AMENDMENT NO. 2
TO
CREDIT AGREEMENTS
THIS AMENDMENT NO. 2 TO CREDIT AGREEMENTS ("AMENDMENT") is dated as of
December 16, 1996, by and among XXXXXX FURNITURE CORPORATION, a Florida
corporation ("LFC"), XXXXXX FURNITURE COMPANY OF THE MIDWEST, INC., a
Colorado corporation ("LFC MIDWEST"), XXXXXX FURNITURE COMPANY OF THE
PACIFIC, INC., a California corporation ("LFC PACIFIC"), XXXXXX FURNITURE
COMPANY OF WASHINGTON, INC., a Washington corporation ("LFC WASHINGTON") and
XXXX X. XXXXX COMPANY, an Illinois corporation ("XXXXX") (LFC, LFC Midwest,
LFC Pacific, LFC Washington and Xxxxx sometimes hereinafter referred to
individually as a "BORROWER" and collectively as the "BORROWERS"); LFC,
acting in its capacity as borrowing agent for the Borrowers (LFC, in such
capacity, the "LFC FUNDS ADMINISTRATOR"); BT COMMERCIAL CORPORATION, a
Delaware corporation (in its individual capacity, hereinafter referred to as
"BTCC"), acting in its capacity as agent (in such capacity, hereinafter
referred to as the "TRANCHE A AGENT") under the "TRANCHE A CREDIT AGREEMENT"
(as hereinafter defined); BTCC, acting in its capacity as agent (in such
capacity, hereinafter referred to as the "TRANCHE B AGENT") under the
"TRANCHE B CREDIT AGREEMENT" (as hereinafter defined); and each of the
Lenders under and as defined in the Tranche A Credit Agreement (hereinafter
referred to as the "TRANCHE A LENDERS") and the "TRANCHE B LENDERS" (as
defined in the Tranche A Credit Agreement). Capitalized terms used herein
but not otherwise defined herein shall have the respective meanings assigned
to such terms in the Tranche A Credit Agreement.
WITNESSETH:
WHEREAS, Borrowers, the Tranche A Agent and the Tranche A Lenders have
entered into that certain Credit Agreement dated as of July 1, 1996, as
amended (the "TRANCHE A CREDIT AGREEMENT"), pursuant to which the Tranche A
Lenders have agreed to make certain loans and other financial accommodations
to or for the account of Borrowers;
WHEREAS, Borrowers, the Tranche B Agent and the Tranche B Lenders have
entered into that certain Credit Agreement dated as of July 1, 1996, as
amended (the "TRANCHE B CREDIT AGREEMENT"), pursuant to which the Tranche B
Lenders have agreed to make certain loans and other financial accommodations
to or for the account of Borrowers;
WHEREAS, the Term Lenders have advised the Tranche A Agent and the
Tranche B Agent (sometimes hereinafter referred to collectively as the
"AGENTS") and the Tranche A Lenders and the Tranche B Lenders (sometimes
hereinafter referred to collectively as the "LENDERS") that pursuant to that
certain Agreement for Sale of Claim dated as of December 16, 1996 (the "TERM
NOTE PURCHASE AGREEMENT"), among each of the Term Lenders and Silver Oak
Capital, L.L.C., as Agent (the "SUBSTITUTE TERM LENDER"), the Term Lenders
wish to assign their respective rights and delegate their respective
obligations under the Term Notes and the other Credit Documents, including
the Tranche A Credit Agreement (the "TERM ASSIGNMENT"), in each case to the
Substitute Term Lender;
WHEREAS, the Term Lenders have requested that the Tranche A Agent
consent to the Term Assignment, and the Tranche A Agent has agreed to
consent to the Term Assignment, subject to the prior amendment of the
Tranche A Credit Agreement and the Tranche B Credit Agreement (sometimes
hereinafter referred to collectively as the "CREDIT AGREEMENTS"), in each
case as set forth herein; and
WHEREAS, Borrowers, the LFC Funds Administrator, the Agents and the
Lenders have agreed to amend the Credit Agreements, on the terms and subject
to the conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises set forth above, the
terms and conditions contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the respective parties hereto hereby agree as follows:
1. CONSENT TO TERM ASSIGNMENT. Effective as of the date hereof, upon
satisfaction of the conditions precedent set forth in SECTION 3 below, the
Tranche A Agent hereby consents to the Term Assignment.
