EXHIBIT 4.6
CREDIT AGREEMENT
By and Between
TYLER TECHNOLOGIES, INC.
and
BANK OF TEXAS, N.A.
Dated as of February 27, 2002
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS.............................................................................................1
ARTICLE II THE CREDIT facility...................................................................................13
SECTION 2.1. COMMITMENT.......................................................................................13
SECTION 2.2. BORROWING PROCEDURE..............................................................................14
ARTICLE III INTEREST RATE PROVISIONS.............................................................................15
SECTION 3.1. INTEREST RATE DETERMINATION......................................................................15
SECTION 3.2. ADDITIONAL INTEREST RATE PROVISIONS..............................................................16
ARTICLE IV PREPAYMENTS AND OTHER PAYMENTS........................................................................17
SECTION 4.1. REQUIRED PAYMENTS................................................................................17
SECTION 4.2. OPTIONAL PREPAYMENTS.............................................................................18
SECTION 4.3. NOTICE OF PAYMENTS...............................................................................18
SECTION 4.4. PLACE OF PAYMENT OR PREPAYMENT...................................................................18
SECTION 4.5. NO PREPAYMENT PREMIUM OR PENALTY.................................................................18
SECTION 4.6. INCREASED COSTs..................................................................................18
SECTION 4.7. TAXES............................................................................................19
SECTION 4.8. REDUCTION OR TERMINATION OF THE COMMITMENT.......................................................20
SECTION 4.9. PAYMENTS ON BUSINESS DAY.........................................................................20
ARTICLE V COMMITMENT FEE AND OTHER FEES..........................................................................20
SECTION 5.1. COMMITMENT FEES..................................................................................21
SECTION 5.2. FEES NOT INTEREST; NONPAYMENT....................................................................21
ARTICLE VI REPRESENTATIONS AND WARRANTIES........................................................................21
SECTION 6.1. ORGANIZATION AND QUALIFICATION; SUBSIDIARIES.....................................................21
SECTION 6.2. AUTHORIZATION....................................................................................22
SECTION 6.3. NO CONFLICTS.....................................................................................22
SECTION 6.4. ENFORCEABILITY...................................................................................22
SECTION 6.5. ACCURACY OF INFORMATION; NO MATERIAL ADVERSE CHANGE..............................................22
SECTION 6.6. TAXES............................................................................................23
SECTION 6.7. LITIGATION AND OTHER PROCEEDINGS.................................................................23
SECTION 6.8. NO DEFAULTS......................................................................................23
SECTION 6.9. SOLVENCY.........................................................................................24
SECTION 6.10. REPRESENTATIONS AND WARRANTIES..................................................................24
SECTION 6.11. MARGIN REGULATIONS..............................................................................24
SECTION 6.12. LICENSES, PERMITS, TRADEMARKS, ETC..............................................................24
SECTION 6.13. COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS.......................................................24
SECTION 6.14. ERISA...........................................................................................24
SECTION 6.15. TITLE TO PROPERTIES.............................................................................25
SECTION 6.16. BURDENSOME CONTRACTS............................................................................25
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PAGE
ARTICLE VII CONDITIONS...........................................................................................25
SECTION 7.1. CONDITIONS TO INITIAL ADVANCE....................................................................25
SECTION 7.2. CONDITIONS TO EACH LOAN, CONTINUATION OR CONVERSION..............................................27
ARTICLE VIII AFFIRMATIVE COVENANTS...............................................................................28
SECTION 8.1. FINANCIAL STATEMENTS AND INFORMATION.............................................................28
SECTION 8.2. MAINTENANCE OF EXISTENCE AND GOOD STANDING.......................................................29
SECTION 8.3. COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS........................................................29
SECTION 8.4. PAYMENT OF OBLIGATIONS...........................................................................29
SECTION 8.5. NOTIFICATION OF MATERIAL ADVERSE CHANGE..........................................................30
SECTION 8.6. NOTIFICATION OF DEFAULTS.........................................................................30
SECTION 8.7. NOTIFICATION OF EXCHANGE ACT FILINGS.............................................................30
SECTION 8.8. NOTIFICATION OF PROCEEDINGS AFFECTING COLLATERAL.................................................30
SECTION 8.9. ADDITIONAL INFORMATION...........................................................................30
SECTION 8.10. BOOKS AND RECORDS...............................................................................31
SECTION 8.11. INSURANCE.......................................................................................31
SECTION 8.12. DEPOSIT RELATIONSHIP............................................................................31
ARTICLE IX NEGATIVE COVENANTS....................................................................................31
SECTION 9.1. DEBT.............................................................................................31
SECTION 9.2. LIENS............................................................................................32
SECTION 9.3. ORGANIZATIONAL DOCUMENTS.........................................................................32
SECTION 9.4. NO SUBSIDIARIES..................................................................................32
SECTION 9.5. DIVIDENDS........................................................................................33
SECTION 9.6. ACQUISITIONS.....................................................................................33
SECTION 9.7. MERGERS, CONSOLIDATIONS, ETC.....................................................................33
SECTION 9.8. CHANGE OF NAME...................................................................................33
SECTION 9.9. FINANCIAL COVENANTS..............................................................................33
SECTION 9.10. INVESTMENTS.....................................................................................34
SECTION 9.11. SUBORDINATED DEBT; SELLER NOTE..................................................................34
SECTION 9.12. CHARACTER OF BUSINESS...........................................................................34
ARTICLE X EVENTS OF DEFAULT; REMEDIES............................................................................34
SECTION 10.1. EVENTS OF DEFAULT...............................................................................34
SECTION 10.2. REMEDIES........................................................................................35
SECTION 10.3. CERTAIN OTHER REMEDIAL MATTERS..................................................................36
ARTICLE XI MISCELLANEOUS.........................................................................................36
SECTION 11.1. WAIVERS, ETC....................................................................................36
SECTION 11.2. REIMBURSEMENT OF EXPENSES.......................................................................37
SECTION 11.3. VENUE...........................................................................................37
SECTION 11.4. NOTICES.........................................................................................37
SECTION 11.5. GOVERNING LAW...................................................................................38
SECTION 11.6. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS...........................................38
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PAGE
SECTION 11.7. COUNTERPARTS; EXECUTION BY FACSIMILE TRANSMISSION...............................................38
SECTION 11.8. SEPARABILITY....................................................................................38
SECTION 11.9. DESCRIPTIVE HEADINGS............................................................................39
SECTION 11.10. SETOFF.........................................................................................39
SECTION 11.11. SUCCESSORS AND ASSIGNS; PARTICIPATIONS.........................................................39
SECTION 11.12. INTEREST.......................................................................................40
SECTION 11.13. INDEMNIFICATION................................................................................40
SECTION 11.14. PAYMENTS SET ASIDE.............................................................................42
SECTION 11.15. AMENDMENTS, ETC................................................................................42
SECTION 11.16. RELATIONSHIP OF THE PARTIES....................................................................42
SECTION 11.17. CERTAIN MATTERS OF CONSTRUCTION................................................................43
SECTION 11.18. FINAL AGREEMENT................................................................................43
iii
CREDIT AGREEMENT
Tyler Technologies, Inc. a Delaware corporation ("Borrower") and Bank
of
Texas, N.A., a national banking association ("Lender"), hereby agree as
follows:
ARTICLE I
DEFINITIONS
As used herein, the following words and terms shall have the respective
meanings indicated opposite each of them:
"Accounts Receivable" shall mean all of Borrower's and Guarantors'
accounts, instruments, contract rights, chattel paper, documents, and general
intangibles arising from the sale of goods and/or the rendition of services by
Borrower or any Guarantor in the ordinary course of business, and the proceeds
thereof and all security and guaranties therefor, whether now existing or
hereafter created, and all returned, reclaimed or repossessed goods, and all
books and records pertaining to the foregoing.
"Acquisition" shall mean any transaction or series of related
transactions in which Borrower acquires all or substantially all of the stock or
other equity interests in, or all or substantially all of the assets of, any
Person or, in the case of a Person that is a corporation or other business
entity, any division thereof.
"Additional Costs" shall mean, with respect to any Rate Period in the
case of any LIBOR Rate Portion, all costs, losses or payments, as reasonably
determined by Lender in its sole and absolute discretion, that Lender incurs,
suffers or makes by reason of any increase in the cost to Lender of agreeing to
make or making, funding or maintaining any LIBOR Rate Portion because of or
arising from (a) the introduction of, or any change in or in the interpretation
or administration of, any law or regulation or (b) the compliance with any
request from any central bank or other Governmental Authority (whether or not
having the force of law).
"Adjusted LIBOR Rate" shall mean with respect to a LIBOR Rate Portion
on the first day of the Rate Period, a rate per annum equal to the sum of (a)
the quotient of (i) the LIBOR Rate on the first day of the Rate Period, divided
by (ii) the remainder of 1.00 minus the LIBOR Reserve Requirement, if any, on
the first day of the Rate Period, plus (b) the FDIC Percentage in effect on
first day of the Rate Period, together with any additional impositions,
assessments, fees or surcharges that may be imposed on Lender (expressed as a
percentage), to the extent such impositions, assessments, fees or surcharges are
not reflected in the FDIC Percentage or the LIBOR Reserve Requirement and are
generally imposed on banks with capitalization and supervisory risk factors
comparable to Lender, plus (c) the Applicable Margin.
"Advance" means a borrowing hereunder, (a) made by Lender on a
Borrowing Date, or (b) converted or continued by Lender on the same date of
conversion or continuation, consisting, in either case, of the aggregate amount
of Advances of the same Type and for the same Rate Period.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 1
"Affiliate" shall mean any Person controlled by, controlling or under
common control with Borrower provided, that HTE, Inc. will not be deemed to be
an Affiliate of Borrower or any of Borrower's Subsidiaries solely by reason of
Borrower's ownership of the 5,619,000 shares of the common stock of HTE, Inc.
owned by Borrower on the date of this Agreement unless and until (a) such shares
constitute more than fifty percent (50%) of the shares of the capital stock of
HTE, Inc. entitled to vote in the election of directors, (b) all restrictions
imposed by Florida state corporation law on Borrower's right to vote such shares
are removed by the requisite vote of the shareholders (other than Borrower) of
HTE, Inc., or by a final, nonappealable order of a court of competent
jurisdiction or otherwise, and (c) Borrower's ownership of such shares is
confirmed by a final, nonappealable order of a court of competent jurisdiction
in the proceedings to which reference is made in clause (b)(iii) of Section 6.7
or such ownership is otherwise not subject to any claim or restriction arising
out of the proceedings referenced in such clause (b)(iii) of Section 6.7.
"Agreement" shall mean this
Credit Agreement, as the same may be
amended, modified or supplemented from time to time.
"Applicable Margin" means the margin related to LIBOR Rate Portions as
set forth in Schedule I attached hereto.
"Authorized Officer" shall mean, as to any Person, the Chairman, the
President, Chief Executive Officer, Chief Financial Officer, Vice President,
Treasurer or other officer duly authorized by the board of directors of such
Person.
"Bankruptcy Code" shall mean the United States Bankruptcy Code of 1978,
as amended, and any successor statute.
"Base Rate" means the prime rate of interest announced or published by
XX Xxxxxx Xxxxx Bank from time to time, and may not be the lowest interest rate
charged by XX Xxxxxx Chase Bank.
"Base Rate Portion" shall mean any Loan which bears interest at the
Base Rate.
"Borrower" shall have the meaning set forth in the first paragraph of
this Agreement.
"Borrowing Base" shall mean eighty percent (80%) of Eligible Accounts
Receivable, as shown in the monthly Borrower Base Report.
"Borrowing Base Report" shall mean the monthly report relating to the
Borrowing Base delivered pursuant to this Agreement and in substantially the
form of Exhibit A hereto.
"Borrowing Date" shall mean a date upon which Borrower has an Advance
delivered pursuant to Section 2.2(a) or a Letter of Credit issued pursuant to
Section 2.2(b).
"Business Day" shall mean a day when Lender is open for business,
provided that, if the applicable Business Day relates to any LIBOR Rate Portion,
it shall mean a day when Lender is
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 2
open for business and on which commercial banks are open for international
business (including dealings in Dollar deposits) in London.
"Capital Expenditures" means the expenditures of any Person which are
capitalized on the balance sheet of such Person in accordance with GAAP
(including that portion of Capitalized Lease Obligations which should be
capitalized on a balance sheet of such Person in accordance with GAAP) and which
are made in connection with the purchase, construction or improvement of items
properly classified on such balance sheet as property, plant, equipment or other
fixed assets or intangibles.
"Capitalized Lease" means, as to any Person, a lease of (or other
agreement conveying the right to use) real and/or personal property to such
Person as lessee, with respect to which the obligations of such Person to pay
rent or other amounts are required to be classified and accounted for as a
capital lease on a balance sheet of such Person in accordance with GAAP
(including Statement of Financial Accounting Standards No. 13 of the Financial
Accounting Standards Board).
"Capitalized Lease Obligations" means, as to any Person, the obligation
of such Person to pay rent or other amounts under a Capitalized Lease and, for
purposes of this Agreement, the amount of such obligation shall be the
capitalized amount thereof, determined in accordance with GAAP.
"Closing Date" shall mean the date on which each of the conditions set
forth in Section 7.1 have been satisfied.
"Code" shall mean the Internal Revenue Code of 1986, as amended, as now
or hereafter in effect, together with all regulations, rulings and
interpretations thereof or thereunder issued by the Internal Revenue Service.
"Collateral" shall have the meaning set forth in the Security
Agreements, the Pledge Agreements and any other Loan Document which grants a
Lien in favor of Lender as security for the Obligations, but shall exclude, in
each instance, (a) the Excluded Collateral, (b) subject to the provisions of
section 7.2(e), the real property and improvements, owned by Borrower and
located at 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx, and (c) subject to the provisions
of Section 7.2(e), the real property and improvements, owned by Xxxx Layer
Xxxxxxx Company, a wholly-owned Subsidiary of Borrower, and located at 0000
Xxxxxxxxx Xxxx, Xxxxxx, Xxxx.
"Commitment" shall mean the obligation of Lender to make Advances or
issue Letters of Credit pursuant to this Agreement in an aggregate amount of
principal outstanding at any time and Letter of Credit Exposure not to exceed
$8,000,000, as the same may be increased with the express written consent of
Lender or decreased pursuant to the terms of this Agreement.
"Contingent Obligation" shall mean, with respect of any Person, any
obligation of such Person guaranteeing or intended to guarantee any Debt or
other obligation (the "primary obligation") of any other Person (the "primary
obligor") in any manner, whether directly or indirectly, including, without
limitation, any obligation of such Person, whether or not contingent, (a) to
purchase any such primary obligation or any property constituting direct or
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 3
indirect security therefor, (b) to advance or supply funds (i) for the purchase
or payment of any such primary obligation or (ii) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (c) to purchase property, securities or
services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such primary
obligation or (d) otherwise to assure or hold harmless the owner of any such
primary obligation against loss in respect thereof; provided, that
notwithstanding the foregoing, the term Contingent Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business. The amount of any Contingent Obligation of any Person shall be the
amount of the primary obligation or such lesser amount to which the maximum
exposure of such Person shall have been specifically limited.
"Contribution Agreement" means the contribution agreement, executed by
each Guarantor in favor of the other Guarantors and approved by Lender, as
required by this Agreement and as it may from time to time be renewed, extended,
amended and restated.
"Conversion/Continuation Date" shall have the meaning set forth in
Section 3.1(b).
"Credit Period" shall mean the period commencing on the Closing Date
and ending on the Termination Date, or such earlier date of termination of
Lender's obligation to make Advances or issue Letters of Credit hereunder.
