Exhibit 10.4
CONFORMED COPY
SECOND AMENDMENT (this "AMENDMENT"), dated as of February 21, 2002,
to the FIVE YEAR COMPETITIVE ADVANCE AND REVOLVING CREDIT AGREEMENT dated as of
March 4, 1997, as amended and restated through February 28, 2000 (as amended,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT"),
by and among PHH CORPORATION, a Maryland corporation (the "BORROWER"), the
financial institutions parties thereto (the "LENDERS"), JPMORGAN CHASE BANK
(formerly known as The Chase Manhattan Bank), a New York banking corporation, as
agent for the Lenders (in such capacity, the "ADMINISTRATIVE AGENT").
W I T N E S S E T H:
WHEREAS, the Borrower has requested that certain provisions of the
Credit Agreement be amended as set forth herein; and
WHEREAS, the Lenders are willing to agree to such amendments on the
terms set forth herein;
NOW THEREFORE, in consideration of the premises and mutual covenants
contained herein, the undersigned hereby agree as follows:
I. DEFINED TERMS. Terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.
II. AMENDMENT TO SECTION 1. Section 1 of the Credit Agreement is
hereby amended as follows:
(a) by deleting the definition of the defined term "Chase" in its
entirety and substituting in lieu thereof the following definition in its
appropriate alphabetical order:
"JPMORGAN CHASE BANK" shall mean JPMorgan Chase Bank (formerly known
as The Chase Manhattan Bank), a New York banking corporation.
(b) by deleting the definition of the following defined terms in
their entirety and substituting in lieu thereof the following definitions:
"AVIS FLEET TRANSACTION" shall mean the transaction pursuant to
which, after the consummation of the Avis Merger, the Borrower purchased
Avis Fleet from Avis.
"AVIS MERGER" shall mean the transaction pursuant to the Agreement
and Plan of Merger, dated as of November 11, 2000 (the "MERGER
AGREEMENT"), by and among Avis, Cendant Corporation, a Delaware
corporation ("CENDANT"), the Borrower (an indirect wholly-owned subsidiary
of Cendant) and Avis Acquisition Corp., a Delaware corporation and a
wholly-owned subsidiary of the Borrower ("MERGER SUB") in which Merger Sub
merged with and into Avis and each outstanding share of class A common
stock, par value $.01 per share of Avis (the "COMMON STOCK"), other than
shares of Common Stock held by any subsidiary of Avis, held in Avis'
treasury, held by Cendant
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or any subsidiary of Cendant or held by stockholders who perfect their
appraisal rights under Delaware law, was converted into the right to
receive $33.00 in cash.
"CASH EQUIVALENTS" shall mean (i) investments in commercial paper
maturing in not more than 270 days from the date of issuance which at the
time of acquisition is rated at least A-1 or the equivalent thereof by
S&P, or P-1 or the equivalent thereof by Xxxxx'x, (ii) investments in
direct obligations or obligations which are guaranteed or insured by the
United States or any agency or instrumentality thereof (provided that the
full faith and credit of the United States is pledged in support thereof)
having a maturity of not more than three years from the date of
acquisition, (iii) investments in certificates of deposit maturing not
more than one year from the date of origin issued by a Lender or a bank or
trust company organized or licensed under the laws of the United States or
any state or territory thereof having capital, surplus and undivided
profits aggregating at least $500,000,000 and in each case A rated or
better by S&P or Xxxxx'x, (iv) money market mutual funds having assets in
excess of $2,000,000,000, (v) investments in asset-backed or
mortgage-backed securities, including investments in collateralized,
adjustable rate mortgage securities and those mortgage-backed securities
which are rated at least AA by S&P or Aa by Xxxxx'x or are of comparable
quality at the time of investment, and (vi) banker's acceptances maturing
not more than one year from the date of origin issued by a bank or trust
company organized or licensed under the laws of the United States or any
state or territory thereof and having capital, surplus and undivided
profits aggregating at least $500,000,000, and rated A or better by S&P or
Xxxxx'x.
"EXCESS UTILIZATION DAY" shall mean each day on which the Commitment
Utilization Percentage exceeds 25%.