2. AMENDMENT TO TRANCHE A CREDIT AGREEMENT. Effective as of the date
hereof, upon satisfaction of the conditions precedent set forth in SECTION 3
below, the Tranche A Credit Agreement is hereby amended as follows:
2.1 The defined term "CHANGE OF CONTROL" set forth in SECTION 1.1
of the Tranche A Credit Agreement is hereby amended by deleting the
words "any Term Lender" and substituting therefor the words "Apollo
Management L.P., a Delaware limited partnership," in each case in: (I)
the parenthetical beginning in the first line of CLAUSE (A) thereof);
(II) the parenthetical beginning in the first line of CLAUSE (B)
thereof); and (III) the parenthetical beginning in the third line of
CLAUSE (C) thereof).
2.2 The defined term "EXPENSES" set forth in SECTION 1.1 of the
Tranche A Credit Agreement is hereby amended by deleting therefrom: (I)
the words "the Term Lenders" appearing in the second line thereof and
substituting therefor the words "Apollo Management L.P., a Delaware
limited partnership, and/or its Affiliates"; (II) the words "or any Term
Lender" appearing in the twelfth line thereof; and (III) the words "Term
Lender" appearing in the twenty-seventh line thereof and substituting
therefor the words "Apollo Management L.P., a Delaware limited
partnership, and/or its Affiliates".
2.3 The following defined term is hereby added to SECTION 1.1 of
the Tranche A Credit Agreement in the appropriate alphabetical order:
MAJORITY TERM LENDERS means, at any time, those Term Lenders
holding in the aggregate more than fifty-percent (50%) of the Term
Exposure at such time.
2.4 SECTION 7.2 of the Tranche A Credit Agreement is hereby
amended by deleting therefrom (I) the words "each Term Lender" appearing
in the first and second lines thereof and (II) the words "or any Term
Lender" appearing in the second line of CLAUSE (C) thereof.
2.5 SECTION 7.5 of the Tranche A Credit Agreement is hereby
amended by deleting therefrom the words "Term Lenders, or their
respective" appearing in the fifth line thereof and substituting the
word "its" therefor.
2.6 CLAUSE (B) of SECTION 7.13 of the Tranche A Credit Agreement
is hereby amended by deleting therefrom: (I) the words "or any Term
Lender" appearing in the first line thereof; and (II) the words ", any
Term Lender" appearing in the seventh line thereof.
2.7 CLAUSE (C) of SECTION 7.14 of the Tranche A Credit Agreement
is hereby amended by deleting therefrom the words "or the Term Lenders"
appearing in the twenty-first line thereof.
2.8 SECTION 8.6 of the Tranche A Credit Agreement is hereby
amended by deleting therefrom the proviso set forth therein and
substituting therefor the following language:
PROVIDED, THAT, (A) each such disposition is for fair value and (B)
the Majority Term Lenders have consented thereto in their sole
discretion; PROVIDED, FURTHER, that, the consent of the Majority
Term Lenders to any such disposition shall not be required so long
as:
(1) after giving effect to such disposition, the aggregate
liquidation value of the Borrowers' real property owned in fee
simple absolute, net of any Indebtedness secured by a Lien on such
real property senior to the Lien thereon in favor of the Collateral
Agent, is greater than $59,500,000, such liquidation value to be
determined by reference to the schedule of liquidation values
acknowledged by the Collateral Agent, the Borrowers and the
Majority Term Lenders on or before December 16, 1996, as the
schedule to be used for purposes of determining compliance with
this SUBSECTION (1); PROVIDED, THAT the Borrowers may update such
schedule once (and only once) by retaining, at their own expense, a
nationally recognized real estate appraisal firm that is reasonably
acceptable to the Collateral Agent and the Majority Term Lenders,
which firm shall render an opinion as to the respective fair market
values and liquidation values as of the date of such opinion of all
of Borrower's real property that is (X) owned in fee simple
absolute, and (Y) subject to a Lien in favor of the Collateral
Agent for the benefit of the Secured Parties;
and, PROVIDED, FURTHER, THAT all drafts of such opinion, and the
final such opinion, shall be simultaneously delivered to the
Collateral Agent, the Borrowers and to each Term Lender. The final
opinion shall be reasonably satisfactory to the Collateral Agent
