SECOND AMENDMENT TO PROMISSORY NOTE AND
SEVENTH AMENDMENT TO CREDIT AGREEMENT
Dated as of May 8, 1997
THIS SECOND AMENDMENT TO PROMISSORY NOTE AND SEVENTH
AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is being entered
into by and among LUTCHER-MOORE DEVELOPMENT CORPORATION, a
Louisiana corporation ("Development Corporation"), LUTCHER &
MOORE CYPRESS LUMBER COMPANY, a Louisiana partnership in
commendam ("Lumber Company") (Development Corporation and Lumber
Company, collectively, the "Borrowers"), and THE FIRST NATIONAL
BANK OF LAKE CHARLES, a national banking association (the
"Lender"), with THE ESTATE OF MARY ELIZABETH MECOM, THE ESTATE OF
JOHN W. MECOM, THE MARY ELIZABETH MECOM IRREVOCABLE TRUST,
MATILDA GRAY STREAM, THE OPAL GRAY TRUST, HAROLD H. STREAM,
III, THE SUCCESSION OF EDWARD CARMOUCHE, and VIRGINIA MARTIN
CARMOUCHE (collectively, the "Guarantors"), as intervenors, and
with L. M. HOLDING ASSOCIATES, L.P., A LOUISIANA PARTNERSHIP IN
COMMENDAM ("Holding"), also as intervenor.
WITNESSETH:
THAT,
WHEREAS, the Borrowers and the Lender have heretofore entered
into that certain Credit Agreement dated as of November 16, 1987,
as heretofore amended by that certain First Amendment to Credit
Agreement dated as of May 29, 1991, between the Borrowers and the
Lender, by that certain Second Amendment to Credit Agreement
dated as of May 26, 1994, among the Borrowers, Lender, Guarantors
and Holding, by that certain Third Amendment to Credit Agreement
dated as of June 15, 1995, among the Borrowers, Lender,
Guarantors and Holding, by that certain Fourth Amendment to
Credit Agreement dated as of January 16, 1996, among the
Borrowers, Lender, Guarantors and Holding, by that certain Fifth
Amendment to Credit Agreement dated as of August 8, 1996, among
the Borrowers, Lender, Guarantors and Holding, and by that
certain Amendment to Promissory Note and Sixth Amendment to
Credit Agreement dated as of January 28, 1997, among Borrowers,
Lender, Guarantors and Holding (said Credit Agreement, as so
amended, the "Original Credit Agreement"); and,
WHEREAS, pursuant to the Original Credit Agreement, the Borrowers
executed and delivered to the Lender a promissory note made by
the Borrowers dated August 8, 1996, payable to the order of the
Lender in the principal sum of $2,393,419.88 bearing interest at
the rate of 9.25% per annum (the "Existing Note"); and,
WHEREAS, the Existing Note has an existing principal balance of
S2,293,419.88, which amount is due and payable in lull under the
terms of the Existing Note; and,
WHEREAS, the Borrowers, the Guarantors, and Holding have all
requested the Lender to extend the maturity date of the Existing
Note, and the Lender has agreed to do so, subject to the terms
and conditions of this Amendment.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. Amendments to the Existing Note and the Original
Credit Agreement.
(a) Section 1.1.20 of the Original Credit Agreement is hereby
amended to read in its entirety as follows:
"Maturity Date" means the earlier to occur of (i) July 3, 1997,
or (ii) the earlier date of the Lender's acceleration of the
Obligations pursuant to Section 8.1 hereof
(b) The Existing Note, as heretofore amended, is hereby
further amended so that it shall henceforth be payable on demand,
or if no demand is made, in monthly installments of accrued and
unpaid interest, with such payments to be due and payable on the
17th day of each month from the date hereof through and until
July 3, 1997, at which time all principal and accrued interest
shall be payable in full.
(c) All references in the Original Credit Agreement to the
term "Note" are hereby amended to refer the Existing Note, as
heretofore amended and as further amended hereby
(d) Article IV of the Original Credit Agreement is hereby
deleted in its entirety and replaced with the following:
ARTICLE IV
CONDITIONS PRECEDENT AND CONDITIONS
SUBSEQUENT
4.1 The obligation of Lender to honor the Commitment is
subject to the following conditions precedent:
(a) The representations and warranties of Borrowers set forth
herein, or in any other document furnished to Lender in
connection herewith, shall be true and coreect, when made and on
and as of the date of the renewal of the Obligations pursuant
hereto, as if restated in lull on and as of such date;
(b) Lender shall have received specific corporate resolutions
of Development Corporation and Holdings and proof of authority
for the person or persons signing this Amendment, the Note or any
of the Collateral Documents on behalf of Lumber Company or any
Guarantor which is a trust or estate, all of which must be
satisfactory in form and substance to Lender;
(c) Lender shall have received, in form and substance
satis%ctory to Lender, fully executed counterparts of this
Amendment, the Note, and the modification to the Lumber Company
Note;
(d) No Default or Event of Default exists hereunder or shall
result from the transactions contemplated hereby (except as may
have been waived by Lender in writing);
(e) Lender shall have received opinions of counsel for
Borrowers, Guarantors, and Holding, in form and substance
satisfactory to Lender; and,
(f) Lender shall have received a fully executed counterpart
of an amendment to the Servicing Agreement, in form and substance
satisfactory to it.
4.2 Conditions Subsequent. Lenders obligations to
allow the Obligations to remain outstanding shall be subject to
the satisfaction of the following conditions subsequent:
(a) To the extent the opinion of counsel to Borrowers cannot
state that no court orders are required in connection with the
transactions contemplated hereby from the Succession of Edward
Carmouche, the Estate of John W. Mecom, and the Estate of Mary
Elizabeth Mecom, such court orders shall be obtained to Lenders
satisfaction on or prior to May 31, 1997;
(b) Lender shall receive, on or before May 31, 1997, an
endorsement to the title policy insuring the Mortgage pursuant to
which the title shall be brought current through the date of this
Amendment, which shall evidence no liens against the Lands and
Leases covered by the Mortgage other than the Mortgage and other
mortgages or liens which have been consented to in writing by the
Lender; and,
(c) Holding shall continue to deposit a minimum of $15,000.00
per month, in the deposit account affected by the Holding
Assignment of Deposit Account.
(g) Section 8.1 of the Original Credit Agreement is hereby
amended to revise subparagraph (i) thereof to read in its
entirety as follows:
(i) Failure of the Borrowers to deliver to the Lender the
title insurance endorsement required pursuant to Section 4.2(b)
hereof on or prior to May 31, 1997, or the failure of the
Borrowers to timely obtain and deliver to Lender the court
orders, if any, required pursuant to Section 4.2(a) hereof;
SECTION 2. No Defaults; Representations True. The Borrowers, the
Guarantors, and Holding hereby represent and warrant that, to the
best of their knowledge, no Event of Default or potential Event
of Default has occurred and is continuing as of the date hereof
under the Original Credit Agreement, as amended hereby, and that,
to the best of their knowledge, all of the representations,
warranties, and covenants made in the Existing Note and in
Original Credit Agreement, and in all other documents pertaining
or relating to the Original Credit Agreement, as amended hereby,
are, as of the date hereof; true and correct in all material
aspects.
SECTION 3. No Defenses. The Borrowers represent and warrant
that there is no defense, offset, compensation, counterclaim or
reconventional demand with respect to amounts due under, or
performance of; the terms of the Existing Note; and to the extent
any such defense, offset, compensation, counterclaim or
reconventional demand or other causes of action might exist,
whether known or unknown, such items are hereby waived by the
Borrowers.
SECTION 4. Modification of Lumber Company Note. The Lender agrees
to allow the Borrowers to enter into a modification of the Lumber
Company Note, as defined in the Original Credit Agreement, which
the Lender currently holds in pledge pursuant to the Lumber
Company Note Pledge, as defined in the Original Credit Agreement,
to provide that its payment terms are the same as the payment
terms of the Existing Note, as amended hereby.
SECTION 5. Conditions Precedent. This Amendment is expressly
subject to the prior satisfaction of the conditions precedent set
forth in Articles 4.1 of the Original Credit Agreement, as
amended hereby.
SECTION 6. No Novation. Nothing in this Agreement shall
constitute the satisfaction or extinguishment of the amounts owed
under the Existing Note, nor shall it be a novation of the
amounts owed under the Existing Note, as the same has been
amended hereby. Nothing contained in this Agreement shall be
deemed to imply any obligation of the Lender to renew the Note
beyond its extended final maturity date of July 3, 1997, or
beyond the date of the Lender's earlier acceleration thereof
pursuant to Section 8.1 of the Original Credit Agreement, as
amended hereby.
SECTION 7. Ratification and Confirmation. Except as
expressly modified herein, all terms and provisions of the
Existing Note and of the Original Credit Agreement, and all terms
and provisions of all other documents securing or evidencing the
obligations of the Borrowers under the Original Credit Agreement,
as amended hereby (including without limitation those Collateral
Documents described in Section 3.2 of the Original Credit
Agreement) are hereby ratified and confirmed, and shall be and
shall remain in full force and effect, enforceable in accordance
with their terms. The Borrowers hereby confirm and ratify all
Collateral Documents to which they are a party, and agree that
such instruments shall continue to apply to and secure payment
of; without limitation, the indebtedness of the Borrowers to the
Lender arising pursuant to the Original Credit Agreement (as
amended hereby) and the Existing Note The Borrowers and the
Lender hereby acknowledge that the Collateral Note (as defined in
the Original Credit Agreement) has been constantly held by the
Lender since November 16, 1987, pursuant to the terms of the
Pledge (as defined in the Original Credit Agreement), and that
the Lender shall continue to hold the Collateral Note in pledge
pursuant to the terms and provisions of the Pledge (as defined in
the Original Credit Agreement), as confirmed and ratified hereby.
SECTION 8. Intervention by Guarantor. Now to these presents
intervene the Guarantors (including without limitation, the
undersigned representative of the Succession of Edward M.
Carmouche, who acknowledges, confirms and ratifies the Guaranty
of Edward M. Carmouche and the prior pledge of Edward M Carmouche
of his partnership interest in Lumber Company pursuant to the
Partnership Pledge, and the undersigned representative of the
Estate of Mary Elizabeth Mecom, who acknowledges, confirms and
ratifies the Guaranty of Mary Elizabeth Mecom), who hereby agree
to the terms of this Agreement, who further confirm and ratify
(i) their respective Guaranties, as defined in the Original
Credit Agreement, guaranteeing payment of the indebtedness of the
Borrowers to the Lender, and (ii) the Partnership Pledge, as
defined in the Original Credit Agreement, and who agree that such
Guaranties and Partnership Pledge shall continue to apply to and
secure payment of; without limitation, the indebtedness of the
Borrowers to the Lender arising pursuant to the Original Credit
Agreement (as amended hereby) and the Note, as amended hereby.
SECTION 9. Intervention by Holding. Now to these presents
intervenes Holding, who hereby agrees to the terms of this
Amendment. Holding does hereby further confirm and ratify the
Holding Security Agreement, the Holding Collateral Assignment,
the Lumber Company Note (as modified), the vendor's lien and
mortgage securing the Lumber Company Note, and the Lumber Company
Note Pledge (subject to the terms of the modification of the
Lumber Company Note as anticipated herein), and the Holding
Assignment of Deposit Account, and agrees that such instruments
shall continue to apply to and secure payment of; without
limitation, the indebtedness of the Borrowers to the Lender
arising pursuant to the Original Credit Agreement (as amended
hereby) and the Existing Note (as amended hereby). Lumber
Company, Holding and the Lender hereby acknowledge that the
Lumber Company Note has been constantly held by the Lender since
May 29, 1991, pursuant to the terms of the Lumber Company Note
Pledge, and that the Lender shall continue to hold the Lumber
Company Note (as modified with the consent of Lender pursuant to
the provisions of Section 4 hereof) in pledge pursuant to the
terms and provisions of the Lumber Company Note Pledge, as
confirmed and ratified hereby.
