AMENDMENT NO.9
TO
THIRD AMENDED AND RESTATED LOAN AGREEMENT
THIS AMENDMENT, dated as of November 1, 1999 ("AMENDMENT NO. 9"), is by and
among LINC CAPITAL, INC. (formerly known as Scientific Leasing Inc.), a Delaware
corporation ("LCI"), Connor Capital Corporation (the "ACQUIRED SUBSIDIARY", and
together with each other Subsidiary of LCI which shall become a "Borrower" under
the Loan Agreement subsequent to the date hereof, each a "SUBSIDIARY BORROWER"),
the banks from time to time party thereto (each a "BANK" and collectively, the
"BANKS") and FLEET BANK, N.A. as agent for the Banks (in such capacity, together
with its successors in such capacity, the "AGENT").
W I T N E S S E T H:
WHEREAS, LCI, the Acquired Subsidiary, the Banks and the Agent are parties
to a Third Amended and Restated Loan Agreement dated as of July 22, 1997 (as
amended, supplemented, restated or otherwise modified from time to time,
including as amended hereby, the "LOAN AGREEMENT"); and
WHEREAS, the Borrowers (as hereinafter defined) have requested certain
further amendments to the Loan Agreement and; and
WHEREAS, capitalized terms used and not otherwise defined herein shall have
the meanings specified in the Loan Agreement;
NOW, THEREFORE, in consideration of the premises and for good and valuable
consideration the receipt of which is hereby acknowledged, LCI, the Acquired
Subsidiary (LCI together with the Acquired Subsidiary are herein sometimes
referred to individually as a "BORROWER" and collectively as the "BORROWERS"),
the Banks and the Agent agree as follows:
ARTICLE I. AMENDMENTS TO LOAN AGREEMENT.
This Amendment shall be deemed to be an amendment and supplement to the
Loan Agreement, and shall not be construed in any way as a replacement therefor.
All of the terms and provisions of this Amendment, including, without
limitation, the representations and warranties set forth herein, are hereby
incorporated by reference into the Loan Agreement as if such terms and
provisions were set forth in full therein. The Loan Agreement is hereby amended,
upon the satisfaction of the conditions precedent set forth in Section 4.1
hereof, in the following respects, with such amendments to become effective on
the date first above written except as otherwise indicated:
1.1 Section 1.1 of the Loan Agreement, "DEFINITIONS", is amended to add the
following new definition where alphabetically appropriate:
"AMENDMENT NO. 9" - Amendment No. 9 dated as of November 1, 1999, to
this Third Amended and Restated Loan Agreement.
1.2 Section 1.1 of the Loan Agreement, "DEFINITIONS", is amended to delete
the definitions of the terms "Payment Date", "Term Conversion Date" and "Term
Period" in their entirety and clause (i) of the definition of the term "Interest
Period". Sections 1.2(9), 2.1(b), 2.2(b), 2.8(b), 2.8(c), 2.26(a)(ii)(B) and
5.9(b) of the Loan Agreement are also deleted in their entirety. Any other
references to the "Term Conversion Date" or the "Term Period" in the Loan
Agreement shall also be deemed to be deleted in their entirety, including,
without limitation, the words "and following the Term Conversion Date" set forth
in Section 2.1(a) of the Loan Agreement.
1.3 Section 1.1 of the Loan Agreement, "DEFINITIONS", is amended to amend
the definition of the term "Post-Default Rate" to change the amount "2%" as it
appears throughout such definition to the amount "3%".
1.4 Section 1.2(2) of the Loan Agreement is hereby amended by adding the
following paragraph at the end thereof:
In addition, at no time shall the Post-Computation Amount included in
the Borrowing Base reflecting the Balance of Payments under Unfunded Eligible
Contracts exceed in the aggregate Twenty-One Million ($21,000,000)Dollars.
1.5 Section 2.10 (a) of the Loan Agreement is hereby amended to read in its
entirety as follows:
(a) Subject to Section 2.8(a) hereof, the Borrowers shall pay to the Agent for
the account of each Bank the principal of the Loans made by such Bank
outstanding at the close of business on the Commitment Termination Date (i)
in full, and (ii) in addition on other dates and in the amounts otherwise
required under Section 2.8(a) hereof.
1.6 The definition of "ADJUSTED TANGIBLE NET WORTH" in Section 1.1 is
hereby amended to add the words "after tax" after the word "goodwill".
1.7 The definition of "COMMITMENT TERMINATION DATE" in Section 1.1 is
hereby amended to read in its entirety as follows:
"Commitment Termination Date" - January 31, 2000.
1.8 Section 6.9(c) is hereby deleted in its entirety.
1.9 Section 7.13, "CAPITAL EXPENDITURES", is amended to replace the amount
"One Million ($1,000,000) Dollars" with the amount "Two Million ($2,000,000)
Dollars".
