SECOND AMENDMENT
SECOND AMENDMENT dated as of April 1, 1998 (this "AMENDMENT"), by and among
LAMONTS APPAREL, INC., a Delaware corporation (the "BORROWER"), having its
principal place of business at 00000 Xxxxxxx Xxxx X.X., Xxxxxxxx, XX 00000,
BANKBOSTON, N.A. (f/k/a "The First National Bank of Boston"), a national banking
association with its head office at 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000 (the "BANK"), and BANKBOSTON, N.A. (f/k/a "The First National Bank of
Boston"), as Agent (the "AGENT") amending certain provisions of the Amended and
Restated Debtor in Possession and Exit Financing Loan Agreement by and among the
Borrower, the Bank, and the Agent dated as of September 26, 1997 as previously
amended by a First Amendment dated as of January 8, 1998 (as so amended, the
"LOAN AGREEMENT"). Terms not otherwise defined herein which are defined in the
Loan Agreement shall have the respective meanings herein assigned to such terms
in the Loan Agreement.
WHEREAS, the Borrower has requested that the Bank and the Agent agree to
amend the terms of the Loan Agreement in certain respects; and
WHEREAS, the Bank and the Agent are willing to amend the terms of the Loan
Agreement in such respects, upon the terms and subject to the conditions
contained herein; and
NOW, THEREFORE, in consideration of the mutual agreements contained in the
Loan Agreement, herein 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 DEFINITIONS. Section 1.1 of the Loan Agreement
is hereby amended as follows:
NEW DEFINITIONS. Section 1.1 of the Loan Agreement is amended by adding to
Section 1.1 in the appropriate location in the alphabetical sequence the
following new definitions:
"DERIVATIVE CONTRACT: Any forward contract, future contract, swap,
option or other financing agreement or arrangement (including, without
limitation, caps, floors, collars and similar agreements) at any time
entered into between the Borrower and a Revolving Credit Bank, the value of
which is dependent upon interest rates, currency exchange
-2-
rates, commodities or other indices, in form and substance satisfactory
to the Revolving Credit Banks."
"DERIVATIVE CONTRACT TERMINATION OBLIGATION: The maximum amount of
any termination or loss payment which at the time of determination would be
required to be paid pursuant to the termination of any Derivative Contract
by reason of any event of default or early termination event thereunder,
whether or not such event of default or early termination event has in fact
occurred."
"UNPAID DERIVATIVE CONTRACT TERMINATION OBLIGATION: The amount of any
termination or loss payment due and payable on account of the termination
of any Derivative Contract by reason of the occurrence of an event of
default or early termination event thereunder, together with any interest,
fees, expenses and other amounts payable thereunder, and which at the time
of determination has not been paid."
DEFINITION OF "INDEBTEDNESS." Section 1.1 of the Loan Agreement is further
amended by deleting the word "and" appearing before subpart (e) of the
definition of the term "Indebtedness" and inserting the words, "and (f) all
obligations under any Derivative Contract," after subpart (e) thereof.
DEFINITION OF "LOAN DOCUMENTS." Section 1.1 of the Loan Agreement is
further amended by inserting the words, "Derivative Contracts," in the third
line of the definition of the term "Loan Documents" thereof following the words,
"the Surety Power of Attorney," and before the word, "and" appearing therein.
DEFINITION OF "TOTAL EXIT COMMITMENT." Section 1.1 of the Loan Agreement
is further amended by inserting the following text at the end of the definition
of the term "Total Exit Commitment" appearing therein:
"PROVIDED THAT, so long as any Derivative Contract is
in effect, the "Total Exit Commitment" shall be reduced by the
greater of (i) $550,000, and (ii) the sum of all Derivative
Contract Termination Obligations."
Section 2. AMENDMENT TO SECTION 2.7 OF THE LOAN AGREEMENT.
(a) Section 2.7 of the Loan Agreement is hereby amended by inserting
the words, "and to pay any Unpaid Derivative Contract Termination Obligations,"
following the word "Obligations" appearing in the last line of Section 2.7(a)
thereof.
-3-
(b) Section 2.7 is further amended by inserting the words, "or such
Unpaid Derivative Contract Termination Obligations," in the last paragraph
thereof, after the words, "Unpaid Reimbursement Obligations," appearing in
subpart (A) thereof.
Section 3. AMENDMENT TO SECTION 10.2(b) OF THE LOAN AGREEMENT. Section
10.2(b) of the Loan Agreement is hereby amended by deleting the word "and"
appearing before clause "(vii)" thereof and inserting the words, ", and (viii)
Indebtedness in favor of one or more Revolving Credit Banks arising under any
Derivative Contract", after clause (vii) thereof.
Section 4. AMENDMENT TO SECTION 10.2(d) OF THE LOAN AGREEMENT. Section
10.2(d) of the Loan Agreement is hereby amended by inserting the words, "(v)
investments comprising any Derivative Contract, and", following subpart "(iv)"
thereof, and renumbering subpart "(v)" thereof, "(vi)" thereof.
