AMENDMENT NO. 4
to
LOAN AND SECURITY AGREEMENT
dated as of July 12, 1996
THIS AMENDMENT NO. 4 dated as of July 24, 1997 is made by XXXX
FURNITURE, INC., a North Carolina corporation, AMERICAN FURNITURE COMPANY,
INCORPORATED, a Virginia corporation, XXXXXXX FURNITURE CO., a Mississippi
corporation, XXXXXXX-XXXXXX COMPANY, INC., a North Carolina corporation, XXXX
CONTRACT SALES CORPORATION, a North Carolina corporation, XXXX INTERNATIONAL
SALES CORP., a Barbados corporation, XXXX TRANSPORTATION, INC., a North Carolina
corporation, PENNSYLVANIA HOUSE, INC., a North Carolina corporation, XXXXXXX
FURNITURE, INC., a North Carolina corporation (the "Borrowers"), NATIONSBANK,
N.A. (successor to NationsBank, N.A.(South), a national banking association
("NationsBank")), FLEET CAPITAL CORPORATION, a Rhode Island corporation ("Fleet"
and together with NationsBank, the "Co-Agents"), the financial institutions
parties to the Loan Agreement (as hereinafter defined) from time to time (the
"Lenders"), and NATIONSBANK as administrative agent for the Lenders (the
"Administrative Agent").
Preliminary Statements
The Borrowers, the Lenders, the Co-Agents and the
Administrative Agent are parties to a Loan and Security Agreement dated as of
July 12, 1996, as amended by Amendment No. 1 dated as of August 15, 1996,
Amendment No. 2 dated as of October 10, 1996 and Amendment No. 3 dated as of
December 23, 1996 (said Agreement, as so amended, the "Loan Agreement"; terms
defined therein and not otherwise defined herein being used herein as therein
defined).
XXXX proposes to enter into a factoring agreement with
NationsBanc Commercial Corporation and the Borrowers have requested certain
modifications to the Loan Agreement in connection therewith. The Lenders, the
Co-Agents and the Administrative Agent have agreed to such requests, upon and
subject to all of the terms, conditions and provisions of this Amendment.
Accordingly, in consideration of the Loan Agreement, the Loans
made by the Lenders and outstanding thereunder, the mutual promises hereinafter
set forth and other good and valuable consideration the receipt and sufficiency
of which are hereby acknowledged, the parties hereto hereby agree as follows:
Section 1. Amendments to Loan Agreement. The Loan Agreement is
hereby amended, subject to the provisions of Section 2 hereof, by
(a) amending Section 1.1 Definitions thereof by
(i) amending the definition "Borrowing Base" by redesignating
subsection (b)(ii) thereof as subsection (b)(iii); redesignating
subsection (b)(iii) thereof as subsection (b)(iv), and inserting a new
subsection (b)(ii) to read as follows:
(ii) THE LESSER OF (x) $2,000,000 and (y) 85% (or
such lesser percentage as the Administrative Agent may in its
reasonable credit judgment determine from time to time) of the
Factoring Credit Balance due and owing by the Factor at such
time, PLUS
(ii) amending clause (e) of the definition "Eligible
Receivable" by inserting before the semicolon at the end thereof the
following: "PROVIDED FURTHER, HOWEVER, that no such Receivable shall
have been "charged back" by the Factor after acceptance under the
Factoring Agreement at its credit risk";
(iii) amending the definition "Permitted Liens" by
redesignating subsection (g) thereof as subsection (h) and inserting
between the last comma therein and the word "and" a new subsection (g)
to read as follows:
(g) Liens in favor of the Factor, arising under the
Factoring Agreement,
(b) further amending Section 1.1 Definitions by adding thereto
in appropriate alphabetical order the following new definitions:
"Assignment of Factoring Proceeds" means the Assignment of
Factoring Proceeds (No Advances or Ledger Debt) dated as of July ___,
1997, between XXXX, the Factor and the Administrative Agent.
"Factor" means NationsBanc Commercial Corporation.
"Factoring Agreement" means the Factoring Agreement (Export
Receivables) dated as of July ___, 1997, between the Factor and XXXX.
"Factoring Credit Balance" means the net amount payable by the
Factor to XXXX at any time for accounts receivable factored (at the
Factor's credit risk) under the Factoring Agreement, after accounting
for customer disputes and other deductions.
(c) amending Article 12 Negative Covenants by adding
------------------
thereto a new Section 12.16 to read as follows:
SECTION 12.16 Factored Receivables. Submit for factoring under
the Factoring Agreement any Receivable unless the Account Debtor
thereon is located outside of the United States and Puerto Rico, accept
any loan or advance from the Factor, or provide any security or
collateral (other than as expressly provided for in the Factoring
Agreement) to the Factor.
