EXHIBIT 10.1
SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT
AGREEMENT
This SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT
AGREEMENT (this "Amendment"), made and entered into as of March 2, 1998, is by
and between PILGRIM AMERICA GROUP, INC., a Delaware corporation ("PAG"), PILGRIM
AMERICA CAPITAL CORPORATION, a Delaware corporation ("PACC") (together, the
"Borrowers" and each a "Borrower"), and FIRST BANK NATIONAL ASSOCIATION, a
national banking association (the "Bank").
RECITALS
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1. The Bank and the Borrowers entered into a Second Amended
and Restated Credit Agreement dated as of July 31, 1997, as amended by a First
Amendment to Second Amended and Restated Credit Agreement dated as of September
16, 1997 (as so amended, the "Credit Agreement"); and
2. The Borrowers desire to amend certain provisions of the
Credit Agreement, and the Bank has agreed to make such amendments, subject to
the terms and conditions set forth in this Amendment.
AGREEMENT
---------
NOW, THEREFORE, for good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto hereby
covenant and agree to be bound as follows:
Section 1. Capitalized Terms. Capitalized terms used herein
and not otherwise defined herein shall have the meanings assigned to them in the
Credit Agreement, unless the context shall otherwise require.
Section 2. Amendments. The Credit Agreement is hereby amended
as follows:
2.1 Definitions. The definition of "Commitment
Amount"contained in Section 1.1 of the Credit Agreement is amended to
read in its entirety as follows:
"Commitment Amount": $35,000,000, as the same may be
reduced pursuant to Section 2.14.
2.2 Revolving Note. Exhibit A to the Credit Agreement is
hereby amended to read as set forth on Exhibit A attached to this
Amendment which is made a part of the Credit Agreement as Exhibit A
thereto.
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Section 3. Effectiveness of Amendments. The amendments
contained in this Amendment shall become effective upon delivery by the
Borrowers of, and compliance by the Borrowers with, the following:
3.1 The Bank shall have received this Amendment executed by
duly authorized officers of the Borrowers.
3.2 The Bank shall have received a Second Restated Revolving
Note in the form of Exhibit A hereto, duly executed by the Borrowers
(the "New Note"), which shall replace the existing Restated Revolving
Note evidencing the Borrowers' Obligations.
3.3 The Bank shall have received Reaffirmations of Security
Agreement, in the form of Exhibits E, F, G hereto and executed by PAG,
PAII and PASI, respectively.
3.4 The Bank shall have received Reaffirmations of Pledge
Agreement, in the form of Exhibits H and I hereto, executed by the
Borrowers.
3.5 The Bank shall have received a Reaffirmation of Guaranty,
in the form of Exhibit J hereto, executed by PAII.
3.6 The Bank shall have received copies of the corporate
resolutions of the Borrowers authorizing the execution, delivery and
performance of this Amendment, the New Note and reaffirmations to which
each of them is a party, certified as of the date hereof by the
respective Secretary or an Assistant Secretary of each of the
Borrowers.
3.7 The Bank shall have received copies of the corporate
resolutions of PAII and PASI authorizing the execution, delivery and
performance of the reaffirmations to which each of them is a party,
certified as of the date hereof by the respective Secretary or an
Assistant Secretary of PAII and PASI.
3.8 The Bank shall have received a certificate of the
Secretary of each Borrower, PAII and PASI, respectively, certifying
that there has been no change in the Articles of Incorporation or
bylaws of each respective entity since July 31, 1997.
3.9 The Bank shall have received a written opinion of Xxxxx
Xxxx LLP, counsel to the Borrowers, PAII and PASI, addressed to the
Bank and dated the date hereof, covering the matters set forth in
Exhibit K hereto.
3.10 The Bank shall have received certificates of good
standing for the Borrowers from the Secretary of State of Delaware and
in each state in which such entities transact business as of a current
date.
3.11 The Bank shall have received such other documents,
instruments, opinions and approvals as the Bank may reasonably request.
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3.12 The Borrowers shall have satisfied such other conditions
as specified by the Bank, including payment of all unpaid legal fees
and expenses incurred by the Bank through the date of this Amendment.
Section 4. Representations, Warranties, Authority, No Adverse
Claim.
4.1 Reassertion of Representations and Warranties, No Default.
The Borrowers hereby represent that on and as of the date hereof and after
giving effect to this Amendment and the New Note (a)all of the representations
and warranties contained in the Credit Agreement are true, correct and complete
in all respects as of the date hereof as though made on and as of such date,
except for changes permitted by the terms of the Credit Agreement, and (b) there
will exist no Default or Event of Default under the Credit Agreement as amended
by this Amendment on such date which has not been waived by the Bank.
4.2 Authority, No Conflict, No Consent Required. The Borrowers
represent and warrant that the Borrowers have the power and legal right and
authority to enter into this Amendment and the New Note (hereinafter referred to
as the "Amendment Documents") and have duly authorized as appropriate the
execution and delivery of the Amendment Documents and other agreements and
documents executed and delivered by the Borrowers in connection herewith or
therewith by proper corporate, and none of the Amendment Documents nor the
agreements contained herein or therein contravene or constitute a default under
any agreement, instrument or indenture to which the Borrowers are parties or a
signatory or any provision of the Borrowers' Certificates of Incorporation,
Bylaws or any other agreement or requirement of law, or result in the imposition
of any lien on any of its property under any agreement binding on or applicable
to the Borrowers or any of their property except, if any, in favor of the Bank.
The Borrowers represent and warrant that no consent, approval or authorization
of or registration or declaration with any Person, including but not limited to
any governmental authority, is required in connection with the execution and
delivery by the Borrowers of the Amendment Documents or other agreements and
documents executed and delivered by the Borrowers in connection therewith or the
performance of obligations of the Borrowers therein described, except for those
which the Borrowers have obtained or provided and as to which the Borrowers have
delivered certified copies of documents evidencing each such action to the Bank.
4.3 No Adverse Claim. The Borrowers each warrants,
acknowledges and agrees that no events have been taken place and no
circumstances exist at the date hereof which would give the Borrowers a basis to
assert a defense, offset or counterclaim to any claim of the Bank with respect
to the Obligations as amended by this Amendment.
Section 5. Affirmation of Credit Agreement, Further
References, Affirmation of Security Interest. The Bank and the Borrowers each
acknowledge and affirm that the Credit Agreement and the New Note, as hereby
amended, are hereby ratified and confirmed in all respects and all terms,
conditions and provisions of the Credit Agreement, except as amended by this
Amendment, shall remain unmodified and in full force and effect. All references
in any document or instrument to the Credit Agreement or the Note, or any
similar terms contained in any Loan Document, are hereby amended and shall refer
to the Credit
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Agreement and the New Note, respectively, as amended by this Amendment. The
Borrowers confirm to the Bank that the Obligations, as amended by this
Amendment, are and continue to be secured by the security interest granted by
the Borrowers in favor of the Bank under the Security Documents, and all of the
terms, conditions, provisions, agreements, requirements, promises, obligations,
duties, covenants and representations of the Borrowers under such documents and
any and all other documents and agreements entered into with respect to the
obligations under the Credit Agreement are incorporated herein by reference and
are hereby ratified and affirmed in all respects by the Borrowers.
Section 6. Merger and Integration, Superseding Effect. This
Amendment, from and after the date hereof, embodies the entire agreement and
understanding between the parties hereto and supersedes and has merged into this
Amendment all prior oral and written agreements on the same subjects by and
between the parties hereto with the effect that this Amendment, shall control
with respect to the specific subjects hereof and thereof.
Section 7. Severability. Whenever possible, each provision of
this Amendment and the other Amendment Documents and any other statement,
instrument or transaction contemplated hereby or thereby or relating hereto or
thereto shall be interpreted in such manner as to be effective, valid and
enforceable under the applicable law of any jurisdiction, but, if any provision
of this Amendment, the other Amendment Documents or any other statement,
instrument or transaction contemplated hereby or thereby or relating hereto or
thereto shall be held to be prohibited, invalid or unenforceable under the
applicable law, such provision shall be ineffective in such jurisdiction only to
the extent of such prohibition, invalidity or unenforceability, without
invalidating or rendering unenforceable the remainder of such provision or the
remaining provisions of this Amendment, the other Amendment Documents or any
other statement, instrument or transaction contemplated hereby or thereby or
relating hereto or thereto in such jurisdiction, or affecting the effectiveness,
validity or enforceability of such provision in any other jurisdiction.
Section 8. Successors. The Amendment Documents shall be
binding upon the Borrowers and the Bank and their respective successors and
assigns, and shall inure to the benefit of the Borrowers and the Bank and the
successors and assigns of the Bank.
Section 9. Legal Expenses. The Borrowers agree to reimburse
the Bank, upon execution of this Amendment, for all reasonable out-of-pocket
expenses (including attorneys' fees and legal expenses of Xxxxxx & Whitney LLP,
counsel for the Bank) incurred in connection with the Credit Agreement,
including in connection with the negotiation, preparation and execution of the
Amendment Documents and all other documents negotiated, prepared and executed in
connection with the Amendment Documents, and in enforcing the obligations of the
Borrowers under the Amendment Documents, and to pay and save the Bank harmless
from all liability for, any stamp or other taxes which may be payable with
respect to the execution or delivery of the Amendment Documents, which
obligations of the Borrowers shall survive any termination of the Credit
Agreement.
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Section 10. Headings. The headings of various sections of this
Amendment have been inserted for reference only and shall not be deemed to be a
part of this Amendment.
Section 11. Counterparts. The Amendment Documents may be
executed in several counterparts as deemed necessary or convenient, each of
which, when so executed, shall be deemed an original, provided that all such
counterparts shall be regarded as one and the same document, and either party to
the Amendment Documents may execute any such agreement by executing a
counterpart of such agreement.
Section 12. Governing Law. THE AMENDMENT DOCUMENTS SHALL BE
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF MINNESOTA, WITHOUT GIVING EFFECT
TO CONFLICT OF LAW PRINCIPLES THEREOF, BUT GIVING EFFECT TO FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS, THEIR HOLDING COMPANIES AND THEIR AFFILIATES.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first above written.
PILGRIM AMERICA CAPITAL CORPORATION
By: \S\ Xxxxx X. Xxxx
----------------------------
Title: Vice-Chairman
Address for Borrower:
Two Renaissance Square, Ste. 1200
00 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxx
Telecopier: (000) 000-0000
PILGRIM AMERICA GROUP, INC.
By: \S\ Xxxxx X. Xxxx
----------------------------
Title: Vice-Chairman
Address for Borrower:
Two Renaissance Square, Ste. 1200
00 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxx
Telecopier: (000) 000-0000
FIRST BANK NATIONAL ASSOCIATION
By: \S\ Xxxx X. Xxxxxx
----------------------------
Title: Vice-President
Address:
First Bank Place - MPFP0702
000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000-0000
Attention: Xxxx X. Xxxxxx
Telecopier: (000) 000-0000
EXHIBITS
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A - Revolving Note
E - Reaffirmation of PAG Security Agreement
F - Reaffirmation of PAII Security Agreement
G - Reaffirmation of PASI Security Agreement
H - Reaffirmation of PAG Pledge Agreement
I - Reaffirmation of the PACC Pledge Agreement
J - Reaffirmation of the PAII Guaranty
K - Matters to be Covered by Opinion of Counsel to the Borrowers, PAII and
PSII
EXHIBIT A TO SECOND AMENDMENT
SECOND RESTATED REVOLVING NOTE
$35,000,000 March 2, 0000
Xxxxxxxxxxx, Xxxxxxxxx
FOR VALUE RECEIVED, PILGRIM AMERICA GROUP, INC., a Delaware
corporation, and PILGRIM AMERICA CAPITAL CORPORATION, a Delaware corporation,
hereby jointly and severally promise to pay to the order of FIRST BANK NATIONAL
ASSOCIATION (the "Bank") at its main office in Minneapolis, Minnesota, in lawful
money of the United States of America in Immediately Available Funds (as such
term and each other capitalized term used herein are defined in the Credit
Agreement hereinafter referred to) at the times set forth in the Credit
Agreement the principal amount of THIRTY-FIVE MILLION AND NO/100 DOLLARS
($35,000,000) or, if less, the aggregate unpaid principal amount of all Loans
made by the Bank under the Credit Agreement, and to pay interest (computed on
the basis of actual days elapsed and a year of 360 days) in like funds on the
unpaid principal amount hereof from time to time outstanding at the rates and
times set forth in the Credit Agreement.
This note is the Note referred to in the Second Amended and
Restated Credit Agreement dated as of July 31, 1997 (as the same may hereafter
be from time to time amended, restated or otherwise modified, the "Credit
Agreement") between the undersigned and the Bank. This note is secured, it is
subject to certain permissive and mandatory prepayments and its maturity is
subject to acceleration, in each case upon the terms provided in said Credit
Agreement.
In the event of default hereunder, the undersigned agrees to
pay all costs and expenses of collection, including reasonable attorneys' fees.
The undersigned waives demand, presentment, notice of nonpayment, protest,
notice of protest and notice of dishonor.
THE VALIDITY, CONSTRUCTION AND ENFORCEABILITY OF THIS NOTE
SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF MINNESOTA WITHOUT GIVING
EFFECT TO THE CONFLICT OF LAWS
PRINCIPLES THEREOF, BUT GIVING EFFECT TO FEDERAL LAWS OF THE UNITED STATES
APPLICABLE TO NATIONAL BANKS.
PILGRIM AMERICA GROUP, INC.
By: \S\ Xxxxx X. Xxxx
------------------------
Its Vice-Chairman
PILGRIM AMERICA CAPITAL CORPORATION
By: \S\ Xxxxx X. Xxxx
------------------------
Its Vice-Chairman
EXHIBIT E TO SECOND AMENDMENT
REAFFIRMATION OF SECURITY AGREEMENT
The undersigned, Pilgrim America Group, Inc. ("PAG") hereby
reaffirms that (i) the Security Agreement by and between PAG and First Bank
National Association (the "Bank") dated as of April 28, 1995, as the same may
have been amended from time to time (the "Security Agreement"), remains in full
force and effect, and (ii) the security interests granted pursuant to the
Security Agreement secure, among other things, the obligations of PAG and
Pilgrim America Capital Corporation (collectively, the "Borrowers") and duties
under that certain Second Amended and Restated Credit Agreement by and between
the Borrowers and the Bank and dated as of July 31, 1997, as amended by the
First Amendment to Second Amended and Restated Credit Agreement dated as of
September 16, 1997 and by the Second Amendment to Second Amended and Restated
Credit Agreement dated as of even date herewith.
Date: March 2, 1998.
PILGRIM AMERICA GROUP, INC.
By: \S\ Xxxxx X. Xxxx
------------------------
Its Vice-Chairman
EXHIBIT F TO SECOND AMENDMENT
REAFFIRMATION OF SECURITY AGREEMENT
Reference is made to that certain Security Agreement (the
"Security Agreement") dated as of April 28, 1995, made and given by the
undersigned to secure the Obligations (as defined in the Security Agreement) of
Pilgrim America Group, Inc. ("PAG") to First Bank National Association (the
"Bank").
The undersigned hereby (a) consents to the terms of that
certain Second Amended and Restated Credit Agreement dated as of July 31, 1997
by and between PAG and Pilgrim America Capital Corporation (collectively, the
"Borrowers") and the Bank, as amended by the First Amendment to Second Amended
and Restated Credit Agreement dated as of September 16, 1997 and by the Second
Amendment to Second Amended and Restated Credit Agreement dated as of even date
herewith (as so amended, the "Credit Agreement") and to the execution and
delivery of the Credit Agreement by the Borrowers; (b) agrees that the
obligations of the Borrowers to the Bank under the Credit Agreement constitute
"Obligations" within the meaning of the above-referenced Security Agreement; and
(c) agrees and reaffirms that the security interests granted pursuant to the
Security Agreement secure, among other things, the Borrowers' obligations and
duties under the Credit Agreement and the obligations of the undersigned under
the Security Agreement. The undersigned further reaffirms that all of the terms,
covenants and conditions of the Security Agreement remain in full force and
effect.
Date: March 2, 1998.
PILGRIM AMERICA INVESTMENTS, INC.
By: \S\ Xxxxx X. Xxxx
------------------------
Its Vice-Chairman
EXHIBIT G TO SECOND AMENDMENT
REAFFIRMATION OF SECURITY AGREEMENT
Reference is made to that certain Security Agreement (the
"Security Agreement") dated as of April 28, 1995, made and given by the
undersigned to secure the Obligations (as defined in the Security Agreement) of
Pilgrim America Group, Inc. ("PAG") to First Bank National Association (the
"Bank").
The undersigned hereby (a) consents to the terms of that
certain Second Amended and Restated Credit Agreement dated as of July 31, 1997
by and between PAG and Pilgrim America Capital Corporation (collectively, the
"Borrowers") and the Bank, as amended by the First Amendment to Second Amended
and Restated Credit Agreement dated as of September 16, 1997 and by the Second
Amendment to the Second Amended and Restated Credit Agreement dated as of even
date herewith (as so amended, the "Credit Agreement") and to the execution and
delivery of the Credit Agreement by the Borrowers; (b) agrees that the
obligations of the Borrowers to the Bank under the Credit Agreement constitute
"Obligations" within the meaning of the above-referenced Security Agreement; and
(c) agrees and reaffirms that the security interests granted pursuant to the
Security Agreement secure, among other things, the Borrowers' obligations and
duties under the Credit Agreement and the obligations of the undersigned under
the Security Agreement. The undersigned further reaffirms that all of the terms,
covenants and conditions of the Security Agreement remain in full force and
effect.
Date: March 2, 1998.
PILGRIM AMERICA SECURITIES, INC.
By: \S\ Xxxxx X. Xxxx
-----------------------------
Its Vice-Chairman
EXHIBIT H TO SECOND AMENDMENT
REAFFIRMATION OF PLEDGE AGREEMENT
The undersigned, Pilgrim America Group, Inc. ("PAG") hereby
reaffirms that (i) the Pledge Agreement by and between PAG and First Bank
National Association (the "Bank") dated as of April 28, 1995, as the same may
have been amended from time to time (the "Pledge Agreement"), remains in full
force and effect, and (ii) the security interests granted pursuant to the Pledge
Agreement secure, among other things, the obligations and duties of PAG and
Pilgrim America Capital Corporation (collectively, the "Borrowers") under that
certain Second Amended and Restated Credit Agreement by and between the
Borrowers and the Bank dated as of July 31, 1997, as amended by the First
Amendment to Second Amended and Restated Credit Agreement dated as of September
16, 1997 and by the Second Amendment to the Second Amended and Restated Credit
Agreement dated as of even date herewith.
Date: March 2, 0000
XXXXXXX XXXXXXX GROUP, INC.
By: \S\ Xxxxx X. Xxxx
-----------------------
Its Vice-Chairman
EXHIBIT I TO SECOND AMENDMENT
REAFFIRMATION OF PLEDGE AGREEMENT
Reference is made to that certain Pledge Agreement (the
"Pledge"), dated as of April 28, 1995, made and given by the undersigned to
secure the Obligations (as defined in the Pledge) of Pilgrim America Group, Inc.
("PAG") to First Bank National Association (the "Bank").
The undersigned hereby (a) consents to the terms of that
certain Second Amended and Restated Credit Agreement dated as of July 31, 1997
by and between the undersigned and PAG, as borrowers (collectively, the
"Borrowers") and the Bank, as amended by the First Amendment to Second Amended
and Restated Credit Agreement dated as of September 16, 1997 and by the Second
Amendment to the Second Amended and Restated Credit Agreement dated as of even
date herewith (as so amended, the "Credit Agreement") and to the execution and
delivery of the Credit Agreement by PAG; (b) agrees that the obligations of the
Borrowers to the Bank under the Credit Agreement constitute "Obligations" within
the meaning of the above-referenced Pledge; and (c) agrees and reaffirms that
the security interests granted pursuant to the Pledge Agreement secure, among
other things, the Borrowers' obligations and duties under the Credit Agreement.
The undersigned further reaffirms that all of the terms, covenants and
conditions of the Pledge remain in full force and effect.
Date: March 2, 0000
XXXXXXX XXXXXXX CAPITAL CORPORATION
By: \S\ Xxxxx X. Xxxx
--------------------------------
Its Vice-Chairman
EXHIBIT J TO SECOND AMENDMENT
REAFFIRMATION OF GUARANTY
Reference is made to that certain Guaranty (the "Guaranty")
dated as of April 28, 1995, made and given by the undersigned to secure the
Obligations (as defined in the Guaranty) of Pilgrim America Group, Inc. ("PAG")
to First Bank National Association (the "Bank").
The undersigned hereby (a) consents to the terms of that
certain Amended and Restated Credit Agreement dated as of July 31, 1997 by and
between PAG and Pilgrim America Capital Corporation (collectively, the
"Borrowers") and the Bank, as amended by the First Amendment to Second Amended
and Restated Credit Agreement dated as of September 16, 1997 and by the Second
Amendment to the Second Amended and Restated Credit Agreement dated as of even
date herewith (as so amended, the "Credit Agreement") and to the execution and
delivery of the Credit Agreement by the Borrowers; and (b) agrees that the
obligations of the Borrowers to the Bank under the Credit Agreement constitute
"Obligations" within the meaning of the above-referenced Guaranty. The
undersigned further agrees and reaffirms that such Obligations are guaranteed by
the undersigned in accordance with the terms and conditions of the Guaranty, and
that all of the terms, covenants and conditions of the Guaranty remain in full
force and effect.
Date: March 2, 0000
XXXXXXX XXXXXXX INVESTMENTS, INC.
By: \S\ Xxxxx X. Xxxx
------------------------------
Its Vice-Chairman
EXHIBIT K TO
SECOND AMENDMENT
MATTERS TO BE COVERED BY
OPINION OF COUNSEL
TO THE BORROWERS AND PAII and PSII
The opinion of counsel to the Pilgrim America Group, Inc.
("PAG") and Pilgrim America Capital Corporation (collectively, the "Borrowers")
which is called for by Section 3.8 of the Second Amendment to Second Amended and
Restated Credit Agreement shall be addressed to the Bank and dated the date
thereof. It shall be satisfactory in form and substance to the Bank and shall
cover the matters set forth below, subject to such assumptions, exceptions and
qualifications as may be acceptable to the Bank and counsel to the Bank. With
respect to opinions on the validity and enforceability of those loan documents
which provide that they are to be governed by the laws of the State of
Minnesota, counsel may opine that such documents would be valid and binding
under the laws of the State of Arizona. Capitalized terms used herein have the
respective meanings given such terms in the Credit Agreement.
1. Each Borrower is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware and has
all requisite corporate power and authority to carry on its business as now
conducted, to enter into the Second Amendment to which it is a party and to
perform all of its obligations under each and all of the foregoing. Each
Borrower is duly qualified and in good standing as a foreign corporation in all
of the jurisdictions in which the character of the properties owned or leased by
it or the business conducted by it makes such qualification necessary and the
failure to so qualify would permanently preclude such Borrower from enforcing
its rights with respect to any material asset or expose such Borrower to any
material liability.
2. The execution, delivery and performance by each Borrower of
the Second Amendment and the New Note have been duly authorized by all necessary
corporate action by such Borrower.
3. The Credit Agreement, as amended by the First Amendment
dated as of September 16, 1997 and by the Second Amendment, and the New Note
constitute the legal, valid and binding obligations of each Borrower,
enforceable against such Borrower in accordance with their respective terms.
4. The execution, delivery and performance by each Borrower of
the Second Amendment to which it is a party will not (i) violate any provision
of any law, statute, rule or regulation or, to the best knowledge of such
counsel, any order, writ, judgment, injunction, decree, determination or award
of any court, governmental agency or arbitrator presently in effect having
applicability to either Borrower, (ii) violate or contravene any provision of
the Certificate of Incorporation or bylaws of either Borrower, or (iii) result
in a breach of or constitute a default under any indenture, loan or credit
agreement or any other agreement, lease
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or instrument known to such counsel to which either Borrower is a party or by
which it or any of its properties may be bound or result in the creation of any
Lien thereunder.
5. No order, consent, approval, license, authorization or
validation of, or filing, recording or registration with, or exemption by, any
governmental or public body or authority is required on the part of either
Borrower to authorize, or is required in connection with the execution, delivery
and performance of, or the legality, validity, binding effect or enforceability
of, the Second Amendment.
6. To the best knowledge of such counsel, there are no
actions, suits or proceedings pending or threatened against or affecting either
Borrower, any Subsidiary of either Borrower or any of their respective
properties before any court or arbitrator, or any governmental department,
board, agency or other instrumentality which (i) challenge the legality,
validity or enforceability of the Credit Agreement, as amended by the Second
Amendment, or the New Note or (ii) if determined adversely to such Borrower,
would have a material adverse effect on the business, operations, property or
condition (financial or otherwise) of the Borrowers and the Subsidiaries as a
consolidated enterprise or on the ability of the Borrowers to perform their
obligations under the Credit Agreement, as amended by the Second Amendment.
7. Each of PAII and PASI is a corporation duly incorporated
and validly existing and in good standing under the laws of the State of
Delaware and has all requisite corporate power and authority to carry on its
business as now conducted, to enter into the Loan Documents to which it is a
party and to perform all of its obligations under each and all of the foregoing.
Each of PAII and PASI is duly qualified and in good standing as a foreign
corporation in all of the jurisdictions in which the character of the properties
owned or leased by it or the business conducted by it makes such qualification
necessary and the failure to so qualify would permanently preclude it from
enforcing its rights with respect to any material asset or expose it to any
material liability.
8. The execution, delivery and performance by each of PAII and
PASI of the reaffirmations of the Loan Documents to which it is a party required
under the Second Amendment have been duly authorized by all necessary corporate
action by it.
9. The Loan Documents to which each of PAII and PASI is a
party, as reaffirmed and modified, constitute the legal, valid and binding
obligations of each of PAII and PASI, enforceable against it in accordance with
their respective terms.
10. The execution, delivery and performance by PAII and PSII
of the reaffirmations of the Loan Documents to which it is a party will not (i)
violate any provision of any law, statute, rule or regulation or, to the best
knowledge of such counsel, any order, writ, judgment, injunction, decree,
determination or award of any court, governmental agency or arbitrator presently
in effect having applicability to PAII or PSII, (ii) violate or contravene any
provision of the Articles of Incorporation or bylaws of PAII or PSII, or (iii)
result in a breach of or constitute a default under any indenture, loan or
credit agreement or any other agreement,
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lease or instrument known to such counsel to which PAII or PSII is a party or by
which it or any of its properties may be bound or result in the creation of any
Lien thereunder.
11. No order, consent, approval, license, authorization or
validation of, or filing, recording or registration with, or exemption by, any
governmental or public body or authority is required on the part of PAII or PSII
to authorize, or is required in connection with the execution, delivery and
performance of, or the legality, validity, binding effect or enforceability of,
the reaffirmations of the Loan Documents.
12. After giving effect to the amendment of the Credit
Agreement pursuant to the Second Amendment, the New Note and the reaffirmations
of the Security Agreements and Pledge Agreements required under the Second
Amendment, the Liens created pursuant to the Security Agreements and the Pledge
Agreements will remain in full force and effect, will secure the Obligations,
and will have the same priority as they had prior to such amendment, restatement
and reaffirmations.
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