Exhibit 10.2
LOAN MODIFICATION AGREEMENT
This Loan Modification Agreement ("Agreement") is made as of March 30,
2001 by Trex Company, LLC, a Delaware Limited Liability Company ("Borrower), and
Bank of America, N.A. ("Bank").
Factual Background
------------------
A. Under a Standing Loan Agreement dated as of September 28, 1999
between Bank and Borrower (the "Loan Agreement"), Bank made a loan to Borrower
in the amount of Six Million Seven Hundred Twenty-Eight Thousand Dollars
($6,728,000) (the "Loan"). Capitalized terms used herein without definition
have the meanings given to them in the Loan Agreement.
B. The Loan is secured by a Deed of Trust, Assignment of Rents and
Leases, Security Agreement and Fixture Filing, dated September 28, 1999,
executed by Borrower as trustor for the benefit of Bank as beneficiary (the
"Deed of Trust"). The Deed of Trust encumbers certain real property located in
Lyon County, Nevada, as more particularly described therein (the "Property").
C. Trex Company, Inc., a Delaware corporation ("Guarantor") has
guarantied Borrower's obligations to Bank, in accordance with a Payment Guaranty
(the "Guaranty") dated as of September 28, 1999.
D. The Loan is evidenced in part by a Promissory Note Secured by Deed
of Trust dated September 28, 1999 in the amount of Six Million Seven Hundred
Twenty-Eight Thousand Dollars ($6,728,000) (the "Note").
E. As used here, the terms "Loan Documents" means the Loan Agreement,
the Deed of Trust, this Agreement, the Note and any other documents executed in
connection with the Loan, including which evidence, guaranty, secure or modify
the Loan, as any or all of them may have been amended to date. This Agreement is
a Loan Document.
G. Borrower and Bank now wish the Loan as set forth below.
Agreement
---------
Therefore, Borrower and Bank agree as follows:
1. Recitals. The recitals set forth above in the Factual Background
--------
are true, accurate and correct.
2. Reaffirmation of Loan. Borrower reaffirms all of its obligations
---------------------
under the Loan Documents, and Borrower acknowledges that it has no claims,
offset or defenses with respect to the payment of sums due under any Loan
Document.
3. Modification of Loan Documents. The Loan Documents are hereby
------------------------------
amended as follows:
(a) The first sentence of Section 2.11 of the Loan Agreement (the
section entitled Consolidated Debt to Consolidated Capitalization)
-------------------------------------------------
is deleted and replaced with the following:
"The Borrower and any of its subsidiaries (but excluding its
parent), on a consolidated basis as reported in its public
filings, shall not at any time during any four (4) fiscal
quarters, permit its ratio of Total Consolidated Debt to Total
Consolidated Capitalization to exceed 0.60 to 1.0."
(b) Except as hereby amended, the Loan Documents shall remain in
full force and effect.
4. Conditions Precedent Before this Agreement becomes effective and
--------------------
any party becomes obligated under it, all of the following conditions shall have
been satisfied at Borrower's sole cost and expense in a manner acceptable to
Bank in the exercise of Bank's sole judgment:
(a) Bank shall have received fully executed and, where
appropriate, acknowledged originals of this Agreement, the
attached consent signed by the guarantors, and any other documents
which Bank may require or request in accordance with this
Agreement or the other Loan Documents.
(b) Bank shall have received reimbursement, in immediately
available funds of all costs and expenses incurred by Bank in
connection with this Agreement, including charges for the title
insurance, recording, filing and escrow charges, fees for
appraisal services, and legal fees and expenses of Bank's counsel.
Such costs and expenses may include the actual costs or services
for Bank's in-house staffs, such as legal and appraisal services.
5. Borrower's Representation and Warranties. Borrower represents and
----------------------------------------
warrants to Bank as follows:
(a) Loan Document. All representations and warranties made and
-------------
given by Borrower in the Loan Documents are true, accurate and
correct.
-2-
(b) No Default. No Default has occurred and is continuing under the
----------
Loan or any of the Loan Documents, and no event has occurred and is
continuing which, with notice or the passage of time or both, would
be a Default.
(c) Property. Borrower continues to lawfully possess and hold fee
--------
simple title to all of the Property which is real property, and the
Deed of Trust is a first and prior lien on that property. Borrower
owns all of the Property which is personal property free and clear
of any reservations of title and conditional sales contracts, and
also of any security interests other than the Deed of Trust, which
is a first and prior lien on such property. There is no financing
statement affecting any Property on file in any public office
except for financing statements in favor of Bank.
(d) Borrowing Entity. Borrower is a limited liability company
----------------
which is duly organized and validly existing under the laws of the
State of Delaware. There have been no changes in the organization,
composition, ownership structure or formation documents of Borrower
since the inception of the Loan.
6. Incorporation. Agreement shall form a part of each Loan Document,
-------------
and all references to a given Loan Document shall mean that document as hereby
modified
7. No Prejudice; Reservation of Rights. This Agreement shall not
-----------------------------------
prejudice any rights or remedies of Bank under the Loan Documents. Bank
reserves, without limitation, all rights which it has against any indemnitor,
guarantor, or endorser of the Loan.
8. No Impairment. Except as specifically hereby amended, the Loan
-------------
Documents shall each remain unaffected by this Agreement and all such documents
shall remain in final force and effect. Nothing in this Agreement shall impair
the lien of the Deed of Trust, which as hereby amended shall remain one deed of
trust with one power of sale creating a first lien encumbering the Property.
9. Purpose and Effect of Bank's Approval. Bank's approval of any
-------------------------------------
matter in connection with the Loan shall be for the sole purpose of protecting
Bank's security and rights. No such approval shall result in a waiver of any
default of Borrower. In no event shall Bank's approval be a representation of
any kind with regard to the matter being approved.
10. Disclosure to Title Company. Without notice to or the consent of
---------------------------
Borrower, Bank may disclose to any title insurance company which insures any
-3-
interest of Bank under the Deed of Trust (whether as primary insurer coinsurer
or reinsurer) any information, data or material in Bank's possession relating to
Borrower, the Loan or the Property.
11. Integration. The Loan Documents, including this Agreement and
-----------
the other documents required to be delivered to Bank in connection with this
Agreement: (a) constitute integrated Loan Documents; (b) supersede all oral
negotiations and prior and other writings with respect to their subject matter
and (c) are intended by the parties as the final expression of the agreement
with respect to the terms and conditions set forth in those documents and as the
complete and exclusive statement of the terms agreed to by the parties. If there
is any conflict between the terms conditions and provisions of this Agreement
and those of any other agreement or instrument including any of the other Loan
Documents, the terms, conditions, and provisions of this Agreement shall
prevail.
12. Miscellaneous. This Agreement and any attached consents or
-------------
exhibits requiring signatures may be executed in counterparts, and all
counterparts shall constitute but one and the same document. If any court of
competent jurisdiction determines any provision of this Agreement or any of the
other Loan Documents to be invalid, illegal or unenforceable that portion shall
be deemed severed from the rest which shall remain in full force and effect as
though the invalid illegal or nonenforceable portion had never been a part of
the Loan Documents. This Agreement shall be governed by the laws of the State
of Nevada without regard to the choice of law rules of that State. As used here,
the word "include(s)" means "Include(s) without limitation", and the word
"including" means "including; but not limited to."
Trex Company, LLC, BANK OF AMERICA, N.A.
a Delaware Limited Liability Company
By: /s/ Xxxxxx X. Xxxxxxx, President By: /s/ Xxxx XxXxxxx
-------------------------------- --------------------------------
Print Name and Title Xxxx XxXxxxx, Vice President
-4-
GUARANTOR'S CONSENT
The undersigned Guarantor hereby consent to the terms, conditions and provisions
of the foregoing Loan Modification Agreement and the transactions contemplated
by it. Guarantor hereby reaffirms the full force and effectiveness of its
Payment Guaranty dated September 28, 1999.
TREX COMPANY, INC.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
President
--------------------------
Print Name and Title
-5-
