THIRD MODIFICATION OF SECURED CREDIT AGREEMENT,
NOTES, MORTGAGE AND OTHER LOAN DOCUMENTS
THIS THIRD MODIFICATION OF SECURED CREDIT AGREEMENT, NOTES, MORTGAGE AND
OTHER LOAN DOCUMENTS (this "Agreement") is made, and shall be deemed effective,
as of the 28th day of September, 1995 by and between XXXX XXXXXX STORES, INC.,
an Indiana corporation (herein, together with its successors and assigns,
called the "Borrower") and LASALLE NATIONAL BANK, a national banking
association (herein, together with its successors and assigns, called the
"Bank").
All capitalized terms and phrases, unless defined herein, shall have the
specific meanings as are set forth in that certain Secured Credit Agreement
dated as of October 28, 1993, by and between Borrower and Bank, as amended and
restated by that certain Amended and Restated Secured Credit Agreement dated as
of January 20, 1994, as modified by that certain First Modification of Secured
Credit Agreement, Notes, Mortgage and Other Loan Documents dated as of October
31, 1994, as modified by that certain Second Modification of Secured Credit
Agreement, Notes, Mortgage and Other Loan Documents dated as of January 31,
1995 (the "Credit Agreement").
WHEREAS, Borrower has previously requested loans and advances from Bank
for the purpose of funding Borrower's working capital needs, and in connection
therewith, Borrower and Bank entered into and executed the Credit Agreement,
pursuant to which the Bank agreed to make a term loan in an amount of up to
$2,400,000.00 and a revolving credit loan in an amount of up to $13,500,000.00
to the Borrower; and
WHEREAS, Borrower has previously executed and delivered to Bank (i) a
Secured Promissory Note (Revolver) dated October 28, 1993, as amended (the
"Revolving Note"), in the principal amount of $13,500,000.00, evidencing an
indebtedness owed by Borrower to Bank in like amount (the "Revolving Loan") and
(ii) a Secured Promissory Note (Term) dated January 20, 1994 (the "Term Note")
in the principal amount of $2,400,000.00, evidencing an indebtedness owed by
Borrower to Bank in like amount (the "Term Loan"); and
WHEREAS, repayment of the Notes is secured by, among other items of
collateral, a certain Mortgage, Assignment of Leases and Rents and Security
Agreement dated as of January 20, 1994, made by Borrower to Bank (the "Xxxx-
xxxx"), recorded on February 1, 1994 in the Office of the Recorder, Xxxxxx
County, Indiana as Instrument Number 94-17807, encumbering the property legally
described in Exhibit A attached hereto and made a part hereof (the "Premises");
and
WHEREAS, repayment of the Notes is additionally secured by a certain
Security Agreement and Financing Statement dated as of October 28, 1993, as
amended (the "Security Agreement"), made by Borrower to Bank; and
WHEREAS, repayment of the Notes is additionally secured by a certain
Assignment of Leases dated as of October 28, 1994, as amended, made by Borrower
to Bank (the "Assignment"), affecting the Premises; and
WHEREAS, repayment of the Notes is additionally secured by a certain
Assignment of Distribution Center Leases and Rents dated as of January 20, 1994
(the "Distribution Assignment"), made by Borrower to Bank; and
WHEREAS, repayment of the Notes is additionally secured by UCC Financing
Statements made by Borrower, as debtor, to Bank, as secured party, (said
Financing Statements being hereinafter referred to as the "Financing
Statements"); and
WHEREAS, the Credit Agreement, the Notes, the Mortgage, the Security
Agreement, the Assignment, the Distribution Assignment and the Financing
Statements, together with all other documents and instruments now or hereafter
securing repayment of the Liabilities, or any portion thereof, evidenced by the
Notes are hereinafter collectively referred to as the "Loan Documents"; and
WHEREAS, Borrower has requested that Bank increase the present Revolving
Loan Commitment and extend the present Revolving Credit Maturity Date, and Bank
has so agreed, on the terms and conditions more specifically set forth herein.
NOW, THEREFORE, for and in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Borrower and Bank do hereby agree as follows:
1. The preambles to this Agreement are fully incorporated herein by this
reference thereto with the same force and effect as though restated herein.