and the Majority Term Lenders, shall be addressed to the Collateral
Agent, the Borrowers and the Lenders and shall state that each of
such Persons may rely thereon. Upon delivery of an opinion meeting
the conditions set forth above, the schedule of liquidation values
set forth in such opinion shall become the schedule used for
purposes of determining compliance with this SUBSECTION (1);
(2) after giving effect to such disposition, the aggregate
consideration received with respect to all such dispositions for
all Borrowers does not exceed the following amounts (the "PERMITTED
AMOUNTS"):
(X) $4,890,000, for dispositions made between December
11, 1996 and March 31, 1997, and
(Y) $17,500,000, for dispositions made in any single
fiscal year being with the fiscal year ending March 31, 1998;
PLUS, in any fiscal year, the cumulative unused portion of any
Permitted Amount for a prior fiscal year or the period between
December 11, 1996 and March 31, 1997;
(3) the total consideration received with respect to such
disposition is paid in full in cash upon consummation thereof and
the Net Cash Disposition Proceeds thereof are thereupon (I)
immediately reinvested in the business of the Borrowers or their
respective Subsidiaries or (II) delivered to the Collateral Agent,
in which case such consideration will be applied pursuant to the
terms of the Collateral Agency Agreement; and
(4) the fair value of the property comprising such disposition
(I) is the fair value thereof as reasonably determined by the Board
of Directors of such Borrower, if the total consideration for any
individual piece of real property, or any single item of personal
property, as the case may be, comprising all or any part of such
disposition, does not exceed $7,500,000, or (II) is the fair value
thereof as determined by a reputable
independent appraiser, if the total consideration for any
individual piece of real property, or any single item of personal
property, as the case may be, comprising all or any part of such
disposition, exceeds $7,500,000.
2.9 SECTION 9.1(J) of the Tranche A Credit Agreement is hereby
amended by deleting therefrom the parenthetical beginning in the fourth
line thereof.
2.10 SECTION 9.2A of the Tranche A Credit Agreement is hereby
amended by inserting the word "Majority" immediately prior to the words
"Term Lenders" appearing in the sixth line thereof.
2.11 SECTION 9.4 of the Tranche A Credit Agreement is hereby
amended by inserting the word "Majority" immediately prior to the words
"Term Lenders" appearing in the fifth line thereof.
2.12 CLAUSE (C) of SECTION 11.8 of the Tranche A Credit Agreement
is hereby deleted in its entirety and the following language is hereby
substituted therefor:
(C) TERM LENDER ASSIGNMENT. Each Term Lender may assign to
one or more Persons all or a portion of its rights and obligations
under this Credit Agreement, the Term Notes and the other Credit
Documents, with the consent of the Agent, which consent shall not
be unreasonably withheld or delayed; and upon execution and
delivery to the Agent, for its acceptance and recording in the
Register, of an agreement in substantially the form of EXHIBIT G
(an "ASSIGNMENT AND ASSUMPTION AGREEMENT"), together with surrender
of any Term Note or Term Notes subject to such assignment and a
processing and recordation fee of $2,500, such assignment shall be
effective and ANNEX II hereto shall be deemed to be modified
accordingly. No such assignment shall be for less than $10,000,000
of the Term Commitments unless it is to another Lender or is an
assignment of all of such Term Lender's rights and obligations
under this Credit Agreement.
2.13 CLAUSE (B) of SECTION 11.11 of the Tranche A Credit Agreement
is hereby amended by (I) inserting the word "Majority" immediately prior
to the words "Term Lenders" appearing in the first line thereof; and
(II) deleting from the seventh line thereof the references to Sections
6.11 and 9.1(j).
2A. AMENDMENT TO TRANCHE B CREDIT AGREEMENT. Effective as of the date
hereof, upon satisfaction of the conditions precedent set forth in SECTION 3
below, the Tranche B Credit Agreement is hereby amended as follows:
2A.1 SECTION 7.1(J) of the Tranche B Credit Agreement is hereby
amended by deleting therefrom the parenthetical beginning in the fourth
line thereof.
