or Default. Section 5. Affirmation and Acknowledgment. (a) The Borrower hereby ratifies and confirms all of its Obligations to the Administrative Agent and the Lenders and the Borrower hereby affirms its absolute and unconditional promise to pay to the Lenders the Loans and all other amounts due under the Credit Agreement, as amended hereby. The Borrower hereby confirms that the Obligations are and remain secured pursuant to the Security Documents, and pursuant to all other instruments and documents executed and delivered by the Borrower as security for the Obligations. (b) Each Guarantor hereby acknowledges the provisions of this Amendment and hereby confirms and ratifies all of its obligations under the Guaranty and each Loan Document (as amended hereby) to which such Guarantor is a party. Each Guarantor hereby confirms (i) that the Guaranties and each of the other Loan Documents remain in full force and effect and (ii) that its obligations under the Guaranty to which it is a party are and remain secured pursuant to the Security Documents to which it is a party. Section 6. No Waiver. Except as otherwise expressly provided for in this Amendment, all of the terms and conditions of the Credit Agreement and the other Loan Documents shall remain in full force and effect without modification or waiver. Section 7. Expenses. The Borrower agrees to pay to the Administrative Agent and the Lenders upon written demand therefor an amount equal to any and all reasonable out-of-pocket costs, expenses, and liabilities incurred or sustained by the Administrative Agent in connection with the preparation of this Amendment. Amounts payable pursuant to this Section 7 shall be subject to the provisions of Section 15 of the Credit Agreement, as fully as if set forth therein. Section 8. Miscellaneous. (a) This Amendment shall be governed by and construed in accordance with the internal laws of the Commonwealth of Massachusetts. (b) This Amendment shall constitute a Loan Document under the Credit Agreement, and all obligations included in this Amendment (including, without limitation, all obligations for the payment of principal, interest, fees, and other amounts and expenses) shall constitute obligations under the Loan Documents and be secured by the collateral security for the Obligations. (c) This Amendment may be executed in any number of counterparts, and all such counterparts shall together constitute but one instrument. In making proof of this Amendment it shall not be necessary to produce or account for more than one counterpart signed by each party hereto by and against which enforcement hereof is sought. -12- IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered as of the day and year first above written. QUAKER FABRIC CORPORATION OF FALL RIVER QUAKER FABRIC CORPORATION QUAKER TEXTILE CORPORATION QUAKER FABRIC MEXICO, S.A. de C.V. By: /s/ Paul J. Kelly ---------------------------------------------- Name: Paul J. Kelly Title: Vice President Finance BANK OF AMERICA, N.A. individually and as Administrative Agent, Issuing Bank and Cash Management Bank By: /s/ Matthew T. O'Keefe ------------------------------- Name: Matthew T. O'Keefe Title: Senior Vice President WELLS FARGO FOOTHILL, LLC By: ------------------------------- Name: Title: MERRILL LYNCH CAPITAL, A DIVISION OF MERRILL LYNCH BUSINESS FINANCIAL SERVICES INC. By: ------------------------------- Name: Title: -----END PRIVACY-ENHANCED MESSAGE-----