Section 5. AMENDMENT TO SECTION 11.1(b) OF THE LOAN AGREEMENT. Section
11.1(b) of the Loan Agreement is hereby amended by deleting the word "or"
appearing at the end of clause "(xv)" thereof, inserting the word "or" at the
end of clause "(xvi)" thereof and inserting the following new subpart "(xvii)"
following clause "(xvi)" thereof:
"(xvii) the failure to pay, following any required
notice, any amount as and when due under any Derivative
Contract;"
Section 6. AMENDMENT TO SECTION 11.4(a) OF THE LOAN AGREEMENT.
(a) Section 11.4 of the Loan Agreement is hereby amended by inserting
the phase, "other than any Unpaid Derivative Contract Termination Obligations"
following the term "Obligations", in the first sentence of Section 11.4(a)(ii)
thereof.
(b) Section 11.4 of the Loan Agreement is hereby further amended by
inserting the following text as subpart "(iv)" thereof and renumbering "(iv)
FOURTH" and "(v) FIFTH", "(v) FIFTH" and "(vi) SIXTH" respectively:
"(iv) FOURTH, to the Agent for the benefit of the
Revolving Credit Banks owed Unpaid Derivative Contract
Termination Obligations;"
-4-
Section 7. AMENDMENT TO SECTION 11.4(b) OF THE LOAN AGREEMENT.
(a) Section 11.4(b) of the Loan Agreement is hereby amended by
inserting the phase, "other than any Unpaid Derivative Contract Termination
Obligations" following the term "Obligations", in the first sentence of Section
11.4(b)(iii) thereof.
(b) Section 11.4 of the Loan Agreement is hereby further amended by
inserting the following text as subpart "(iv)" thereof and renumbering "(iv)
FOURTH" and "(v) FIFTH", "(v) FIFTH" and "(vi) SIXTH" respectively:
"(iv) FOURTH, to the Agent for the benefit of the
Revolving Credit Banks owed Unpaid Derivative Contract
Termination Obligations;"
Section 8. REPRESENTATIONS, WARRANTIES AND COVENANTS; NO DEFAULT;
AUTHORIZATION. The Borrower hereby represents, warrants and covenants to the
Agent as follows:
(a) Each of the representations and warranties of the Borrower contained
in the Loan Agreement or in any other Loan Documents was true and correct as of
the date as of which it was made and is true and correct in all material
respects as of the date of this Amendment except to the extent such
representations and warranties expressly related to a prior date (in which case
they shall be true and correct as of such earlier date); and no Default or Event
of Default has occurred and is continuing as of the date of this Amendment;
(b) This Amendment has been duly authorized, executed and delivered by the
Borrower; and
(c) This Amendment shall constitute the legal, valid and binding
obligation of the Borrower, enforceable in accordance with its terms.
Section 9. RATIFICATION, ETC. Except as expressly amended hereby, the
Loan Agreement, the other Loan Documents, and all documents, instruments and
agreements related thereto are hereby ratified and confirmed in all respects.
All references in the Loan Agreement or any related agreement or instrument to
the Loan Agreement or the Notes shall hereafter refer to the Loan Agreement or
the Notes as amended hereby.
Section 10. NO OTHER CHANGES; NO IMPLIED WAIVER. Except as expressly
provided herein, the Loan Agreement and the other Loan Documents shall be
-5-
unaffected hereby and shall continue in full force and effect, and nothing
contained herein shall constitute a waiver by the Agent or any Bank of any
right, remedy, Default, or Event of Default, or impair or otherwise affect any
Obligations, any other obligations of the Borrower, or any right of the Agent or
any Bank consequent thereon.
Section 11. COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original but which together shall
constitute one and the same instrument.
Section 12. GOVERNING LAW. THIS AMENDMENT SHALL FOR ALL PURPOSES BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS (WITHOUT REFERENCE TO CONFLICTS OF LAW.
IN WITNESS WHEREOF, the undersigned have duly executed this Amendment as a
sealed instrument as of the date first above written.
LAMONTS APPAREL, INC.
By: /s/ Xxxxxx Xxxxxxxxxx
-----------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: EVP & CFO
BANKBOSTON, N.A.
for itself and as Agent
BY: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
-6-
CONFIRMATION OF THE SURETY
AND
OF THE GUARANTOR
The Surety hereby confirms approval of the foregoing amendment in all
respects and directs the Term Loan Lender to give its consent thereto. The
Guarantor (as defined in the Purchase and Guaranty Agreement) hereby ratifies
and confirms the Supplemental Guaranty (as defined in the Purchase and Guaranty
Agreement) in all respects, and agrees that the Supplemental Guaranty, after
giving effect to foregoing amendment, shall continue in full force and effect.
SPECIALTY INVESTMENT I LLC
By: /s/ Xxxx X. Xxxxxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Mgr & CFO
XXXXXX XXXXXXXX PARTNERS, INC.
By: /s/ Xxxx X. Xxxxxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: CFO & SVP
