Exhibit 10 (x)
Execution
Copy
SECOND AMENDMENT
TO
AMENDED AND RESTATED CREDIT AGREEMENT
(Revolving Credit Agreement)
Second Amendment to Amended and Restated Credit Agreement (the "Amendment")
dated as of January 19, 1996 among (i) PIONEER FINANCIAL SERVICES, INC., a
Delaware corporation (the "Company"), (ii) AMERICAN NATIONAL BANK AND TRUST
COMPANY OF CHICAGO, as administrative agent (in such capacity, the "Agent"),
(iii) AMERICAN NATIONAL BANK AND TRUST COMPANY OF CHICAGO ("ANB"), FIRSTAR BANK
MILWAUKEE, N.A. ("Firstar") and BANK ONE, ROCKFORD, NA ("Bank One") (ANB,
Firstar and Bank One collectively referred to as the "Existing Banks" and
individually as an "Existing Bank") and (iv) FLEET NATIONAL BANK OF CONNECTICUT
("Fleet") (the Existing Banks and Fleet collectively referred to as the "Banks"
and individually as a "Bank").
R E C I T A L S
WHEREAS, the Company, the Agent and the Existing Banks have heretofore
entered into an Amended and Restated Credit Agreement dated as of March 22,
1995, as amended by that certain Amendment to Credit Agreement dated as of
August 30, 1995 (as so amended, the "Revolving Credit Agreement"), pursuant to
which, among other things, the Existing Banks agreed, upon the terms and subject
to the conditions set forth therein, to make Loans (as defined in the Revolving
Credit Agreement) to the Company;
WHEREAS, Fleet desires to become a party to the Revolving Credit Agreement
and Bank One desires to increase its Commitment under the Revolving Credit
Agreement;
WHEREAS, the Company and the Banks desire to amend certain provisions of
the Revolving Credit Agreement to, among other things, affect the foregoing;
NOW THEREFORE, in consideration of the premises and the mutual agreements
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
Section 1. Definitions, Ratification, References. Unless otherwise
specifically defined herein, each term used herein that is defined in the
Revolving Credit Agreement shall have the meaning assigned to such term in the
Revolving Credit Agreement. Except as amended and supplemented hereby, all of
the terms of the Revolving Credit Agreement shall remain and continue in full
force and effect and are hereby confirmed in all respects. Each reference to
"hereof", "hereunder", "herein" and "hereby" and each other similar reference
and each reference to "this Agreement" and each other similar reference
contained in the Revolving Credit Agreement shall from and after the date of
this Amendment refer to the Revolving Credit Agreement as amended by this
Amendment.
Section 2. Amendments to Revolving Credit Agreement.
2.1 The following definitions that appear in Section 1 of the Revolving
Credit Agreement are amended in their entirety to read as follows:
"`Aggregate Commitment' means the combined Commitments of the Banks in
the amount of twenty-seven million dollars ($27,000,000), as such amount
may be reduced from time to time pursuant to this Agreement."
"`Business Day' means any day of the year on which each Bank is open
for business in the city where such Bank's main office is located and, in
addition, with respect to Eurodollar Rate Loans, any day of the year on
which commercial banks are open for business (including dealings in U.S.
dollar deposits) in London, England."
"`Majority Banks' means at any time a group of Banks that shall
include ANB and shall hold at least 51% of the Aggregate Commitment, or if
the Commitments have expired or been terminated, a group of Banks that
shall include ANB and shall hold at least 51% of the sum of (a) the
aggregate principal amount of all Loans then outstanding and not repaid,
(b) the aggregate Stated Amount of all LCs previously issued and then
outstanding and (c) the aggregate amount of all Reimbursement Obligations."
"`Stated Amount' shall mean, with respect to any LC and as of the date
of determination, the maximum amount for which a draw or demand for payment
may then be made thereunder, whether or not (i) the conditions for making a
draw or demand for payment under such LC could then be met and (ii) such
maximum amount is defined in such LC as the "Stated Amount" thereof."
2.2 The term "Banks", wherever such term appears in the Revolving Credit
Agreement, shall mean and refer to ANB, Firstar, Bank One and Fleet collectively
and the term "Bank" shall mean and refer to any one such Bank individually.
2.3 Notwithstanding any provision of the Revolving Credit Agreement, the
parties acknowledge and agree that from and including the date hereof the
Commitments and Commitment Percentages of each Bank are as set forth opposite
such Bank's name below:
Bank Commitment Commitment Percentage
ANB $9,000,000 33.333333%
Firstar $3,000,000 11.111111%
Bank One $9,000,000 33.333333%
Fleet $6,000,000 22.222222%
__________ ___________
Total $27,000,000 $100.000000%
The parties further acknowledge and agree that (i) on the date hereof the
parties shall disburse between and among themselves such amounts representing
principal on outstanding Loans under the Revolving Credit Agreement in
accordance with that certain Disbursement Memorandum dated the date hereof from
the Agent to each of the other parties (the "Disbursement Memorandum"), (ii)
interest and fees shall be paid by the Company to the Banks on the next Interest
Payment Date or the next fee payment date in accordance with Section 4.2 of the
Revolving Credit Agreement, which payment shall take into account the
reallocation of principal of outstanding Loans as set forth in the Disbursement
Memorandum, and (iii) from and including the date hereof the rights and
obligations of each Bank shall be in proportion to the Commitment Percentages
set forth above.
2.4 Section 4.4(a) of the Revolving Credit Agreement is amended by adding
the phrase "or participating in any LC" immediately after the phrase "and the
result of any of the foregoing is to increase the cost to such Bank of making or
maintaining any Loan", which phrase appears immediately after subsection (B) of
such Section 4.4(a).
2.5 Section 4.4(b) of the Revolving Credit Agreement is amended in its
entirety to read as follows:
"(b) If either (i) of the introduction of or any change in or in the
interpretation of any law or regulation or (ii) compliance by a Bank with
any new guideline or request from any central bank or other governmental
authority affects or would affect the amount of capital required or
expected to be maintained by such Bank or any corporation controlling such
Bank and the amount of such capital is increased by or based upon the
existence of such Bank's commitment to make or maintain any Loan or to
participate in any LC by such Bank hereunder or in the case of the Issuing
Bank, its commitment to issue any LC hereunder, then, within 30 days after
demand by such Bank, with a copy to the Agent (which demand shall set forth
in reasonable detail the basis of such demand), the Company shall pay to
the Agent for the account of such Bank, from time to time as reasonably
specified by such Bank, additional amounts sufficient to compensate such
Bank in the light of such circumstances, to the extent that such Bank
reasonably determines such increase in capital to be allocable to the
existence of such Bank's commitment to make or maintain any Loan or to
participate in any LC hereunder or in the case of the Issuing Bank, its
commitment to issue any LC hereunder, provided, however, that any such
amount or amounts payable by the Company shall not exceed the increased
amount of capital required to be maintained by such Bank and allocable to
any such Loan or any such LC, as the case may be, in direct proportion to
any such Loan or any such LC."
2.6 A new Section 4.6 is added to the Revolving Credit Agreement as
follows:
"SECTION 4.6 Illegality. If, after the date hereof, the adoption of
any applicable law, rule or regulation, or any change therein, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by a Bank with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency, shall make it unlawful or
impossible for a Bank to make, maintain or fund its Eurodollar Rate Loans,
and such Bank shall so notify the Agent, the Agent shall forthwith give
notice thereof to the other Banks and the Company, whereupon until such
Bank notifies the Company and the Agent that the circumstances giving rise
to such suspension no longer exist, the obligation of such Bank to make
Eurodollar Rate Loans shall be suspended. If such Bank shall determine
that it may not lawfully continue to maintain and fund any of its
outstanding Eurodollar Rate Loans to maturity and shall so specify in such
notice, the Company shall immediately prepay in full the then outstanding
principal amount of each such Eurodollar Rate Loan, together with accrued
interest thereon. Concurrently with prepaying each such Eurodollar Rate
Loan, the Company shall borrow a Base Rate Loan or a CD Rate Loan as
determined by the Company from such Bank in a principal amount equal to the
principal amount of such affected Eurodollar Rate Loan for an Interest
Period coincident with the remaining term of the Interest Period applicable
to such affected Eurodollar Rate Loan and such Bank shall make such a Base
Rate Loan or CD Rate Loan, as the case may be."
2.7 Sections 10.1(a) and (b) of the Revolving Credit Agreement are amended
in their entirety to read as follows:
"(a) increase or extend the Commitment of any Bank (or reinstate any
Commitment pursuant to Section 2.9), extend the expiration date of any LC
to a date that is more than one year after the Termination Date, or subject
any Bank to any additional obligations;
(b) postpone or delay any date fixed for any payment of principal,
interest, fees or other amounts (including, without limitation, the payment
of any Reimbursement Obligations) due to the Banks (or any of them)
hereunder or under any other Related Document;"
2.8 Sections 10.1(d) and (e) of the Revolving Credit Agreement are
redesignated as Sections 10.1(e) and (f), respectively, and a new Section
10.1(d) is added as follows:
"(d) release any amounts paid pursuant to Section 2.7 of this
Agreement, except as expressly permitted by the terms of this Agreement;"
2.9 Section 10.4(b) of the Revolving Credit Agreement is amended in its
entirety to read as follows:
"(b) The reasonable costs and expenses which the Agent, the Issuing
Bank or any Bank incurs in any manner or way with respect to the following
shall be part of the Liabilities, payable by the Company within thirty (30)
days after demand if at any time after the date of this Agreement the
Agent, the Issuing Bank or any Bank, as the case may be: (i) reasonably
employs counsel for advice or other representation (A) to represent the
Agent, the Issuing Bank or such Bank, as the case may be, in any
litigation, contest, dispute, suit or proceeding or to commence, defend or
intervene or to take any other action in or with respect to any litigation,
contest, dispute, suit or proceeding (whether instituted by the Agent, the
Issuing Bank, such Bank, any other Bank, the Company or any other Person)
in any way or respect relating to this Agreement or the Related Documents,
(B) to enforce any of the Agent's, the Issuing Bank's or such Bank's, as
the case may be, rights with respect to the Company under this Agreement
and the Related Documents; and/or (ii) reasonably seeks to enforce or
enforces any of the Agent's, the Issuing Bank's or such Bank's, as the case
may be, rights and remedies with respect to the Company under this
Agreement and the Related Documents."
2.10 Section 10.12(a) of the Revolving Credit Agreement is amended by
adding the following sentence to the end of such Section 10.12(a):
"In addition to the foregoing, any Bank may, without the written consent of
the Company, assign or pledge all or any portion of such Bank's rights to
payment under its Note to a Federal Reserve Bank, provided that no such
assignment or pledge shall release such Bank from any of its obligations
under this Agreement."
Section 3. Effectiveness.
3.1 This Amendment shall become effective as of the date hereof upon the
execution and delivery of this Amendment and the Agent's having received (i) a
Promissory Note substantially in the form of Exhibit A hereto appropriately
completed and executed in favor of Bank One, which Promissory Note shall amend,
restate and replace in its entirety the existing Promissory Note in favor of
Bank One and (ii) a Promissory Note substantially in the form of Exhibit B
hereto appropriately completed and executed in favor of Fleet.
3.2 As soon as administratively possible after the date hereof, Bank One
shall deliver to the Agent, and the Agent shall deliver to the Company, the
existing Promissory Note in favor of Bank One, marked "Superseded."
Section 4. Representations and Warranties. Each of the representations
and warranties made by the Company in Section 6 of the Revolving Credit
Agreement is true and correct as of the date hereof with the same effect as
though made on the date hereof (except to the extent that such representations
and warranties expressly refer to an earlier date, in which case they shall be
true and correct as of such earlier date).
Section 5. No Default. No Event of Default, or event which, with the
giving of notice or lapse of time, or both, would constitute an Event of
Default, has occurred and is continuing.
Section 6. Governing Law. This Amendment shall be governed by and
interpreted in accordance with the laws of the State of Illinois, without regard
to its conflicts of laws rules.
Section 7. Headings. Section headings herein are included for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
Section 8. Execution in Counterparts. This Amendment may be executed
in any number of counterparts and by the different parties on separate
counterparts and each such counterpart shall be deemed to be an original, but
all such counterparts shall together constitute only one agreement.
IN WITNESS WHEREOF, the Company and each Bank have caused this Amendment to
be executed and delivered as of day and year first above written.
THE COMPANY: PIONEER FINANCIAL SERVICES, INC.
By:
Title:
THE AGENT: AMERICAN NATIONAL BANK AND TRUST
COMPANY OF CHICAGO
By:
Vice President
THE BANKS: AMERICAN NATIONAL BANK AND TRUST
COMPANY OF CHICAGO
By:
Vice President
FIRSTAR BANK MILWAUKEE, N.A.
By:
Title:
BANK ONE, ROCKFORD, NA
By:
Title:
FLEET NATIONAL BANK OF CONNECTICUT
By:
Title:
