Cash-strapped US textile company CMI Industries has announced it has reached an agreement with its debt holders that will allow it to keep running its Greensboro operation.

The South Carolina-based firm employs about 260 people at the plant, which makes fabric for women's underwear.

Earlier this year, holders of CMI's senior notes filed a court petition seeking to have the company reorganise involuntarily in accordance with the federal bankruptcy code.

Since then the company and senior note holders have reached an agreement under which CMI will sell all its plants with the exception of those in its Elastic Fabric of America subsidiary. The company's Greensboro plant is part of that subsidiary.

The firm has already closed all of its factories besides the elastics plans and will sell them to pay off creditors. Under the agreement the company, which faces another involuntary bankruptcy petition for $80,000 filed by several former workers, will also restructure its debt.

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