"Current Maturities" shall mean, with respect to any Person, on any
date of calculation, the current liabilities of such Person attributable to the
principal portion of its long-term debt, determined in accordance with GAAP.
"Debt" shall mean, with respect to any Person at any time, without
duplication, (a) indebtedness for borrowed money or for the deferred purchase
price of property or services purchased, excluding trade accounts payable within
120 days after the creation thereof, (b) all indebtedness of others for borrowed
money or for the deferred purchase price of property or services secured by a
Lien on any property owned by such Person, whether or not such indebtedness has
been assumed by such Person, (c) Capitalized Lease Obligations, (d) all
obligations payable out of the proceeds of production from property of such
Person, whether or not the obligation secured thereby shall have been assumed by
such Person, and (e) Contingent Obligations of such Person.
"Default" shall mean any of the events specified in Section 10.1,
whether or not there has been satisfied any requirement in connection with such
event for the giving of notice, or the lapse of time, or the happening of any
further condition, event or act.
"Dollars" and "$" shall mean lawful currency of the United States of
America.
"Distribution" by any Person, shall mean (a) with respect to any stock
issued by such Person or any partnership or joint venture interest of such
person, the retirement, redemption, repurchase, or other acquisition for value
of such stock, partnership or joint venture interest, (b) the declaration or
payment (without duplication) of any dividend or other distribution, whether
monetary or in kind, on or with respect to any stock, partnership or joint
venture of any Person,
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 4
and (c) any other payment or distribution of assets of a similar nature or in
respect of an equity investment.
"EBITDA" shall mean, for any period, determined in accordance with GAAP
for Borrower and its Subsidiaries on a consolidated basis, the sum of net
income, less income or plus loss from discontinued operations and extraordinary
items, plus income taxes, plus depreciation, plus amortization, plus interest
expense, plus any other non-cash expenses, each as deducted in determining such
net income.
"Eligible Account Receivable" shall mean, at the time of any
determination thereof, each Account Receivable as to which the following
requirements have been fulfilled to the satisfaction of Lender:
(a) Borrower or a Guarantor has lawful and absolute title to
such Account Receivable;
(b) Such Account Receivable is a valid, legally enforceable
obligation of the Person who is obligated under such Account Receivable
(the "account debtor") for goods or services previously delivered or
rendered to such Person by Borrower or such Guarantor;
(c) There has been excluded from such Account Receivable any
portion that is subject to any dispute, offset, counterclaim or other
claim or defense on the part of the account debtor or to any claim on
the part of the account debtor denying liability under such Account
Receivable;
(d) Borrower or such Guarantor has the full and unqualified
right to assign and grant a security interest in such Account
Receivable to Lender as security for the Obligations;
(e) Such Account Receivable is payable in Dollars and is
evidenced by an invoice rendered to the account debtor and such Account
Receivable is not evidenced by any chattel paper, promissory note or
other instrument;
(f) Such Account Receivable is subject to a fully perfected
first priority security interest in favor of Lender, pursuant to the
Loan Documents, prior to the rights of, and enforceable as such
against, any other Person (including holders of a purchase money
security interest);
(g) Such Account Receivable is not subject to any lien in
favor of any Person other than the lien of Lender pursuant to the Loan
Documents, including, without limitation, any Lien described in Section
9.2(i), whether or not such Lien is permitted under Section 9.2(i);
(h) Such Account Receivable arose from a transaction in the
ordinary course of business of Borrower or such Guarantor;
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 5
(i) Such Account Receivable has not been due and payable for
more than ninety (90) days from the invoice date;
(j) No account debtor in respect of such Account Receivable is
(i) primarily conducting business in any jurisdiction located outside
the United States of America, (ii) any foreign government, (iii) an
Affiliate of Borrower or such Guarantor, (iv) the subject of a
proceeding under any Debtor Relief Laws, or (v) the United States of
America;
(k) No account debtor in respect of such Account Receivable is
an account debtor on other Accounts Receivable of Borrower or any
Guarantor and either (i) more than five percent (5%) of all such other
Accounts Receivable have been due and payable for more than ninety (90)
days, or (ii) the aggregate of such account debtor's Accounts
Receivables is more than ten percent (10%) of all Accounts Receivable
(provided, that only the amount of the excess of such Accounts over
such ten percent (10%) shall be excluded as ineligible by virtue of
this clause (ii)); and
(l) Lender has not determined in good faith that there is a
legitimate concern with respect to the timing or collection of such
Account Receivable.
"Environmental Laws" shall mean any and all Governmental Requirements
relating to: (a) the environment, which includes, without limitation, ambient
air, surface water, ground water, land surface or subsurface strata; (b)
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals or industrial, toxic or hazardous substances or wastes
into the environment; or (c) otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, chemicals or industrial, toxic or hazardous substances
or wastes.
"ERISA" shall have the meaning set forth in Section 6.14.
"Event of Default" shall mean any of the events specified in Section
10.1, provided that there has been satisfied any requirement in connection with
such event for the giving of notice, or the lapse of time, or the happening of
any further condition, event or act.
"Excluded Collateral" means the capital stock of the Excluded
Subsidiaries and the assets of the Excluded Subsidiaries.
"Excluded Subsidiaries" means TPI and Swan.
"Existing Subsidiaries" means Appraisal Records Services, Inc., a
Texas
corporation; Automated Records Services, Inc., a
Texas corporation; Xxxx Layer
Xxxxxxx Company, a Delaware corporation; Eagle Computer Systems, Inc., a
Delaware corporation; FundBalance, Inc., a Delaware corporation; Interactive
Computer Designs, Inc., a
Texas corporation; MUNIS, Inc., a Maine corporation;
XxxxxxxXxxx.xxx, Inc., a Delaware corporation; The Software Group, Inc., a
Texas
corporation; and Tyler Leasing, Inc., a Delaware corporation, but does not
include the Excluded Subsidiaries.
"Expiration Date" shall mean the last day of a Rate Period.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 6
"FDIC Percentage" shall mean, on any day, the net assessment rate
(expressed as a percentage rounded to the next highest 1/100 of 1%), if any,
which is in effect on such day (under the regulations of the Federal Deposit
Insurance Corporation or any successor) for determining the assessments paid by
Lender to the Federal Deposit Insurance Corporation (or any successor) for
insuring Eurocurrency deposits made in Dollars at Lender's principal offices.
Each determination of said percentage made by Lender shall, in the absence of
manifest error, be binding and conclusive.
"Fixed Charge Coverage" shall mean the ratio of (i) EBITDA less cash
paid for taxes and less Capital Expenditures to (ii) the sum of Current
Maturities plus Interest Expense plus the Current Maturities of Capitalized
Lease Obligations (without duplication of Interest Expense).
"Funded Debt" shall mean all outstanding liabilities for borrowed money
and other interest-bearing liabilities, including current and long-term Debt,
and unfunded commitments under any outstanding letters of credit.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board, which principles are applicable to the
circumstances in question as of the date of determination, except as to the
financial statements delivered pursuant to Section 8.1(b), subject to (a)
changes resulting from year-end adjustments and (b) any non-conformity with such
generally accepted accounting principles as a result of the absence of any
footnotes required by such generally accepted accounting principles.
"Governmental Authority" shall mean any government, any state or other
political subdivision thereof, or any Person exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.
"Governmental Requirement" means any law, statute, code, ordinance,
order, rule, regulation, judgment, decree, injunction, writ, edict, franchise,
permit, certificate, license, award, authorization or other direction,
guideline, or requirement of any Governmental Authority, including, without
limitation, any requirement under common law.
"Guarantor" shall mean each of the Existing Subsidiaries and any other
Subsidiary executing a Guaranty of the Obligations in favor of Lender; provided,
however, that neither of the Excluded Subsidiaries shall be deemed to be, or
required to become, a Guarantor.
"Guaranty" shall mean the continuing guaranty of payment and
performance of the Obligations, executed by each Guarantor in favor of Lender,
as it may from time to time be renewed, extended, amended or restated.
"Highest Lawful Rate" shall mean, with respect to Lender, the maximum
non-usurious interest rate, if any, that at any time or from time to time may be
contracted for, taken, reserved, charged, or received with respect to the Loan
and Note or on other amounts, if any, due to Lender pursuant to this Agreement
or any other Loan Document, under laws applicable to Lender which are presently
in effect, or, to the extent allowed by law, under such applicable laws
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 7
which may hereafter be in effect and which allow a higher maximum non-usurious
interest rate than applicable laws now allow. At all times, if any, as Chapter
303 ("Chapter 303") of the
Texas Finance Code, shall establish the Highest
Lawful Rate for any purpose under this Agreement or any other Loan Document, the
Highest Lawful Rate shall be the "indicated rate ceiling" as defined in Chapter
303 from time to time in effect. To the extent required by applicable law in
determining the Highest Lawful Rate with respect to Lender as of any date, there
shall be taken into account the aggregate amount of all payments and charges
theretofore charged, reserved or received by Lender hereunder or under the other
Loan Documents which constitute or are deemed to constitute interest under
applicable law.
"incur" (including the correlative terms "incurred," "incurring,"
"incurs" and "incurrence"), when used with respect to any Debt, shall mean
create, incur, assume, guarantee or in any manner become liable in respect of
such Debt.
"Indemnified Parties" shall have the meaning set forth in Section
11.13.
"Interest Expense" shall mean for any period, without duplication, the
aggregate of all interest expense, all prepayment charges and all amortization
of debt discount and expense, including, without limitation, all net amounts
payable (or receivable) under Interest Rate Agreements and all interest expense
attributable to Capitalized Leases, in each instance determined in accordance
with GAAP.
"Interest Payment Date" shall mean (a) as to any Base Rate Portion, the
fifteenth of each month, beginning with March 15, 2002 (or if any such date is
not a Business Day, then the next succeeding Business Day); (b) as to any LIBOR
Rate Portion in which the Rate Period with respect thereto is one month, the
date on which such Rate Period ends; and (c) as to any LIBOR Rate Portion in
which the Rate Period with respect thereto is greater than one month, the date
on which each month during such Rate Period ends, and the date on which such
Rate Period ends.
"Interest Rate Agreement" shall mean an interest rate swap agreement,
interest rate cap agreement or similar arrangement.
"Investment" means, as applied to any Person, any direct or indirect
purchase or other acquisition by such Person of stock or other securities of any
other Person, or any direct or indirect loan, advance or capital contribution by
such Person to any other Person, or any other item which would be classified as
an "investment" on a balance sheet of such Person prepared in accordance with
GAAP, including any direct or indirect contribution by such Person of property
or assets to a joint venture, partnership or other business entity in which such
Person retains an interest.
"Lender" shall have the meaning set forth in the first paragraph of
this Agreement.
"Letter of Credit" shall mean a letter of credit issued for the account
of Borrower (or a Guarantor designated by Borrower) upon application by Borrower
pursuant to Section 2.2(b) and the other terms and conditions of this Agreement.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 8
"Letter of Credit Exposure" shall mean the aggregate of the undrawn
portion of each Letter of Credit outstanding at any time.
"Letter of Credit Margin" shall mean the fee applicable to Letters of
Credit as set forth on Schedule I hereto.
"LIBOR Rate" shall mean the rate of interest determined by Lender at
which deposits in Dollars for the relevant Rate Period and comparable in amount
to the LIBOR Rate Portion in question are offered based on information presented
on the Telerate Screen as of 11:00 A.M. (London time) on the day which is two
(2) Business Days prior to the first day of such Rate Period; provided, that if
at least two such offered rates appear on the Telerate Screen in respect of such
Rate Period, the arithmetic mean of all such rates (as determined by Lender)
will be the rate used; provided, further, that if Telerate ceases to provide
LIBOR quotations, such rate shall be the average rate of interest determined by
Lender at which deposits in Dollars are offered for the relevant Rate Period by
Lender (or its successor) to banks with combined capital and surplus in excess
of $500,000,000 in the London interbank market as of 11:00 A.M. (London time) on
the first day of such Rate Period.
"LIBOR Rate Portion" shall mean that portion or portion of the Loan
which bears interest at the Adjusted LIBOR Rate.
"LIBOR Reserve Requirement" shall mean, on any day, that percentage
(expressed as a decimal fraction) which is in effect on such date, if any, as
provided by the Federal Reserve System for determining the maximum reserve
requirements generally applicable to financial institutions regulated by the
Federal Reserve Board comparable in size and type to Lender (including, without
limitation, basic supplemental, marginal and emergency reserves) under
Regulation D with respect to "Eurocurrency liabilities" as currently defined in
Regulation D, or under any similar or successor regulation with respect to
Eurocurrency liabilities or Eurocurrency funding (or, if reserves for
Eurocurrency liabilities are not separately stated in such regulations, the
other applicable category of liabilities which includes deposits by reference to
which the interest rate on a LIBOR Rate Portion is determined). Each
determination by Lender of the LIBOR Reserve Requirement, shall, in the absence
of manifest error, be conclusive and binding.
"Lien" shall mean (a) any interest in property (whether real, personal
or mixed and whether tangible or intangible) which secures the payment of Debt
or an obligation owed to, or a claim by, a Person other than the owner of such
property, whether such interest is based on the common law, statute or contract,
including, without limitation, any such interest arising from (and irrespective
of whether created by such owner or another Person) a mortgage, charge, pledge,
security agreement, conditional sale, Capitalized Lease or trust receipt, or
arising from a lease, consignment or bailment given for security purposes, and
(b) any exception to or defect in the title to or ownership interest in such
property, including, without limitation, reservations, rights of entry,
possibilities of reverter, encroachments, easements, rights of way and
restrictive covenants (other than minor exceptions to or irregularities in the
title or ownership interest in such property which do not materially impair the
use of such property for its intended purpose).
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 9
"Loan" shall mean the revolving line of credit in the maximum amount of
the Commitment to be funded by Lender to Borrower pursuant to the term of this
Agreement as the same may be renewed or extended or increased (with the prior
written consent of Lender) from time to time.
"Loan Documents" shall mean this Agreement, the Note, the Guaranties,
the Security Agreements, and all instruments, certificates and agreements now or
hereafter executed or delivered to Lender pursuant to any of the foregoing and
the transactions connected therewith, and all amendments, modifications,
renewals, extensions, increases and rearrangements of, and substitutions for,
any of the foregoing.
"Material Adverse Effect" shall mean any material adverse effect on (a)
the financial condition, business, properties, assets, or operations of Borrower
and its Subsidiaries (other than the Excluded Subsidiaries) on a consolidated
basis, (b) the ability of Borrower and the Guarantors, on a consolidated basis,
to repay the Obligations, (c) the ability of Borrower or any Guarantor to
perform on a timely basis any other obligations under this Agreement or any
other Loan Document to which it is a party, (d) the validity or enforceability
of any Loan Document or (e) the rights and remedies of Lender under any Loan
Document.
"Maturity Date" shall mean January 1, 2005.
"Moody's" shall mean Xxxxx'x Investors Service, Inc. and any successor
thereto.
"Note" shall mean the promissory note executed by Borrower in favor of
Lender evidencing the obligation to repay the Loan, together with any renewals,
extensions, modifications or amendments of the forgoing.
"Notice of Borrowing" shall have the meaning set forth in Section
2.2(a).
"Notice of Rate Change/Continuation" shall have the meaning set forth
in Section 3.1(b).
"Obligations" shall mean the Loan and all of the other obligations of
Borrower and the Subsidiaries now or hereafter existing under the Loan
Documents, whether for principal, interest, fees, expenses, indemnification or
otherwise.
"Officer's Certificate" shall mean a certificate signed in the name of
Borrower by an Authorized Officer.
"Other Taxes" shall have the meaning set forth in Section 4.7(b).
"PBGC" shall have the meaning set forth in Section 6.14.