2. Effective as of September 28, 1995 (the "Modification Date"), the
Credit Agreement is modified as set forth below:
a. The definition of "Maturity Date" set forth in Section 1.1 of
the Credit Agreement is deleted in its entirety and the following
definition is substituted therefor:
"Maturity Date" means, with respect to the Revolving Credit
Commitment, June 30, 1996.
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b. Section 2.1 is deleted in its entirety and the following is
substituted in its place and stead:
2.1 Revolving Credit Commitment. On the terms and subject to
the conditions set forth in this Agreement, Bank agrees to make Revolving
Loans to Borrower and to issue Letters of Credit, pursuant to Section 2.3,
for the account of the Borrower, from time to time before the Revolving
Credit Termination Date in such aggregate amounts as Borrower may from
time to time request but not exceeding at any one time out standing the
lesser of (i) the Borrowing Baseor(ii) $15,000,000; provided, however,
that (a) Revolving Loans shall be limited to $3,500,000 in the aggregate,
and (b) the issuance of standby Letters of Credit shall be limited to
$1,000,000 in the aggregate. Borrower shall have the right to repay and
reborrow any of the Revolving Loans in increments of $100,000 (or $25,000
integral multiples); provided, however, that it shall be a condition
precedent to any reborrowing that as of the date of any reborrowing all of
the conditions to borrowing set forth in this Agreement shall be satisfied
and all representations and warranties made herein shall be true and
correct in all material respects as of such date.
c. Section 8.9 is hereby deleted in its entirety and the following
is substituted in its place and stead:
8.9 Minimum Tangible Net Worth. Not permit Borrower's Tangible
Net Worth to be less than (a) $6,600,000 for the period commencing on
November 1, 1994 and ending on October 31, 1995,(b) $7,600,000 for the
period commencing on November 1, 1995 and ending on October 31, 1996, (c)
$8,600,000 for the period commencing on November 1, 1996 and ending on
October 31, 1997,(d) $9,600,000 for the period commencing on November 1,
1997 and ending on October 31, 1998 and (e) $10,600,000 for the period
commencing on November 1, 1998 and ending on October 31, 1999, measured
quarterly.
d. Schedule A to the Credit Agreement is deleted in its entirety and
the revised Schedule A, attached hereto and made a part hereof, is
substituted in its place and stead.
3. All references in the Notes, the Mortgage, the Security Agreement,
the Assignment, the Distribution Assignment and the other Loan Documents to the
Credit Agreement are hereby understood to be to the Credit Agreement as
modified hereby.
4. Effective as of the Modification Date, paragraph one of page one of
the Revolving Note is hereby deleted in its entirety and the following is sub-
stituted in its place and stead:
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REVOLVING NOTE
$15,000,000.00 Chicago, Illinois
October 28, 1993
FOR VALUE RECEIVED, XXXX XXXXXX STORES, INC., an Indiana corporation
(together with its successors and assigns, "Maker"),promises to pay to the
order of LASALLE NATIONAL BANK, a national banking association (together with
its successors and assigns, "Bank"), on or before June 30, 1996, at the Bank's
principal office in Chicago, Illinois, the principal sum of FIFTEEN MILLION AND
NO/100THS DOLLARS ($15,000,000.00), or, if less, the Revolving Loan Balance at
such time, plus accrued and unpaid interest thereon and all other charges
applicable thereto, all as set forth more fully in that Secured Credit
Agreement dated as of October 28, 1993, between Maker and Bank (as the same may
be amended, modified, supplemented or restated from time to time, the "Credit
Agreement"). All capitalized terms used but not elsewhere defined herein shall
have the same meanings as are ascribed to them in the Credit Agreement.
5. All references in the Credit Agreement, the Mortgage, the Security
Agreement, the Assignment, the Distribution Assignment and the other Loan
Documents to the Revolving Note are hereby understood to be the Revolving Note
as modified hereby.
6. In the event of any conflict among the terms of the Mortgage, the
Notes, the Credit Agreement and the other Loan Documents as modified by this
Agreement, the terms of the Credit Agreement as modified by this Agreement
shall control. All terms and provisions of the Notes, the Mortgage, the
Security Agreement, the Assignment, the Distribution Assignment and the other
Loan Documents corresponding to terms and provisions of the Credit Agreement
prior to the date of this Agreement shall be deemed modified in accordance with
the terms of this Agreement.
7. Borrower hereby warrants and represents that (i) Borrower has no
defense, offset or counterclaim with respect to the payment of any sum owed to
Bank, or with respect to any covenant in the Loan Documents; (ii) Bank, on and
as of the date hereof, has fully performed all obligations to Borrower which it
may have had or has on and as of the date hereof; and (iii) other than as
expressly set forth herein, by entering into this Agreement, Bank does not
waive any condition or obligation in the Loan Documents.
8. Unless waived by the Bank, in the Bank's sole and absolute
discretion, this Agreement shall be of no force or effect until recorded in the
Office of the Recorder, Xxxxxx County, Indiana.
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9. Unless waived by the Bank, in the Bank's sole and absolute
discretion, this Agreement shall be of no force or effect until a Date Down
Endorsement, reflecting recordation of this Agreement, in form and content
acceptable to Bank, is issued by Ticor Title Insurance Company to its Loan
Policy No. 222-721TE, dated January 1, 1994, indicating that there are no new
or unpermitted exceptions to title except as set forth in said policy as of
January 1, 1994, except as approved by Bank, in Bank's sole and absolute
discretion.
10. Borrower hereby agrees to execute and deliver promptly to Bank, at
Bank's request, such other documents as Bank, in its reasonable discretion,
shall deem necessary or appropriate to evidence the transaction contemplated
herein.
11. Borrower agrees to pay all fees and expenses associated with the
consummation of the transactions contemplated in this Agreement, including,
without limitation, fees and expenses of Bank's counsel, recording charges,
escrow charges, title charges and related expenses.
12. Time is of the essence of this Agreement. Unless this Agreement is
executed by Borrower and Guarantor on or before September 28, 1995, it shall
become null and void and shall have no force or effect.
13. This Agreement may be executed in any number of counterparts, each
of which shall constitute an original, but all of which, taken together, shall
constitute one and the same Agreement.
14. Except as otherwise set forth herein to the contrary, the Loan
Documents remain unmodified and continue in full force and effect. Borrower
hereby reaffirms, confirms and ratifies each and every covenant, condition,
obligation and provision set forth in the Notes, the Mortgage, the Security
Agreement, the Assignment, the Distribution Assignment, the Credit Agreement
and the other Loan Documents, each as modified hereby.
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IN WITNESS WHEREOF, the undersigned, intending to be legally bound hereby,
have executed and delivered this Agreement as of the day and year first above
written.
BORROWER:
XXXX XXXXXX STORES, INC., an Indiana
corporation
By: /s/Xxxx X. Xxxxxx
Title: SVP - Finance & Treasurer
Its:
BANK:
LASALLE NATIONAL BANK, a national banking
association
By: /s/Xxx Xxxxxxxxx
Title: VP
Its:
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STATE OF ILLINOIS )
) SS
COUNTY OF XXXX )
I, Xxxxxxx X. Xxxxxx , a Notary Public, in and for said County in the
State aforesaid, do hereby certify that Xxx Xxxxxxxxx, personally known to me
to be the VP of LASALLE NATIONAL BANK, a national banking association, and
personally known to me to be the same person whose name is subscribed to the
foregoing instrument, appeared before me this day in person and acknowledged
that he/she signed and delivered the said instrument on behalf of the aforesaid
banking association.
GIVEN under my hand and Notarial Seal this 28th day of September, 1995.
/s/Xxxxxxx X. Xxxxxx
Notary Public
[SEAL]
My Commission Expires:
10-6-96
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STATE OF Indiana )
) SS
COUNTY OF Xxxxxx )
I, Xxxxx X. Xxxxxxxx, a Notary Public, in and for said County in the
State aforesaid, do hereby certify that Xxxx X. Xxxxxx, personally known to me
to be the Sr. V.P. & Treasurer of XXXX XXXXXX STORES, INC., an Indiana
corporation, and personally known to me to be the same person whose name is
subscribed to the foregoing instrument, appeared before me this day in person
and acknowledged that he/she signed and delivered the said instrument on behalf
of the aforesaid corporation.