"LEAF TRUST TRANSACTION" means the financing of motor vehicles and
other equipment or personal property pursuant to that certain Amended and
Restated Purchase Agreement, dated as of March 1, 2001, among LEAF Trust,
a trust established under the laws of the Province of Ontario, the
Canadian Imperial Bank of Commerce, as Administrative Agent and PHH
Vehicle Management Services, Inc., a corporation amalgamated under the
laws of Canada (the "PURCHASE AGREEMENT"), including any amendments,
supplements, modifications, extensions, renewals, restatements or
refundings thereof and any facilities or agreements that replace, refund
or refinance, in whole or in part, the Purchase Agreement.
(c) by deleting the following proviso from the definition of
"Indebtedness" in its entirety and substituting in lieu thereof a period ("."):
; PROVIDED that on the date of the Avis Merger and for a period of
thirty (30) days thereafter, any Indebtedness of Avis or any of its
Subsidiaries shall not be deemed Indebtedness for the purposes of
this definition.
III. AMENDMENTS TO SECTION 2.
(a) Section 2.7 of the Credit Agreement is hereby amended by
deleting the "." at the end of Section 2.7(a) and substituting in lieu thereof
the following:
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; PROVIDED, that if any Lender continues to have any outstanding
Loans after its Commitment terminates, then such Facility Fee shall
continue to accrue on the daily aggregate principal amount of such
Lender's Loans for each day from and including the date on which its
Commitment terminates to but excluding the date on which such Lender
ceases to have any outstanding Loans.
(b) Section 2.7 of the Credit Agreement is hereby further amended by
deleting Section 2.7(b) in its entirety and substituting in lieu thereof the
following:
(b) The Borrower agrees to pay to each Lender, through the
Administrative Agent, on each March 31, June 30, September 30 and
December 31, and on the date on which the Commitment of such Lender
shall be terminated as provided herein, a utilization fee (a
"UTILIZATION FEE") at a rate per annum equal to .25% for each day on
which the Commitment Utilization Percentage exceeds 25%, which fee
shall accrue on the daily amount of the Commitment of such Lender
(whether used or unused) for each Excess Utilization Day during the
period from and including February 21, 2002 to but excluding the
date on which such Commitment terminates; PROVIDED that, if such
Lender continues to have any outstanding Loans after its Commitment
terminates, then such Utilization Fee shall continue to accrue on
the daily aggregate principal amount of such Lender's Loans for each
Excess Utilization Day from and including the date on which its
Commitment terminates to but excluding the date on which such Lender
ceases to have any outstanding Loans. All Utilization Fees shall be
computed on the basis of the actual number of days elapsed in a year
of 360 days and shall be payable in arrears.
(c) Section 2.22 of the Credit Agreement is hereby amended by
deleting the first sentence thereof and the table set forth therein in their
respective entireties and substituting in lieu thereof the following:
The Facility Fee and the applicable LIBOR Spread in effect from time
to time from and including February 21, 2002 shall be determined in
accordance with the following table:
S&P/Xxxxx'x Rating
Equivalent of the
Borrower's senior unsecured Facility Fee Applicable LIBOR
long-term debt (in Basis Points) Spread (in Basis Points)
-------------- ----------------- ------------------------
A/A2 or better 10.0 52.5
A-/A3 12.5 62.5
BBB+/Baa1 15.0 72.5
BBB/Baa2 17.5 82.5
BBB-/Baa3 22.5 90.0
BB+/Ba1 or worse 37.5 137.5
IV. AMENDMENTS TO SECTION 6.
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(a) Section 6.1 of the Credit Agreement is hereby amended by
deleting Section 6.1(i) thereof in its entirety and substituting in lieu thereof
the following:
(i) Indebtedness (other than Indebtedness of Asset Securitization
Subsidiaries incurred to finance asset securitization transactions
permitted by this Agreement) consisting of the obligation to repurchase
mortgages and related assets or secured by mortgages and related assets in
connection with other mortgage warehouse financing arrangements, if the
aggregate principal amount of all such Indebtedness does not exceed
$900,000,000; and
(b) Section 6.1 of the Credit Agreement is hereby amended by
deleting clause (j) thereof and making clause (k) thereof into clause (j)
thereof.
(c) Section 6.3 of the Credit Agreement is hereby amended by
deleting said section in its entirety and substituting in lieu thereof the
following:
SECTION 6.3. LIMITATION ON TRANSACTIONS WITH AFFILIATES. Enter into
any transaction, including, without limitation, any purchase, sale, lease
or exchange of property or the rendering of any service, with any
Affiliate (other than the Borrower or a wholly-owned Subsidiary of the
Borrower) unless such transaction is (a) otherwise permitted under this
Agreement and (b) upon fair and reasonable terms no less favorable to the
Borrower or such Subsidiary, as the case may be, than it would obtain in a
comparable arm's length transaction with a Person which is not an
Affiliate.
(d) Section 6.4 of the Credit Agreement is hereby amended by
deleting clause (ii) of Section 6.4(a) thereof in its entirety and substituting
in lieu thereof the following:
(ii) in which the surviving entity becomes a Material Subsidiary of
the Borrower immediately upon the effectiveness of such merger,
consolidation, dissolution or liquidation or
(e) Section 6.5 of the Credit Agreement is hereby amended by
deleting Section 6.5(o) thereof in its entirety and substituting in lieu thereof
the following:
(o) Liens on mortgages and related assets securing obligations to
the extent such obligations are permitted by Section 6.1(i); and
(f) Section 6.5 of the Credit Agreement is hereby further amended by
deleting Section 6.5(p) and (q) thereof in their respective entireties, and
substituting in lieu thereof the following:
(p) any Liens securing Indebtedness and related obligations of the
Borrower or any of the Material Subsidiaries that principally transact
business in the United States to the extent such Indebtedness and related
obligations are permitted under Section 6.1(j) hereof.
(g) Section 6.6 of the Credit Agreement is hereby amended by
deleting said section in its entirety and substituting in lieu thereof the
following:
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SECTION 6.6. SALE AND LEASEBACK. Enter into any arrangement with any
Person or Persons, whereby in contemporaneous transactions the Borrower or
any of its Subsidiaries sells essentially all of its right, title and
interest in a material asset and the Borrower or any of its Subsidiaries
acquires or leases back the right to use such property except that the
Borrower or any of its Subsidiaries may enter into sale-leaseback
transactions relating to assets not in excess of $100,000,000 in the
aggregate on a cumulative basis, and except (a) any arrangements of Avis
Fleet or any of its Subsidiaries (other than the LEAF Trust Transaction)
existing as of the date of the Avis Fleet Transaction and any renewals,
extensions or modifications thereof so long as such renewals, extensions
or modifications are effected on substantially the same terms or on terms
which, in the aggregate, are not more adverse to the Lenders in any
material respect; (b) the LEAF Trust Transaction; and (c) without limiting
either of the foregoing clauses (a) and (b), any sale-leaseback
transaction entered into in connection with an asset securitization
transaction the indebtedness or Indebtedness relating to which is
permitted to be secured pursuant to Section 6.5(l) or 6.5(n).
(h) Section 6.7 of the Credit Agreement is hereby amended by
deleting said section in its entirety and substituting in lieu thereof the
following:
SECTION 6.7. CONSOLIDATED NET WORTH. Permit Consolidated Net Worth
on the last day of any fiscal quarter to be less than the sum of (i)
$1,250,000,000 PLUS (ii) 25% of Consolidated Net Income, if positive, for
each fiscal quarter after December 31, 2001.
(i) Section 6.10 of the Credit Agreement is hereby amended by
deleting said section in its entirety and substituting in lieu thereof the
following:
SECTION 6.10. RESTRICTIONS AFFECTING SUBSIDIARIES. Enter into, or
suffer to exist, any Contractual Obligation with any Person, which
prohibits or limits the ability of any Material Subsidiary (other than
Special Purpose Vehicle Subsidiaries and Asset Securitization
Subsidiaries) to (a) pay dividends or make other distributions or pay any
Indebtedness owed to the Borrower or any other Subsidiary, (b) make loans
or advances to the Borrower or any other Subsidiary or (c) transfer any of
its properties or assets to the Borrower or any other Subsidiary, except
in each case any Contractual Obligation of Avis Fleet or any of its
Subsidiaries (other than Asset Securitization Subsidiaries or Special
Purpose Vehicle Subsidiaries) existing as of the date of the Avis Fleet
Transaction and any renewals, extensions or modifications thereof so long
as such renewals, extensions or modifications are effected on
substantially the same terms or on terms which, in the aggregate, are not
more adverse to the Lenders in any material respect.
(j) Section 6.12 of the Credit Agreement is hereby amended by
deleting said section in its entirety.
V. AMENDMENTS TO SECTION 9.
(a) Section 9.1 of the Credit Agreement is hereby amended by
deleting the reference to "11333 XxXxxxxxx Xxxx, Xxxx Xxxxxx, Xxxxxxxx
00000-0000" set forth therein and substituting in lieu thereof "0 Xxxxxx Xxxxx,
Xxxxxxxxxx, Xxx Xxxxxx 00000-0000".
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(b) Section 9.3 of the Credit Agreement is hereby amended by
deleting clause (3) of the proviso to Section 9.3(b)(ii) in its entirety and
substituting in lieu thereof the following:
(3) the amount of the Commitment or Competitive Loans, as the case
may be, of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect to
such assignment is delivered to the Lender) shall be in a minimum Dollar
Equivalent Amount of $10,000,000 unless such assignment is an assignment
of all of the assigning Lender's rights and obligations under this
Agreement or unless otherwise agreed by the Borrower and the
Administrative Agent and
(c) Section 9.3 of the Credit Agreement is hereby further amended by
deleting Section 9.3(h) thereof in its entirety and substituting in lieu thereof
the following:
(h) The Lenders may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this
Section 9.3, disclose to the assignee or participant or proposed assignee
or participant, any information relating to the Borrower furnished to the
Administrative Agent or the Lenders by or on behalf of the Borrower.
(d) Section 9 of the Credit Agreement is hereby amended by adding
thereto the following Section 9.17:
SECTION 9.17. CONFIDENTIALITY. Each of the Administrative Agent and
the Lenders agrees to keep confidential all non-public information
provided to it by the Borrower and its Subsidiaries pursuant to this
Agreement that is designated by the Borrower as confidential; PROVIDED
that nothing herein shall prevent the Administrative Agent or any Lender
from disclosing any such information (a) to the Administrative Agent, any
other Lender or any affiliate of any Lender, (b) to any participant or
assignee (each, a "TRANSFEREE") of such Lender or prospective Transferee
which agrees to comply with the provisions of this Section, (c) to any of
its employees, directors, agents, attorneys, accountants and other
professional advisors, (d) upon the request or demand of any governmental
or regulatory authority having jurisdiction over it, (e) in response to
any order of any court or other governmental authority or as may otherwise
be required pursuant to any requirement of law, (f) if requested or
required to do so in connection with any litigation or similar proceeding,
(g) which has been publicly disclosed other than in breach of this Section
9.17, (h) to the National Association of Insurance Commissioners or any
similar organization or any nationally recognized rating agency that
requires access to information about a Lender's investment portfolio in
connection with ratings issued with respect to such Lender or (i) in
connection with the exercise of any remedy hereunder or under any other
Fundamental Document.
VI. GLOBAL AMENDMENT. References in the Credit Agreement to "Chase"
shall be deemed to be references to "JPMorgan Chase Bank".
VII. EFFECTIVE DATE. This Amendment shall become effective on the
date (the "EFFECTIVE DATE") on which the Borrower, the Administrative Agent and
the Required Lenders under the Credit Agreement shall have duly executed and
delivered to the Administrative Agent this Amendment, and the Administrative
Agent shall have received evidence of the effectiveness
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of the Two Year Competitive Advance and Revolving Credit Agreement, dated as of
March 4, 1997, as amended and restated through February 21, 2002, among PHH, the
lenders parties thereto and JPMorgan Chase Bank, as administrative agent.
VIII. REPRESENTATIONS AND WARRANTIES. The Borrower hereby represents
and warrants that, except as disclosed in the Borrower's filings with the
Securities and Exchange Commission prior to February 21, 2002, (a) each of the
representations and warranties in Section 3 of the Credit Agreement (other than
those set forth in Section 3.5, which shall be deemed made only on the Closing
Date) shall be, after giving effect to this Amendment, true and correct in all
material respects as if made on and as of the Effective Date (unless such
representations and warranties are stated to relate to a specific earlier date,
in which case such representations and warranties shall be true and correct in
all material respects as of such earlier date) and (b) after giving effect to
this Amendment, no Default or Event of Default shall have occurred and be
continuing.
IX. NO OTHER AMENDMENTS; CONFIRMATION. Except as expressly amended
hereby, the provisions of the Credit Agreement and each of the Fundamental
Documents are and shall remain in full force and effect.
X. GOVERNING LAW. This Amendment and the rights and obligations of
the parties hereto shall be governed by, and construed and interpreted in
accordance with, the laws of the State of
New York.
XI. COUNTERPARTS. This Amendment may be executed by one or more of
the parties hereto on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. This Amendment may be delivered by facsimile transmission of the
relevant signature pages hereof.
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be
executed and delivered by their duly authorized officers as of the date first
above written.
PHH CORPORATION
By: /s/ Duncan H. Corcroft
---------------------------------
Name: Duncan H. Corcroft
Title: EVP--Finance and Treasurer
JPMORGAN CHASE BANK, individually and as
Administrative Agent
By: /s/ Xxxxxxxx X. Xxxxx
---------------------------------
Title: Xxxxxxxx X. Xxxxx
Name: Vice President
ALLFIRST BANK
By: /s/ Xxxxx Xxxxxxx Xxxxxxxxxxx
---------------------------------
Name: Xxxxx Xxxxxxx Xxxxxxxxxxx
Title: Vice President
BANK ONE, NA
By: /s/ Xxxxx X. Xxxxx
---------------------------------
Name: Xxxxx X. Xxxxx
Title: Director
BANK OF AMERICA, N.A.
By: /s/ Xxxx Xxxxx
---------------------------------
Name: Xxxx Xxxxx
Title: Vice President
BANK OF MONTREAL
By: /s/ Xxxxx X. Xxxxx
---------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
THE BANK OF
NEW YORK
By: /s/ Xxxxx X. Xxxxx
---------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
THE BANK OF NOVA SCOTIA
By: /s/ Xxxxx Xxxxx
---------------------------------
Name: Xxxxx Xxxxx
Title: Managing Director
BANK OF TOKYO-MITSUBISHI TRUST COMPANY
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
CREDIT LYONNAIS
NEW YORK BRANCH
By: /s/ Xxx Xxxxx
---------------------------------
Name: Xxx Xxxxx
Title: Vice President
CREDIT SUISSE FIRST BOSTON
By: /s/ XXXX X'XXXX
---------------------------------
Name: Xxxx X'Xxxx
Title: Director
By: /s/ Xxxxxxxxx Xxxxxxx
---------------------------------
Name: Xxxxxxxxx Xxxxxxx
Title: Associate
FIRST UNION NATIONAL BANK
By: /s/ Xxxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
FLEET NATIONAL BANK
By: ______________________________
Name:
Title:
THE FUJI BANK, LIMITED
By: ______________________________
Name:
Title:
THE INDUSTRIAL BANK OF JAPAN, LIMITED
By: /s/ Xxxxxxx Xxxxxxx
---------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Senior Vice President
MELLON BANK, N.A.
By: /s/ J. Xxxx Xxxx
---------------------------------
Name: J. Xxxx Xxxx
Title: Vice President
THE NORTHERN TRUST COMPANY
By: ______________________________
Name:
Title:
THE ROYAL BANK OF SCOTLAND PLC,
ACTING AS AGENT FOR NATIONAL
WESTMINSTER BANK PLC
By: /s/ Xxxxxxx Xxxxxx
---------------------------------
Name: Xxxxxxx Xxxxxx
Title:
ROYAL BANK OF CANADA
By: ______________________________
Name:
Title:
SUMITOMO MITSUI BANKING
CORPORATION (formerly known as The
Sumitomo Bank, Limited)
By: /s/ Suresh Tata
---------------------------------
Name: Suresh Tata
Title: Senior Vice President
XXXXX FARGO BANK, N.A.
By: /s/ Xxxxxx Xxxxxx
---------------------------------
Name: Xxxxxx Xxxxxx
Title: Vice President
By: /s/ Xxxxx Xxxxxxxxxxx
---------------------------------
Name: Xxxxx Xxxxxxxxxxx
Title: Senior Vice President
WESTDEUTSCHE LANDESBANK
GIROZENTRALE,
NEW YORK BRANCH
By: /s/ Xxxx X. Xxxxxxxx
---------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Director
By: /s/ Xxxxx X. Xxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxx
Title: Associate Director
