EXHIBIT 10.5.1
Execution Copy
FIRST AMENDMENT TO CREDIT AGREEMENT AND WAIVER
THIS FIRST AMENDMENT TO CREDIT AGREEMENT AND WAIVER dated as of December 7,
1998 by and between EDUTREK INTERNATIONAL, INC. (f/k/a E_Holdings, Inc.)
(together with its successors and assigns, the "Borrower"), each of the Lenders
a signatory hereto (the "Lenders") and NATIONSBANK, N.A. (f/k/a NationsBank,
N.A. (South)), as Agent (the "Agent").
WHEREAS, the Borrower and the Lenders and the Agent entered into that
certain Credit Agreement dated as of October_8, 1996 (the "Credit Agreement"),
pursuant to which the Lenders agreed to make available to the Borrower certain
financial accommodations; and
WHEREAS, the Borrower, the Lenders hereby agree, on the terms and
conditions set forth herein, to amend the Credit Agreement in certain respects;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties, the parties hereto
agree as follows:
SECTION 1. SPECIFIC AMENDMENTS TO CREDIT AGREEMENT.
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(a) The Credit Agreement is amended by deleting from Section_1.1 thereof
the definition of the term "Revolving Termination Date" in its entirety and
substituting in its place the following:
"Revolving Termination Date" means March 7, 1999.
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(b) The Credit Agreement is amended by deleting Section_2.1(B)(1) thereof
in its entirety and substituting in its place the following:
"(B) Revolving Loans. (1)_Subject to the terms and
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conditions of this Agreement and in reliance upon the
representations and warranties of the Borrower
contained herein, each Lender agrees, severally and not
jointly, to lend to the Borrower from time to time
during the period from the Closing Date to but
excluding the Revolving Termination Date, its Pro Rata
Share of the Revolving Loan. The aggregate amount of
all Revolving Loan Commitments shall not exceed the
amounts set forth for the respective periods in the
table below, as reduced from time to time pursuant to
Section_2.6(C) and/or 2.6(D):
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PERIOD REVOLVING LOAN
COMMITMENTS
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December 7, 1998 through January 22, 1999 $4,000,000
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January 22, 1999 through March 7, 1999 $3,000,000
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If at any time the aggregate amount of Revolving Loans
outstanding exceeds the Revolving Loan Commitments as
set forth in the above table, the Borrower shall
immediately repay a principal amount of
Revolving Loans equal to such excess. On the terms and
conditions set forth herein, amounts borrowed under
this Section 2.1(B) may be repaid and reborrowed at any
time prior to the Revolving Termination Date."
SECTION_2. ACKNOWLEDGMENT OF LENDERS' COMMITMENTS. The parties hereto
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hereby agree that after giving effect to the transactions contemplated by this
Amendment and Waiver, the amount of each Lender's respective Revolving Loan
Commitment is as set forth on the signature page hereto.
SECTION 3. CONDITIONS PRECEDENT TO EFFECTIVENESS OF THIS AMENDMENT AND
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WAIVER. The effectiveness of this Amendment and Waiver is subject to receipt by
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the Agent of each of the following, each in form and substance satisfactory to
the Agent:
(a) A counterpart of this Amendment and Waiver duly executed by the
Borrower and each Guarantor;
(b) Payment of a modification fee in the amount of $10,000;
(c) A Revolving Note executed by the Borrower, payable to the order of
NationsBank, N.A. ("NationsBank") and in the original principal amount of
$4,000,000 (the "New Note") in replacement of the outstanding Revolving Note in
favor of NationsBank in the principal amount of $2,500,000;
(d) A copy of the resolutions of the board of directors of the Borrower
authorizing the execution and delivery of this Amendment and Waiver and the New
Note, certified by the Secretary or an Assistant Secretary of the Borrower; and
(e) Such other documents, instruments and agreements as the Agent may
reasonably request.
SECTION 4. WAIVER. The Lenders hereby waive application of the
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requirements of Section 5.14 of the Credit Agreement to the real property leases
entered into by the Borrower after October 8, 1996 at the locations set forth on
Schedule A hereto until March 7, 1999.
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SECTION 5. REAFFIRMATION BY BORROWER. The Borrower hereby reaffirms all
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representations and warranties made by the Borrower to the Agent and Lenders in
the Credit Agreement on and as of the date hereof with the same force and effect
as if such representations and warranties were set forth in this Amendment and
Waiver in full, except for any representation or warranty limited by its terms
to a specific date and except as set forth on Schedule B hereto and taking into
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account any amendments to the Schedules or Exhibits as a result of any
disclosures made in writing by the Borrower to the Agent after the Closing Date
and approved by the Agent.
SECTION_6. REAFFIRMATION BY GUARANTORS. Each of the Guarantor reaffirms
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its continuing obligations to the Agent and Lenders under its Guaranty, and
agrees that this Amendment and Waiver shall not in any way affect the validity
and enforceability of such Guaranty, or reduce, impair or discharge the
obligations of such Guarantor thereunder.
SECTION 7. REPRESENTATIONS. The Borrower further represents to the Agent
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and Lenders that:
(a) Authorization. The Borrower has the right and power, and has taken all
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necessary action to authorize it, to execute and deliver this Amendment and
Waiver and the New Note and to perform under this Amendment and Waiver, the New
Note and the Credit Agreement, as amended by this Amendment and Waiver, in
accordance with their respective terms. Each of this Amendment and Waiver, the
New Note and the Credit Agreement, as amended by this Amendment and Waiver, is a
legal, valid and binding obligation of the Borrower enforceable against the
Borrower in accordance with its terms, except as the same may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
generally the enforcement of creditors' rights.
(b) Compliance of Loan Documents with Laws, etc. The execution and
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delivery of this Amendment and Wavier and the New Note, and the performance of
this Amendment and Waiver, the New Note and the Credit Agreement, as amended by
this Amendment and Waiver, in accordance with their respective terms and the
borrowings thereunder do not and will not, by the passage of time, the giving of
notice or otherwise: (i)_require any Government Approval or violate any
Applicable Law relating to the Borrower; (ii)_conflict with, result in a breach
of or constitute a default under the partnership agreement or by-laws of the
Borrower, or any indenture, agreement or other instrument to which the Borrower
is a party or by which it or any of its properties may be bound; or (iii)_result
in or require the creation or imposition of any Lien upon or with respect to any
property now owned or hereafter acquired by the Borrower other than in favor of
the Agent for the benefit of the Lenders.
(c) No Default. No Default or Event of Defaults exists as of the date
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hereof and, after giving effect to this Amendment and Waiver, no Default or
Event of Default will occur or exist.
SECTION 8. COVENANT OF THE BORROWER. The Borrower shall, on or before
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January 7, 1999, supplement in writing and deliver to the Agent revisions of all
Schedules annexed to the Credit Agreement to the extent necessary to disclose
new or changed facts or circumstances after the Closing Date which have not
already been provided to the Agent pursuant to Section 5.1(P) of the Credit
Agreement. The failure of the Borrower to comply with this covenant shall
constitute an Event of Default.
SECTION 9. REFERENCES TO THE CREDIT AGREEMENT AND THE OTHER LOAN
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DOCUMENTS. Each reference to the Credit Agreement and any of the Loan Documents
shall be deemed to be a reference to the Credit Agreement as amended by this
Amendment and Waiver, and as each may from time to time be further amended,
supplemented, restated or otherwise modified in the future by one or more other
written amendments or supplemental or modification agreements entered into
pursuant to the applicable provisions of the Credit Agreement.
SECTION 10. EXPENSES. Pursuant to Section_10.2 of the Credit Agreement,
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the Borrower shall reimburse the Agent upon demand for all reasonable costs and
expenses (including reasonable attorneys' fees) incurred by the Agent in the
preparation, negotiation and execution of this Amendment and Wavier and the
other agreements and documents executed and delivered in connection herewith.
SECTION 11. BENEFITS. This Amendment and Wavier shall be binding upon and
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shall inure to the benefit of the parties hereto and their respective successors
and assigns.
SECTION 12. GOVERNING LAW. THIS AMENDMENT AND WAIVER SHALL BE GOVERNED
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BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
GEORGIA.
SECTION 13. EFFECT. Except as expressly herein amended, the terms and
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conditions of the Credit Agreement and the other Loan Documents shall remain in
full force and effect. The amendment contained in Section 1 herein shall be
deemed to have prospective application only. The waiver contained in Section 4
herein shall not be construed to be a waiver of any Event of Default that may be
in existence as of the date hereof except as specifically stated in said
Section. Further, this Amendment and Waiver shall not be construed as a waiver
of any future violation of any of the terms and conditions of the Credit
Agreement nor shall the Borrower, by receipt of this waiver, expect that such a
waiver will be given in the future.
SECTION 14. COUNTERPARTS. This Amendment and Waiver may be executed in
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any number of counterparts, each of which shall be deemed to be an original and
shall be binding upon all parties, their successors and assigns.
SECTION 15. DEFINITIONS. All terms defined in the Credit Agreement which
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are used herein shall have the meanings defined in the Credit Agreement, unless
specifically defined otherwise herein. The Credit Agreement shall be further
amended by incorporating all terms defined in this Amendment and Waiver.
SECTION 16. NO NOVATION. The parties do not intend that the amendment to
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the Credit Agreement effected hereby constitutes a novation of the indebtedness
incurred under, and evidenced by, the Credit Agreement and the other Loan
Documents.
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to
Credit Agreement and Waiver to be executed by their duly authorized officers as
of the date first above written.
AGENT AND SOLE LENDER:
NATIONSBANK, N.A. (f/k/a
NationsBank, N.A. (South))
By: Xxxxx X. Xxxxx
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Title: Senior Vice President
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BORROWER:
EDUTREK INTERNATIONAL, INC.
(f/k/a E Holdings, Inc.)
By: Xxxxx Xxxxxx
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Title: Chairman
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GUARANTORS:
AMERICAN INTERCONTINENTAL
UNIVERSITY, INC.
By: Xxxxx Xxxxxx
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Title: Chairman
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THE AMERICAN COLLEGE IN
LONDON, LTD. U.S.
By: Xxxxx Xxxxxx
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Title: Chairman
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[Signatures Continued on Next Page]
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[SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT AND WAIVER DATED AS OF
DECEMBER 7, 1998
FOR EDUTREK INTERNATIONAL, INC.]
EDUTREK SYSTEMS, INC.
By: Xxxxx Xxxxxx
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Title: Chairman
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AMERICAN EUROPEAN MIDDLE
EAST CORPORATION, L.L.C.
By: American Intercontinental University,
Inc., its Manager
By: Xxxxx Xxxxxx
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Title: Chairman
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THE AMERICAN COLLEGE IN LONDON, LTD.
By: Xxxxx Xxxxxx
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Title: Chairman
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SCHEDULE A
NEW LEASE LOCATIONS
0.0.0.Xxxxx dated October 2, 1998 with Highwoods/Florida Holdings, L.P., as
Landlord for 13,352 square feet at 0000 X. Xxxxxxxx Xxxxxxx, Xxxxxxxx X,
Xxxxxxx, Xxxxxxx 00000, expiring September 30, 1999.
3. 0.4. Lease dated February 16, 1998 with CarrAmerica Realty Corporation, as
Landlord for the building known as Embassy Row 500, 0000 Xxxxxxxxx
Xxxxxxxx Xxxx, Xxxxxxx, Xxxxxxx 00000.
5. 0.6. Lease dated June 19, 1998 with W9/WLA Real Estate Limited Partnership,
as Landlord for the building known as 00000 Xxxx Xxxxxxxxx Xxxxxxxxx,
Xxx Xxxxxxx, Xxxxxxxxxx 00000.
7. 0.8. Lease dated June 30, 1998 with The 0000 X Xxxxxx Limited Partnership,
as Landlord for space in the building located at 0000 X Xxxxxx,
Xxxxxxxxxx, D.C.
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SCHEDULE B
EXCEPTIONS TO REPRESENTATIONS
1.0.2.Section 4.1(B). Edutrek International, Ltd. is no longer a
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Subsidiary of the Borrower.
3. 0.4. The last sentence of Section 4.1(C). Schedule 4.1(C) does not set
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forth the jurisdictions in which the Loan Parties have qualified
to do business since the Closing Date.
5. 0.6. Section 4.1(E). Edutrek International, Ltd., a Subsidiary set
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forth in Schedule 4.1(E), was merged into E-Holdings, Inc., its
parent (which changed its name to Edutrek International, Inc.) on
April 4,1997.
7. 0.8. The last sentence of Section 4.6. The annual payment amounts under
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Operating Leases and Real Property Leases exceed the amounts set
forth in such Section by $1,645,146 and $3,414,811, respectively, as
of November 30, 1998.
9. 0.10. The first sentence of Section 4.12(A). Schedule 4.12 does not set
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forth all of the Employee Benefits Plans of the Loan Parties as the
Borrower has created additional Employee Benefits Plans in the
ordinary course of its business since the Closing Date.
11. 0.12. Section 4.13. The Borrower has registered additional trademarks
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since the Closing Date which are not set forth on Schedule 4.13.
13. 0.14. The last sentence of Section 4.16. The Borrower has entered into
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certain employment contracts in the ordinary course of business since
the Closing Date which are not set forth on Schedule 4.16.
15. 0.16. Section 4.21. Schedule 4.21 does not set forth the current bank
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accounts of the Borrower, all of which are maintained with
NationsBank and its Affiliates.