SECTION 10. Fees and Expenses. Holding hereby agrees to pay
all fees, taxes, costs and expenses of the Lender in connection
with the preparation, negotiation, execution, and delivery of
this Amendment and of all Collateral Documents (or modifications
or confirmations thereof) executed in connection with the
transactions contemplated hereby, including without limitation
the disbursements and reasonable fees of counsel to the Lender
and the costs of the endorsement to the title policy required
hereunder, and the Borrowers and Holding hereby agree to bound in
solido to the Bank for the payment of all costs and expenses of
the Lender in connection with the enforcement of the Original
Credit Agreement, as amended hereby, the Existing Note, as
amended hereby, or the other Collateral Documents, including
reasonable attorney's fees and disbursements incurred in
connection therewith.
SECTION 11. Further Assurances. The Borrowers, Guarantors, and
Holding agree to do, execute, acknowledge and deliver, all and
every such further acts and instruments as the Lender may
reasonably require for the better assuring and confirming unto
the Lender all and singular the rights granted or intended to be
granted hereby or hereunder.
SECTION 12. Capitalized Terms. All capitalized terms used herein
and not otherwise defined herein shall have the meanings ascribed
to them in the Original Credit Agreement.
SECTION 13. Counterparts. This Amendment may be executed by the
parties hereto in any number of separate counterparts, each of
which when so executed and delivered shall be deemed to be an
original and all of which when taken together shall constitute
but one and the same instrument.
SECTION 14. Governing Law: Binding Effect. This Amendment shall
be governed by and construed in accordance with the laws of the
State of Louisiana and shall be binding upon the parties hereto
and their respective successors and assigns.
SECTION 15. Headings Section headings in this Amendment are
included herein for the convenience of reference only and shall
not constitute part of this Amendment for any other purpose.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be duly executed by themselves or their duly authorized
representatives as of May 8, 1997.
WITNESSES: THE BORROWERS:
__________________ LUTCHER-MOORE DEVELOPMENT CORPORATION
__________________ By:_________________________
John W. Mecom, III, President
LUTCHER & MOORE CYPRESS LUMBER COMPANY,
A Louisiana Partnership in Commendam
By: The Mary Elizabeth Mecom
Irrevocable Trust, its General Partner
_________________ By:_______________________
John W. Mecom, Jr.,
__________________ its Successor Trustee
__________________ By:________________________
Matilda Gray Stream, its
__________________ General Partner
THE LENDER:
THE FIRST NATIONAL BANK OF LAKE CHARLES
__________________
BY:_____________________________
__________________ Wayne B. Gabbert,
Executive Vice President
THE INTERVENORS:
ESTATE OF MARY ELIZABETH MECOM
____________________
By:_____________________________
___________________ John W, Mecom, Jr., Its Executor
ESTATE OF JOHN W. MECOM
_____________________
By:_____________________________
______________________ John W. Mecom, III,
Independent Co-Executor
THE MARY ELIZABETH MECOM
IRREVOCABLE TRUST
_______________________
By:___________________________
_______________________ John W. Mecom, Jr., its Successor
Trustee
________________________
_________________________
________________________ MATILDA GRAY STREAM
OPAL GRAY TRUST
_________________________
By:__________________________
George L. Paret, III, its
_________________________ Co-Trustee
_________________________
By:____________________________
_________________________ Bruce N. Kirkpatrick, its
Co-Trustee
_________________________
___________________________
_________________________ HAROLD H. STREAM, III
SUCCESSION OF EDWARD M.
CARMOUCHE
_________________________
By:________________________
__________________________ Virginia Martin Carmouche,
Executrix
__________________________
_________________________
__________________________ VIRGINIA MARTIN CARMOUCHE
L.M. HOLDING ASSOCIATES,
L.P., A Louisiana
Partnership in Commendam
By: XCL Land Ltd., General
Partner
__________________________
By:________________________
__________________________ Title:_____________________