"Permitted Acquisition" shall mean an Acquisition which is agreed to by
Borrower and the other party thereto with respect to which (a) the aggregate
consideration paid by Borrower or any Subsidiary (whether in cash, by issuance
of Subordinated Debt permitted under Section 9.1, by issuance of stock, by
assumption of Debt or otherwise and including the value of any management,
consulting, purchase or required performance agreement by Borrower or any
Subsidiary in connection therewith), does not exceed, together with the
consideration paid for all
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 10
other Permitted Acquisitions consummated in the same fiscal year, $3,000,000,
(b) Borrower has caused to be subordinate to the payment of the Obligations and
unsecured, any Debt Borrower issues in connection with such Acquisition, and (c)
Borrower has paid any Debt assumed in connection with such Acquisition unless
such Debt is permitted under Section 9.1.
"Permitted Investments" shall mean (a) obligations, with a maturity of
less than two years, with the full faith and credit of the United States of
America, (b) direct obligations of any state of the United States, or
municipality therein, rated in one of the two top classifications by S&P or
Moody's and maturing within one year, (c) certificates of deposit or banker's
acceptances, maturing within two years, issued by United States commercial banks
having capital, surplus and undivided profits aggregating not less than $100
million and whose unsecured long-term debt is rated in one of the two top
classifications by S&P or Moody's, (d) commercial paper of any United States
corporation with a maturity of less than 270 days and which is rated in one of
the two top classifications by S&P or Moody's, (e) investments in money market
funds that invest exclusively in securities of the type described in items (a)
through (d) above, (f) Investments in wholly-owned Subsidiaries of Borrower, so
long as Borrower has complied with the requirements of Section 9.4 with respect
thereto, (g) expense advances to employees in the ordinary course of business
for travel and lodging not to exceed $100,000 in the aggregate at any time
outstanding, (h) Investments in demand deposit accounts maintained with FDIC
member banks, (i) Investments outstanding on the date of this Agreement that are
disclosed in Schedule 9.10, and (j) Investments in or for the benefit of Swan
pursuant to the plan of reorganization to which reference is made in clause
(a)(iv) of Section 6.7.
"Person" shall mean an individual, partnership, joint venture,
corporation, limited liability company, joint stock company, bank, trust,
unincorporated organization and/or a government or any department or agency
thereof.
"Pledge Agreement" shall mean the Pledge Agreement or Pledge Agreements
executed by Borrower and any applicable Subsidiary (other than the Excluded
Subsidiaries), by which Borrower or such applicable Subsidiary pledges to Lender
a security interest in all of the stock or other equity interests of the
Subsidiaries (other than the Excluded Subsidiaries).
"Rate Period" shall mean the period of time for which the LIBOR Rate
shall be in effect as to any LIBOR Rate Portion which shall be a one, two or
three month period of time, commencing with the Borrowing Date or the Expiration
Date of the immediately preceding Rate Period, as the case may be, applicable to
and ending on the effective date of any rate change or rate continuation made as
provided in Section 3.1(b) as Borrower may specify in a Notice of Borrowing or
Notice of Rate Change/Continuation, subject, however, to the early termination
provisions of Section 3.2(a) relating to any LIBOR Rate Portion; provided,
however, that: (i) any Rate Period which would otherwise end on a day which is
not a Business Day shall be extended to the next succeeding Business Day unless
such Business Day falls in another calendar month, in which case such Rate
Period shall end on the next preceding Business Day, and (ii) no Rate Period
shall extend beyond the Maturity Date.
"S&P" shall mean Standard & Poor's Rating Group and any successor
thereto.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 11
"Security Agreements" shall mean (a) that certain Security Agreement,
dated as of the Closing Date executed by Borrower in favor of Lender, and (b)
any Security Agreement executed by a Subsidiary in favor of Lender.
"Subordinated Debt" shall mean any Debt of Borrower (a) unsecured, and
(b) subordinated to payment of the Obligations in form and substance
satisfactory to Lender.
"Swan" means Swan Transportation Company, a Delaware corporation.
"Subsidiary" shall mean any corporation, partnership, limited liability
company, joint venture, association, bank or other business entity of which 50%
or more of the total voting power of shares of stock or other indicia of equity
rights entitled to vote in the election of directors, managers, general
partners, trustees or other members of the governing body thereof is at the time
directly or indirectly owned by Borrower or any Subsidiary (other than the
Excluded Subsidiaries), provided, that HTE, Inc. will not be deemed to be an
Subsidiary of Borrower solely by reason of Borrower's ownership of the 5,619,000
shares of the common stock of HTE, Inc. owned by Borrower on the date of this
Agreement unless and until (a) such shares constitute more than fifty percent
(50%) of the shares of the capital stock of HTE, Inc. entitled to vote in the
election of directors, (b) all restrictions imposed by Florida state corporation
law on Borrower's right to vote such shares are removed by the requisite vote of
the shareholders (other than Borrower) of HTE, Inc., by a final, nonappealable
order of a court of competent jurisdiction or otherwise, and (c) Borrower's
ownership of such shares is confirmed by a final, nonappealable order of a court
of competent jurisdiction in the proceedings to which reference is made in
clause (b)(iii) of Section 6.7 or such ownership is otherwise not subject to any
claim or restriction arising out of the proceedings referenced in such clause
(b)(iii) of Section 6.7.
"Tangible Net Worth" shall mean total assets (valued at cost less
normal depreciation), less (a) all intangibles and (b) Total Liabilities, all
determined in accordance with GAAP. The term "intangibles" shall include,
without limitation (i) the amount of any write-up in the book value of any
assets contained in any balance sheet resulting from revaluation thereof or any
write-up in excess of the cost of such assets acquired, and (ii) the aggregate
of all amounts appearing on the asset side of any such balance sheet for
franchises, licenses, permits, patents, patent applications, copyrights,
trademarks, trade names, goodwill, treasury stock, experimental or
organizational expenses and other intangible assets.
"Taxes" shall have the meaning set forth in Section 4.7(a).
"Termination Date" means the Maturity Date.
"Total Liabilities" shall mean and include without duplication (a) all
items which in accordance with GAAP would be included on the liability side of a
consolidated balance sheet of Borrower on the date as of which Total Liabilities
is to be determined (excluding capital stock surplus, surplus reserves and
deferred credits), (b) all Contingent Obligations, (c) all Debt secured by any
Lien existing on any interest of Borrower or any Subsidiary in property owned
subject to such lien whether or not the Debt secured thereby shall have been
assumed, and (d) all leases sold by a Borrower or any Subsidiary with recourse
to Borrower or any Subsidiary, provided that such term shall not mean or include
any Debt in respect of which monies sufficient
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 12
to pay and discharge the same in full (either on the expressed date of maturity
thereof or on such earlier date as such Debt may be duly called for redemption
and payment) shall be deposited with a depository, agency or trustee acceptable
to Lender, in trust and on a fully perfected basis, for the payment thereof.
"TPI" means TPI of
Texas, Inc., a Delaware corporation.
"Type" shall mean any Base Rate Portion or any LIBOR Rate Portion.
ARTICLE II
THE CREDIT FACILITY
SECTION 2.1. COMMITMENT.
(a) REVOLVING LINE OF CREDIT. Upon the terms and conditions
and relying upon the representations and warranties set forth herein
and in the other Loan Documents, Lender agrees to make revolving
Advances to Borrower from time to time in amounts not to exceed in the
aggregate at any one time the lesser of: (i) the Borrowing Base or (ii)
the maximum amount of the Commitment. Within such limits and during
such period and subject to the terms and conditions of this Agreement,
Borrower may borrow, repay and reborrow Advances hereunder at any time
prior to the Termination Date.
(b) REVOLVING NOTE. Borrower shall execute and deliver to
Lender the Note, which shall be (i) dated the Closing Date; (ii) in the
principal amount of the Commitment, and (iii) payable as provided in
the Note and in this Agreement. The Note shall bear interest on the
unpaid principal amount thereof from time to time outstanding at the
rate per annum determined as specified in Section 3.1, payable on each
Interest Payment Date and on the Maturity Date, commencing with the
first Interest Payment Date following the date of the Note.
(c) LETTERS OF CREDIT. During the Credit Period, Lender
agrees, subject to the terms and conditions set forth in this
Agreement, to issue, upon request by Borrower, Letters of Credit for
the account of Borrower (or a Guarantor designated by Borrower),
provided, that, immediately after each such Letter of Credit is issued,
(i) the aggregate amount of the Letter of Credit Exposure shall not
exceed $5,000,000, and (ii) the aggregate amount of the Letter of
Credit Exposure plus Outstanding Advances shall not exceed the lesser
of (x) the Borrower Base and (y) the maximum amount of the Commitment.
All amounts Lender is required to advance under any Letter of Credit
shall be deemed an Advance hereunder and shall bear interest as
provided herein, and Borrower shall be liable for all costs and
expenses, including, but not limited to, attorney's fees and court
costs, relating to such Letter of Credit, or any action related to such
Letter of Credit, incurred by Lender in connection with such Letter of
Credit.
(d) BORROWING BASE. Lender will not be obligated to lend to
Borrower or issue any Letter of Credit under this Agreement to
Borrower, and Borrower shall not be
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 13
entitled to borrow or obtain any Letter of Credit hereunder, if the
amount of such Advance or Letter of Credit would cause the sum of (i)
the then outstanding principal balance of the Note plus (ii) the Letter
of Credit Exposure, to exceed the Borrowing Base.
(e) TERMINATION OF COMMITMENT. The outstanding principal
balance of the Note, together with all accrued but unpaid interest
thereon, shall be due and payable in full on the Termination Date. The
Commitment shall terminate on the Termination Date and, after such
date, Lender shall have no obligation under this Article II.
(f) USE OF PROCEEDS. All Advances and Letters of Credit made
or issued pursuant to this Agreement shall be used solely for working
capital needs of Borrower and its Subsidiaries.
SECTION 2.2. BORROWING PROCEDURE.
(a) AMOUNTS; METHOD OF BORROWING. Each Advance by Borrower
hereunder shall be (i) in the case of a borrowing consisting of a LIBOR
Rate Portion, in an aggregate amount of not less than $500,000 or an
integral multiple of $50,000 in excess thereof; or (ii) in the case of
a borrowing consisting of a Base Rate Portion, in an aggregate amount
of not less than $50,000. Each Advance by Borrower shall be made upon
prior written notice from Borrower to Lender in the form of Exhibit B-1
hereto (a "Notice of Borrowing"), delivered to Lender not later than
10:00 a.m. (Dallas,
Texas time) (i) on the third Business Day prior to
the Borrowing Date, if such borrowing consists of a LIBOR Rate Portion;
and (ii) on the Borrowing Date, if such borrowing consists of a Base
Rate Portion. Each Notice of Borrowing shall be irrevocable and shall
specify (i) the amount of the proposed borrowing and of each LIBOR Rate
Portion and/or Base Rate Portion comprising a part thereof; (ii) the
Borrowing Date; (iii) with respect to any LIBOR Rate Portion, the Rate
Period with respect to each such LIBOR Rate Portion and the Expiration
Date of each such Rate Period; and (iv) the demand deposit account of
Borrower at Lender in which the proceeds of the borrowing are to be
deposited. Delivery of any Notice of Borrowing to Lender shall
constitute a representation by Borrower that the representations and
warranties made by Borrower under the Loan Documents are true and
correct as of the date of delivery of such Notice of Borrowing.
(b) METHOD OF ISSUING LETTERS OF CREDIT. Not less than five
(5) Business Days prior to the requested date of issuance of any Letter
of Credit, Borrower shall execute and deliver to Lender the customary
letter of credit application and agreement in the form of Exhibit B-2
hereto (a "LOC Application"). Nothing in this Agreement shall prohibit
Lender from modifying the form of the LOC Application in effect from
time to time in connection with the issuance of any Letter of Credit.
In the event of a direct conflict between the provisions of the LOC
Application and this Agreement, the provisions of this Agreement shall
govern. In no event shall a Letter of Credit have an expiration date
which is later than the earlier of (i) the fifth Business Day prior to
the Termination Date and (ii) one year after its issuance. If any
Letter of Credit is presented for payment by the beneficiary thereof,
Borrower hereby irrevocably authorizes the Lender to cause an Advance
to be made to reimburse Lender for such payment. Upon satisfaction of
the conditions precedent set forth in Article VII, and subject to the
other
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 14
terms and conditions of this Agreement, Lender shall issue Letters of
Credit for the account of Borrower (or a Guarantor designated by
Borrower) within five (5) Business Days from receipt by Lender of the
fully-executed LOC Application. Borrower understands and agrees that in
the event that Lender issues a Letter of Credit which has a termination
date (whether as originally stated in such Letter of Credit or which
may result from a required extension of such Letter of Credit), then
Borrower shall deposit with Lender on the Termination Date cash
collateral satisfactory to Lender in an aggregate amount equal to the
Letter of Credit Exposure which remains outstanding at such time.
ARTICLE III
INTEREST RATE PROVISIONS
SECTION 3.1. INTEREST RATE DETERMINATION. The Loan shall bear interest
on the unpaid principal amount thereof from time to time outstanding, until
maturity, at a rate per annum (calculated based on a year of 360 days in each
case for the actual days elapsed) as follows:
(a) The principal balance of the Loan from time to time
outstanding shall bear interest at an annual rate equal to the lesser
of (i) with respect to any LIBOR Rate Portion, the Adjusted LIBOR Rate,
and with respect to any Base Rate Portion, the Base Rate, as the case
may be, with respect thereto or (ii) the Highest Lawful Rate, from the
day of Advance to, but not including, (y) with respect to any Base Rate
Portion, the Maturity Date and (z) with respect to any LIBOR Rate
Portion, the Expiration Date of the Rate Period then in effect with
respect thereto.
(b) So long as no Default or Event of Default has occurred and
is continuing, Borrower may at any time prior to the applicable
Maturity Date (y) change the interest rates to apply to all or any
portion of the Loan or (z) elect to continue all or any part of the
outstanding principal balance of any LIBOR Rate Portion as portions of
such Type by giving Lender an irrevocable written notice in the form of
Exhibit C hereto (the "Notice of Rate Change/Continuation") specifying
(i) the date on which the applicable LIBOR Rate Portion or Base Rate
Portion was made; (ii) the interest rate then applicable to such LIBOR
Rate Portion or Base Rate Portion; (iii) with respect to any LIBOR Rate
Portions, the Rate Period then applicable to each such LIBOR Rate
Portion; (iv) the principal amount of such LIBOR Rate Portion to remain
outstanding; and (v) the requested effective date of the rate change or
continuation (the "Conversion/Continuation Date"). In the case of the
conversion of all or any part of any Base Rate Portion into a LIBOR
Rate Portion or the continuation of any LIBOR Rate Portion, (x) such
notice must be received by Lender at least three (3) full Business Days
prior to the Conversion/Continuation Date, and otherwise at least one
(1) full Business Day prior thereto, and (y) in either case such LIBOR
Rate Portion shall be in an aggregate principal amount greater than or
equal to $1,000,000 or in an integral multiple of $100,000 in excess
thereof. Each rate so specified shall become effective on the
Conversion/Continuation Date and remain in effect until the expiration
of the applicable Rate Period specified in such Notice of Rate
Change/Continuation. Each Notice of Rate Change/Continuation shall be
irrevocable.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 15
(c) If Borrower shall fail to choose, as provided in
subsection (b) above, the rate of interest to become effective with
respect to any LIBOR Rate Portions upon the Expiration Date of the Rate
Period with respect thereto, such portion of the Loan shall bear
interest at the Base Rate on and after such Expiration Date until
Borrower shall have so chosen a different rate.
(d) Nothing contained herein shall authorize Borrower (i) to
convert any Base Rate Portion into or continue any LIBOR Rate Portion
as a LIBOR Rate Portion unless the Expiration Date of the Rate Period
for the new LIBOR Rate Portion occurs on or before the Maturity Date,
(ii) to continue or change the interest rates applicable to any LIBOR
Rate Portions prior to the Expiration Date of the Rate Period with
respect thereto, or (iii) to convert any Base Rate Portion into a LIBOR
Rate Portion or to continue any LIBOR Rate Portion if a Default or an
Event of Default has occurred and is continuing.
(e) Notwithstanding anything set forth herein to the contrary
(other than Section 11.12), if an Event of Default has occurred and is
continuing the Loan shall bear interest at a rate per annum which shall
be equal to the lesser of (i) 3% above the Base Rate or (ii) the
Highest Lawful Rate, which interest shall be due and payable on demand.
SECTION 3.2. ADDITIONAL INTEREST RATE PROVISIONS.
(a) Anything in this Agreement to the contrary
notwithstanding, if at any time Lender determines (which determination
shall be conclusive absent manifest error) that the introduction of or
any change in any Governmental Regulation by any Governmental Authority
charged with the interpretation or administration thereof shall make it
unlawful for Lender to maintain or fund any LIBOR Rate Portion or to
convert any Base Rate Portion into, or to continue, any LIBOR Rate
Portion hereunder, Lender shall promptly give notice thereof to
Borrower. With respect to any LIBOR Rate Portion which is outstanding
when Lender so notifies Borrower, upon such date as shall be specified
in such notice, the Rate Period shall end and the lesser of (i) the
Base Rate or (ii) the Highest Lawful Rate shall commence to apply in
lieu of the Adjusted LIBOR Rate in respect of such portion of the Loan.
At least five (5) Business Days after such specified date, Borrower
shall pay to Lender (y) accrued and unpaid interest on each affected
LIBOR Rate Portion at the Adjusted LIBOR Rate in effect at the time of
such notice to but not including such specified date plus (z) such
amount or amounts (to the extent that such amount or amounts would not
be usurious under applicable Governmental Regulation) as may be
necessary to compensate Lender for any costs and losses incurred by it,
but otherwise without penalty. If notice has been given by Lender
pursuant to the foregoing provisions of this Section 3.2, then, unless
and until the circumstances giving rise to such notice no longer apply,
such Adjusted LIBOR Rate shall not again apply to any portion of the
Loan and the obligation of Lender to convert any portion of the Loan
into, or to continue, any LIBOR Rate Portion as, a LIBOR Rate Portion
shall be suspended.
(b) Subject to Section 11.12 hereof, Borrower will indemnify
Lender against, and reimburse Lender on demand for, any loss, cost or
expense incurred or sustained by Lender (including, without limitation,
any loss or expense incurred by reason of the
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 16
liquidation or reemployment of deposits or other funds acquired by
Lender to fund or maintain any LIBOR Rate Portion to Borrower ) as a
result of (i) any Additional Costs incurred by Lender; (ii) any
payment, prepayment or repayment (whether authorized or required
hereunder or otherwise) of all or a portion of any LIBOR Rate Portion
on a day other than the last day of a Rate Period for such LIBOR Rate
Portion; (iii) any payment or prepayment (whether required hereunder or
otherwise) of any LIBOR Rate Portion made after the delivery of a
Notice of Borrowing or a Notice of Rate Change/Continuation, as the
case may be, but before the applicable Borrowing Date or a
Conversion/Continuation Date, as the case may be, if such payment or
prepayment prevents the proposed borrowing from becoming fully
effective; or (iv) after receipt by Lender of a Notice of Borrowing or
a Notice of Rate Change/Continuation, as the case may be, the failure
of any LIBOR Rate Portion to be made or effected by Lender due to any
condition precedent to a borrowing not being satisfied by Borrower or
due to any other action or inaction of Borrower.
(c) The agreements contained in Sections 3.2(a) and 3.2(b)
shall survive the termination of this Agreement and the payment in full
of the Note and all other amounts payable hereunder.
ARTICLE IV
PREPAYMENTS AND OTHER PAYMENTS
SECTION 4.1. REQUIRED PAYMENTS.
(a) INTEREST PAYMENT DATES. Interest owed under the Note is
due not later than 12:00 noon (Dallas,
Texas time) on each Interest
Payment Date, in immediately available funds in Dallas, Texas, to
Lender at its address referred to in Section 11.4.
(b) PRINCIPAL PAYMENT DATE. All outstanding principal owed
under the Note is due not later than 12:00 noon (Dallas, Texas time) on
the Termination Date in immediately available funds in Dallas, Texas,
to Lender at its address referred to in Section 11.4.
(c) OUT OF DEBT PERIOD. Borrower shall be required to reduce
the amount of Advances outstanding under the Loan to zero for a period
of at least thirty consecutive days during the Credit Period. For the
purposes of this subsection, Advances do not include undrawn amounts of
outstanding letters of credit.
(d) EXCESS ADVANCES. In the event that the sum of the
outstanding Advances (including, without limitation, any Advances
required to be made as a result of a draw on a Letter of Credit) plus
the Letter of Credit exposure exceeds the lesser of (i) the Borrowing
Base then in effect or (ii) the maximum amount of the Commitment then
in effect (such excess amount referred to herein as the "Excess
Amount"), Borrower shall immediately pay to Lender the Excess Amount,
together with any amount owed under Section 3.2(b) resulting from such
payment.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 17
SECTION 4.2. OPTIONAL PREPAYMENTS. Borrower shall have the right at any
time and from time to time to prepay, in whole or in part any Advance; provided,
that each partial prepayment shall be in an aggregate principal amount of at
least $25,000, together with interest accrued thereon to the date of such
prepayment and all amounts due, if any, under Section 3.2.
SECTION 4.3. NOTICE OF PAYMENTS. Borrower shall give Lender at least
three (3) Business Days' prior written notice of each prepayment with respect to
any LIBOR Rate Portion proposed to be made by Borrower pursuant to Section 4.2
on a day other than the last day of the Rate Period for such LIBOR Rate Portion,
specifying the principal amount thereof to be prepaid, the prepayment date and
the account of Borrower to be charged if such prepayment is to be so effected.
Notice of such prepayment having been given, the principal amount of the Loan
specified in such notice, together with interest thereon to the date of
prepayment, shall become due and payable on such prepayment date. If Borrower
pays or prepays any LIBOR Rate Portion prior to the end of the Rate Period
applicable thereto, such payment shall be subject to Section 3.2(b).
SECTION 4.4. PLACE OF PAYMENT OR PREPAYMENT. All payments and
prepayments made in accordance with the provisions of this Agreement or of the
Note in respect of commitment fees or of principal or interest on the Note shall
be made to Lender no later than 12:00 noon (Dallas, Texas time) in immediately
available funds at the address referred to in Section 11.4.
SECTION 4.5. NO PREPAYMENT PREMIUM OR PENALTY. Each prepayment pursuant
to Section 4.2 shall be without premium or penalty, except as provided in
Section 3.2(b).
SECTION 4.6. INCREASED COSTs.
(a) Notwithstanding any other provision herein, but subject to
Section 11.12, if after the date of this Agreement the introduction of
or change in any applicable Governmental Regulation or any change in
any Governmental Regulation or in the interpretation or administration
thereof, or compliance by Lender (or any lending office of Lender) with
any applicable guideline or request from any central bank or
Governmental Authority (whether or not having the force of a
Governmental Regulation) either (i) shall impose, modify or make
applicable any reserve, deposit, capital adequacy or similar
requirement against loans made or commitments entered into by Lender,
or (ii) shall impose on Lender any other conditions affecting this
Agreement; and the result of any of the foregoing affects or would have
the effect of reducing the rate of return on Lender's capital as a
consequence of its obligations hereunder to a level below that which
Lender could have achieved but for such adoption, change or compliance
(taking into consideration Lender's policies with respect to capital
adequacy) then, subject to Section 11.12 hereof, Borrower shall pay to
Lender such additional amount or amounts as will compensate Lender for
such reduction. Notwithstanding the foregoing, in no event shall the
compensation payable under this Section 4.6 (to the extent, if any,
constituting interest under applicable laws) together with all amounts
constituting interest under applicable laws and payable in connection
with this Agreement, the Note and the other Loan Documents, exceed the
Highest Lawful Rate.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 18
(b) Lender will notify Borrower of any event which will
entitle Lender to compensation pursuant to subsection (a) above. A
certificate of Lender setting forth in reasonable detail such amount or
amounts as shall be necessary to compensate Lender as specified in
subsection (a) above shall be conclusive absent manifest error.
Borrower agrees to pay to Lender for the account of Lender the amount
shown as due on any such certificate within fifteen (15) days after its
receipt of the same Lender may not make any claim for compensation
under this Section 4.6 by reason of any increased costs or reduction of
return incurred or suffered by Lender more than ninety (90) days prior
to the date on which such certificate is received by Borrower.
(c) Subject to the last sentence of Section 4.6(b), failure on
the part of Lender to demand compensation for any increased costs or
reduction in amounts received or receivable or reduction in return on
capital with respect to the Loan shall not constitute a waiver of
Lender's rights to demand compensation for any increased costs or
reduction in amounts received or receivable or reduction in return on
capital with respect to the Loan.
SECTION 4.7. TAXES.
(a) Subject to Section 11.12, any and all payments by Borrower
hereunder or under the Note shall be made free and clear of and without
deduction for any and all present or future taxes, deductions, charges
or withholdings, and all liabilities with respect thereto, including,
without limitation, such taxes, deductions, charges, withholdings or
liabilities whatsoever (x) imposed, assessed, levied or collected on or
in respect of the Loan solely as a result of the interest rate being
determined by reference to the LIBOR Rate, or the provisions of this
Agreement relating to the LIBOR Rate, or the recording, registration,
notarization or other formalization of any thereof or any payments of
principal, interest or other amounts made on or in respect of the Loan
when the interest rate is determined by reference to the LIBOR Rate, or
(y) imposed, assessed, levied or collected by any jurisdiction (or any
political subdivision thereof) under or in which Borrower or any
Subsidiary is organized or doing business, excluding, taxes imposed on
Lender's net income (including penalties and interest payable in
respect thereof) and franchise taxes imposed on Lender by any
jurisdiction (or any political subdivision thereof) under the laws of
which Lender is organized or doing business (all such non-excluded
taxes, deductions, charges, withholdings and liabilities being
hereinafter referred to as "Taxes"). Subject to Section 11.12 hereof,
if Borrower shall be required by Governmental Regulation to deduct any
Taxes from or in respect of any sum payable hereunder or under the Note
to Lender (i) the sum payable shall be increased as may be necessary so
that after making all required deductions (including deductions
applicable to additional sums payable under this Section 4.7) Lender
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) Borrower shall make such deductions, and
(iii) Borrower shall pay the full amount deducted to the relevant
taxation authority or other authority in accordance with applicable
Governmental Regulation. If requested by Lender, Borrower shall confirm
that all applicable Taxes, if any, imposed on it by virtue of the
transactions under this Agreement have been properly and legally paid
by it to the appropriate taxing authorities by sending either (A)
official tax receipts or notarized copies of such receipts to Lender
within thirty (30) days after
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 19
payment of any applicable tax or (B) a certificate executed by an
Authorized Officer of Borrower confirming that such Taxes have been
paid, together with evidence of such payment.
(b) In addition, subject to Section 11.12 hereof, Borrower
agrees to pay any present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies which arise
from any payment made hereunder or under the Note or from the
execution, delivery or registration of, or otherwise with respect to,
this Agreement or the Note (hereinafter referred to as "Other Taxes").
(c) Subject to Section 11.12 hereof, Borrower will indemnify
Lender for the full amount of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed by any jurisdiction on
amounts payable under this Section 4.7) paid by Lender and any
liability (including penalties, interest and expenses) arising
therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally asserted. This indemnification shall be
made within thirty (30) days from the date Lender makes written demand
therefor.
(d) Without prejudice to the survival of any other agreement
of Borrower hereunder, the agreement and obligations of Borrower
contained in this Section 4.7 shall survive the termination of this
Agreement and the payment in full of the Note and all other amounts
payable hereunder.
SECTION 4.8. REDUCTION OR TERMINATION OF THE COMMITMENT. Borrower may
at any time or from time to time reduce or terminate the Commitment of Lender to
it by giving not less than three (3) full Business Days' prior written notice to
such effect to Lender; provided, that any partial reduction shall be in an
amount of not less than $500,000 or an integral multiple of $100,000 in excess
thereof; and provided further, however, that no partial reduction shall reduce
the aggregate amount of the Commitment to an amount greater than zero and less
than $1,000,000. Promptly after Lender's receipt of such notice of reduction,
such reduction shall be effective on the date specified in the notice from
Borrower with respect to such reduction. The Commitment of Lender shall
automatically terminate on the earlier of the Termination Date or upon the
acceleration of the maturity date of the Note. Each reduction of the Commitment
hereunder shall be irrevocable.
SECTION 4.9. PAYMENTS ON BUSINESS DAY. Whenever any payment or
prepayment hereunder or under the Note shall be stated to be due on a day other
than a Business Day, such payment shall be made on the next succeeding Business
Day, and such extension of time shall in such case be included in the
computation of payment of interest; provided, however, if such extension would
cause payment of interest on or principal of LIBOR Rate Portions to be made in
the next following calendar month, such payment shall be made on the next
preceding Business Day.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 20
ARTICLE V
COMMITMENT FEE AND OTHER FEES
SECTION 5.1. COMMITMENT FEES.
(a) UPFRONT COMMITMENT FEE. Borrower agrees to pay to Lender,
on the Closing Date, an upfront commitment fee in respect of the
Commitment of Lender to Borrower in the amount of $60,000.
(b) UNUSED COMMITMENT FEE. Borrower agrees to pay to Lender a
fee at a per annum rate equal to 37.5 basis points on the daily unused
portion of the Commitment from the date hereof to and including the
Termination Date, payable in arrears at the end of each calendar
quarter hereafter and on the Termination Date (the amount of the Letter
of Credit Exposure at any time shall reduce the unused portion of the
Commitment for the purpose of calculating the fee under this Section
5.1(b)). Borrower may permanently reduce the Commitment in whole, or in
part, pursuant to Section 4.8, provided, however, that the amount of
the Commitment may not be reduced below the principal amount of the
outstanding Advances and Letter of Credit Exposure. All accrued fees
under this Section 5.1(b) shall be payable on the effective date of any
termination of the obligations of Lender to make Advances hereunder.
(c) LETTER OF CREDIT FEES. Borrower shall pay to Lender a
letter of credit fee at a per annum rate equal to the Letter of Credit
Margin on the average daily Letter of Credit Exposure, such fee to be
payable in arrears payable at the end of each calendar quarter
hereafter and on the Termination Date. Borrower shall also pay to
Lender at the time of issuance of each Letter of Credit and in
connection with any re-issuance or draws thereunder, issuance fees and
documentary charges in accordance with Lender's standard schedule for
such charges as in effect from time to time.