GIVEN under my hand and Notarial Seal this 27th day of September, 1995.
/s/Xxxxx X. Xxxxxxxx
Notary Public
My Commission Expires:
04-30-99
_______________________________
THIS DOCUMENT WAS PREPARED Address:
BY AND AFTER RECORDING 0000 Xxxxx Xxxx
SHOULD BE RETURNED TO: Xxxxxxxxxxxx, XX 00000
Xxx Xxxxx Xxxx, Esq. Parcel Ident. Nos.:
Xxxxxx Xxxxxx & Xxxxx
000 Xxxx Xxxxxx Xxxxxx 600-6003252
Suite 1600 600-6003368
Xxxxxxx, Xxxxxxxx 00000-0000 600-6003107
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SCHEDULE A
Additional Financial Covenants
(amounts in thousands except Fixed Charge Ratios)
Quarter 2 3 4 1 2
Fiscal Year 95 95 95 96 96
Period Ending Jul.95 Oct.95 Jan.96 Apr.96 Jul.96
--------------------------------------------------------------------------
Capital Expenditures(1) 7,000 7,000 8,000 8,000 8,000
Cash Balance(2) 4,000 3,000 12,000 4,000 4,000
Operating Cash Flow
Before Working Capital
Changes(3) 7,000 7,000 8,000 8,000 8,000
Fixed Charge Ratio 1.50 1.50 1.75 2.00 2.00
(1) MAXIMUM cumulative Capital Expenditures for prior eight quarters.
(2) MINIMUM financial accounting ("GAAP") "Cash and cash equivalents" at
each quarter end.
(3) MINIMUM cumulative cash flow on a rolling four quarter basis.
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EXHIBIT A
Legal Description of Premises
Reference made to same text as "EXHIBIT A" attached to item (4)(e) - First
Modification of Secured Credit Agreement, Notes, Mortgage and Other Loan
Documents dated as of October 31, 1994 by and between Xxxx Xxxxxx Stores, Inc.
and LaSalle National Bank, from Form 10-K dated January 28, 1995.
Also described as:
Part of the Northwest Quarter of Section 5, Township 16 North, Range 3 East, in
Xxxxxx County, Indiana, described as follows:
Commencing at the southwest corner of the northwest quarter of said Section 5;
thence on an assumed bearing of North 89 degrees 58 minutes 45 seconds East
along the south line of said northwest quarter section a distance of 1180.87
feet to the centerline of Xxxxx road; thence North 03 degrees 09 minutes 45
seconds East along said centerline a distance of 150.00 feet to the Beginning
Point; thence continuing North 03 degrees 09 minutes 45 seconds East along said
centerline a distance of 150.00 feet to the southwest corner of the tract of
land described in Instrument No. 93-157281; thence North 89 degrees 58 minutes
45 seconds East along the south line of said tract and parallel with the south
line of said quarter section a distance of 260.58 feet to the southeast corner
of said tract; thence North 03 degrees 09 minutes 45 seconds East along the
east line of said tract and parallel with the centerline of said Xxxxx Road a
distance of 120.00 feet to the northeast corner of said tract; thence South 89
degrees 58 minutes 45 seconds West along the north line of said tract and
parallel with the south line of said quarter section a distance of 260.58 feet
to the northwest corner of said tract and a point on the centerline of said
Xxxxx Road; thence North 03 degrees 09 minutes 45 seconds East along said
centerline a distance of 455.00 feet; thence North 89 degrees 58 minutes 45
seconds East parallel with the south line of said quarter section a distance of
1093.32 feet to the west right of way line of the C.C.C. & St. L. (Penn
Central) Railroad and a point on a curve having a radius of 5679.58 feet to the
radius point of which bears South 73 degrees 15 minutes 40 seconds West; thence
southerly along said west right of way line and along said curve an arc
distance of 743.36 feet to a point distant 150.00 feet north of the south line
of the aforesaid northwest quarter (as measured parallel with the centerline of
Xxxxx Road), said point bears North 80 degrees 45 minutes 37 seconds East from
said radius point; thence South 89 degrees 58 minutes 45 seconds West parallel
with said south line a distance of 1300.28 feet to the Beginning Point.
