FOURTH AMENDMENT TO CREDIT AGREEMENT
THIS FOURTH AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is entered
into as of March 15, 1999, among LANCER PARTNERSHIP, LTD., a Texas limited
partnership ("Operating Subsidiary"), and LANCER DE MEXICO, S.A. de C.V.,
formerly known as NUEVA DISTRIBUIDORA LANCERMEX, S.A. de C.V., a corporation
organized under the laws of Mexico ("Mexico Subsidiary") (Operating Subsidiary
and Mexico Subsidiary are hereinafter referred to individually as a "Borrower"
and collectively as "Borrowers"); LANCER CORPORATION, a Texas corporation
("Parent Company"); LAN-LEASING, INC., a Delaware corporation, ("Lan-Leasing"),
LANCER CAPITAL CORPORATION, a Delaware corporation ("Lancer Capital") and LANCER
INTERNATIONAL SALES, INC., a Texas corporation ("Lancer International")
(Lan-Leasing, Lancer Capital, Lancer International and Operating Subsidiary,
individually, a "Guarantor" and collectively, the "Guarantors"); and THE FROST
NATIONAL BANK, a national banking association, individually and as agent for the
Banks acting in the manner and to the extent provided in Article 8 of the Credit
Agreement described below (in such capacity, the "Agent"), NATIONSBANK, N.A., a
national banking association, successor to THE BOATMEN'S NATIONAL BANK OF ST.
LOUIS, a national banking association, individually, and each of the lenders
which becomes a party hereto as provided in Section 10.7 (individually, a "Bank"
and collectively, the "Banks").
Recitals
I. Borrowers, the Parent Company, the Agent and the other Banks have
heretofore entered into the Credit Agreement dated as of July 15, 1996 (as
amended, modified, restated and supplemented from time to time, the "Credit
Agreement").
II. Borrower has requested that the Banks agree to modify certain of the
covenants contained in Section 6.1(b) of the Credit Agreement.
III. The Banks are willing to agree to such requested change on the terms and
conditions set forth in this Amendment.
Agreements
In consideration of the foregoing premises, the mutual agreements
contained herein and other good and valuable consideration and reasonably
equivalent value, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:
A. Definitions. Unless otherwise defined herein, terms defined in
the Credit Agreement and used herein shall have the respective
meanings set forth in the Credit Agreement.
B. Amendments. The Credit Agreement is hereby amended as follows:
1. Section 6.1(b) is hereby amended to read in its entirety as
follows:
(b) the ratio of (i) EBIT of the Companies determined on a
consolidated basis to (ii) the interest expense of the
Companies determined on a consolidated basis, for the
four-quarter period ending as of the end of such Fiscal
Quarter, to be less than set out below opposite the period in
which such Fiscal Quarter ends; provided, however, for each
Fiscal Quarter in which an Acquisition is consummated, and
each Fiscal Quarter ending prior thereto, the financial
information necessary to determine the foregoing ratio shall
be adjusted to reflect, on a pro forma basis, such Acquisition
as if it had occurred as of the beginning of the first of such
Fiscal Quarters included in the relevant four-quarter
measurement period; or
Fiscal Quarters Ended On or About Ratio
3/15/99 through 9/30/99 2.75 to 1.00
10/1/99 through 7/15/01 3.00 to 1.00
4. Exhibit M -- Compliance Certificate is hereby amended to
incorporate the following change to the "Minimum Ratio" for
purposes of Section 6.1(b) of the Credit Agreement
(EBIT/INTEREST RATIO COMPANIES) as set forth therein:
Fiscal Quarters Ended On or About Ratio
3/15/99 through 9/30/99 2.75 to 1.00
10/1/99 through 7/15/01 3.00 to 1.00
C. In order to induce the Agent and the Banks to enter into this
Amendment, each Borrower hereby represents and warrants to the Agent and the
Banks that, as of the date of this Amendment, (a) the representations and
warranties set forth in the Credit Agreement and each other Loan Document are
true and correct as if made on and as of the date hereof (other than those
representations and warranties expressly limited by their terms to a specific
date), (b) no Default or Event of Default has occurred and is continuing, and
(c) no event has occurred since the date of the most recent financial statements
delivered pursuant to Section 5.1 of the Credit Agreement that has caused a
Material Adverse Effect.
D. Each Borrower hereby acknowledges and agrees that no facts events
status or conditions presently exist which, either now or with the passage of
time or the giving of notice or both, presently constitute or will constitute a
basis for any claim or cause of action against any of the Banks, or any defense
to the payment of any of the indebtedness evidenced or to be evidenced by any of
the Loan Documents.
E. Parent Company covenants and agrees that, as to the Parent Guaranty
executed and delivered by Parent Company in favor of the Banks as part of the
Loan Documents, (a) the Parent Guaranty is an unconditional guarantee of payment
and performance and not of collection, (b) the Parent Guaranty represents the
primary, absolute and unconditional obligation of Parent Company and (c) the
Parent Guaranty is a continuing guarantee and shall remain in full force and
effect until the termination of the obligations of the Banks to make Loans and
the indefeasible payment in full of the Obligations (as defined in the Parent
Guaranty).
F. Each of the undersigned Guarantors covenants and agrees that, as to
the Affiliate Guaranty executed and delivered by such Guarantor in favor of the
Banks as part of the Loan Documents, (a) such Affiliate Guaranty is an
unconditional guarantee of payment and performance and not of collection, (b)
such Affiliate Guaranty represents the primary, absolute and unconditional
obligation of such Guarantor, and (c) such Affiliate Guaranty is a continuing
guarantee and shall remain in full force and effect until the termination of the
obligations of the Banks to make Loans and the indefeasible payment in full of
the Obligations (as defined in each such Affiliate Guaranty).
G. As to the Stock Pledge Agreement executed and delivered by Parent
Company in favor of the Banks as a part of the Loan Documents, Parent Company
hereby ratifies and confirms the liens and security interests of the Banks in
and to all collateral covered by the Stock Pledge Agreement as security for the
prompt and full payment and performance of the obligations secured by the Stock
Pledge Agreement. In furtherance of the foregoing, all liens and security
interests of the Stock Pledge Agreement (which are hereby acknowledged to be
valid and subsisting) are hereby carried forward, continued, extended, modified
and renewed to secure the prompt and full payment and performance of the
obligations secured by the Stock Pledge Agreement.
H. Each Loan Document is hereby amended and modified to the extent
necessary to give full force and effect to the terms of this Amendment, and each
such Loan Document shall hereafter be construed and interpreted after giving
full force and effect to the terms of this Amendment. As amended, modified and
supplemented pursuant to this Amendment, each Borrower, Parent Company and each
Guarantor hereby ratify, confirm and restate each Loan Document and agrees that
each such Loan Document to which it is a party shall continue in full force and
effect. Each of the Loan Documents now or hereafter executed and delivered
pursuant to the terms hereof or pursuant to the terms of the Credit Agreement,
as amended hereby, or as further evidence of or in connection with the Credit
Agreement, as amended hereby, are hereby amended to the extent necessary so that
any reference in any such documents, instruments or agreements to the Credit
Agreement shall be a reference to the Credit Agreement as amended hereby.
I. In the event that any one or more of the provisions contained in
this Amendment shall be determined invalid, illegal or unenforceable in any
respect for any reason, the validity, legality and enforceability of any such
provision or provisions in every other respect and the remaining provisions of
this Amendment shall not be impaired in any way.
J. When required or implied by the context used, defined terms used
herein shall include the plural as well as the singular, and vice versa.
K This Amendment shall be governed by and construed in accordance with
the internal laws of the State of Texas and applicable federal laws of the
United States of America. This Amendment has been entered into in Bexar County,
Texas and shall be performable for all purposes in Bexar County, Texas. The
courts within the State of Texas shall have jurisdiction over any and all
disputes arising under or pertaining to this Amendment; and any such dispute
shall be heard in the county or judicial district of the principal place of
business of The Frost National Bank.
L. This Amendment shall be binding upon and inure to the benefit of all
parties hereto and their respective successors and assigns; provided, however,
that neither of the Borrowers nor any of their respective successors or assigns
may, without the prior written consent of all of the Banks, assign any rights,
powers, duties or obligations hereunder.
M. This Amendment may be executed in any number of counterparts and by
different parties hereto on separate counterparts, each of which when so
executed shall be deemed to be an original and all of which when taken together
shall constitute but one and the same instrument.
N. This Amendment constitutes a Loan Document.
O. Upon execution of this Amendment by the Banks, or within forty-five
days thereafter, each Borrower, Parent Company and each of the Guarantors shall
deliver to the Agent, in form and substance satisfactory to the Agent, the
certificates and documents described on Annex B, if any.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective authorized signatories as of the day and year
first above written.
OPERATING SUBSIDIARY:
LANCER PARTNERSHIP, LTD., a Texas
limited partnership
By: Lancer Capital Corporation, a Delaware
corporation, general partner
By:/s/Xxxxx Xxxxx
Name:Xxxxx Xxxxx
Title:Treasurer
MEXICO SUBSIDIARY:
LANCER DE MEXICO, S.A. de C.V., formerly known as NUEVA DISTRIBUIDORA LANCERMEX,
S.A. de C.V.
By:/s/Xxxxx Xxxxx
Name:Xxxxx Xxxxx
Title:Secretary
PARENT COMPANY:
LANCER CORPORATION
By:/s/Xxxxx Xxxxx
Name:Xxxxx Xxxxx
Title:Treasurer
GUARANTORS:
LAN-LEASING, INC.
By:/s/Xxxxx Xxxxx
Name:Xxxxx Xxxxx
Title:Vice President
LANCER CAPITAL CORPORATION
By:/s/Xxxxx Xxxxx
Name:Xxxxx Xxxxx
Title:Treasurer
LANCER INTERNATIONAL SALES, INC.
By:/s/Xxxxx Xxxxx
Name:Xxxxx Xxxxx
Title:Treasurer
LANCER PARTNERSHIP, LTD., a Texas
limited partnership
By: Lancer Capital Corporation, a Delaware
corporation, general partner
By:/s/Xxxxx Xxxxx
Name:Xxxxx Xxxxx
Title:Treasurer
AGENT/BANKS:
THE FROST NATIONAL BANK,
Individually and as the Agent
By:/s/Xxxx Xxxxxxx
Name:Xxxx Xxxxxxx
Title:Sr. VicePresident
NATIONSBANK, N.A.,
a national banking association,
successor to THE BOATMEN'S
NATIONAL BANK OF ST. LOUIS
By:/s/Xxxxxx X. Xxxxx
Name:Xxxxxx X. Xxxxx
Title:VicePresident
ANNEX B
1. Each Borrower, Parent Company and each Guarantor shall have provided
to the Agent a certificate signed by the secretary of such corporation, which
secretary's office and signature shall be confirmed by another officer of such
corporation, dated as of the effective date of this Amendment attaching thereto
or containing therein, and certifying as to the following: (i) corporate
resolutions, as in effect and neither revoked nor rescinded, duly adopted by the
board of directors of such corporation authorizing the execution, delivery and
performance of this Amendment and all other documents, instruments and
agreements in connection therewith (the "Amendment Documents") to which it is or
will be a party, and the transactions contemplated thereby; and (ii) names,
incumbency and specimen signatures of the officers of such corporation
authorized to execute and deliver the Amendment Documents to which such
corporation is a party.
2. Each Guarantor shall have executed and delivered to each Bank a
Reaffirmation of Guaranty.
3. All other documents requested by the Agent in connection with this
Amendment.