SECTION 5.2. FEES NOT INTEREST; NONPAYMENT. The fees described in this
Agreement represent compensation for services rendered and to be rendered
separate and apart from the lending of money or the provision of credit and do
not constitute compensation for the use, detention, or forbearance of money,
and, subject to Section 11.12, the obligation of Borrower to pay each fee
described herein shall be in addition to, and not in lieu of, the obligation of
Borrower to pay interest, other fees described in this Agreement, and expenses
otherwise described in this Agreement. Fees shall be payable when due in Dollars
and in immediately available funds. Subject to Section 11.12 hereof, all fees,
including, without limitation, the fees referred to in Section 5.1 and any other
fees payable pursuant to this Agreement, shall be non-refundable, and shall, to
the fullest extent permitted by Governmental Regulation, bear interest, if not
paid when due, at a rate per annum equal to the lesser of (a) 3% above the Base
Rate or (b) the Highest Lawful Rate.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants that:
SECTION 6.1. ORGANIZATION AND QUALIFICATION; SUBSIDIARIES. Borrower and
each Subsidiary is (i) duly organized, validly existing and in good standing
under the laws of the state
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 21
of its organization and has full legal right, power and authority to carry on
its business as presently conducted and to execute, deliver and perform its
obligations under this Agreement and all other Loan Documents executed by it,
and (ii) is duly qualified to do business and in good standing in each
jurisdiction in which the nature of the business it conducts in such
jurisdiction makes such qualification necessary or desirable except where the
failure to so qualify would not reasonably be expected to have a Material
Adverse Effect. All of Borrower's Subsidiaries are identified in Schedule II
hereto. Borrower owns all of the issued and outstanding stock of such
Subsidiaries and there are no outstanding warrants or requirements of any type
for the issuance of additional shares in such Subsidiaries.
SECTION 6.2. AUTHORIZATION. Borrower's and each Subsidiary's execution,
delivery and performance of the Loan Documents executed by it (i) have been duly
authorized by all necessary action under such Person's organizational documents
and otherwise, (ii) do not and will not require any consent of any other person
or entity, and (iii) do not and will not require any consent, license, permit
authorization or other approval (including foreign exchange approvals) of any
Governmental Authority, or any notice to, exemption by, any registration,
declaration or filing with or the filing of any other action in respect of any
Governmental Requirement.
SECTION 6.3. NO CONFLICTS. Neither execution or delivery by Borrower or
any Subsidiary of any Loan Document nor the fulfillment of or compliance with
its terms and provisions will (i) violate any Governmental Requirement of any
Governmental Authority or the basic organizational documents of such Person or
(ii) conflict with or result in a breach of the terms, conditions or provisions
of, or cause a default under, any material agreement, instrument, franchise,
license or concession to which such Person is a party or bound.
SECTION 6.4. ENFORCEABILITY. Each Loan Document to which Borrower or
any Subsidiary is a party has been duly and validly executed, issued and
delivered by Borrower or such Subsidiary. They are in proper legal form for
prompt enforcement and they are Borrower's or such Subsidiary's, as applicable,
valid and legally binding obligations enforceable in accordance with their
terms, except as limited by applicable bankruptcy, insolvency, fraudulent
transfer, fraudulent conveyance, reorganization, moratorium, or other similar
laws at the time in effect affecting the rights of creditors generally.
Borrower's or such Subsidiary's obligations under the Loan Documents to which
each is a party rank and will rank at least equal in priority of payment with
all of Borrower's or such Subsidiary's other debt.
SECTION 6.5. ACCURACY OF INFORMATION; NO MATERIAL ADVERSE CHANGE. All
information supplied to Lender and all statements made to Lender by or on behalf
of Borrower or any Subsidiary in connection with this Agreement are and will be
true, correct, complete, valid and genuine in all material respects. Each of
Borrower's financial statements furnished to Lender pursuant to Section 7.1 of
this Agreement fairly presents the financial condition and results of operations
of Borrower and its Subsidiaries, on a consolidated basis, as of its date and
for the period then ended. There has been no material adverse change in the
financial condition or results of operations of Borrower since the last
financial statements delivered by Borrower pursuant to Section 7.1(c) or 8.1, as
applicable, and all assets listed on the last such statement so delivered are
subject to Borrower's or the applicable Subsidiary's management control and
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 22
disposition and, except as shown therein, are available to satisfy any claim
rightfully made pursuant to the Loan Documents executed by Borrower or any
Subsidiary.
SECTION 6.6. TAXES. Borrower and each Subsidiary has filed all tax
returns required to be filed and paid all taxes shown thereon to be due by the
due date or extension thereof, including interest and penalties, except for
taxes being diligently contested in good faith and for payment of which adequate
reserves have been set aside.
SECTION 6.7. LITIGATION AND OTHER PROCEEDINGS. There is no condemnation
or other action, suit or proceeding pending or, to the best of Borrower's
knowledge, threatened against or affecting Borrower, any Subsidiary or any
Collateral, at law or in equity, or before or by any Governmental Authority,
which could reasonably be expected to result in any material adverse change in
Borrower's or any Subsidiary's business or financial condition or in any
Collateral or in other material property of Borrower or any interest in it,
except (a) matters regarding the Excluded Subsidiaries (i) described in "Item 3.
LEGAL PROCEEDINGS" contained in Borrower's Form 10-K for Fiscal Year End
December 31, 2000, filed by Borrower with the Securities and Exchange Commission
on Xxxxx 00, 0000, (xx) described in footnote 17 ("Commitments and
Contingencies") of the Notes to Consolidated Financial Statements contained in
Borrower's Form 10-K for Fiscal Year End December 31, 2000, filed by Borrower
with the Securities and Exchange Commission on Xxxxx 00, 0000, (xxx) described
in footnote 4 ("COMMITMENTS AND CONTINGENCIES") of the Notes to Condensed
Consolidated Financial Statements (Unaudited) contained in Borrower's Form 10-Q
for Quarter Ended September 30, 2001, filed by Borrower with the Securities and
Exchange Commission on November 8, 2001, and/or (iv) described in "Item 5. Other
Events" contained in Borrower's Form 8-K Current Report, filed by Borrower with
the Securities and Exchange Commission on December 28, 2001, and (b) matters
regarding the Borrower's Investment in HTE, Inc. (i) described under the caption
"INVESTMENT SECURITY AVAILABLE-FOR-SALE" in "Item 7. MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS" contained in
Borrower's Form 10-K for Fiscal Year End December 31, 2000, filed by Borrower
with the Securities and Exchange Commission on Xxxxx 00, 0000, (xx) described in
footnote 6 ("INVESTMENT SECURITY AVAILABLE-FOR-SALE") of the Notes to
Consolidated Financial Statements contained in Borrower's Form 10-K for Fiscal
Year End December 31, 2000, filed by Borrower with the Securities and Exchange
Commission on March 21, 2001, and/or (iii) described in footnote 8 ("Investment
Securities Available-For-Sale") of the Notes to Condensed Consolidated Financial
Statements (Unaudited) contained in Borrower's Form 10-Q for Quarter Ended
September 30, 2001, filed by Borrower with the Securities and Exchange
Commission on November 8, 2001; provided, that, Borrower represents and warrants
to Lender that neither Borrower nor any Guarantor has any liability or potential
for material loss under or with respect to any of the proceedings described in
clause (a) above.
SECTION 6.8. NO DEFAULTS. Neither Borrower nor any Subsidiary (other
than an Excluded Subsidiary) is in default with respect to the payment of any
debt for borrowed money which has an outstanding balance in excess of $100,000
or under any agreement or other papers evidencing or securing any such debt,
which has not been waived, or with respect to any Governmental Requirement under
circumstances in which any such default could reasonably be
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 23
expected to have a Material Adverse Effect, except in connection with the
matters described or to which reference is made in Section 6.7.
SECTION 6.9. SOLVENCY. Borrower and each Guarantor, the assets and
revenues of which exceed one percent (1%) of Borrower's consolidated assets or
revenues, as the case may be, is solvent and no bankruptcy or insolvency
proceedings are pending or contemplated by or, to Borrower's knowledge, against
Borrower or any Guarantor. After giving effect to the limitations on liability
contained in the Guaranty and to the rights and obligations of the Borrower and
the Guarantors under the Contribution Agreements, Borrower's and each
Guarantor's liabilities and obligations under this Agreement and the other Loan
Documents do not and will not render Borrower or any Guarantor insolvent, cause
Borrower's or any Guarantor's liabilities to exceed Borrower's or such
Guarantor's assets or leave Borrower or any Guarantor with too little capital to
properly conduct all of its business as now conducted or contemplated to be
conducted.
SECTION 6.10. REPRESENTATIONS AND WARRANTIES. No representation or
warranty contained in any Loan Document executed by Borrower or any Subsidiary
and, as of the date such statement is dated or certified, no statement contained
in any certificate, schedule, list, financial statement or other papers
furnished to Lender by or on behalf of Borrower contains or will contain any
untrue statement of material fact, or omits or will omit to state a material
fact necessary to make the statements contained therein not misleading, provided
that, insofar as the foregoing representation and warranty addresses information
provided to Borrower or any Subsidiary by customers, such representation and
warranty is based solely upon investigation made by Borrower or any such
Subsidiary in the normal course of business.
SECTION 6.11. MARGIN REGULATIONS. None of the proceeds of the Loan will
be used for the purpose of purchasing or carrying, directly or indirectly, any
margin stock or for any other purpose which would make such credit a "purpose
credit" within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System.
SECTION 6.12. LICENSES, PERMITS, TRADEMARKS, ETC. Borrower and each
Guarantor possesses all material permits, licenses, patents, trademarks, trade
names and copyrights required to conduct its business.
SECTION 6.13. COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS. Except for the
possible noncompliance with Governmental Requirements at issue in the litigation
to which reference is made in clauses (a)(i), (a)(ii) and (a)(iii) of Section
6.7, Borrower, each Subsidiary and the property of Borrower and each Subsidiary
covered by the Loan Documents are in compliance with all Governmental
Requirements, except where the failure to comply with the same could not
reasonably be expected to have a Material Adverse Effect, and Borrower manages
and operates (and will continue to manage and operate) its business in
accordance with good industry practices.
SECTION 6.14. ERISA. No event has occurred which could result in
liability on Borrower or any Subsidiary to the Pension Benefit Guaranty
Corporation ("PBGC"). Borrower has met all requirements with respect to funding
of each plan (a "Plan") maintained for any of Borrower's or any Subsidiary's
employees subject to Title IV of the Employee Retirement Benefit Act of 1974, as
amended, and related regulations ("ERISA"), if any exists. No event or
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 24
condition has occurred that would permit any lien under ERISA to attach to any
of the collateral for Borrower's or any Subsidiary's obligations in connection
herewith.
SECTION 6.15. TITLE TO PROPERTIES. Borrower and each Guarantor has
good, sufficient and legal title to, or valid leasehold interest in, all of the
assets listed on its balance sheet, subject to no Liens except those permitted
in Section 9.2.
SECTION 6.16. BURDENSOME CONTRACTS. Neither Borrower nor any Guarantor
is a party to any contract or agreement or subject to any restriction the
performance of or the compliance with which could reasonably be expected to have
a Material Adverse Effect.
ARTICLE VII
CONDITIONS
SECTION 7.1. CONDITIONS TO INITIAL ADVANCE. Lender will not be
obligated to make the initial Advance or issue any Letter of Credit hereunder
unless all of the following conditions shall be satisfied at the time of such
Advance or issuance:
(a) APPROVALS. Prior to the Closing Date, Borrower and each
Subsidiary shall have obtained all orders, approvals or consents of all
Persons required for the execution, delivery and performance by
Borrower and each Subsidiary of the Loan Documents to which each such
Person is a party.
(b) COMPLIANCE WITH LAW. The business and operations of
Borrower and each Subsidiary as conducted at all times relevant to the
transactions contemplated by this Agreement to and including the close
of business on the Closing Date shall have been and shall be in
compliance (other than any failure to be in compliance that does not
result in a Material Adverse Effect) with all applicable Governmental
Regulations. No Governmental Regulation shall prohibit the transactions
contemplated by the Loan Documents, no order, judgment or decree of any
Governmental Authority shall exist, and no litigation shall be pending
or, to the best knowledge of Borrower, threatened, which in the
judgment of Lender (A) would enjoin, prohibit or restrain the
transactions contemplated by the Loan Documents or (B) could reasonably
be expected to have a Material Adverse Effect.
(c) FINANCIAL STATEMENTS. On the Closing Date, Lender shall
have received and reviewed: (i) internally prepared, consolidated
financial statements of Borrower and its Subsidiaries as of December
31, 2001; (ii) a company prepared, consolidated financial projection
for Borrower and its Subsidiaries for the 2002 calendar year; and (iii)
a certificate dated the Closing Date of the chief financial officer or
the treasurer of Borrower certifying that the financial position of
Borrower and its Subsidiaries as of the Closing Date is not materially
different from that presented in the December 31, 2001 consolidated
balance sheet of Borrower and its Subsidiaries attached to such
certificate.
(d) INSURANCE. Lender shall have received evidence
satisfactory to it of the existence of all insurance policies required
by the Loan Documents, such policies
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 25
designating Lender as the loss payee, providing for the giving of at
least thirty (30) days' notice to Lender of cancellation or material
modification thereof, and otherwise complying with the provisions of
Section 8.11. Lender shall have received such agreements, guaranties
(including without limitation the guaranties of each Existing
Subsidiary), subordinations (as to payment liens and security interests
or both), releases and other agreements and assurances from other
creditors of Borrower or any Subsidiary as Lender shall reasonably
require.
(e) PAYMENT OF FEES AND EXPENSES. Lender shall have received
payment of (i) all fees described in Section 5 hereof and (ii) without
limiting the obligations of Borrower under Section 11.2, the reasonable
expenses of, or incurred by, Lender and its counsel, to the extent
billed as of the Closing Date, in connection with the negotiation and
closing of the transactions contemplated herein.
(f) REQUIRED DOCUMENTS AND CERTIFICATES. On the Closing Date,
Lender shall have received the following, in each case in form, scope
and substance satisfactory to Lender:
(i) the Note;
(ii) the Security Agreements, Pledge Agreements, and
applicable UCC-1 financing statements;
(iii) the Guaranties and the Contribution Agreements;
(iv) the original stock certificates evidencing all of
the shares of stock of each Subsidiary which are issued and
outstanding, together with related stock powers executed in
blank by the appropriate Person;
(v) an Officer's Certificate from Borrower and each
Subsidiary dated as of the Closing Date certifying, inter
alia, (A) the Articles of Incorporation or Bylaws (or
equivalent corporate documents), as amended and in effect, of
Borrower and each Subsidiary; (B) resolutions duly adopted by
the Board of Directors of Borrower and each Subsidiary
authorizing the transactions contemplated by the Loan
Documents to which it is a party; and (C) the incumbency and
specimen signatures of the officers of Borrower and each
Subsidiary authorized to execute documents on its behalf;
(vi) a Borrowing Base Report for Borrower, as of
January 31, 2002;
(vii) a certificate from the appropriate public
official of the jurisdiction in which Borrower and each
Subsidiary is organized as to the continued existence and good
standing of Borrower and each Subsidiary;
(viii) a certificate from the appropriate public
official of each jurisdiction in which Borrower and each
Subsidiary is authorized and qualified to do business as to
the due qualification and good standing of Borrower and each
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 26
Subsidiary unless failure is not reasonably likely to have a
Material Adverse Effect;
(ix) a legal opinion in form, substance and scope
reasonably satisfactory to Lender from counsel for, and issued
upon the express instructions of, Borrower and its
Subsidiaries; and
(x) certified copies of Requests for Information of
Copies (Form UCC-11), or equivalent reports, listing all
effective financing statements which name Borrower or any
Subsidiary (under its present name, any trade names and any
previous names) as debtor and which are filed, together with
copies of all such financing statements.
(g) FIELD EXAM/AUDIT. Lender shall have performed to its
satisfaction a field exam/audit of Borrower's and the Subsidiaries'
assets, including, without limitation, the Eligible Accounts
Receivables.
SECTION 7.2. CONDITIONS TO EACH LOAN, CONTINUATION OR CONVERSION.
Lender will not be obligated to make, continue or convert any Advance or LIBOR
Rate Portion (including its initial Advance) hereunder unless all of the
following conditions shall be satisfied at the time of such Advance,
continuation or conversion:
(a) REPRESENTATIONS AND WARRANTIES. The representations and
warranties made, or deemed made, in or pursuant to this Agreement and
the other Loan Documents shall be true and correct as of the date of
the contemplated Advance, continuation or conversion as though
originally made on such date, and Lender shall have received a
certificate from an Authorized Officer of Borrower certifying that: (i)
the representations and warranties of Borrower and its Subsidiaries
contained in the Loan Documents (other than those representations and
warranties limited by their terms to a specific date) shall be true and
correct on and as of the particular Borrowing Date or the applicable
Conversion/Continuation Date, as though made on and as of such date;
(ii) no Event of Default or Default has occurred and is continuing; and
(iii) no event has occurred since the date of the most recent financial
statements delivered pursuant to Section 8.1(a), that has caused, or
could reasonably be expected to cause, a Material Adverse Effect.
(b) NO DEFAULT. No Event of Default or Default shall have
occurred and be continuing.
(c) BORROWING DOCUMENTS. On each Borrowing Date, Lender shall
have received a Notice of Borrowing delivered in accordance with
Section 2.2 and any necessary report or representation required to be
delivered by Borrower subsequent to the Closing Date pursuant to
Section 7.1(f) or Section 8.1(c), as the case may be. Prior to the
issuance of any Letter of Credit, Lender shall have received an LOC
Application as required by this Agreement.
(d) CONVERSION/CONTINUATION DOCUMENTS. On each
Conversion/Continuation Date, Lender shall have received a Notice of
Rate
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 27
Change/Continuation and any documents or representations necessary to
facilitate such action.
(e) SECURITY FOR THE LOAN. Each Subsidiary shall have executed
and delivered to Lender a Guaranty and a Contribution Agreement and
Borrower and each Subsidiary shall have executed and delivered to
Lender, and filed where appropriate, all security agreements, pledge
agreements, financing statements and other documents, instruments and
agreements so as to create in favor of Lender a first priority lien on
all of the assets of Borrower and its Subsidiaries (other than the
Excluded Collateral, the real property and improvements, owned by
Borrower and located at 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx, and the
real property and improvements, owned by Xxxx Layer Xxxxxxx Company, a
wholly-owned Subsidiary of Borrower, and located at 0000 Xxxxxxxxx
Xxxx, Xxxxxx, Xxxx) as collateral for the Obligations; provided that,
after the occurrence of a Default, Borrower shall, if requested by
Lender, cause to be granted to Lender a first and prior lien on the
property in Austin, Texas, and Dayton, Ohio, above described pursuant
to a mortgage or deed of trust satisfactory to Lender and shall deliver
to Lender such title insurance policies, surveys, environmental reports
and other property specific information requested by Lender in
connection therewith.
(f) OTHER DOCUMENTATION AND INFORMATION. Lender shall have
received such other evidence, documentation and information as Lender
may reasonably request.
ARTICLE VIII
AFFIRMATIVE COVENANTS
Borrower covenants and agrees that, so long as Borrower may obtain
Advances or issuances of Letters of Credit under this Agreement and until
payment in full of the Obligations and termination of the Commitment, Borrower
will and will cause each Subsidiary to:
SECTION 8.1. FINANCIAL STATEMENTS AND INFORMATION. Furnish or cause to
be furnished to Lender a copy of each of the following within the times
indicated:
(a) as soon as available and in any event no later than ninety
(90) days after the end of each fiscal year of Borrower, (i) annual
audited consolidated financial statements for Borrower, and all notes
thereto, including a balance sheet and statements of income, retained
earnings and cash flows for such fiscal year and the immediately
preceding fiscal year in comparative form, all prepared in conformity
with GAAP on a consolidated basis and accompanied by a report and
opinion of Ernst & Young LLP or other firm of independent certified
public accountants satisfactory to Lender stating that such accountants
have conducted audits of such financial statements in accordance with
generally accepted auditing standards and that, in their opinion, such
financial statements present fairly, in all material respects,
Borrower's financial position as of their date and the results of
Borrower's operations and cash flows for the period they covered in
conformity with GAAP, (ii) copies of the internally prepared
consolidating balance sheets and statements of income of Borrower and
its Subsidiaries utilized in the preparation of the consolidated
financial statements of Borrower furnished to Lender pursuant to clause
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 28
(i) preceding and certified on behalf of Borrower by an appropriate
officer or other responsible party acceptable to Lender, and (iii) a
Compliance Certificate substantially in the form of Exhibit D;
(b) as soon as available and in any event within 45 days after
the end of each of the first three fiscal quarters of each fiscal year
of Borrower, (i), unaudited consolidated financial statements for
Borrower, including a balance sheet as at the close of such quarter and
an income statement and statement of cash flows for such quarter, all
prepared in accordance with GAAP on a consolidated basis and certified
on behalf of Borrower by an appropriate officer or other responsible
party acceptable to Lender, and (ii) a Compliance Certificate
substantially in the form of Exhibit D;
(c) as soon as available and in any event within 30 calendar
days after the end of each calendar month: (i) a Borrowing Base Report
and supporting exhibits substantially in the form of Exhibit A dated as
of the end of the preceding month; and (ii) a complete aging of all
accounts receivable by Borrower;
(d) promptly following the discovery thereof, information in
reasonable detail correcting any information provided to Lender in
reliance upon information from a customer of Borrower which Borrower
discovers to be inaccurate or misleading in any material respect;
(e) promptly upon the filing thereof, copies of all
registration statements, and annual, quarterly, monthly or other
regular reports filed by or on behalf of Borrower or any of its
Subsidiaries with the Securities and Exchange Commission; and
(f) such other information relating to Borrower's or any
Subsidiary's financial condition and affairs as Lender may from time to
time reasonably requests or as may be required from time to time by any
Loan Document.
SECTION 8.2. MAINTENANCE OF EXISTENCE AND GOOD STANDING. Maintain its
existence and obtain and maintain all franchises and permits necessary for
Borrower and each Subsidiary continuously to be in good standing in the state of
its organization with full power and authority to conduct its regular business
and to own and operate its property.
SECTION 8.3. COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS. Conduct its
business in substantial compliance with all Governmental Requirements and will
comply with and punctually perform all of the covenants, agreements and
obligations imposed upon it to the extent any failure to so comply could
reasonably be expected to have a Material Adverse Effect or cause any
representation or warranty in the Loan Documents to be false or misleading in
any material respect.
SECTION 8.4. PAYMENT OF OBLIGATIONS. Pay punctually and discharge when
due, or renew or extend, any debt incurred by it equal to or exceeding $100,000
and will discharge, perform and observe the covenants, provisions and conditions
to be performed, discharged and observed on its part in connection therewith or
in connection with any agreement or other instrument relating thereto or in
connection with any mortgage, pledge or lien existing at any
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 29
time upon any of the property or assets of Borrower securing the payment
thereof, provided, however, that nothing contained in this Section 8.4 shall
require Borrower to pay, discharge, renew or extend any such indebtedness or to
discharge, perform or observe any such covenants, provisions and conditions so
long as Borrower shall be diligently and in good faith contesting any claims
which may be asserted against it with respect to any such indebtedness or any
such covenants, provisions and conditions and shall set aside on its books
reserves with respect thereto deemed adequate by Lender.
SECTION 8.5. NOTIFICATION OF MATERIAL ADVERSE CHANGE. Promptly upon
acquiring knowledge of any material adverse change in its assets, liabilities,
financial condition, business, operations, affairs or circumstances, notify
Lender in writing thereof, setting forth the nature of such change in reasonable
detail and will take or cause to be taken all such steps as are necessary or
appropriate to remedy promptly any such change.
SECTION 8.6. NOTIFICATION OF DEFAULTS. Promptly upon acquiring
knowledge thereof, notify Lender by telephone (and confirm such notice in
writing within five (5) days) of the existence of any Default or Event of
Default hereunder or of any default or event of default (however denominated)
under any of the Loan Documents, or under the loan papers evidencing and/or
securing any other Debt, specifying the nature and duration thereof and what
action Borrower has taken, is taking and proposes to take with respect thereto.
In no event shall silence by Lender be deemed a waiver by it of a Default or an
Event of Default. Borrower will take all such steps as are necessary or
appropriate to remedy promptly any such Default or Event of Default.
SECTION 8.7. NOTIFICATION OF EXCHANGE ACT FILINGS. Promptly upon
acquiring knowledge of the filing with the Securities and Exchange Commission of
any Schedule 13D, 13G, or 14D-1 with respect to the acquisition of, or a tender
offer with respect to, the capital stock of Borrower, furnish a copy of such
filing to Lender.
SECTION 8.8. NOTIFICATION OF PROCEEDINGS AFFECTING COLLATERAL.
Immediately upon obtaining knowledge of the institution of any proceedings for
the condemnation of the Collateral covered by the Loan Documents, the real
property described in Section 7.2(e) or any material portion thereof, or any
other legal proceedings arising out of injury or damage to the Collateral
covered by the Loan Documents, the real property described in Section 7.2(e) or
any material portion thereof, notify Lender in writing of the pendency of such
proceedings. Lender may (but shall not be required to) participate in any such
proceedings, and Borrower or the applicable Subsidiary shall from time to time
deliver to Lender all instruments requested by it to permit such participation.
Borrower or the applicable Subsidiary shall, at its expense, diligently
prosecute any such proceedings, and shall consult with Lender, its attorneys and
experts, and cooperate with them in the carrying on or defense of any such
proceeding.
SECTION 8.9. ADDITIONAL INFORMATION. Furnish to Lender from time to
time, within ten (10) days after Lender's request thereof, such information
relating to the Collateral or Borrower's or any Subsidiary's financial condition
and affairs as Lender may from time to time request or as may be required from
time to time by any Loan Document.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 30
SECTION 8.10. BOOKS AND RECORDS. At all times maintain proper books of
record and account in accordance with sound accounting practice in which true,
full and correct entries will be made of all its dealings and business affairs,
and will set aside on its books adequate reserves for depletion, depreciation,
obsolescence and/or amortization of its property, and all other reserves which,
in accordance with sound accounting practice, should be set aside, and will
write down, to the estimated salvage value thereof, all property not useful in
its business. Lender shall be entitled to have such books examined and audited,
at the expense of Borrower, at any time (but, except during the continuance of a
Default, not more than once in any fiscal quarter of Borrower) by
representatives of Lender.
SECTION 8.11. INSURANCE. At all times maintain insurance with insurance
companies rated acceptably to Lender or otherwise acceptable to Lender, in such
amounts and against such risks as are satisfactory to Lender, including without
limitation casualty and liability insurance complying with the loss payee and
notice requirements specified in Section 7.1(d), and, in any event, as would be
reasonably prudent for entities in the same or similar type and size of business
and owning similar property in the same general area, and furnish to Lender, not
less frequently than annually a certificate of insurance as to the insurance
carried. If Borrower or any Subsidiary shall at any time or times hereafter fail
to obtain or maintain any of the policies of insurance required herein, or fail
to pay any premium in whole or in part relating to such policies, Lender may,
but shall not be obligated to, obtain or cause to be maintained insurance
coverage, including at Lender's option, the coverage provided by all or any of
the policies of Borrower and its Subsidiaries and pay all or any part of the
premium therefor, without waiving any default by Borrower, and any sums so
disbursed by Lender shall be additional Advances to Borrower by Lender payable
on demand.
SECTION 8.12. DEPOSIT RELATIONSHIP. Except for demand depositary
accounts maintained by Subsidiaries of Borrower for the purposes of facilitating
deposits of collections in the ordinary course of business and of providing a
source of daily xxxxx cash requirements, Borrower will at all times during the
term of this Agreement maintain, and cause its Subsidiaries (other than the
Excluded Subsidiaries) to maintain, general operating accounts and day-to-day
cash management accounts with Lender.
ARTICLE IX
NEGATIVE COVENANTS
Borrower covenants and agrees that, so long as Borrower may obtain
Advances or issuances of Letters of Credit under this Agreement and until
payment in full of the Obligations, Borrower will not and will not permit any
Subsidiary to, without obtaining the prior written consent of Lender:
SECTION 9.1. DEBT. Create, incur, suffer or permit to exist, or assume
or guarantee, directly or indirectly, or otherwise become or remain liable with
respect to, any Debt, contingent or otherwise (including without limitation, any
off balance sheet liabilities), except: (a) the Obligations; (b) Debt that is in
the form of loans or advances from Borrower to any Guarantor or between
Guarantors and that is not evidenced by promissory notes and, if requested by
Lender, is expressly subordinated to the Note; (c) any senior Debt not to exceed
$500,000 in the aggregate;
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 31
(d) Subordinated Debt (i) existing on the date of this Agreement and described
in Schedule 9.1 or (ii) incurred to make Permitted Acquisitions, provided that
the aggregate amount of Subordinated Debt issued for such purpose in any fiscal
year shall not exceed $3,000,000 and shall relate only to Permitted Acquisitions
made in the fiscal year in which it is counted; and (e) Debt existing on the
date of this Agreement and described in Schedule 9.1.
SECTION 9.2. LIENS. Create or suffer to be created or to exist any Lien
excepting only (a) Liens in favor of Lender to secure the Obligations, (b) Liens
subordinated to Liens in favor of Lender under terms acceptable to Lender in its
sole discretion and to which Lender is a party, (c) Liens created by operation
of law in the ordinary course of business for amounts not yet due (or being
contested in good faith by appropriate proceedings or other appropriate actions
which are sufficient to prevent enforcement of such Liens and with respect to
which adequate reserves or other appropriate provisions are being maintained in
accordance with GAAP), (d) Liens existing on the date of this Agreement and
described in Schedule 9.2, (e) Liens securing Debt or Capital Leases permitted
under Section 9.1(c), provided that no such Lien secures any Debt other than the
Debt incurred in connection with the purchase or lease of the property subject
thereto or encumbers any property (including the proceeds thereof) other than
the property purchased or leased with the proceeds of the Debt secured thereby,
(f) Liens in the form of precautionary financing statements filed under the
Uniform Commercial Code to reflect operating leases, (g) Liens in the form of
zoning restrictions, restrictive covenants, rights of way, easements, licenses
and other restrictions on the use of real property which do not materially
impair the use of such real property in the ordinary operation of the business
of Borrower or the applicable Subsidiary of Borrower utilizing the same, (h)
with respect to the shares of the common stock of HTE, Inc. registered in the
name of Borrower on the date of this Credit Agreement, Liens in the form of (i)
restrictions, if any, imposed upon the voting rights of such shares under the
laws of the State of Florida, and (ii) rights of redemption and cancellation of
such shares, if any, as may be vested in HTE, Inc., each as described in
footnote 8 ("Investment Securities Available-For-Sale") of the Notes to
Condensed Consolidated Financial Statements (Unaudited) contained in Borrower's
Form 10-Q for the Quarter Ended September 30, 2001, filed by Borrower with the
Securities and Exchange Commission on November 8, 2001, and (i) Liens in the
form of purchase money security interests in favor of vendors from whom
equipment is purchased in the ordinary course of business for resale to
customers of Borrower or its Subsidiaries if (1) such Liens in favor of any
vendor do not cover property other than equipment purchased from such vendor and
(2) the Debt secured by such Liens is fully paid within 120 days after the
creation thereof.
SECTION 9.3. ORGANIZATIONAL DOCUMENTS. Modify or amend its organization
documents or suffer or permit a material modification or amendment to its
organizational documents in any manner that reasonably could be expected to
affect any rights of Lender under the Loan Documents or have a Material Adverse
Effect.
