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FIRST AMENDMENT TO AMENDED
AND RESTATED LOAN AGREEMENT
This First Amendment to Amended and Restated Loan Agreement
(this "Amendment"), dated as of the 26th day of February, 1998, by and between
PAYLESS CASHWAYS, INC., a Delaware corporation (herein called "Borrower"), and
UBS MORTGAGE FINANCE, INC. (herein called "Lender").
WHEREAS, the parties have previously entered into that certain
Amended and Restated Loan Agreement, dated as of December 2, 1997 (the "Loan
Agreement"), pursuant to which Borrower executed in favor of Lender a certain
Consolidated, Amended and Restated Promissory Note in the principal amount of
$100,809,000.00 (the "Note"), which Note, among other things, consolidated the
Prior Notes (as such term is defined in the Loan Agreement) into a single
promissory note and evidences a certain loan transaction (the "Loan") between
Borrower and Lender.
WHEREAS, by assignments of even date herewith (collectively,
the "Assignments"), LaSalle National Bank, as Trustee for Lender has become the
owner and holder of a certain (i) mortgage encumbering real property located in
Xxxxxxx County, Kansas (the "Kansas Mortgage"), (ii) mortgage encumbering real
property located in Monroe County, Indiana (the "Indiana Mortgage") and (iii)
deed of trust encumbering real property in Xxxxx County, Nevada (the "Nevada
DOT"; and collectively with the Kansas Mortgage and the Indiana Mortgage, the
"Existing Mortgages") and the notes secured thereby (collectively, the "Existing
Notes") evidencing a debt with a principal balance, at the time of delivery of
the Assignments, of $16,000,000, which, immediately prior to the effectiveness
of the Reduction Letter (as such term is hereinafter defined) was due and owing
without any offset, defense or counterclaim whatsoever;
WHEREAS, pursuant to a separate letter, dated the date hereof,
from Lender to Borrower (the "Reduction Letter"), and immediately following the
delivery of the Assignments and prior to the effectiveness of the modifications
contemplated hereby, Lender reduced the principal amount of the Existing Notes
to the principal amount of $13,000,000.00 which is due and owing without any
offset, defense or counterclaim whatsoever;
WHEREAS, Lender and Borrower desire, after the effectiveness
of the reduction of the aggregate principal amounts of the Existing Notes as set
forth in the Reduction Letter to (i) amend and restate the terms of each of the
Existing Mortgages (the Existing Mortgages, as so amended and restated shall
hereinafter be referred to, collectively, as the "New Mortgages"), (ii)
consolidate into one indebtedness the Existing Notes and the Note in the
aggregate principal amount of $102,689,450 and (iii) amend and restate the terms
of the Existing Note and the Note pursuant to a certain Amended and Restated
Promissory Note, dated the date hereof, in the principal amount of $102,689,450
from Borrower to Lender (the "New Note"); and
WHEREAS, Lender and Borrower desire to amend the Loan
Agreement to reflect, among other things, the increased amount of the Loan
evidenced thereby and by the New Note.
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NOW THEREFORE, in consideration of the premises and the mutual
agreements, covenants and conditions hereinafter set forth, Borrower and Lender
agree as follows:
1. All capitalized terms used herein and not otherwise defined
are used as defined in the Loan Agreement.
2. The definition of "Loan" contained in Section 1.1 of the
Loan Agreement is hereby deleted in its entirety and the following shall be
substituted therefor:
"Loan" means the indebtedness of the Borrower to
Lender evidenced by the terms of Borrower's promissory
note dated February 26, 1998, in the principal amount
of One Hundred and Two Million Six Hundred Eighty Nine
Thousand Four Hundred and Fifty Dollars ($102,689,450).
3. The definition of "Mortgage" contained in Section 1.1 of
the Loan Agreement is hereby deleted in its entirety and the following shall be
substituted therefor:
"Mortgage" means collectively, all of the
mortgages and deeds of trust included in the Security
Documents and executed by the Borrower, as the same may
be amended, supplemented, extended or otherwise
modified from time to time.
4. The definition of "Note" contained in Section 1.1 of the
Loan Agreement is hereby deleted in its entirety and the following shall be
substituted therefor:
"Note" means the Amended and Restated Promissory
Note dated February 26, 1998 made by Borrower to Lender
in the principal amount of One Hundred and Two Million
Six Hundred Eighty Nine Thousand Four Hundred and Fifty
Dollars ($102,689,450).
