Exhibit 10.3
Execution Copy
FIRST AMENDMENT TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment"), made and
entered into as of March 5, 2001, is by and between MATRIX BANCORP, INC., a
Colorado corporation (the "Borrower"), the lenders from time to time party
hereto (each a "Lender" and collectively, the "Lenders"), and U.S. BANK NATIONAL
ASSOCIATION ("U.S. Bank"), as agent for the Lenders (in such capacity, together
with any successor agents appointed hereunder, the "Agent").
RECITALS
A. The Borrower and U.S. Bank National Association, in its capacities as a
Lender and as Agent, entered into a Credit Agreement dated as of December 27,
2000 (the "Credit Agreement");
B. Contemporaneously with this Amendment, U.S. Bank National Association,
in its capacities as a Lender and as Agent, and Residential Funding Corporation,
a Delaware corporation ("RFC"), have entered into an Assignment Agreement
pursuant to which U.S. Bank National Association, in its capacity as a Lender,
intends to sell and assign to RFC certain rights, obligations and commitments
under the Credit Agreement and under which RFC will become a Lender under the
Credit Agreement; and
C. The Borrower desires to amend certain provisions of the Credit
Agreement, and the Lender and Agent have agreed to make such amendments, subject
to the terms and conditions set forth in this Amendment.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto hereby
covenant and agree to be bound as follows:
Section 1. Capitalized Terms. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to them in the Credit
Agreement, unless the context shall otherwise require.
Section 2. Amendments.
2.1 The Credit Agreement is hereby amended by amending the definitions
of "Cash Equivalents," "Revolving Commitment Amount," "Revolving Commitment
Fees," "Revolving Loan," and "Termination Date" contained in Section 1.1 of
the Credit Agreement to read in their entirety as follows:
"Cash Equivalents": Investments described in Section 6.9(a) through
(e).
"Revolving Commitment Amount": With respect to a Lender, initially the
amount set opposite such Lender's name on Schedule 1.1-1 hereto as its
Revolving Commitment Amount, but as the same may be reduced from time to
time pursuant to Section 2.8, or modified by an assignment pursuant to
Section 9.6 hereof.
"Revolving Commitment Fees": As defined in Section 2.9.
"Revolving Loan": As defined in Section 2.1(a).
"Termination Date": The earliest of (a) December 26, 2001, (b) the
date on which the Revolving Commitments are terminated pursuant to Section
7.2 hereof or (c) the date on which the Revolving Commitment Amounts are
reduced to zero pursuant to Section 2.8 hereof.
2.2 The Credit Agreement is hereby amended by adding the definition of
"Regulatory Action" to Section 1.1 in the appropriate
alphabetical order to read as follows:
"Regulatory Action": Any cease and desist order, letter agreement,
memorandum, or other similar regulatory action taken by a state or federal
banking agency or other Person to which either the Borrower or Matrix Bank
is subject.
2.3 The Credit Agreement is hereby amended by deleting the definition
of "Unpaid Drawing" contained in Section 1.1 in its entirety.
2.4 Section 1.4 of the Credit Agreement is hereby amended by deleting
the last sentence thereof and substituting the following sentence:
All incorporation by reference of covenants, terms, definitions or other
provisions from other agreements are incorporated into this Agreement as if
such provisions were fully set forth herein, include all necessary
definitions and related provisions from such other agreements but including
only amendments thereto agreed to by the Majority Lenders, and shall
survive any termination of such other agreements until the obligations of
the Borrower under this Agreement and the Notes are irrevocably paid in
full, and the commitments of any Lender to advance funds to the Borrower
are terminated.
2.5 Section 2.5 of the Credit Agreement is hereby amended by deleting
the word "Revolving" in the second line thereof.
2.6 Section 2.10 of the Credit Agreement is hereby amended by deleting
the number "365" where it appears and substituting the number "360"
therefor.
2.7 Section 2.14(b) of the Credit Agreement is hereby amended by
deleting the following text in the sixth line thereof: "or against Letters
of Credit issued by the Agent."
2.8 Section 5.1(a) of the Credit Agreement is hereby amended in its
entirety to read as follows:
(a) Annually. Promptly after preparation but no later than 90 days
after the last day of each fiscal year of Borrower (i) the consolidated and
consolidating financial statements of the Borrower consisting of at least
statements of income, cash flow and changes in stockholders' equity, and a
consolidated balance sheet as of the end of such fiscal year, setting forth
in each case in comparative form corresponding figures from the previous
annual audit, (ii) Matrix Bank's consolidated and consolidating financial
statements consisting of at least statements of income, cash flow and
changes in stockholders' equity, and a consolidated balance sheet as of the
end of such fiscal year, setting forth in each case in comparative form
corresponding figures from the previous annual audit, (iii) solely with
respect to the consolidated portion of financial statements referenced in
(i) and (ii) above, the opinions, without material qualification, of Ernst
& Young or of another firm of nationally-recognized independent certified
public accountants reasonably acceptable to Majority Lenders, based on
audits using generally accepted auditing standards, that the consolidated
portion of those financial statements were prepared in accordance with GAAP
and present fairly, in all material respects, Matrix Bank's and Borrower's
respective consolidated financial conditions and results of operations.
2.9 Section 6.2 of the Credit Agreement is hereby amended in its
entirety to read as follows:
Section 6.2 Disposition of Assets. Neither Borrower nor Matrix Bank
may sell, assign, lease, transfer, or otherwise dispose of any of its
assets (including, without limitation, equity interests in any other
Person) except (a) sales and dispositions in the ordinary course of
business for a fair and adequate consideration and (b) sales of assets
which are obsolete or are no longer in use and which are not significant to
the continuation of the business of the Borrower or Matrix Bank, as the
case may be.
2.10 Section 6.10 of the Credit Agreement is hereby amended to add the
following Sections 6.10(j) and (k):
(j) The Guaranties.
(k) The guaranty by Matrix Bank dated March 5, 2001 of the obligations
under the Matrix Financial Loan Agreement.
2.11 Section 7.1 of the Credit Agreement is hereby amended to add the
following Sections 7.1(p) and 7.1(q):
(p) The Borrower or Matrix Bank shall become subject to any Regulatory
Action.
(q) An Event of Default shall occur under the Matrix Financial Loan
Agreement.
2.12 Section 9.1(h) of the Credit Agreement is hereby deleted in its
entirety.
2.13 Section 9.6(b) of the Credit Agreement is hereby amended to read
in its entirety as follows:
(b) Any Lender may, in the ordinary course of its commercial lending
business and in accordance with applicable law, at any time sell to one or
more lenders or other entities ("Participants") participating interests in
a minimum aggregate amount of $5,000,000 in the Loans, the Notes and the
Revolving Commitment held by such Lender, and any other interest of such
Lender hereunder. In the event of any such sale by a Lender of
participating interests to a Participant, (i) such Lender's obligations
under this Agreement to the other parties to this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible for the
performance thereof, (iii) such Lender shall remain the holder of any such
Revolving Note and Term Note for all purposes under this Agreement, (iv)
the Borrower and the Agent shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations under
this Agreement and (v) the agreement pursuant to which such Participant
acquires its participating interest herein shall provide that such Lender
shall retain the sole right and responsibility to enforce the Obligations,
including, without limitation the right to consent or agree to any
amendment, modification, consent or waiver with respect to this Agreement
or any other Loan Document, provided that such agreement may provide that
such Lender will not consent or agree to any such amendment, modification,
consent or waiver with respect to the matters set forth in Sections
9.1(a)-(e) without the prior consent of such Participant. The Borrower
agrees that if amounts outstanding under this Agreement, the Revolving
Notes, the Term Notes and the Loan Documents are due and unpaid, or shall
have been declared or shall have become due and payable upon the occurrence
of an Event of Default, each Participant shall be deemed to have, to the
extent permitted by applicable law, the right of setoff in respect of its
participating interest in amounts owing under this Agreement and any
Revolving Note, Term Note or other Loan Document to the same extent as if
the amount of its participating interest were owing directly to it as a
Lender under this Agreement or any Revolving Note, Term Note or other Loan
Document; provided, that such right of setoff shall be subject to the
obligation of such Participant to share with the Lenders, and the Lenders
agree to share with such Participant, as provided in subsection 8.11. The
Borrower also agrees that each Participant shall be entitled to the
benefits of Sections 2.13 through 2.17 and 9.2 with respect to its
participation in the Revolving Commitments, Term Loan Commitments,
Revolving Loans and the Term Loans; provided, that no Participant shall be
entitled to receive any greater amount pursuant to such subsections than
the transferor Lender would have been entitled to receive in respect of the
amount of the participation transferred by such transferor Lender to such
Participant had no such transfer occurred. Notwithstanding the foregoing,
nothing contained in this Agreement shall in any manner
or to any extent affect the right of the Lender to assign, pledge or
participate any Note and its right to receive and retain payments on any
Note in connection with any arrangement maintained by the Lender to fund
credit facilities provided by the Lender, provided the Lender remains
primarily and directly liable to perform all of its obligations under this
Agreement.
Section 3. Effectiveness of Amendments. The amendments contained in
this Amendment shall become effective provided the Agent shall have
received at least five (5) counterparts of this Amendment, duly executed by
the Company and all of the Lenders, and the Agent shall have received the
following, each duly executed or certified:
3.1 This Amendment duly executed by the Borrower.
3.2 A copy of the resolutions of the Board of Directors of the
Borrower authorizing the execution, delivery and performance of this
Amendment certified as true and accurate by its Secretary or Assistant
Secretary, along with a certification by such Secretary or Assistant
Secretary (i) certifying that there has been no amendment to the
Certificate of Incorporation or Bylaws of the Borrower since true and
accurate copies of the same were delivered to the Lender with a certificate
of the Secretary of the Borrower dated December 27, 2000, and (ii)
identifying each officer of the Borrower authorized to execute this
Amendment and any other instrument or agreement executed by the Borrower in
connection with this Amendment (collectively, the "Amendment Documents"),
and certifying as to specimens of such officer's signature and such
officer's incumbency in such offices as such officer holds.
3.3 Certified copies of all documents evidencing any necessary
corporate action, consent or governmental or regulatory approval (if any)
with respect to this Amendment.
3.4 The Consent and Reaffirmation of Guarantors, in the form attached
hereto as Exhibit A, duly executed by each Guarantor.
3.5 The Borrower shall have satisfied such other conditions as
specified by the Agent and the Lenders, including payment of all unpaid
legal fees and expenses incurred by the Agent through the date of this
Amendment in connection with the Credit Agreement and the Amendment
Documents.
Section 4. Representations, Warranties, Authority, No Adverse Claim.
4.1 Reassertion of Representations and Warranties, No Default. The
Borrower hereby represents that on and as of the date hereof and after
giving effect to this Amendment (a) all of the representations and
warranties contained in the Credit Agreement are true, correct and complete
in all respects as of the date hereof as though made on and as of such
date, except for changes permitted by the terms of the Credit Agreement,
and (b) there will exist no Default or Event of Default under the Credit
Agreement as amended by this Amendment on such date which has not been
waived by the Agent and the Lenders.
4.2 Authority, No Conflict, No Consent Required. The Borrower
represents and warrants that the Borrower has the power and legal right and
authority to enter into the Amendment Documents and has duly authorized as
appropriate the execution and delivery of the Amendment Documents and other
agreements and documents executed and delivered by the Borrower in
connection herewith or therewith by proper corporate, and none of the
Amendment Documents nor the agreements contained herein or therein
contravenes or constitutes a default under any agreement, instrument or
indenture to which the Borrower is a party or a signatory or a provision of
the Borrower's Certificate of Incorporation, Bylaws or any other agreement
or requirement of law in which the consequences of such default or
violation could have a material adverse effect on the business, operations,
properties, assets or condition (financial or otherwise) of the Borrower
and its Subsidiaries taken as a whole, or result in the imposition of any
Lien on any of its property under any agreement binding on or applicable to
the Borrower or any of its property except, if any, in favor of the Agent
on behalf of the Lenders. The Borrower represents and warrants that no
consent, approval or authorization of or registration or declaration with
any Person, including but not limited to any governmental authority, is
required in connection with the execution and delivery by the Borrower of
the Amendment Documents or other agreements and documents executed and
delivered by the Borrower in connection therewith or the performance of
obligations of the Borrower therein described, except for those which the
Borrower has obtained or provided and as to which the Borrower has
delivered certified copies of documents evidencing each such action to the
Agent.
4.3 No Adverse Claim. The Borrower warrants, acknowledges and agrees
that no events have taken place and no circumstances exist at the date
hereof which would give the Borrower a basis to assert a defense, offset or
counterclaim to any claim of the Agent or the Lenders with respect to the
Obligations or the Borrower's obligations under the Credit Agreement as
amended by this Amendment.
Section 5. Affirmation of Credit Agreement, Further References. The
Agent, the Lenders, and the Borrower each acknowledge and affirm that the
Credit Agreement, as hereby amended, is hereby ratified and confirmed in
all respects and all terms, conditions and provisions of the Credit
Agreement, except as amended by this Amendment, shall remain unmodified and
in full force and effect. All references in any document or instrument to
the Credit Agreement are hereby amended and shall refer to the Credit
Agreement as amended by this Amendment. All of the terms, conditions,
provisions, agreements, requirements, promises, obligations, duties,
covenants and representations of the Borrower under such documents and any
and all other documents and agreements entered into with respect to the
obligations under the Credit Agreement are incorporated herein by reference
and are hereby ratified and affirmed in all respects by the Borrower.
Section 6. Merger and Integration, Superseding Effect. This Amendment,
from and after the date hereof, embodies the entire agreement and
understanding between the parties hereto and supersedes and has merged into
this Amendment all prior oral and written agreements on the same subjects
by and between the parties hereto with the effect that this Amendment,
shall control with respect to the specific subjects hereof and thereof.
Section 7. Severability. Whenever possible, each provision of this
Amendment and the other Amendment Documents and any other statement,
instrument or transaction contemplated hereby or thereby or relating hereto
or thereto shall be interpreted in such manner as to be effective, valid
and enforceable under the applicable law of any jurisdiction, but, if any
provision of this Amendment, the other Amendment Documents or any other
statement, instrument or transaction contemplated hereby or thereby or
relating hereto or thereto shall be held to be prohibited, invalid or
unenforceable under the applicable law, such provision shall be ineffective
in such jurisdiction only to the extent of such prohibition, invalidity or
unenforceability, without invalidating or rendering unenforceable the
remainder of such provision or the remaining provisions of this Amendment,
the other Amendment Documents or any other statement, instrument or
transaction contemplated hereby or thereby or relating hereto or thereto in
such jurisdiction, or affecting the effectiveness, validity or
enforceability of such provision in any other jurisdiction.
Section 8. Successors. The Amendment Documents shall be binding upon
the Borrower, the Lenders, and the Agent and their respective successors
and assigns, and shall inure to the benefit of the Borrower, the Lenders,
and the Agent and the successors and assigns of the Lenders and the Agent.
Section 9. Legal Expenses. As provided in Section 9.2 of the Credit
Agreement, the Borrower agrees to reimburse the Agent, upon execution of
this Amendment, for all reasonable out-of-pocket expenses (including
attorney' fees and legal expenses of Xxxxxx & Xxxxxxx LLP, counsel for the
Agent) incurred in connection with the Credit Agreement, including in
connection with the negotiation, preparation and execution of the Amendment
Documents and all other documents negotiated, prepared and executed in
connection with the Amendment Documents, and in enforcing the obligations
of the Borrower under the Amendment Documents, and to pay and save the
Agent and the Lenders harmless from all liability for, any stamp or other
taxes which may be payable with respect to the execution or delivery of the
Amendment Documents, which obligations of the Borrower shall survive any
termination of the Credit Agreement.
Section 10. Headings. The headings of various sections of this
Amendment have been inserted for reference only and shall not be deemed to
be a part of this Amendment.
Section 11. Counterparts. The Amendment Documents may be executed in
several counterparts as deemed necessary or convenient, each of which, when
so executed, shall be deemed an original, provided that all such
counterparts shall be regarded as one and the same
document, and either party to the Amendment Documents may execute any such
agreement by executing a counterpart of such agreement.
Section 12. Governing Law. THE AMENDMENT DOCUMENTS SHALL BE GOVERNED
BY THE INTERNAL LAWS OF THE STATE OF MINNESOTA, WITHOUT GIVING EFFECT TO
CONFLICT OF LAW PRINCIPLES THEREOF, BUT GIVING EFFECT TO FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS, THEIR HOLDING COMPANIES AND THEIR AFFILIATES.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the date and year first above written.
MATRIX BANCORP, INC.
By /s/ Xxx X. Xxxxxx
Xxx X. Xxxxxx
Its President
Address for Notices:
0000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
U.S. BANK NATIONAL ASSOCIATION
By /s/ Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
Its Vice President
Address for Notices:
000 00xx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxx
Telecopier Number: (000) 000-0000