SECTION 9.4. NO SUBSIDIARIES. Acquire or form any Subsidiary unless (a)
such Subsidiary (i) is a wholly-owned Subsidiary, (ii) executes and delivers to
Lender a Guaranty, (iii) enters into a Security Agreement in substantially the
form of the Security Agreements executed by Subsidiaries on the Closing Date,
and (iv) delivers such certificates, evidences of corporate action, financing
statements, opinions of counsel and other documents as Lender may reasonably
request and (b) Borrower or the appropriate Subsidiary executes a Pledge
Agreement pledging to
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 32
Lender the stock of such new Subsidiary, and delivers to Lender the applicable
stock certificates and stock powers executed in blank, all of the items referred
to in (a) and (b) above to be in form and substance reasonably satisfactory to
Lender, in each case not later than 10 days after the acquisition or formation
of such Subsidiary.
SECTION 9.5. DIVIDENDS. Declare or pay any Distributions, except
dividends declared and paid by any Guarantor to Borrower.
SECTION 9.6. ACQUISITIONS. Make any Acquisition other than a Permitted
Acquisition.
SECTION 9.7. MERGERS, CONSOLIDATIONS, ETC. (a) Merge or consolidate
with or into any other Person, (b) convey, transfer or otherwise dispose of all
or substantially all of its assets to any Person, except that Borrower may
dispose of the stock of Swan in connection with the confirmation of the plan of
reorganization to which reference is made in clause (a)(iv) of Section 6.7, or
(c) adopt or effect any plan of reorganization, recapitalization, liquidation or
dissolution, except that (i) a Subsidiary of Borrower may be a party to any
merger or consolidation that constitutes an Acquisition permitted by Section
9.6, provided that such Subsidiary shall be the survivor of any such merger or
consolidation, (ii) any Guarantor may merge into or consolidate with Borrower
(if Borrower is the survivor of any such merger or consolidation), (iii) any
Guarantor may merge into or consolidate with any other Guarantor, (iv) Borrower
may cause the statutory dissolutions of Swan and TPI, and, (v) if, at the time
of dissolution, neither their assets nor their revenues, each computed on both
an individual and a combined basis as of the end of and for the last full fiscal
quarter of Borrower preceding the date of such dissolution, do not exceed one
percent (1%) of Borrower's consolidated assets or revenues, as the case may be,
as of the end of, or for, such fiscal quarter, Borrower may cause the statutory
dissolutions of Xxxxxxxxxxx.xxx, Inc. and Tyler Leasing, Inc.
SECTION 9.8. CHANGE OF NAME. Change its name without first notifying
Lender in writing of such change at least thirty (30) days before its effective
date.
SECTION 9.9. FINANCIAL COVENANTS. Permit:
(a) Tangible Net Worth on the last day of any fiscal quarter
to be less than the sum of (i) the amount equal to ninety percent (90%)
of Borrower's consolidated Tangible Net Worth computed as of December
31, 2001, plus (ii) as of the end of each fiscal quarter commencing
with March 31, 2002, the product of (A) ninety percent (90%) times (b)
the consolidated net income of Borrower for the immediately preceding
fiscal quarter, provided, that in no case shall such sum be less than
the minimum Tangible Net Worth calculated hereunder for the previous
quarter.
(b) On a consolidated basis as of the last day of any fiscal
quarter, the ratio of Funded Debt to EBITDA for the preceding four
fiscal quarters then ended to be greater than 1.5:1.0.
(c) On a consolidated basis as of the last day of any fiscal
quarter, the Fixed Charge Coverage for the preceding four fiscal
quarters then ended to be less than 2.0:1.0.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 33
In calculating the above financial covenants, Borrower shall exclude
(i) any gain or loss attributable to shares of HTE, Inc. owned by Borrower (or
resulting from Borrower's sale or other disposition thereof), provided, that,
Borrower agrees to apply the net cash proceeds from any such sale up to the full
amount thereof to prepay any Advances outstanding on the date such net cash
proceeds are received by Borrower (or, with respect to any outstanding Advances
included in the LIBOR Rate Portion on such date, on the last day of the
applicable Rate Periods, in the order of occurrence) and (ii) any Tangible Net
Worth or EBITDA attributable to the Excluded Subsidiaries.
SECTION 9.10. INVESTMENTS. Make or permit to remain outstanding any
Investment other than Permitted Investments.
SECTION 9.11. SUBORDINATED DEBT; SELLER NOTE. Permit any amendment or
modification to the documents evidencing or governing any Subordinated Debt
permitted by Section 9.1(d) or the Debt owing to Xxx Xxxxxxx and V. Xxxx Xxxxxx
referenced in Schedule 9.1 (the "Seller Notes"), or directly or indirectly,
voluntarily prepay, defease or in substance defease, purchase, redeem, retire,
or otherwise acquire, any such Subordinated Debt or the Seller Notes, or make
any principal payment on the Subordinate Debt or the Seller Notes prior to
payment in full of the Obligations and the termination of the Commitment.
SECTION 9.12. CHARACTER OF BUSINESS. Change the general character of
its business as conducted on the Closing Date, or engage in any type of business
not reasonably related to its business as presently conducted.
ARTICLE X
EVENTS OF DEFAULT; REMEDIES
SECTION 10.1. EVENTS OF DEFAULT. The occurrence of any of the following
events shall constitute an "Event of Default" (herein so called) under this
Agreement:
(a) Borrower (i) shall fail to pay when due any payment or
prepayment of the principal of the Note or (ii) shall fail to pay when
due any interest on the Note or any other monetary amount due under
this Agreement or any other Loan Document and such failure shall not
have been cured within five (5) Business Days;
(b) (i) any covenant contained in Sections 8.1, 8.2, 8.5, 8.6,
8.9, or Article IX of this Agreement is not fully and timely performed,
observed or kept in all material respects or (ii) any other covenant,
agreement or condition contained in this Agreement or in any other Loan
Document is not fully and timely performed, observed or kept in all
material respects and such failure or breach is not cured within thirty
(30) days following the earlier of knowledge of such failure or breach
by Borrower or the receipt by Borrower of written notice thereof from
Lender;
(c) any representation, warranty, certification or statement
made or deemed to have been made by Borrower or any Subsidiary in this
Agreement or by Borrower or any other Person in any certificate,
financial statement or other document delivered pursuant
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 34
to this Agreement, including, without limitation, any other Loan
Document, shall prove to have been incorrect in any material respect
when made;
(d) any event or condition shall occur and continue unremedied
or unwaived for a period beyond any applicable cure period provided
pursuant to the terms of any Debt of Borrower or any Subsidiary in
excess of $500,000, which entitles (or, with the giving of notice or
lapse of time or both, would entitle) the holder of any such Debt to
accelerate the maturity thereof;
(e) Borrower or any Subsidiary shall commence a voluntary case
or other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment
of a trustee, receiver, liquidator, custodian or other similar official
of it or any substantial part of its property, or shall consent to any
such relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against
it, or shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due, or shall take
any corporate action to authorize any of the foregoing;
(f) an involuntary case or other proceeding shall be commenced
against Borrower or any Subsidiary seeking liquidation, reorganization
or other relief with respect to it or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking
the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, and
such involuntary case or other proceeding shall remain undismissed and
unstayed for a period of sixty (60) days; or an order for relief shall
be entered against Borrower or any Subsidiary under the federal
bankruptcy laws as now or hereafter in effect;
(g) one or more final judgments or orders for the payment of
money in an aggregate amount outstanding at any time in excess of
$100,000 shall be rendered against Borrower or any Subsidiary and such
judgment or order (i) shall continue unsatisfied and unstayed (unless
bonded with a supersedeas bond at least equal to such judgment or
order) for a period of thirty (30) days or (ii) is not fully paid and
satisfied at least ten days prior to the date on which any of its
assets may be lawfully sold to satisfy such judgment or order;
(h) one or more judgments or orders for the payment of money
shall be rendered against Borrower or any Subsidiary (other than any
Excluded Subsidiary), whether or not otherwise bonded or stayed, which
has a Material Adverse Effect; or
(i) the sale, pledge, encumbrance, assignment or transfer,
voluntarily or involuntarily, of any equity interest in any Guarantor,
without the prior written consent of Lender.
SECTION 10.2. REMEDIES. If any of the Events of Default specified in
Section 10.1 shall occur, then (a) Lender shall be entitled (i) by notice to
Borrower, to declare the commitments and the obligation to make Advances or
issue Letters of Credit hereunder to be terminated,
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 35
whereupon the same shall forthwith terminate, and (ii) to declare the Note and
all interest accrued and unpaid thereon, and all other amounts payable under the
Note, this Agreement, and the other Loan Documents, to be forthwith due and
payable, whereupon the notes, all such interest and all such other amounts,
shall become and be forthwith due and payable without presentment, demand,
protest, or further notice of any kind (including, without limitation, notice of
default, notice of intent to accelerate and notice of acceleration), all of
which are hereby expressly waived by Borrower, and (b) Lender may avail itself
of any and all powers, rights and remedies available at law or provided in this
Agreement, the Note, the other Loan Documents or any other document executed
pursuant hereto or in connection herewith; provided, however, that with respect
to any Event of Default described in Section 10.1(e) or 10.1(f), (a) the
Commitment and the obligation of Lender to make Advances or issue Letters of
Credit hereunder shall automatically be terminated and (b) the entire unpaid
principal amount of the Note, all interest accrued and unpaid thereon and all
such other amounts payable under the Note, this Agreement and the other Loan
Documents, shall automatically become immediately due and payable, without
presentment, demand, protest, or any notice of any kind (including, without
limitation, notice of default, notice of intent to accelerate and notice of
acceleration), all of which are hereby expressly waived by Borrower.
SECTION 10.3. CERTAIN OTHER REMEDIAL MATTERS. Upon the occurrence of
any Event of Default, Lender shall also have the right immediately and without
notice, to take possession of and exercise possessory rights with regard to any
property securing payment of the Obligations. All powers, rights and remedies of
Lender set forth in this Article X shall be cumulative and not exclusive of any
other power, right or remedy available to Lender under any Governmental
Requirement or under this Agreement, the Note, the other Loan Documents or any
other document executed pursuant hereto or in connection herewith to enforce the
performance or observance of the covenants and agreements contained in this
Agreement and the other Loan Documents, and no delay or omission of Lender to
exercise any power, right or remedy shall impair any such power, right or
remedy, or shall be construed to be a waiver of the right to exercise any such
power, right or remedy. Every power, right or remedy of Lender set forth in this
Agreement, the Note, the other Loan Documents or any other document executed
pursuant hereto or in connection herewith, or afforded by Governmental
Requirement may be exercised from time to time, and as often as may be deemed
expedient by Lender.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. WAIVERS, ETC. No failure or delay on the part of Lender
in exercising any power or right hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. No course of dealing between Borrower and Lender shall operate
as a waiver of any right of Lender. No modification or waiver of any provision
of this Agreement, the Note or any other Loan Document nor consent to any
departure by Borrower therefrom shall in any event be effective unless the same
shall be in writing, and then such waiver or consent shall be effective only in
the specific instance and for the purpose for which given. No notice to or
demand on
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 36
Borrower in any case shall entitle Borrower to any other or further notice or
demand in similar or other circumstances.
SECTION 11.2. REIMBURSEMENT OF EXPENSES. Whether or not the
transactions contemplated by this Agreement shall be consummated, Borrower
agrees to reimburse, within ten (10) days after written demand therefor, (a)
Lender for its out-of-pocket expenses, including the reasonable fees and
expenses of counsel to Lender, in connection with such transactions, or any of
them, or otherwise in connection with this Agreement or any other Loan Document,
including, without limitation, the negotiation, preparation, execution,
administration, modification and enforcement of this Agreement or any other Loan
Document and all fees, including the reasonable fees and expenses of counsel to
Lender, costs and expenses of Lender in connection with audits, due diligence,
transportation, computer, duplication, consultants, search reports, all filing
and recording fees, appraisals, insurance, environmental inspection fees, survey
fees and escrow fees, and (b) Lender for its out-of-pocket expenses, including
the reasonable fees and expenses of its counsel, in connection with the
enforcement of this Agreement or any other Loan Document.
SECTION 11.3. VENUE. BORROWER AND LENDER AGREE THAT DALLAS COUNTY,
TEXAS IS PROPER VENUE FOR ANY ACTION OR PROCEEDING BROUGHT BY BORROWER OR
LENDER, WHETHER IN CONTRACT, TORT OR OTHERWISE. ANY ACTION OR PROCEEDING AGAINST
BORROWER MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT IN SUCH COUNTY TO THE
EXTENT NOT PROHIBITED BY APPLICABLE LAW. TO THE EXTENT PERMITTED BY APPLICABLE
LAW, BORROWER HEREBY IRREVOCABLY (A) SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF
SUCH COURTS, AND (B) WAIVES ANY OBJECTION BORROWER MAY NOW OR HEREAFTER HAVE AS
TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT OR THAT
ANY SUCH COURT IS AN INCONVENIENT FORUM. BORROWER AGREES THAT SERVICE OF PROCESS
UPON BORROWER MAY BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT
REQUESTED, AT BORROWER'S ADDRESSES SPECIFIED IN SECTION 11.4. LENDER MAY SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW AND MAY BRING ANY ACTION OR
PROCEEDING AGAINST BORROWER OR WITH RESPECT TO ANY OF BORROWER'S PROPERTIES IN
COURTS IN OTHER PROPER JURISDICTIONS OR VENUES.
SECTION 11.4. NOTICES. All notices and other communications provided
for herein shall be in writing (including telex, facsimile, or cable
communication) and shall be mailed, couriered, telecopied, telexed, cabled or
delivered addressed as follows:
If to Borrower, to it at:
0000 Xxxxxx Xxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Treasurer
Telephone: 000-000-0000
Fax:000-000-0000
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 37
If to Lender, to it at:
Bank of Texas, N.A.
0000 Xxxxxx Xxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxx Xxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
or as to Borrower or Lender, to such other address as shall be designated by
such party in a written notice to the other parties. All such notices and
communications shall, when mailed, delivered by courier, telecopied, telexed,
transmitted, or cabled, become effective when three (3) Business Days have
elapsed after being deposited in the mail (with first class postage prepaid and
addressed as aforesaid), or when confirmed by telex answerback, transmitted to
the correct telecopier, or delivered to the courier or the cable company, except
that notices and communications from Borrower to Lender shall not be effective
until actually received by Lender.
SECTION 11.5. GOVERNING LAW. EACH LOAN DOCUMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND THE UNITED
STATES OF AMERICA.
SECTION 11.6. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS.
All representations, warranties and covenants contained herein or in the other
Loan Documents or made in writing by Borrower or any Subsidiary in connection
herewith or therewith shall survive the execution and delivery of this Agreement
and the Note, and will bind and inure to the benefit of the respective
successors and assigns of the parties hereto, whether so expressed or not,
provided that the undertaking of Lender to make Advances to, or issue Letters of
Credit for, Borrower shall not inure to the benefit of any successor or assign
of Borrower. No investigation at any time made by or on behalf of Lender shall
diminish Lender's right to rely thereon.
SECTION 11.7. COUNTERPARTS; EXECUTION BY FACSIMILE TRANSMISSION. This
Agreement may be executed in several counterparts, and by the parties hereto on
separate counterparts, and each counterpart, when so executed and delivered,
shall constitute an original instrument, and all such separate counterparts
shall constitute but one and the same instrument. The method of execution of
each Loan Document may be by means of facsimile transmission, and delivery of
such a facsimile transmission shall be deemed an original for purposes hereof,
and each party so delivering a facsimile transmission shall promptly thereafter
deliver the original version thereof.
SECTION 11.8. SEPARABILITY. Should any clause, sentence, paragraph or
section of this Agreement be judicially declared to be invalid, unenforceable or
void, such decision shall not have the effect of invalidating or voiding the
remainder of this Agreement, and the parties hereto agree that the part or parts
of this Agreement so held to be invalid, unenforceable or void will be deemed to
have been stricken herefrom and the remainder will have the same force and
effectiveness as if such part or parts had never been included herein. Each
covenant contained in this Agreement shall be construed (absent an express
contrary provision herein) as being
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 38
independent of each other covenant contained herein, and compliance with any one
covenant shall not (absent such an express contrary provision) be deemed to
excuse compliance with one or more other covenants.
SECTION 11.9. DESCRIPTIVE HEADINGS. The section headings in this
Agreement have been inserted for convenience only and shall be given no
substantive meaning or significance whatsoever in construing the terms and
provisions of this Agreement.
SECTION 11.10. SETOFF. Borrower, for itself and its Subsidiaries,
hereby gives and confirms to Lender a right of setoff of all moneys, securities
and other property of Borrower or any Subsidiary and the proceeds thereof, now
or hereafter delivered to remain with or in transit in any manner to Lender, its
correspondents or its agents from or for Borrower or any Subsidiary, whether for
safekeeping, custody, pledge, transmission, collection or otherwise or coming
into possession of Lender in any way, and also, any balance of any deposit
accounts and credits of Borrower or any Subsidiary with, and any and all claims
of security for the payment of the Note and of all other liabilities and
obligations now or hereafter owed by Borrower or any Subsidiary to Lender,
contracted with or acquired by Lender, whether such liabilities and obligations
be joint, several, absolute, contingent, secured, unsecured, matured or
unmatured, and Borrower, for itself and its Subsidiaries, hereby authorizes
Lender at any time or times, while there is then continuing an Event of Default
without prior notice, to apply such money, securities, other property, proceeds,
balances, credits of claims, or any part of the foregoing, to any or all of the
Obligations now or hereafter existing, whether such Obligations be contingent,
unmatured or otherwise, and whether any collateral security therefor is deemed
adequate or not. The rights described herein shall be in addition to any
collateral security described in any separate agreement executed by Borrower.
SECTION 11.11. SUCCESSORS AND ASSIGNS; PARTICIPATIONS.
(a) All covenants, promises and agreements by or on behalf of
Borrower, its Subsidiaries or Lender contained in this Agreement and
the other Loan Documents shall bind and inure to the benefit of their
respective successors and permitted assigns. Neither Borrower nor any
Subsidiary may assign or transfer any of its rights or obligations
under the Loan Documents without the prior written consent of Lender,
except in connection with the consummation of a transaction permitted
under Section 9.7.
(b) Lender may sell participations to one or more banks or
other financial institutions in all or a portion of its rights and
obligations under this Agreement and the other Loan Documents
(including all or a portion of any of its Commitment, the Loan and the
Obligations of Borrower owing to it and the Note held by it).
(c) Notwithstanding any other provision herein, Lender may, in
connection with any assignment or participation or proposed assignment
or participation pursuant to this Section 11.11, disclose to the
assignee or participant or proposed assignee or participant, any
information relating to Borrower or any Subsidiary furnished to Lender
by or on behalf of Borrower or any Subsidiary.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 39
SECTION 11.12. INTEREST. All agreements between Borrower and Lender,
whether now existing or hereafter arising and whether written or oral, are
hereby expressly limited so that in no contingency or event whatsoever, whether
by reason of demand being made on the Note or otherwise, shall the amount
contracted for, charged, reserved or received by Lender for the use,
forbearance, or detention of the money to be loaned under this Agreement or
otherwise or for the payment or performance of any covenant or obligation
contained herein or in any other Loan Document exceed the Highest Lawful Rate.
If, as a result of any circumstances whatsoever, fulfillment by Borrower of any
provision hereof or of any of such documents, at the time performance of such
provision shall be due, shall involve transcending the limit of validity
prescribed by applicable usury law or result in Lender having or being deemed to
have contracted for, charged, reserved or received interest (or amounts deemed
to be interest) in excess of the maximum lawful rate or amount of interest
allowed by applicable law to be so contracted for, charged, reserved or received
by Lender, then, ipso facto, the obligation to be fulfilled by Borrower shall be
reduced to the limit of such validity, and if, from any such circumstance,
Lender shall ever receive interest or anything which might be deemed interest
under applicable law which would exceed the Highest Lawful Rate, such amount
which would be excessive interest shall be refunded to Borrower, or, to the
extent (i) permitted by applicable law and (ii) such excessive interest does not
exceed the unpaid principal balance of the Note and the amounts owing on other
Obligations of Borrower to Lender under any Loan Document, applied to the
reduction of the principal amount owing on account of the Note or the amounts
owing on other Obligations of Borrower to Lender under any Loan Document and not
to the payment of interest. All sums paid or agreed to be paid to Lender for the
use, forbearance, or detention of the indebtedness of Borrower to Lender shall,
to the extent permitted by applicable law, be amortized, prorated, allocated,
and spread throughout the full term of such indebtedness until payment in full
of the principal thereof (including the period of any renewal or extension
thereof) so that the interest on account of such indebtedness shall not exceed
the Highest Lawful Rate. The terms and provisions of this Section 11.12 shall
control and supersede every other provision hereof and of all other agreements
between Borrower and Lender. Borrower and Lender agree that Chapter 15 of the
Texas Credit Code shall not apply to this Agreement, the Note, the Loan or the
Commitment.
SECTION 11.13. INDEMNIFICATION. Borrower agrees:
(a) TO INDEMNIFY LENDER AND ITS AFFILIATES AND EACH OF ITS
OFFICERS, DIRECTORS, EMPLOYEES, SHAREHOLDERS, REPRESENTATIVES, AGENTS,
ATTORNEYS, ACCOUNTANTS AND EXPERTS ("INDEMNIFIED PARTIES") FROM, HOLD
EACH OF THEM HARMLESS AGAINST AND PROMPTLY UPON DEMAND PAY OR REIMBURSE
EACH OF THEM FOR, THE INDEMNITY MATTERS WHICH MAY BE INCURRED BY OR
ASSERTED AGAINST OR INVOLVE ANY OF THEM (WHETHER OR NOT ANY OF THEM IS
DESIGNATED A PARTY THERETO) AS A RESULT OF, ARISING OUT OF OR IN ANY
WAY RELATED TO (I) ANY ACTUAL OR PROPOSED USE BY BORROWER OF THE
PROCEEDS OF THE LOAN, (II) THE EXECUTION, DELIVERY AND PERFORMANCE OF
THE LOAN DOCUMENTS, (III) THE OPERATION OF THE BUSINESS OF BORROWER OR
THE SUBSIDIARIES, (IV) THE FAILURE
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 40
OF BORROWER OR ANY OF THE SUBSIDIARIES TO COMPLY WITH THE TERMS OF ANY
LOAN DOCUMENT OR WITH ANY GOVERNMENTAL REQUIREMENT, (V) ANY INACCURACY
OF ANY REPRESENTATION OR ANY BREACH OF ANY WARRANTY OF BORROWER OR ANY
OF THE SUBSIDIARIES SET FORTH IN ANY OF THE LOAN DOCUMENTS, (VI) ANY
ASSERTION THAT LENDER WAS NOT ENTITLED TO RECEIVE THE PROCEEDS RECEIVED
PURSUANT TO THE LOAN DOCUMENTS OR (VII) ANY OTHER ASPECT OF THE LOAN
DOCUMENTS, INCLUDING, WITHOUT LIMITATION, THE REASONABLE FEES AND
DISBURSEMENTS OF COUNSEL AND ALL OTHER EXPENSES INCURRED IN CONNECTION
WITH INVESTIGATING, DEFENDING OR PREPARING TO DEFEND ANY SUCH ACTION,
SUIT, PROCEEDING (INCLUDING ANY INVESTIGATIONS, LITIGATIONS OR
INQUIRIES) OR CLAIM AND INCLUDING ALL INDEMNITY MATTERS ARISING BY
REASON OF THE NEGLIGENCE OF ANY INDEMNIFIED PARTY (EXCEPT AS TO THE
EXTENT ANY SUCH INDEMNITY MATTERS HAVE BEEN CAUSED BY THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED PARTY, IT BEING
THE INTENT OF THE PARTIES THAT EACH INDEMNIFIED PARTY SHALL BE
INDEMNIFIED FROM INDEMNITY MATTERS CAUSED BY THE NEGLIGENCE, WHETHER
SOLE, JOINT, CONCURRENT, CONTRIBUTORY, ACTIVE OR PASSIVE, OF SUCH
INDEMNIFIED PARTY), PROVIDED, HOWEVER, THAT THE PROVISIONS OF THIS
SECTION 11.13(A) SHALL NOT BE APPLICABLE TO ANY ACTION INITIATED BY
BORROWER AGAINST LENDER FOR BREACH OF CONTRACTUAL OBLIGATION CONTAINED
IN ANY OF THE LOAN DOCUMENTS IN WHICH BORROWER IS THE PREVAILING PARTY;
AND
(b) TO INDEMNIFY AND HOLD HARMLESS FROM TIME TO TIME THE
INDEMNIFIED PARTY FROM AND AGAINST ANY AND ALL LOSSES, CLAIMS, COST
RECOVERY ACTIONS, ADMINISTRATIVE ORDERS OR PROCEEDINGS, DAMAGES AND
LIABILITIES TO WHICH ANY SUCH PERSON MAY BECOME SUBJECT (I) UNDER ANY
ENVIRONMENTAL LAW APPLICABLE TO BORROWER, THE SUBSIDIARIES, OR ANY OF
THEIR PROPERTIES, INCLUDING, WITHOUT LIMITATION, THE TREATMENT OR
DISPOSAL OF HAZARDOUS SUBSTANCES ON ANY OF THEIR PROPERTIES, (II) AS A
RESULT OF THE BREACH OR NON-COMPLIANCE BY BORROWER OR ANY SUBSIDIARY
WITH ANY ENVIRONMENTAL LAW APPLICABLE TO BORROWER OR ANY SUBSIDIARY,
(III) DUE TO PAST OWNERSHIP BY BORROWER OR ANY SUBSIDIARY OF ANY OF ITS
PROPERTIES OR PAST ACTIVITY ON ANY OF ITS PROPERTIES WHICH, THOUGH
LAWFUL AND FULLY PERMISSIBLE AT THE TIME, COULD RESULT IN PRESENT
LIABILITY, (IV) THE PRESENCE, USE, RELEASE, STORAGE, TREATMENT OR
DISPOSAL OF HAZARDOUS SUBSTANCES ON OR AT ANY OF THE PROPERTIES OWNED
OR OPERATED BY BORROWER OR ANY SUBSIDIARY OR (V) ANY OTHER
ENVIRONMENTAL, HEALTH OR
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 41
SAFETY CONDITION IN CONNECTION WITH THE BUSINESS OF BORROWER OR ANY
SUBSIDIARY.
(c) Borrower's obligations under this Section 11.13 shall
survive the termination of this Agreement and the payment in full of
the Note and all other amounts payable hereunder.
SECTION 11.14. PAYMENTS SET ASIDE. To the extent any payments on the
Obligations or proceeds of any Collateral or the proceeds of such enforcement or
setoff or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to a trustee,
receiver or any other Person under any Debtor Relief Law, then to the extent of
such recovery, the Obligations or part thereof originally intended to be
satisfied, and all rights and remedies therefor, shall be revived and shall
continue in full force and effect, and Lender's rights, powers and remedies
under this Agreement and each other Loan Document shall continue in full force
and effect, as if such payment had not been made or such enforcement or setoff
had not occurred. In such event, each Loan Document shall be automatically
reinstated and Borrower and each Subsidiary shall take such action as may be
reasonably requested by Lender to effect such reinstatement.
SECTION 11.15. AMENDMENTS, ETC. No amendment or waiver of any provision
of this Agreement, the Note or any other Loan Document, nor consent to any
departure by Borrower or any Subsidiary herefrom or therefrom, shall in any
event be effective unless the same shall be in writing and signed by Borrower
and/or the applicable Subsidiary, as to amendments, and by Lender in all cases,
and then, in any case, such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
SECTION 11.16. RELATIONSHIP OF THE PARTIES. This Agreement provides for
the making of a loan by Lender, in its capacity as a lender, to Borrower, in its
capacity as a borrower, and for the payment of interest and repayment of
principal by Borrower to Lender. The relationship between Lender and Borrower is
limited to that of creditor/secured party, on the one hand, and debtor, on the
other hand. The provisions herein for compliance with financial, environmental,
and other covenants, delivery of financial, environmental and other reports, and
financial, environmental and other inspections, investigations, audits,
examinations or tests are intended solely for the benefit of Lender to protect
its interests as a lender in assuring payments of interest and repayment of
principal and nothing contained in this Agreement or any other Loan Document
shall be construed as permitting or obligating Lender to act as financial or
business advisors or consultants to Borrower or any Subsidiary, as permitting or
obligating Lender to control Borrower or any Subsidiary or to conduct or operate
Borrower's or any Subsidiary's operations, as creating any fiduciary obligation
on the part of Lender to Borrower or any Subsidiary, or as creating any joint
venture, agency, or other relationship between the parties other than as
explicitly and specifically stated in this Agreement. Borrower acknowledges that
it has had the opportunity to obtain the advice of experienced counsel of its
own choosing in connection with the negotiation and execution of this Agreement
and the other Loan Documents and to obtain the advice of such counsel with
respect to all matters contained herein. Borrower further acknowledges that it
is experienced with respect to financial and credit matters and has made its own
independent decision to apply to Lender for the financial accommodations
provided hereby and to execute and deliver this Agreement and the other Loan
Documents.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 42
SECTION 11.17. CERTAIN MATTERS OF CONSTRUCTION. The masculine and
neuter genders used in this Agreement each includes the masculine, feminine and
neuter genders, and whenever the singular number is used, the same shall include
the plural where appropriate, and vice versa. Wherever the term "including" or a
similar term is used in this Agreement, it shall be read as if it were written
"including by way of example only and without in any way limiting the generality
of the clause or concept referred to."
SECTION 11.18. FINAL AGREEMENT. THIS WRITTEN AGREEMENT AND THE OTHER
LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 43
IN WITNESS WHEREOF, the parties hereto, by their respective officers
thereunto duly authorized, have executed this Agreement effective as of February
27, 2002.
BORROWER:
TYLER TECHNOLOGIES, INC., a
Delaware corporation
By:
------------------------------------
Xxxxx X. Xxxxxx,
Vice President-Finance
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 44
IN WITNESS WHEREOF, the parties hereto, by their respective officers
thereunto duly authorized, have executed this Agreement effective as of February
27, 2002.
LENDER:
BANK OF TEXAS, N.A., a national
banking association
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
CREDIT AGREEMENT - TYLER TECHNOLOGIES, INC. PAGE 45
SCHEDULE I
PRICING SCHEDULE
TYPE OR FEE MARGIN
Base Rate Portion 0
LIBOR Rate Portion 3%
Letter of Credit 2.5%
CREDIT AGREEMENT - SCHEDULE I PAGE 1
SCHEDULE II
List of Subsidiaries
Appraisal Records Services, Inc., a Texas corporation
Automated Records Services, Inc., a Texas corporation
Xxxx Layer Xxxxxxx Company, a Delaware corporation
Eagle Computer Systems, Inc., a Delaware corporation
FundBalance, Inc., a Delaware corporation
Interactive Computer Designs, Inc., a Texas corporation
MUNIS, Inc., a Maine corporation
XxxxxxxXxxx.xxx, Inc., a Delaware corporation
The Software Group, Inc., a Texas corporation
Tyler Leasing, Inc., a Delaware corporation
TPI of Texas, Inc., a Delaware corporation
Swan Transportation Company, a Delaware corporation
CREDIT AGREEMENT - SCHEDULE II PAGE 1
