Execution Copy
SECOND AMENDMENT
TO
CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this "AMENDMENT") is entered
into as of March 4, 1997 among OLYMPIC FINANCIAL LTD., a Minnesota corporation
(the "COMPANY"), the financial institutions signatory hereto (collectively, the
"LENDERS") and BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as agent
for the Lenders (the "AGENT").
WITNESSETH:
WHEREAS, the Company, the Agent and the Lenders are parties to a Credit
Agreement dated as of July 11, 1996 (as heretofore amended, the "CREDIT
AGREEMENT");
WHEREAS, Section 7.10(f) of the Credit Agreement permits the Company to
incur or suffer to exist unsecured Indebtedness evidenced by the Senior Notes
and Indebtedness that is incurred after the Effective Date that is not
Subordinated Debt if it is issued pursuant to an instrument no less favorable to
the Lenders and the Company than the Senior Notes Indenture;
WHEREAS, the Company desires to sell $300,000,000 of its 11.50% Senior
Notes due 2007 (the "NEW NOTES") pursuant to an indenture and supplemental
indenture relating to the New Notes (collectively, the "NEW INDENTURE") that the
Agent and the Lenders have not had an opportunity to completely review, and a
portion of the proceeds of such New Notes will be used to pay in full and retire
or defease all outstanding Senior Notes;
WHEREAS, the Company has provided to the Lenders and the Agent the
Description of Notes (the "RED XXXXXXX DESCRIPTION") from Company's red xxxxxxx
Prospectus dated February 21, 1997 describing the New Indenture and the New
Notes; and
WHEREAS, the Company has requested that the Credit Agreement be amended in
certain respects and has also requested the acknowledgement contained herein.
NOW, THEREFORE, in consideration of the premises and mutual agreements
herein contained, the parties hereto agree as follows:
SECTION 1. DEFINED TERMS.
Terms defined in the Credit Agreement and not otherwise
defined herein are used herein as therein defined.
SECTION 2. AMENDMENTS TO CREDIT AGREEMENT AND ACKNOWLEDGEMENT.
2.1 AMENDMENTS TO CREDIT AGREEMENT. On the Effective Date (defined
below):
2.1.1 The definition of "Loan Documents" in Section 1.1 of the Credit
Agreement shall be amended by adding the following at the end of such
definition: "(including any Subsidiary Guaranty delivered pursuant to Section
7.21)."
2.1.2 The following Section 7.21 shall be added to the Credit
Agreement:
7.21 LIMITATION ON ISSUANCE OF GUARANTY OBLIGATIONS. The Company
will not permit any Subsidiary to create, incur, assume, suffer to exist,
or otherwise become or remain directly or indirectly liable with respect to
any Indebtedness referred to in clause (e) of the definition of
"Indebtedness" (a "GUARANTY OBLIGATION") relating to any Indebtedness of
the Company unless
(i) such Subsidiary simultaneously executes and delivers to the Agent
a guaranty of the Obligations in form and substance satisfactory to the
Agent (a "SUBSIDIARY GUARANTY"), together with such supporting
documentation as the Agent may reasonably request, and
(ii) if the Indebtedness guaranteed by the Guaranty Obligation is by
its terms subordinated to the Obligations, any such assumption, guaranty or
other liability of such Subsidiary with respect to such Indebtedness shall
be subordinated, in form and substance satisfactory to the Agent, to such
Subsidiary Guaranty to the same extent as such Indebtedness is subordinated
to the Obligations (IT BEING UNDERSTOOD that the Guaranty Obligation shall
be subordinated to the full amount of the Subsidiary Guaranty without
giving effect to any reduction thereto necessary to render the Subsidiary
Guaranty not voidable under applicable law relating to fraudulent
conveyance or fraudulent transfer).
2.1.3 Section 8.1(k) of the Credit Agreement shall be amended by adding
the following language at the end of the section:
or an offer to purchase any of its 11.50% Senior Notes due 2007 ("New
Senior Notes") under Section 510 of the First Supplemental Indenture
dated as of March 12, 1997 between the Company and Norwest Bank
Minnesota,
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National Association, as trustee (the "New Senior Notes Supplemental
Indenture").
2.1.4 Section 8.1(m) of the Credit Agreement shall be amended by adding
the following language at the end of the section:
or the Company is required to make any Change in Control Offer (as
defined in the New Senior Notes Supplemental Indenture) pursuant to
Section 509 of the New Senior Notes Supplemental Indenture and New
Senior Notes in an aggregate principal amount greater than $20,000,000
are tendered from time to time to the Company in response to any such
offer or offers.
2.1.5 Section 8.1 of the Credit Agreement shall be amended by adding
the following Section 8.1(o):
(o) GUARANTOR DEFAULTS. Any Subsidiary Guaranty entered into
pursuant to Section 7.21 shall cease to be in full force and effect
with respect to any Subsidiary party thereto, any such Subsidiary
shall fail to comply with or to perform any applicable provision of
such Subsidiary Guaranty, or any such Subsidiary (or any Person acting
by, through or on behalf of such Subsidiary) shall contest any manner
the validity, binding nature or enforceability of such Subsidiary
Guaranty.
2.2 ACKNOWLEDGMENT. The Required Lenders acknowledge for the benefit of
the Company that, after giving effect to the amendments set forth herein, based
solely upon their review of the Red Xxxxxxx Description, the New Indenture will
not be deemed to be less favorable to the Company and the Lenders than the
Senior Notes Indenture; PROVIDED, that the New Indenture will contain revisions
from the Red Xxxxxxx Description to the following effect (i) the definition of
"Permitted Liens" will be revised to permit "Liens on Receivables securing
Permitted Warehouse Debt" (or similar language) and (ii) the exception to the
covenant restricting "Incurrence of Indebtedness and Issuance of Preferred
Stock" covering guarantees between the Company and its "Restricted Subsidiaries"
will be revised to permit any "Restricted Subsidiary" that becomes a "Subsidiary
Guarantor" (as such terms are defined in the Red Xxxxxxx Description) to
guarantee the Company's obligations under the Credit Agreement. This
acknowledgement shall not prevent the Lenders from asserting that the New
Indenture is less favorable to the Company and the Lenders than the Senior Notes
Indenture (and thus that the Company has breached Section 7.10(f) of the Credit
Agreement) upon completion of their review of the New Notes and New Indenture to
the extent of material matters not covered or not
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accurately or completely covered by the Red Xxxxxxx Description.
SECTION 3. CONDITIONS PRECEDENT.
The amendments to the Credit Agreement and the consent of the Lenders set
forth in SECTION 2 of this Amendment shall become effective on such date (the
"EFFECTIVE DATE") when the Agent shall have received all of the following, each
duly executed and dated the date hereof, and each in a sufficient number of
signed counterparts to provide one to each Lender:
(a) AMENDMENT. An original of this Amendment, duly executed by
the Company and the Required Lenders.
(b) OPINION. An opinion of Xxxxxx & Xxxxxxx LLP, counsel to the
Company, in form and substance satisfactory to the Agent.
(c) NEW INDENTURE. Copies, certified by the Secretary or an
Assistant Secretary of the Company, of the Indenture, dated as of
March 12, 1997, between the Company and Norwest Bank Minnesota,
National Association, as trustee (the "NEW TRUSTEE"), and the First
Supplemental Indenture thereto, dated as of March 12, 1997, between
the Company and the New Trustee, in relation to the New Notes.
(d) OTHER. Such other documents as the Agent or any Lender may
reasonably request.
SECTION 4. MISCELLANEOUS.
4.1 WARRANTIES TRUE AND ABSENCE OF DEFAULTS. In order to induce the Agent
and the Lenders to enter into this Amendment, the Company hereby warrants to the
Agent and the Lenders that, as of the date hereof and the Effective Date:
(a) The representations and warranties set forth in Article V of
the Credit Agreement (other than as set forth in the last sentence of
Section 5.5 of the Credit Agreement) and in the Pledge and Security
Agreement are true and correct (except to the extent such
representations and warranties expressly refer to an earlier date, in
which case they shall be true and correct as of such earlier date).
(b) No Event of Default or Unmatured Event of Default exists.
4.2 GOVERNING LAW. This Amendment shall be a contract made under and
governed by the law of the State of New York.
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4.3 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, and by the parties hereto on the same or separate counterparts,
and each such counterpart, when so executed and delivered, shall be deemed to be
an original, but all such counterparts shall together constitute but one and the
same instrument.
4.4 REFERENCES TO DOCUMENTS. Except as amended hereby, the Credit
Agreement shall remain in full force and effect and is hereby ratified and
confirmed in all respects. On and after the effectiveness hereof, each
reference in the Credit Agreement to "this Agreement," "hereunder," "hereof,"
"herein" or words of like import, and each reference to the Credit Agreement in
any Note or in any other Loan Document, shall be deemed a reference to the
Credit Agreement, as amended hereby.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized as of the date
and year first above written.
OLYMPIC FINANCIAL LTD.
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------
Title:
----------------------
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Agent
By: /s/ Xxxxxxx [illegible]
-------------------------
Title: Managing Director
----------------------
BANK OF AMERICA ILLINOIS, as a
Lender
By: /s/ Xxxxxxx [illegible]
-------------------------
Title: Managing Director
----------------------
FIRST BANK NATIONAL ASSOCIATION, as
Co-Manager and as a Lender
By: /s/ [illegible]
-------------------------
Title: Vice President
----------------------
COMERICA BANK
By: /s/ Xxxxx [illegible]
-------------------------
Title: Vice President
----------------------
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DG BANK DEUTSCHE
GENOSSENSCHAFTSBANK, CAYMAN ISLAND
BRANCH
By: /s/ Xxxxx Xxxx
-------------------------
Title: Vice President
----------------------
By: /s/
-------------------------
Title:
----------------------
DRESDNER BANK AG, NEW YORK AND GRAND
CAYMAN BRANCHES
By: /s/ Xxxxxx X. Nodramia
-------------------------
Title: Vice President
----------------------
By: /s/ Xxxxxxxxxxx X. Xxxxxxx
-------------------------
Title: Assistant Treasurer
----------------------
THE SUMITOMO BANK, LIMITED
By: /s/ Xxxxxxx X. Xxxxxxxxx
---------------------------
Title: Vice President & Manager
---------------------------
By: /s/ Xxxx X. Xxxxxxxx
-------------------------
Title: Vice President
----------------------
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