1.10
(a) Commencing as of November 1, 1999 (the "Commitment Decrease Effective
Date"), the Total Commitment of the Banks shall be decreased from One
Hundred Fifty Five Million Dollars ($155,000,000) to One Hundred Seventeen
Million Dollars ($117,000,000). The amount of each Bank's Commitment as a
result of such amendment as of the Commitment Decrease Effective Date shall
be as set forth under the heading "New Commitment" set forth in SCHEDULE A
annexed to this Amendment No. 9, PROVIDED, HOWEVER, that nothing in this
Amendment No. 9 shall be deemed to decrease the Temporary Commitment.
(b) In order to evidence the Loans made by each of the Banks under its
Commitment as amended hereby, the Borrowers shall execute and deliver to
each of the Banks within ten (10) Business Days of the Commitment Decrease
Effective Date a new promissory note substantially in the form attached to
the Loan Agreement as Exhibit B-1, reflecting the Commitment of each Bank
respectively as amended hereby, dated the Commitment Decrease Effective
Date and otherwise duly completed (collectively, all of the above-
described promissory notes are defined as the "New Notes"). Upon execution
and delivery by the Borrowers of the New Notes, the Agent shall cause each
of the Notes being replaced by a New Note to be marked "Replaced by New
Note", and returned to the Borrowers.
(c) All references in the Loan Agreement, Loan Documents and all other
instruments, documents and agreements executed and delivered pursuant to
any of the foregoing, to "the ratable benefit of the Banks", "pro rata", or
terms of similar effect shall be deemed to refer to the ratable interests
of the Banks, as their respective pro rata interests shall be adjusted to
reflect the amendments to the Commitments of each of the Banks as set forth
on Schedule A annexed hereto.
(d) The Borrower agrees to pay to each Bank on the Commitment Decrease
Effective Date, in addition to any other fees otherwise due and payable
under the Loan Documents, an amendment fee (the "Amendment Fee") in
consideration of the agreement of the Banks to the terms hereof in an
amount equal to 0.10%(ten basis points) of such Bank's Commitment as of the
Commitment Decrease Effective Date, the receipt by all of the Banks of such
Amendment Fee to be a condition precedent to the effectiveness of this
Amendment No. 9.
(e) In order to reflect the foregoing, if necessary, the Banks shall, as of the
Commitment Decrease Effective Date, make appropriate adjustments among
themselves in order that the amount of Loans outstanding to the Borrowers
from each Bank under the Loan Agreement are in principal amounts, as of the
Commitment Decrease Effective Date, which are in the same proportion to the
outstanding principal amount of all Loans that each Bank's Commitment,
respectively, bears to the aggregate Commitments of all the Banks, after
giving effect to the amended amount of the Commitments; PROVIDED, HOWEVER,
that the foregoing adjustments shall not be made as of the Commitment
Decrease Effective Date in respect of Loans bearing interest at a rate
subject to an Interest Period outstanding immediately prior to the
Commitment Decrease Effective Date but such adjustments will be made on the
first day on which the foregoing adjustments can be made without incurring
"breakage costs" in respect of each respective Interest Period, so that the
foregoing adjustment shall be made as of the Commitment Decrease Effective
Date only in respect of borrowings from and after the Commitment Decrease
Effective Date or borrowings that are not subject to any Interest Period.
The Borrowers, the Banks and the Agent acknowledge that no prepayments
under the Loan Agreement shall be required in respect of the decrease in
the Total Commitment as provided herein since the total Loans and L/C
Obligations outstanding as of the Commitment Decrease Effective Date shall
be less than the Banks' Total Commitment as so decreased. The Borrowers
agree and consent to the terms of this Section 1.12.
ARTICLE II. WAIVERS
2.1. The Banks and the Agent hereby waive any breach of Section 6.9(a) of
the Loan Agreement solely for the calendar quarter ending September 30, 1999.
The waiver set forth in this Section 2.1 is applicable only to the specific
provision of the Loan Agreement, and for the time period, described in this
Section 2.1 and shall not constitute a waiver of any other or future breach of
any terms of the Loan Agreement.
2.2. The Banks and the Agent hereby waive any breach of Section 6.9(c) of
the Loan Agreement solely for the twelve-month period ending on the last day of
the calendar quarter ending on September 30, 1999. The waiver set forth in this
Section 2.2 is applicable only to the specific provision of the Loan Agreement,
and for the time period, described in this Section 2.2 and shall not constitute
a waiver of any other or future breach of any terms of the Loan Agreement.
ARTICLE III. REPRESENTATIONS AND WARRANTIES.
3.1 Each of the Borrowers represents and warrants to the Agent and the
Banks, as of the Effective Date, as follows:
(a) Each Borrower is duly organized and validly existing under the laws of its
state of organization and has the power to own its assets and to transact
the business in which it is presently engaged and in which it proposes to
be engaged.
(b) Each Borrower is in good standing in its state of incorporation and in each
state in which it is qualified to do business. There are no jurisdictions
in which the character of the properties owned by any Borrower or in which
the transaction of the business of any Borrower as now conducted requires
or will require such Borrower to qualify to do business, except
jurisdictions in which the failure to so qualify would not have a material
adverse effect on the Collateral in the Borrowing Base or on the business,
operations, financial condition, or properties of any Borrower.
(c) Each Borrower has the power to execute and deliver this Amendment No. 9 and
the other Loan Documents contemplated hereby and to perform the Loan
Agreement as amended hereby and the other Loan Documents contemplated
hereby. No consent or approval of any Person (including, without
limitation, any stockholder of any Borrower), no consent or approval of any
landlord or mortgagee, no waiver of any Lien or right of distraint or other
similar right and no consent, license, approval, authorization or
declaration of any governmental authority, bureau or agency, is or will be
required in connection with the execution or delivery by any Borrower of
this Amendment No. 9 or any of the other Loan Documents contemplated
hereby.
(d) This Amendment No. 9 and each of the other Loan Documents contemplated
hereby has been duly executed and delivered by each Borrower party thereto
and each constitutes the valid and legally binding obligation of such
Borrower, enforceable in accordance with its terms, except that the remedy
of specific performance and other equitable remedies are subject to
judicial discretion and except as such enforcement may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, or other
similar laws, now or hereafter in effect, relating to or affecting the
enforcement of creditors' rights generally.
(e) The execution and delivery by the Borrowers of this Amendment and each of
the other Loan Documents contemplated hereby and the performance by the
Borrowers under each of the aforementioned documents does not and will not
violate any provision of law (including, without limitation, the ▇▇▇▇▇▇▇▇
Act, Sections 13 and 14 of the Securities and Exchange Act of 1934, and the
▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, and Regulations U, G
and X of the Board of Governors of the Federal Reserve System and the rules
and regulations promulgated thereunder) and does not and will not conflict
with or result in a breach of any order, writ, injunction, ordinance,
resolution, decree, or other similar document or instrument of any court or
governmental authority, bureau or agency, domestic or foreign, or any
certificate of incorporation or by-laws of or applicable to any Borrower or
create (with or without the giving of notice or lapse of time, or both) a
default under or breach of any agreement, instrument, document, bond, note
or indenture to which any Borrower is a party, or by which it is bound or
any of its properties or assets is affected, or result in the imposition of
any Lien of any nature whatsoever upon any of the properties or assets
owned by or used in connection with the business of LCI or any other Loan
Party, except for the Liens created and granted pursuant to the Security
Documents or otherwise permitted under the Loan Agreement.
(f) All of the properties and assets owned by each Borrower and each of the
Subsidiaries and all of the properties and assets owned by any other Loan
Party which properties or assets are covered by a Security Document
executed by such Loan Party are owned by each of them, respectively, free
and clear of any Lien of any nature whatsoever, except as provided for in
the Security Documents and as permitted by Section 7.2 of the Loan
Agreement. The Liens which have been created and granted by the Security
Documents constitute valid perfected Liens on the properties and assets
covered by such Security Documents, subject to no prior or equal Lien
except as permitted by Section 7.2 of the Loan Agreement.
(g) The Liens granted pursuant to the Security Documents secure, without
limitation, the Obligations under the Loan Agreement as amended by this
Amendment No. 9, whether or not so stated in the Security Documents. The
terms "Obligations" as used in the Security Documents (or any other term
used therein to refer to the Indebtedness, liabilities and obligations of
the Borrowers to the Banks or the Agent) include, without limitation,
Indebtedness, liabilities and obligations to the Banks and the Agent under
the Loan Agreement as amended by this Amendment No. 9.
ARTICLE IV. CONDITIONS.
4.1 CONDITIONS. The amendments and waiver set forth in Articles I and II
above shall be subject to the fulfillment by the Borrowers, in a manner
satisfactory to the Agent, of all of the conditions precedent set forth in this
Section 4.1:
(a) The Borrowers and each of the Banks shall have executed and delivered to
the Agent this Amendment No. 9.
(b) (i) The representations and warranties contained in Article III of this
Amendment No. 9 and in each other agreement, instrument, certificate or
other writing delivered to the Agent or any Bank pursuant hereto or to the
Loan Agreement shall be correct on and as of the date hereof and on and as
of the Effective Date (after giving effect to the waivers included herein)
as though made on and as of such date, and (ii) no Default or Event of
Default shall have occurred and be continuing on the Effective Date; and
execution and delivery of this Amendment shall constitute confirmation by
the Borrowers of the truth and accuracy and satisfaction of the conditions
of this Section 4.1.