2B. Amendment to Collateral Agency Agreement. Effective as of the date
hereof, upon satisfaction of the conditions precedent set forth in SECTION 3
below, the Collateral Agency Agreement is hereby amended as follows:
2B.1 CLAUSE (A) of SECTION 1 of the Collateral Agency Agreement is
hereby amended by adding the following defined term thereto in the
appropriate alphabetical order:
"MAJORITY TERM LENDERS" means the "Majority Term Lenders" as
defined in the Tranche A Credit Agreement.
2B.2 SECTION 2.3 of the Collateral Agency Agreement is hereby
amended by inserting the word "Majority" immediately prior to the words
"Term Lenders" appearing in the twentieth and twenty-first lines
thereof.
2B.3 SECTION 2.5 of the Collateral Agency Agreement is hereby
amended by inserting the word "Majority" immediately prior to the words
"Term Lenders" appearing in the ninth line thereof.
2B.4 SECTION 2.7 of the Collateral Agency Agreement is hereby
amended by inserting the word "Majority" immediately prior to the words
"Term Lenders" appearing in the fourth line thereof.
3. CONDITIONS PRECEDENT. This Amendment shall become effective as of
the date hereof, upon satisfaction of each of the following conditions:
(A) Agents shall have received twelve (12) copies of this
Amendment, duly executed by the LFC Funds Administrator, each of the
Borrowers and the Majority Lenders.
(B) The Term Assignment shall have been consummated pursuant to
the respective terms and provisions of the Term Note Purchase Agreement.
(C) The Tranche A Agent shall have received (I) an Assignment and
Assumption Agreement with respect to the Term Notes, duly executed by
the Term Lenders and the Substitute Term Lender and (II) each of the
Term Notes.
(D) Borrowers shall have reimbursed the Term Lenders for Expenses
in an aggregate amount equal to $27,500.00.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS.
4.1 Each of the Borrowers hereby represents and warrants to each
of the Agents and Lenders that, after giving effect to this Amendment:
(A) All representations and warranties contained in each of the
Credit Agreements and the other Transaction Documents are true and
correct in all material respects on and as of the date of this
Amendment, in each case as if then made, other than representations and
warranties that expressly relate solely to an earlier date (in which
case such representations and warranties were true and accurate on and
as of such earlier date);
(B) No Default or Event of Default has occurred which has not been
waived (or, in the case of an Event of Default, cured) pursuant to the
respective terms of the Credit Agreements;
(C) this Amendment, and each of the Credit Agreements as amended
hereby, constitute legal, valid and binding obligations of the LFC Funds
Administrator and each of the Borrowers and are enforceable against such
Persons in accordance with their respective terms; and
(D) the execution and delivery by the LFC Funds Administrator and
each of the Borrowers of this Amendment does not require the consent or
approval of any Person, except such consents and approvals as shall have
been obtained.
5. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENTS AND THE OTHER
CREDIT DOCUMENTS.
5.1 Upon the effectiveness of this Amendment, each reference in
each of the Credit Agreements to "this Agreement", "hereunder", "hereof",
"herein" or words of like import, and each reference in each of the other
Transaction Documents to the "Credit Agreement," the "Tranche A Credit
Agreement" and/or the "Tranche B Credit Agreement" shall in each case mean
and be a reference to the respective Credit Agreements as amended hereby.
5.2 Except as expressly set forth herein, (I) the execution and
delivery of this Amendment shall in no way affect any of the respective
rights, powers or remedies of either of the Agents or any of the Lenders
with respect to any Event of Default nor constitute a waiver of any
provision of either of the Credit Agreements or any of the other Transaction
Documents and (II) all of the respective terms and conditions of the Credits
Agreement, the other Transaction Documents and all other documents,
instruments, amendments and agreements executed and/or delivered by the
Borrowers and/or the LFC Funds Administrator pursuant thereto or in
connection therewith shall remain in full force and effect and are hereby
ratified and confirmed in all respects. The execution and delivery of this
Amendment by the Agents and each of the Lenders shall in no way obligate the
Agents or any of the Lenders, at any time hereafter, to consent to any other
amendment or modification of any term or provision of the Credit Agreements
or any of the other Transaction Documents, whether of a similar or different
nature.
6. GOVERNING LAW. THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS
AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
AND DECISIONS OF THE STATE OF NEW YORK.
7. HEADINGS. Section headings in this Amendment are included herein
for convenience of reference only and shall not constitute a part of this
Amendment for any other purpose.
8. COUNTERPARTS. This Amendment may be executed in any number of
counterparts and by the different parties hereto in separate counterparts,
each of which when so executed and delivered shall be an original, but all
of which shall together constitute one and the same instrument.
[SIGNATURE PAGES FOLLOW]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their proper and duly authorized officers as
of the date first set forth above.
LFC FUNDS ADMINISTRATOR:
XXXXXX FURNITURE CORPORATION, a Florida
corporation, in its capacity as LFC
Funds Administrator
By: /s/ XXXXXXX X. XXXXX
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
BORROWERS:
XXXXXX FURNITURE CORPORATION, a Florida
corporation
By: /s/ XXXXXXX X. XXXXX
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
XXXXXX FURNITURE COMPANY OF THE MIDWEST,
INC., a Colorado corporation
By: /s/ XXXXXXX X. XXXXX
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
XXXXXX FURNITURE COMPANY OF THE PACIFIC,
INC., a California corporation
By: /s/ XXXXXXX X. XXXXX
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
XXXXXX FURNITURE COMPANY OF WASHINGTON,
INC., a Washington corporation
By: /s/ XXXXXXX X. XXXXX
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
XXXX X. XXXXX COMPANY, an Illinois
corporation
By: /s/ XXXXXXX X. XXXXX
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
AGENTS:
BT COMMERCIAL CORPORATION, in its
respective capacities as Tranche A Agent
and Tranche B Agent
By: /s/ XXXXX XXXXX
Xxxxx Xxxxx
Vice President
LENDERS:
BT COMMERCIAL CORPORATION
By: /s/ XXXXX XXXXX
Xxxxx Xxxxx
Vice President
SANWA BUSINESS CREDIT CORPORATION
By: /s/ XXXXXXXX X. XXXXXX
Name: Xxxxxxxx X. Xxxxxx
Title: Vice President
LASALLE NATIONAL BANK
By: /s/ XXXXXXXXXXX X. XXXXXXXX
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Senior Vice President
CONGRESS FINANCIAL CORPORATION (CENTRAL)
By: /s/ XXXXXX XXXXXXXXX
Name: Xxxxxx Xxxxxxxxx
Title: Vice President
XXXXXX FINANCIAL, INC.
By: /s/ XXXXXX X. XXXXX
Name: Xxxxxx X. Xxxxx
Title: Vice President
TRANSAMERICA BUSINESS CREDIT CORPORATION
By: /s/ XXXXXXX X. XXXXXXXX
Name: Xxxxxxx X. XxXxxxxx
Title: Vice President
FINOVA CAPITAL CORPORATION
By: /s/ XXXX XXXXXXXX
Name: Xxxx Xxxxxxxx
Title: Asst. Vice President
APOLLO INVESTMENT FUND III, L.P.
By: APOLLO ADVISORS II, L.P., ITS GENERAL PARTNER
By: APOLLO CAPITAL MANAGEMENT II, INC.
ITS GENERAL PARTNER
By: /s/ XXXXXX XXXX
Name: Xxxxxx Xxxx
Title: Vice President
APOLLO OVERSEAS PARTNERS III, L.P.
By: APOLLO ADVISORS II, L.P.,
ITS MANAGING GENERAL PARTNER
By: APOLLO CAPITAL MANAGEMENT II, INC., ITS
GENERAL PARTNER
By: /s/ XXXXXX XXXX
Name: Xxxxxx Xxxx
Title: Vice President
APOLLO (U.K.) PARTNERS III, L.P.,
By: APOLLO ADVISORS II, L.P., ITS MANAGING GENERAL
PARTNER
By: APOLLO CAPITAL MANAGEMENT II, INC.
ITS GENERAL PARTNER
By: /s/ XXXXXX XXXX
Name: Xxxxxx Xxxx
Title: Vice President