(d) amending Section 15.1 Appointment of Agent by replacing
the reference to clause "(b)(iii)(C)" therein with "(b)(iv)(C),"
(e) amending Section 16.11 Amendments thereof by redesignating
subsection (b)(v) thereof as subsection (b)(vi), and inserting between the last
comma therein and the word "and" a new subsection (b)(v) to read as follows:
(v) amend, assign or agree thereunder to any amendment of
Factoring
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Agreement that is adverse to the interests of the
Administrative Agent and the Lenders in the Factoring Credit Balance,
(f) further amending the Loan Agreement by substituting for
Exhibit C thereto a new Exhibit C -- Form of Borrowing Base Certificate in the
form attached hereto as ANNEX A.
Section 2. Effectiveness of Amendment. This Amendment shall
become effective on the date (the "Amendment Effective Date") on which the
Administrative Agent shall have received each of the following documents (in
sufficient copies for each Lender):
(a) this Amendment duly executed and delivered by each
Borrower and each Lender;
(b) the Assignment of Factoring Proceeds duly executed and
delivered by XXXX, the Factor and the Administrative Agent on behalf of the
Lenders;
(c) a certificate of the Secretary of each Borrower having
attached thereto the articles or certificate of incorporation and bylaws of such
Borrower as in effect on the Amendment Effective Date attached thereto (or
containing the certification of such Secretary that no amendment or modification
of such articles or certificate or bylaws has become effective since the last
date on which such documents were delivered to the Administrative Agent pursuant
to the Loan Agreement), and to the further effect that the incumbency
certificate and corporate action delivered in connection with the occurrence of
the Effective Date remain in effect, unchanged;
(d) a certificate of the President or Financial Officer of
XXXX to the effect that
(i) the representations and warranties of the Borrowers
contained in the Loan Documents are true and correct in all material
respects on and as of the Amendment Effective Date as if made on and as
of such date, and
(ii) no Default or Event of Default has occurred and is
continuing, and such statements shall be true;
(e) a certified copy of the Factoring Agreement (as defined in
the Loan Agreement as amended by this Amendment); and
(f) such other documents, certificates and instruments in
connection with the effectiveness of this Amendment as the Administrative Agent
or any Lender may reasonably request.
Section 3. Effect of Amendment. From and after the
effectiveness of this Amendment, all references in the Loan Agreement and in any
other Loan Document to "this Agreement," "the Loan Agreement," "hereunder,"
"hereof" and words of like import referring to the Loan Agreement, shall mean
and be references to the Loan Agreement as amended by this Amendment. Except as
expressly amended hereby, the Loan Agreement and all terms, conditions and
provisions thereof remain in full force and effect and are hereby ratified and
confirmed. The execution, delivery and effectiveness of this Amendment shall
not, except as expressly provided herein, operate as a waiver of any right,
power or remedy of any Lender or the Administrative Agent under any of the Loan
Documents, nor constitute a waiver of any provision of any of the
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Loan Documents.
Section 4. Counterpart Execution; Governing Law.
(a) Execution in Counterparts. This Amendment may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which taken together shall constitute but one and the
same agreement.
(b) Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of Georgia.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
BORROWERS:
XXXX FURNITURE, INC.
By:___________________________
Xxxxxxx X. Xxxxxxxxx
Executive Vice President
AMERICAN FURNITURE COMPANY, INCORPORATED
By:___________________________
Xxxxxxx X. Xxxxxxxxx
Vice President
XXXXXXX FURNITURE CO.
By:___________________________
Xxxxxxx X. Xxxxxxxxx
Vice President
XXXXXXX-XXXXXX COMPANY, INC.
By:___________________________
Xxxxxxx X. Xxxxxxxxx
Vice President
XXXX CONTRACT SALES CORP.
By:___________________________
Xxxxxxx X. Xxxxxxxxx
Vice President
PENNSYLVANIA HOUSE, INC.
By:___________________________
Xxxxxxx X. Xxxxxxxxx
Vice President
XXXXXXX FURNITURE, INC.
By:___________________________
Xxxxxxx X. Xxxxxxxxx
Vice President
XXXX TRANSPORTATION, INC.
By:___________________________
Xxxxxxx X. Xxxxxxxxx
President
XXXX INTERNATIONAL SALES CORP.
By:___________________________
Xxxxxxx X. Xxxxxxxxx
Vice President
AGENTS/LENDERS:
NATIONSBANK, N.A., as Administrative Agent,
a Co-Agent and
as a Lender
By:___________________________
Xxxxx X. Xxxx
Vice President
FLEET CAPITAL CORPORATION, as a Co-Agent and
as a Lender
By: _________________________
Name:
Title:
BANKAMERICA BUSINESS CREDIT, INC.,
as a Lender
By:___________________________
Name:
Title:
THE CIT GROUP/BUSINESS CREDIT,
INC., as a Lender
By:___________________________
Name:
Title:
SANWA BUSINESS CREDIT CORPORATION,
as a Lender
By:___________________________
Name:
Title:
BANKBOSTON, N.A., as a Lender
By:___________________________
Name:
Title:
CREDITANSTALT CORPORATE FINANCE, INC.,
as a Lender
By:___________________________
Name:
Title:
BRANCH BANKING AND TRUST COMPANY, as a Lender
By:___________________________
Name:
Title:
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