(c) The Agent shall have received copies of the resolutions of the board of
directors of the Borrowers, certified as true, correct and complete by an
officer thereof, authorizing the execution and delivery of this Amendment.
(d) The Agent shall have received in form and substance satisfactory to the
Agent a certificate of an authorized officer of each of the Borrowers
certifying the names and true signatures of the officer authorized to sign
this Amendment No. 9 and each of the other documents contemplated hereby
together with evidence of the incumbency of such authorized officer.
(e) If requested, the Agent shall have received an opinion, in form and
substance satisfactory to the Banks and the Agent, of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
or ▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq., counsel to the Borrowers as to such matters
relating to this Amendment as the Agent and the Banks may reasonably
request.
(f) The Borrowers shall have (i) paid to each Bank, and each Bank shall have
received, the Amendment Fee, (ii) paid all fees and expenses of counsel to
the Agent incurred in connection herewith; and (iii) otherwise complied in
all respects with the terms hereof and of any other agreement, document,
instrument or other writing to be delivered by the Borrower in connection
herewith.
(g) All legal matters incident to this Amendment shall be reasonably
satisfactory to the Agent and counsel to the Agent.
ARTICLE V. MISCELLANEOUS.
5.1 The Loan Agreement and the other agreements to which the Borrowers are
a party delivered in connection herewith or with the Loan Agreement are, and
shall continue to be, in full force and effect, and are hereby ratified and
confirmed in all respects, except that on and after the effectiveness of this
Amendment (a) all references in the Loan Agreement to "this Agreement",
"hereto", "hereof", "hereunder" or words of like import referring to the Loan
Agreement shall mean the Loan Agreement as amended hereby, (b) all references in
the Loan Agreement, the Security Documents or any other agreement, instrument or
document executed and delivered in connection therewith to (i) the "Loan
Agreement", "thereto", "thereof", "thereunder" or words of like import referring
to the Loan Agreement shall mean the Loan Agreement as amended hereby, and (ii)
the "Loans" (or any other term or terms used in any of such documents to
describe or refer to Loans made by the Banks to the Borrowers under the Loan
Agreement) shall be deemed to refer to Loans made by the Banks to the Borrowers
pursuant to the Loan Agreement as amended hereby.
5.2 The Loan Agreement, the Security Documents and all agreements,
instruments and documents executed and delivered in connection with any of the
foregoing shall each be deemed amended hereby to the extent necessary, if any,
to give effect to the provisions of this Amendment No. 9. Except as so amended
hereby, the Loan Agreement and the other Loan Documents shall remain in full
force and effect in accordance with their respective terms. The execution and
delivery of this Amendment No. 9 by the Borrowers, the Banks and the Agent shall
not waive or be deemed to waive any default which has occurred or which may be
occurring in respect of the Loan Agreement, and each of the waivers granted
hereunder shall be effective only in the specific instance and for the purpose
for which given. All of the terms and provisions of this Amendment No. 9 are
hereby incorporated by reference into the Loan Agreement as if such terms and
provisions were set forth in full therein.
5.3 The miscellaneous provisions under Article 10 of the Loan Agreement,
together with the definitions of all terms used therein, and all other Sections
of the Loan Agreement to which such Sections refer are hereby incorporated by
reference as if the provisions thereof were set forth in full herein.
5.4 This Amendment No. 9 may be executed in counterparts by the parties
hereto, and each such counterpart shall be considered an original, and all such
counterparts shall constitute one and the same instrument. Signatures
transmitted by facsimile shall be deemed as effective as manually executed
originals.
5.5 THIS AMENDMENT NO. 9 SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK (WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS), AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, each of the parties hereto has caused this Amendment
No. 9 to Third Amended and Restated Loan Agreement to be duly executed as of the
date first above written.
LINC CAPITAL, INC. (formerly known
as SCIENTIFIC LEASING, INC.),
as Borrower
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------
Name:▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title:Executive Vice President and
Chief Financial Officer
CONNOR CAPITAL CORPORATION,
as Borrower
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
FLEET BANK, N.A. (formerly NATWEST
BANK N.A.) as Agent and as a Bank
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
FIRST UNION NATIONAL BANK (formerly
known as CORESTATES BANK, N.A.)
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
LASALLE BANK NATIONAL ASSOCIATION
(formerly known as LASALLE NATIONAL BANK)
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇▇
[Signature Page to Amendment No. 9 Under
LINC Capital Third Amended and Restated Loan Agreement]
BANK ONE, NA (formerly known as THE FIRST
NATIONAL BANK OF CHICAGO)
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
EUROPEAN AMERICAN BANK
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
UNION BANK OF CALIFORNIA, N.A.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇
KEY BANK NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇▇ ▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇
NATIONAL CITY BANK
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇▇▇▇▇▇▇
[Signature Page to Amendment No. 9 Under
LINC Capital Third Amended and Restated Loan Agreement]
