AMENDMENT NO. 2
to
LOAN AND SECURITY AGREEMENT
dated as of July 12, 1996
THIS AMENDMENT NO. 2 dated as of October 10, 1996 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, LEA INDUSTRIES, INC., a North Carolina corporation, PENNSYLVANIA
HOUSE, INC., a North Carolina corporation, XXXXXXX FURNITURE, INC., a North
Carolina corporation, 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 (said
Agreement, as so amended, the "Loan Agreement"; terms defined therein and not
otherwise defined herein being used herein as therein defined).
In response to the requests of certain Lenders made in
connection with their becoming Lenders, the Borrowers, the Lenders, the
Co-Agents and the Administrative Agent have agreed to amend the Loan Agreement
as hereinafter set forth, upon and subject to all of the terms, conditions and
provisions hereof.
NOW, THEREFORE, 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, effective as of the date
hereof by
(a) amending Section 1.1 Definitions by
(i) amending the definition "Eligible Assignee" in its
entirety to read as follows:
"Eligible Assignee" means, subject to the provisions of
Section 14.3, a commercial bank having total assets in excess of
$1,000,000,000, any Affiliate of such a bank that conducts a commercial
finance or asset based lending business and is organized under the laws
of the United States or any state thereof, and any Lender; provided
that if an Assignment Event has occurred, "Eligible Assignee" shall
included any Person who would be an "accredited investor" under and as
defined in Regulation D of the Securities and Exchange Commission.
(ii) amending the definition "Interbank Offered Rate"
in its entirety to read as follows:
"Interbank Offered Rate" means, for any Eurodollar Rate Loan
for any Interest Period therefor, the rate per annum (rounded upwards,
if necessary to the nearest 1/100 of 1%) appearing on Telerate Page
3750 (or any successor page) as the London interbank offered rate for
deposits in Dollars at approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period. If for any reason such rate is not
available, the term "Eurodollar Rate" shall mean, for any Eurodollar
Rate Loan for any Interest Period therefor, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) appearing on the
Reuters Screen LIBO Page as the London interbank offered rate for
deposits in Dollars at approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period; provided, however, that if more
than one rate is specified on the Reuters Screen LIBO Page, the
applicable rate shall be the arithmetic mean of all such rates.
(iii) amending the definition "Net Proceeds" by amending the
first parenthetical phrase therein in its entirety to read as follows:
(including, without limitation, payments under notes or other debt
securities received in connection with any Asset Disposition, but
excluding any proceeds received in connection with the disposition of
Daystrom assets or the sale of assets contemplated by the New BOT
Transaction)
(iv) amending the definition "Permitted Lien" by amending
subsection (a) thereof in its entirety to read as follows:
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(a) Liens securing taxes, assessments and other governmental
charges or levies (excluding any Lien imposed pursuant to any of the
provisions of ERISA) or the claims of materialmen, mechanics, carriers,
warehousemen or landlords for labor, materials, supplies or rentals
incurred in the ordinary course of business or the claims of credit
card processors under agreements with one or more Borrowers as
"merchants" entered into in the ordinary course of such Borrowers'
business(es), but (i) in the case of governmental charges or levies and
warehousemen or landlords, only if payment shall not at the time be
required to be made in accordance with Section 10.6, (ii) further, in
the case of warehousemen or landlords, only if such Liens are junior to
the Security Interest in any of the Collateral or the Real Estate, and
(iii) in the case of merchant processors, only if such Liens affect
solely any funds of such Borrowers representing proceeds of
transactions processed by such merchant processors and in the
possession and control of such merchant processors in accordance with
the terms of their agreements with such Borrowers,
(v) adding thereto in proper alphabetical order the
following new definition:
"Assignment Event" means the occurrence of an Event of Default
pursuant to Section 13.1(a), 13.1(g) or 13.1(h) or the occurrence of
any other Event of Default that continues for 75 days or more without
its being cured or waived by the Lenders (or Required Lenders, as
applicable) and the Administrative Agent.
(b) amending Section 4.3 Repayment of Term Loan by
adding at the end thereof a new sentence to read as follows:
The final installment of principal of the Term Loan shall be due and
payable on the earlier of (i) October 1, 2006 and (ii) the Termination
Date.
(c) amending Article 14 by adding thereto a new
Section 14.3 to read as follows:
SECTION 14.3. Non-U.S. Lenders. Prior to the Agreement Date
or, with respect to any Lender that becomes a Lender after the Agreement
Date, prior to the "Effective Date" of the Assignment and Acceptance
pursuant to which such Lender became a Lender, each Lender which is not
incorporated under the laws of the United States of America or a state
thereof agrees that it will deliver to the Administrative Agent (i) a
letter in duplicate and two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224 or successor applicable form,
as the case may be, certifying in each case that such Lender is entitled
to receive payments under this Agreement without deduction
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or withholding of any United States federal income taxes, and (ii) an
Internal Revenue Service Form W-8 or W-9 or successor applicable form,
as the case may be, to establish an exemption from United States backup
withholding tax. Each such Lender which delivers a copy of a Form 1001
or 4224 and Form W-8 or W-9 pursuant to the next preceding sentence
further undertakes to deliver to the Administrative Agent two further
copies of the said letter and Form 1001 or 4224 and Form W-8 or W-9, or
successor applicable forms, or other manner of certification, as the
case may be, on or before the date that any such letter or form expires
or becomes obsolete or after the occurrence of any event requiring a
change in the most recent letter and form previously delivered by it to
the Administrative Agent, and such extensions or renewals thereof as
may reasonably be requested by the Administrative Agent, certifying in
the case of a Form 1001 or 4224 that such Lender is entitled to receive
payments under this Agreement without deduction or withholding of any
United States federal income taxes, unless in any such case an event
(including without limitation any change in treaty, law or regulation)
has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or
which would prevent such Lender from duly completing and delivering any
such letter or form with respect to it and such Lender advises the
Administrative Agent that it is not capable of receiving payments
without any deduction or withholding of United States federal income
tax, and in the case of a Form W-8 or W-9, establishing an exemption
from United States backup withholding tax, in which case, all payments
by the Borrowers hereunder and under any Note shall be increased by the
amount necessary to pay to such Lender, net of any such withholding
tax(es) the amount of each payment provided for hereunder.
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 the Required Lenders,
(b) 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
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action delivered in connection with the occurrence of the
Effective Date remain in effect, unchanged,
(c) 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, and
(d) 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 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.
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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
LEA INDUSTRIES, INC.
(a North Carolina corporation)
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
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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
Vice President
XXXX INTERNATIONAL SALES CORP.
By:
-------------------------
Xxxxxxx X. Xxxxxxxxx
Vice President
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AGENTS/LENDERS:
NATIONSBANK, N.A. (SOUTH), 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:
THE FIRST NATIONAL BANK OF BOSTON,
as a Lender
By:
-------------------------
Name:
Title:
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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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