FIFTH MODIFICATION
OF
CREDIT AGREEMENT
This Fifth Modification of Credit Agreement ("Agreement") is made this
day of January, 1998, among THE ROTTLUND COMPANY, INC., a Minnesota
corporation ("Borrower"), BANKBOSTON, N.A. (formerly known as THE FIRST
NATIONAL BANK OF BOSTON), having its principal place of business at 000
Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 ("BKB") and BANKBOSTON, N.A.,
as Agent ("Agent") for itself and the other lending institutions which are
or may become parties to the Credit Agreement (as hereinafter defined).
W I T N E S S E T H:
IN CONSIDERATION OF TEN AND NO/100 DOLLARS ($10.00) and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the undersigned Borrower and BKB hereby covenant and agree as
follows:
. RECITALS. The following Recitals are true and correct as of the
date of this Agreement:
() The Borrower, BKB and the Agent entered into that certain
Credit Agreement dated as of October 23, 1996, and that certain First
Modification of Credit Agreement dated November 19 1996, Second
Modification of Credit Agreement dated December 24, 1996, Third
Modification of Credit Agreement dated January 28, 1997, and Fourth
Modification of Credit Agreement dated June 25, 1997 (the foregoing Credit
Agreement, as modified, is referred to herein as "Credit Agreement").
() The parties to the Credit Agreement wish to further amend
and modify the Credit Agreement.
() All terms not otherwise defined herein shall have the same
meaning as in the Credit Agreement.
. The Credit Agreement is hereby modified as follows:
. By substituting "$23,000,000.00" for "$18,000,000" in:
() the definition of Commitment Amount in Section 1;
() the definition of Maximum Revolver Amount in Section 1;
() Section 2.1;
() Schedule 3.3(i); and
() Schedule 1.
. By adding the following definition to Section 1:
"FIFTH MODIFICATION EFFECTIVE DATE. December
31, 1997."
. By adding the following sentence after the first sentence in
Section 2.3:
"As of the Fifth Modification Effective Date,
the Revolving Credit Note has been amended and restated,
therefore, all references herein to the Revolving Credit
Note shall mean the Revolving Credit Note as amended and
restated."
. By deleting Section 10.3 in its entirety and replacing it
with the following:
"Section 10.3 EBITDA TO INTEREST EXPENSE. The Borrower
will not permit the ratio of (a) EBITDA to (b) Interest
Incurred, determined on a date described in the table set
forth below, to exceed the ratio set forth below:
PERIOD PERMITTED RATIO
October 1, 1997 to December 31, 1997 1.10:1
January 1, 1998 to March 31, 1998 1.10:1
April 1, 1998 to June 30, 1998 1.25:1
July 1, 1998 to September 30, 1998 1.50:1
October 1, 1998 to December 31, 1998 2.00:1
January 1, 1999 to March 31, 1999 2.00:1"
. By changing all references to First National Bank of Boston
to BankBoston, N.A.
. The Effective Date of this Fifth Modification shall be as of
December 31, 1997 so that, without limitation, compliance with all
covenants contained in the Credit Agreement shall be determined from
modifications contained herein.
. Except as modified hereby, the
terms and conditions of the Credit Agreement shall remain in full force
and effect and the Borrower hereby ratifies the terms and conditions
thereof.
. This Agreement may be executed in any number of counterparts each
of which shall be deemed an original.
[SIGNATURES BEGIN ON THE FOLLOWING PAGE]
IN WITNESS WHEREOF, the undersigned Borrower and Agent have hereunto
caused this instrument to be executed by their duly authorized corporate
officers and their seal to be affixed hereto as of the day and year first
above written.
THE ROTTLUND COMPANY, INC., a Minnesota
corporation
By:______
Title:___
BANKBOSTON, N.A.
By:______
Title:___
The undersigned guarantors hereby agree to all modifications of the
Credit Agreement and hereby ratify and reaffirm their respective Subsidiary
Guaranty dated as of the day and year first above written.
NORTHCOAST MORTGAGE, INC.
By:_______________________________
Its:______________________________
ROTTLUND HOMES OF FLORIDA, INC.
By:_______________________________
Its:______________________________
ROTTLUND HOMES OF INDIANA, INC.
By:_______________________________
Its:______________________________
ROTTLUND
HOMES OF INDIANA LIMITED PARTNERSHIP
By:_______________________________
Its:______________________________
ROTTLUND HOMES OF IOWA, INC.
By:_______________________________
Its:______________________________
ROTTLUND HOMES OF NEW JERSEY
By:_______________________________
Its:______________________________