5. The following defined terms shall be inserted in Section
1.1 of the Loan Agreement:
"Payment Notice" has the meaning given it in Section
2.3(e)."
"Sale Payment" has the meaning given it in Section
2.7(e)."
"Sale Payment Date" has the meaning given it in Section
2.7(e)."
6. Section 2.3 of the Loan Agreement is hereby amended
by adding a new subsection (e) thereto to read as follows:
"(e) Each month during the term of the Loan,
Lender shall calculate the amount due on each
Payment Date and provide Borrower with at least one
(1) Business Day notice thereof (each, a "Payment
Notice"), provided however, that Lender shall not
in any way be liable to Borrower for its failure to
provide any such Payment Notice pursuant to this
subsection (e)
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and any such failure shall not, in any way relieve Borrower
from its obligation to timely make the payments on each
Payment Date required under this Agreement or under the Note.
If the amount set forth in any Payment Notice provided by
Lender pursuant to this subsection (e) shall be incorrect,
Borrower shall remain obligated to pay to Lender the amount
that otherwise should have been paid had such Payment
Notice been correct, and Lender's failure to deliver a correct
Payment Notice shall not in any way be deemed a waiver by
Lender of its right to receive the full, correct amount of
such payment."
7. Section 2.7 of the Loan Agreement is hereby
amended by adding a new subsection (e)thereto to read as follows:
"(e) Notwithstanding anything to the contrary
contained herein, in connection with any prepayment of
principal pursuant to Sections 2.7(a) or 2.7(b) hereof,
any and all interest accrued on such principal being
prepaid, through and including the date of prepayment,
shall be paid by Borrower on the first Payment Date
following such date of prepayment."
8. Exhibit C to the Loan Agreement is hereby amended by adding
thereto the properties listed on Exhibit A attached hereto and made a part
hereof.
9. Lender's obligation to consummate the transaction
contemplated hereby is subject to the satisfaction by Borrower of each of the
following conditions:
a. Borrower shall have obtained all consents to the
transaction contemplated hereby required under the Credit
Agreement, which consents shall be in recordable form and
otherwise in form and substance reasonably satisfactory to
Lender in all respects;
b. No Event of Default shall exist and be continuing as
of the date hereof;
c. Lender shall have received an opinion of counsel for
Borrower in form and substance satisfactory to Lender;
d. Lender shall have received a mortgagee policy of
title insurance or title commitment to issue a mortgagee
policy of title insurance with respect to each of the New
Mortgages, in form satisfactory to Lender in all respects;
e. Borrower shall have executed and delivered to Lender
the New Note, the New Mortgages (together with appropriate
Uniform Commercial Code Financing Statements) and such other
documents and items as Lender may reasonably request;
f. Lender shall have received from the holders of the
Permitted Second Lien, amendments to the mortgages or deeds of
trust that are subordinate to the Existing Mortgages, which
amendments shall contain, among other things, the
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provisions set forth on Exhibit B attached hereto and which
amendments shall otherwise be in form and substance
satisfactory to Lender in all respects;
g. Borrower shall have provided Lender with evidence,
reasonably satisfactory to Lender in all respects, that (i)
all real estate taxes affecting the Property have been paid to
date or (ii) real estate taxes that are due and owing as of
the date hereof and that have not been paid are being disputed
in good faith by Borrower; and
h. Borrower shall have provided Lender with evidence,
reasonably satisfactory to Lender in all respects, that all
title insurance premiums due and owing in connection with the
transaction consummated on December 2, 1997 between Borrower
and Lender, have been paid in full.
10. Borrower hereby represents and warrants that (a) Borrower
is the sole legal and beneficial owner of each of the properties encumbered by
the Existing Mortgages (collectively, the "New Properties"); (b) Borrower is not
in Default in the performance of any of the covenants and agreements contained
in the Loan Agreement as amended hereby, or in the Loan Documents; (c) no event
has occurred and is continuing which constitutes a Default; (d) Borrower is a
corporation duly organized, validly existing and in good standing under the laws
of its state or organization, having all corporation or partnership powers
required to carry on its business and enter into and carry out the transactions
contemplated hereby; (e) Borrower has all requisite power and all governmental
certificates of authority, licenses, permits qualifications and other
documentation to own, lease and operate the New Properties and to carry on its
business as now conducted and as contemplated to be conducted except where
failure to obtain any such governmental certificate of authority, license,
permit, qualification or other documentation would not have a Materially Adverse
Effect; (f) Borrower is duly qualified, in good standing and authorized to do
business in each of the jurisdictions where the New Properties are located; (g)
Borrower had duly taken all corporate action necessary to authorize the
execution and delivery by it of this Agreement and all other documents executed
in connection herewith (collectively, the "New Loan Documents") and to authorize
the consummation of the transactions contemplated thereby and the performance of
its obligations hereunder and thereunder; (h) the execution and delivery by
Borrower of this Amendment and the New Loan Documents, the performance of its
obligations under this Amendment and the New Loan Documents, and the
consummation of the transactions contemplated by this Amendment, do not and will
not (1) conflict with any provision of (A) any application domestic or foreign
law, statute, decree, rule or regulation, except where failure to comply
therewith would not have a Materially Adverse Effect, (B) the articles or
certificates of incorporation, bylaws, charter or partnership agreement or
certificate of Borrower or (C) any agreement, judgment, license, order or permit
applicable to or binding upon Borrower, (2) result in the acceleration of any
Debt owed by Borrower, (3) result in or require the creation of any Lien upon
any assets or properties of Borrower except as expressly contemplated in this
Amendment or the Loan Documents, or (4) contravene, result in a breach of or
constitute a default under any mortgage, deed of trust, lease, promissory note,
loan agreement or other material contract or material agreement to which
Borrower is a party or by which Borrower or any of its Properties may currently
be bound or affected; (i) except as otherwise provided herein, no consent,
approval, authorization or order of, and no notice to or filing with, any court
or
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governmental authority or third party is required in connection with the
execution, delivery or performance by Borrower of this Amendment or the New Loan
Documents or to consummate any transactions contemplated by this Amendment; (j)
this Amendment and the New Loan Documents are legal and binding obligations of
Borrower, enforceable in accordance with their respective terms, except as
limited by bankruptcy, insolvency or similar laws of general application
relating to the enforcement of creditors' rights; and (k) all representations
and warranties of Borrower set forth in the Loan Agreement are true and complete
in all material respects as of the date hereof. Borrower agrees to indemnify and
hold Lender harmless against any loss, claim, damage, liability or expense
(including without limitation reasonable attorneys' fees and disbursements)
incurred as a result of any representation or warranty made by Borrower herein
proving to be untrue in any material respect.
11. Borrower agrees to execute such other and future documents
as may be reasonably necessary or appropriate to consummate the transaction
contemplated hereby or to perfect the liens and security interests intended to
secure the payment of the New Note.
12. Except as provided herein, the terms and revisions of the
Loan Agreement and the other Loan Documents shall remain unchanged and shall
remain in full force and effect. Any modification herein of the Loan Agreement
and the other Loan Documents shall in no way affect the security of the payment
of the New Note. Borrower hereby agrees, covenants and represents that the Loan
Agreement and the other Loan Documents as modified and amended hereby are and
remain valid and that nothing herein shall affect the validity or enforceability
thereof.
13. Borrower hereby acknowledges that the liens and security
interests created and evidenced by the Mortgage are valid and subsisting and
further acknowledges and agrees that there are no offsets, claims or defenses to
the Note, the Loan Agreement or any other Loan Documents. Borrower further
acknowledges that it has no knowledge that there are any defects or deficiencies
with respect to the liens and security interests created and evidenced by any of
the Security Documents.
14. Contemporaneously with the execution and delivery hereof,
Borrower shall pay, or cause to be paid, all costs and expenses incident to the
preparation hereof and the consummation of the transactions specified herein,
including but not limited to legal fees and expenses of outside counsel and
title costs.
15. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original of this Agreement, and
which, when taken together, shall constitute but one instrument.
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IN WITNESS WHEREOF, the undersigned parties have
executed this Agreement this 26 day of February, 1998.
PAYLESS CASHWAYS, INC.
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
Title: Sr. Vice President-Finance
UBS MORTGAGE FINANCE, INC.
By: /s/ Xxxxx Xxxxxxx
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Name: Xxxxx Xxxxxxx
Title:
By: /s/ Xxxxxxxx Xxxxxx
-------------------------
Name: Xxxxxxxx Xxxxxx
Title:
