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EXHIBIT 10.(J)
AMENDMENT NO. 1 TO AMENDED AND RESTATED LOAN
FACILITY AGREEMENT AND GUARANTY
THIS AMENDMENT NO. 1 TO AMENDED AND RESTATED LOAN FACILITY
AGREEMENT AND GUARANTY (this "Amendment") dated as of June __, 2000, by and
among XXXXX RENTS, INC., a Georgia corporation ("Sponsor"), each of the
financial institutions listed on the signature pages hereof (the "Participants")
and SUNTRUST BANK, a Georgia banking corporation, formerly known as SunTrust
Bank, Atlanta, as servicer (in such capacity, the "Servicer").
WITNESSETH:
WHEREAS, the Sponsor, Participants and Servicer, in order to
make available a loan facility to certain franchisees of Sponsor, entered into
that certain Amended and Restated Loan Facility Agreement and Guaranty dated as
of November 3, 1999 (as hereafter amended or modified, the "Loan Facility
Agreement") by and among Sponsor, Servicer and the Participants;
WHEREAS, in order to expedite the ongoing operations of the
loan facility, Sponsor and Servicer entered into that certain Servicing
Agreement, dated as of November 3, 1999 (as amended or modified from time to
time, the "Servicing Agreement") to set forth certain agreements regarding fees
and operations;
WHEREAS, the Sponsor has requested among other things (i) that
the Maximum Commitment Amount be increased to $70,000,000.00 (by increase of the
Participating Commitments of the existing Participants), and (ii) that the
Commitment Termination Date be extended to June __, 2001;
WHEREAS, the Sponsor, the Participants and the Servicer wish
to enter into this Amendment to set forth their understandings regarding the
amendments;
NOW, THEREFORE, for and in consideration of the mutual
premises contained herein and other valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
1. Definitions. All terms used herein without definition shall
have the meanings set forth for such terms in the Loan Facility Agreement.
2. Amendment to Section 1.1 of the Loan Facility Agreement.
Section 1.1 of the Loan Facility Agreement is hereby amended by deleting the
definitions of "Maximum Committed Amount", "Maximum Established Franchisee
Recourse Amount", "Payment Date" and "Wind-Down Event" and replacing them with
the following definitions:
"Maximum Commitment Amount" shall mean $70,000,000, as such amount may
be reduced pursuant to Section 2.7, Section 2.8 or Section 15.2.
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"Maximum Established Franchisee Recourse Amount" shall mean the greater
of (x) $20,000,000 and (y) two (2) times the largest aggregate amount
committed or loaned to any Borrower Group under the Franchisee Loan
Program, in each case as reduced by any amounts paid by Sponsor
pursuant to Section 10.3(c).
"Payment Date" shall mean the last day of each calendar month;
provided, however, if such day is not a Business Day, the next
succeeding Business Day
"Wind-Down Event" shall mean either (i) the event that the Commitments
are not extended for any reason and the Commitment Termination Date
occurs or (ii) the event that the Maximum Established Franchisee
Recourse Amount is, at any date of determination, less than
$20,000,000.
3. Amendment to Section 2.1 of the Loan Facility Agreement.
Section 2.1 of the Loan Facility Agreement is hereby amended by replacing
subsection 2.1(a) and subsection 2.1(b) with the following subsection 2.1(a) and
subsection 2.1(b):
(a) Startup Franchisee Commitment. Subject to and upon the terms
and conditions set forth in this Agreement and the other Operative
Documents, and in reliance upon the guaranty and other obligations of
the Sponsor set forth herein, the Servicer hereby establishes a
commitment to the Sponsor to establish Startup Franchisee Loan
Commitments and to make Advances thereunder to such Startup Franchisees
as may be designated by the Sponsor in its Funding Approval Notices
during a period commencing on the date hereof and ending on June __,
2001 (as such period may be extended for one or more subsequent 364-day
periods pursuant to Section 2.8, the "Commitment Termination Date") in
an aggregate committed amount at any one time outstanding not to exceed
SEVENTY MILLION AND NO/100 DOLLARS ($70,000,000) (the "Startup
Franchisee Commitment"); provided that, notwithstanding any provision
of this Agreement to the contrary, at no time shall the sum of
aggregate committed amounts of all Loan Commitments outstanding
pursuant to the Commitments, or, following the termination of any such
Loan Commitment, Advances outstanding thereunder, exceed the Maximum
Commitment Amount.
(b) Established Franchisee Commitment. Subject to and upon the
terms and conditions set forth in this Agreement and the other
Operative Documents, and in reliance upon the guaranty and other
obligations of the Sponsor set forth herein, the Servicer hereby
establishes a commitment to the Sponsor to establish Established
Franchisee Loan Commitments and to make Advances thereunder to such
Established Franchisees as may be designated by the Sponsor in its
Funding Approval Notices during a period commencing on the date hereof
and ending on the Commitment Termination Date in an aggregate committed
amount at any one time outstanding not to exceed SEVENTY MILLION AND
NO/100 DOLLARS
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($70,000,000) (the "Established Franchisee Commitment"); provided that,
notwithstanding any provision of this Agreement to the contrary, at no
time shall the sum of aggregate committed amounts of all Loan
Commitments outstanding pursuant to the Commitments, or, following the
termination of any such Loan Commitment, Advances outstanding
thereunder, exceed the Maximum Commitment Amount.
4. Amendment to Section 2.9 to the Loan Facility Agreement.
Section 2.9 of the Loan Facility is hereby amended by replacing subsection
2.9(b) with the following:
(b) In the event that the Maximum Established Franchisee Recourse
Amount is, at any date of determination, less than $20,000,000, then the Sponsor
shall not have the right to request that any further Established Franchisee Loan
Commitments be established; provided, however, that the occurrence of such
Wind-Down Event shall not affect the obligation of (x) the Servicer to make
Advances pursuant to existing Established Franchisee Loan Commitments, (y) the
Participants to fund their Participant's Interest as provided herein, or (z) the
Credit Parties under the Operative Documents.
5. Amendment to Section 10.2 of the Loan Facility Agreement.
Section 10.2 of the Loan Facility Agreement is hereby amended by replacing the
first paragraph of Section 10.2 with the following:
10.2 Limitation on Guaranty of Startup Franchisee Loans.
The obligation of the Sponsor pursuant to this Article 10 with respect
to the Startup Franchisee Loans shall be limited, as of any date of
determination, to an amount (the "Maximum Amount") equal to the greater
of (a) fifty percent (50%) of the aggregate outstanding principal
amount of the Startup Franchisee Loans on such date (after giving
effect to any payments, recoveries on Collateral or other recoveries
made by the Servicer or any Participant on such date with respect to
the Startup Franchisee Loans), (b) three (3) times the largest
aggregate amount of all Loan Commitments (or if the Loan Commitments
have been terminated, all outstanding Loans) made to any Startup
Franchisee Borrower and its Borrower Group and (c) $10,000,000;
provided that, the Maximum Amount shall not on any date of
determination exceed the aggregate outstanding Loan Indebtedness of the
Startup Franchisee Loans. As a material inducement to the Servicer's
and each Participant's entering into this Agreement, the parties hereto
expressly agree that the Maximum Amount shall be redetermined (and the
obligation of the Sponsor to pay such replenished Maximum Amount shall
be enforceable by the Servicer and the Participants hereunder) on each
day that any Loan Indebtedness remains outstanding pursuant to any
Startup Franchisee Loan regardless of (i) any previous payments made by
the Sponsor hereunder on any prior date, whether or not constituting
the Maximum Amount payable on such prior date, or (ii) the
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number of prior demands made by the Servicer or the Participants
hereunder; provided that, for purposes of calculating the Maximum
Amount, (x) any Defaulted Loan for which a demand has previously been
made, or deemed to have been made, pursuant to this Section 10.2 shall
not be deemed to be outstanding and (y) demand shall be deemed to have
been made with respect to each Defaulted Loan on the date on which the
Servicer is authorized to make a demand on the Sponsor with respect to
such Defaulted Loan pursuant to Section 4.3 or Section 4.4 of this
Agreement unless such Loan Default arises solely from the occurrence of
a Credit Event in which case demand shall be deemed to be made only
upon receipt of written request from the Servicer.
6. Amendment to Exhibit E to Loan Facility Agreement. Section
6(i) of the form of Startup Franchisee Loan Agreement attached as Exhibit E to
the Loan Facility Agreement is hereby deleted in its entirety and replaced by
the following Section 6(i):
(i) Rental Revenue to Debt Service. Commencing on the first day of
the calendar quarter in which the 25th month following the Opening Date
of the first store location of the Borrower occurs, and measured as of
the last day of the calendar quarter in which such 25th month occurs
and on the last day of each calendar quarter thereafter, the ratio of
the Borrower's Rental Revenue to Debt Service for such quarter shall
not be less than 2.2:1.00;
7. Conditions of Effectiveness. The effectiveness of this
Amendment (the date on which this amendment becomes effective is referred to
herein as, the "Effective Date") and the obligation of Servicer to make lines of
credit available to franchisees of Sponsor under the Loan Facility Agreement, as
amended hereby, and the obligation of each Participant to purchase its
participation therein, is subject to receipt by Servicer of each of the
following in form and substance satisfactory to Servicer and each of the
Participants:
(a) a fee in the amount of $45,000 in immediately
available funds, which the Sponsor agrees to pay on the date hereof;
(b) from each of the parties hereto a duly executed
counterpart of this Amendment;
(c) a certificate of Sponsor, dated as of the date
hereof, signed by the Secretary or Assistant Secretary of Sponsor, (i)
certifying as to names and true signatures of the officers of Sponsor
authorized to execute and deliver this Amendment, (ii) certifying that
Sponsor's articles of incorporation and bylaws delivered to Servicer on
November 3, 1999 have not been amended or modified and are in full
force and effect as of the date hereof, and (iii) certifying a true and
correct copy of the action taken by the Board of Directors or the
Sponsor authorizing the Sponsor's execution, delivery and performance
of this Amendment and the certificates referred to herein;
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(d) a certificate of the Secretary of State of the State
of Georgia as to the existence of the Sponsor as a Georgia corporation;
(e) a favorable written opinion of Xxxxxxxxxx Xxxxxxxx,
LLP, counsel for Sponsor and Guarantors, in form satisfactory to
Servicer and each Participant and covering such matters relating to the
transactions contemplated by this Amendment as Servicer may reasonably
request;
(f) a duly executed amendment to the Servicing Agreement;
and
(g) in addition, each of the Participants shall have
received a duly executed Participation Certificate from the Servicer.
8. Representations and Warranties of Sponsor. Sponsor, without
limiting the representations and warranties provided in the Loan Facility
Agreement, represents and warrants to the Participants and the Servicer as
follows:
(a) The execution, delivery and performance by Sponsor of
this Amendment are within Sponsor's corporate powers, have been duly
authorized by all necessary corporate action (including any necessary
shareholder action) and do not and will not (a) violate any provision
of any law, rule or regulation, any judgment, order or ruling of any
court or governmental agency, the articles of incorporation or by-laws
of Sponsor or any indenture, agreement or other instrument to which
Sponsor is a party or by which Sponsor or any of its properties is
bound or (b) be in conflict with, result in a breach of, or constitute
with notice or lapse of time or both a default under any such
indenture, agreement or other instrument.
(b) This Amendment constitutes the legal, valid and
binding obligations of Sponsor, enforceable against Sponsor in
accordance with their respective terms.
(c) No Unmatured Credit Event or Credit Event has
occurred and is continuing as of the Effective Date.
9. Survival. Each of the foregoing representations and warranties
and each of the representations and warranties made in the Loan Facility
Agreement shall be made at and as of the Effective Date. Each of the foregoing
representations and warranties shall constitute a representation and warranty of
Sponsor under the Loan Facility Agreement, and it shall be a Credit Event if any
such representation and warranty shall prove to have been incorrect or false in
any material respect at the time when made. Each of the representations and
warranties made under the Loan Facility Agreement (including those made herein)
shall survive and not be waived by the execution and delivery of this Amendment
or any investigation by the Participants or the Servicer.
10. No Waiver, Etc. Sponsor hereby agrees that nothing herein
shall constitute a
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waiver by the Participants of any Unmatured Credit Event or Credit Event,
whether known or unknown, which may exist under the Loan Facility Agreement.
Sponsor hereby further agrees that no action, inaction or agreement by the
Participants, including without limitation, any indulgence, waiver, consent or
agreement altering the provisions of the Loan Facility Agreement which may have
occurred with respect to the non-payment of any obligation during the terms of
the Loan Facility Agreement or any portion thereof, or any other matter relating
to the Loan Facility Agreement, shall require or imply any future indulgence,
waiver, or agreement by the Participants. In addition, Sponsor acknowledges and
agrees that it has no knowledge of any defenses, counterclaims, offsets or
objections in its favor against any Participant with regard to any of the
obligations due under the terms of the Loan Facility Agreement as of the date of
this Amendment.
11. Ratification of Loan Facility Agreement. Except as expressly
amended herein, all terms, covenants and conditions of the Loan Facility
Agreement and the other Operative Documents shall remain in full force and
effect, and the parties hereto do expressly ratify and confirm the Loan Facility
Agreement as amended herein. All future references to the Loan Facility
Agreement shall be deemed to refer to the Loan Facility Agreement as amended
hereby.
12. Ratification of Guaranty Agreement. The Guarantor hereby
ratifies and confirms that the Guaranty Agreement remains in full force and
effect and is hereby affirmed by the Guarantor.
13. Binding Nature. This Amendment shall be binding upon and inure
to the benefit of the parties hereto, their respective heirs, successors,
successors-in-titles, and assigns.
14. Costs, Expenses and Taxes. Sponsor agrees to pay on demand all
reasonable costs and expenses of the Servicer in connection with the
preparation, execution and delivery of this Amendment and the other instruments
and documents to be delivered hereunder, including, without limitation, the
reasonable fees and out-of-pocket expenses of counsel for the Servicer with
respect thereto and with respect to advising the Servicer as to its rights and
responsibilities hereunder and thereunder. In addition, Sponsor shall pay any
and all stamp and other taxes payable or determined to be payable in connection
with the execution and delivery of this Amendment and the other instruments and
documents to be delivered hereunder, and agrees to save the Servicer and each
Participant harmless from and against any and all liabilities with respect to or
resulting from any delay in paying or omission to pay such taxes.
15. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA.
16. Entire Understanding. This Amendment sets forth the entire
understanding of the parties with respect to the matters set forth herein, and
shall supersede any prior negotiations or agreements, whether written or oral,
with respect thereto.
17. Counterparts. This Amendment may be executed in any number of
counterparts
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and by different parties hereto in separate counterparts and may be delivered by
telecopier. Each counterpart so executed and delivered shall be deemed an
original and all of which taken together shall constitute but one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this
Amendment through their authorized officers as of the date first above written.
XXXXX RENTS, INC.
By:
---------------------------------
Name:
Title:
SUNTRUST BANK, FORMERLY KNOWN AS
SUNTRUST BANK, ATLANTA, as Servicer
By:
---------------------------------
Name:
Title:
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SUNTRUST BANK, FORMERLY KNOWN AS
SUNTRUST BANK, ATLANTA
By:
---------------------------------
Name:
Title:
Participating Commitment Amount: $20,000,000
Pro Rata Share: 28.57%
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BANK ONE, NA
By:
---------------------------------
Name:
Title:
Participating Commitment Amount: $12,666,667.00
Pro Rata Share: 18.10%
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FIRST UNION NATIONAL BANK
By:
---------------------------------
Name:
Title:
Participating Commitment Amount: $18,666,667.00
Pro Rata Share: 26.67%
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SOUTHTRUST BANK, N.A.
By:
---------------------------------
Name:
Title:
Participating Commitment Amount: $18,666,667.00
Pro Rata Share: 26.67%
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ACKNOWLEDGMENT OF GUARANTOR
The Guarantor acknowledges and agrees to the terms of the
foregoing Amendment, and further acknowledges and agrees that (i) all of the
obligations of the Sponsor shall continue to constitute "Guaranteed Obligations"
covered by Guaranty Agreement executed by the undersigned, and (ii) the Guaranty
Agreement is and shall remain in full force and effect on and after the date
hereof, and (iii) the foregoing agreement shall in no way release, discharge, or
otherwise limit the obligations of the undersigned Guarantor under the Guaranty
Agreement.
This Acknowledgment of Guarantor made and delivered as of June
__, 2000.
XXXXX INVESTMENT COMPANY
By:
----------------------------
Name:
Title:
