Exhibit 10 (w)
Execution
Copy
AMENDMENT TO CREDIT AGREEMENT
(Term Loan A Credit Agreement)
Amendment to Credit Agreement (the "Amendment") dated as of August 30, 1995
among (i) PIONEER FINANCIAL SERVICES, INC., a Delaware corporation (the
"Company"), and (ii) AMERICAN NATIONAL BANK AND TRUST COMPANY OF CHICAGO
("ANB"), FIRSTAR BANK MILWAUKEE, N.A. ("Firstar"), LASALLE NATIONAL BANK
("LaSalle") and BANK ONE, ROCKFORD, NA ("Bank One") (ANB, Firstar, LaSalle and
Bank One collectively referred to as the "Banks" and individually as a "Bank").
R E C I T A L S
WHEREAS, the Company, ANB, Firstar and Bank One have heretofore entered
into a Credit Agreement dated as of March 22, 1995 (the "Term Loan A Credit
Agreement"), pursuant to which, among other things, ANB, Firstar and Bank One
agreed, upon the terms and subject to the conditions set forth therein, to make
Loans (as defined in the Term Loan A Credit Agreement) to the Company;
WHEREAS, immediately prior to the execution and delivery of this Amendment,
ANB and LaSalle have entered into that certain Assignment and Assumption
Agreement dated as of the date hereof (the "Assignment Agreement") pursuant to
which, among other things, ANB has sold and assigned to LaSalle, and LaSalle has
purchased and assumed from ANB, an interest in the Loan (as such term is defined
in the Term Loan A Credit Agreement) made by ANB to the Company in an amount
equal to $3,714,285.71 and a corresponding portion of all rights and obligations
of ANB under the Term Loan A Credit Agreement;
WHEREAS, pursuant to the Assignment Agreement, LaSalle has become a party
to the Term Loan A Credit Agreement and, to the extent of the interest assigned
pursuant to the Assignment Agreement, has all the rights and obligations of a
Bank under the Term Loan A Credit Agreement as if it were an original signatory
thereto;
WHEREAS, contemporaneously with the execution and delivery of this
Amendment, the Company and the Banks have entered into that certain Credit
Agreement dated as of the date hereof (the "Term B Credit Agreement") pursuant
to which, among other things, the Banks agreed, upon the terms and subject to
the conditions set forth therein, to make additional term loans to the Company
in an aggregate principal amount of $11,100,000;
WHEREAS, the Company and the Banks desire to amend certain provisions of
the Term Loan A Credit Agreement;
NOW THEREFORE, in consideration of the premises and the mutual agreements
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
Section 1. Definitions, Ratification, References. Unless otherwise
specifically defined herein, each term used herein that is defined in the Term
Loan A Credit Agreement shall have the meaning assigned to such term in the Term
Loan A Credit Agreement. Except as amended and supplemented hereby, all of the
terms of the Term Loan A Credit Agreement shall remain and continue in full
force and effect and are hereby confirmed in all respects. Each reference to
"hereof", "hereunder", "herein" and "hereby" and each other similar reference
and each reference to "this Agreement" and each other similar reference
contained in the Term Loan A Credit Agreement shall from and after the date of
this Amendment refer to the Term Loan A Credit Agreement as amended by this
Amendment.
Section 2. Amendments to the Term Loan A Credit Agreement.
2.1 The following definitions that appears in Section 1 of the Term Loan A
Credit Agreement are amended in their entirety to read as follows:
"`Authorized Officer' means the Chairman, the President, any
Executive Vice President, the Treasurer, any Vice President or any
other officer of the Company that are designated as authorized
officers pursuant to a resolution of the Board of Directors or the
Executive Committee of the Board of Directors of the Company (each
Bank shall be entitled to rely on such resolution until revoked or
amended in writing by the Company).
"Available Cash Flow" means, with respect to the Company, for any
period, the net income of all Subsidiaries of the Company other than
Insurance Subsidiaries for such period, and shall include, without
limitation, the net income of Network Air Medical Systems, Inc.,
Association Management Corporation, Design Benefit Plans, Inc.,
Administrators Service Corporation, and National Health Services, Inc.
for such period.
"Commitment Percentage" means, as to any Bank, the percentage
equivalent at the time of determination of the outstanding principal
amount of such Bank's Loan divided by the aggregate outstanding
principal amount of all Loans."
"Indebtedness" means, as of any date, all indebtedness,
obligations or other liabilities of the Company and its Subsidiaries
as of such date (i) for borrowed money, (ii) evidenced by bonds,
debentures, notes or other similar instruments for borrowed money, or
(iii) pursuant to any guarantee of any indebtedness, obligations or
other liabilities of any other Person of the type described in clauses
(i) or (ii); provided, however, that (a) the amounts set forth in
clauses (i), (ii) and (iii) shall not be double counted and shall
relate only to amounts actually owed or otherwise outstanding as of
such date and (b) Indebtedness shall not include indebtedness,
obligations or other liabilities of the Company to any Subsidiary or
indebtedness, obligations or other liabilities of any Subsidiary to
the Company or another Subsidiary.
"Majority Banks" means at any time a group of Banks then holding
at least 51% of the then aggregate unpaid principal amount of the
Notes."
"Net Worth" means, with respect to the Company, as at the time
any determination thereof is made, the consolidated shareholders'
equity, including common stock, additional paid-in capital, retained
earnings, and net unrealized gains and losses, but excluding any
increase or decrease in the Company's "available for sale investment
portfolio" (as calculated in accordance with GAAP) since June 30,
1995.
"Permitted Liens" means (i) purchase money security interests
hereinafter incurred in connection with the acquisition of assets or
property; (ii) Liens for taxes, assessments or governmental charges or
levies on property of the Company if the same shall not at the time be
delinquent or thereafter can be paid without penalty, or are being
contested in good faith and by appropriate proceedings and as to which
the Company shall have set aside on its books such reserves as are
required by GAAP with respect to any such taxes, assessments or other
governmental charges; (iii) Liens imposed by law, such as carriers',
warehousemen's and mechanics' liens and other similar liens, which
arise in the ordinary course of business with respect to obligations
not yet due or being contested in good faith by appropriate
proceedings and as to which the Company shall have set aside on its
books such reserves as are required by GAAP with respect to any such
Liens; (iv) Liens arising out of pledges or deposits under insurance
laws, worker's compensation laws, unemployment insurance, old age
pensions, or other Social Security or retirement benefits, or similar
legislation; (v) Liens consisting of mortgages, deeds of trust, liens
or security interests on any interest of the Company as sublessor
under any sublease of property which solely secure obligations of the
Company as the lessee of such property and extensions or renewals
thereof; and (vi) Liens consisting of mortgages, deeds of trust or
similar encumbrances that may be incurred by the Company or an
Insurance Subsidiary of the Company in connection with the Company's
or such Insurance Subsidiary's purchase or refinancing of the building
and property located at 0000 Xxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx;
provided, however, that promptly after the creation of any Lien of the
type referred to in this subsection (vi), the Company shall provide to
the Banks written notice of the creation of such Lien, describing the
amount of the obligation secured thereby and the properties and assets
subject to such Lien.
"Unrestricted Subsidiary Indebtedness" means, as of any date, for
any Unrestricted Subsidiary, all indebtedness, obligations or other
liabilities of such Unrestricted Subsidiary and its Subsidiaries as of
such date (i) for borrowed money, (ii) evidenced by bonds,
debentures, notes or other similar instruments for borrowed money, or
(iii) pursuant to any guarantee of any indebtedness, obligations or
other liabilities of any other Person of the type described in clauses
(i) or (ii); provided, however, that the amounts set forth in clauses
(i), (ii) and (iii) shall not be double counted and shall relate only
to amounts actually owed or otherwise outstanding as of such date."
2.2 The following definition is added to Section 1 of the Term Loan A
Credit Agreement:
"`Term Loan B Credit Agreement' means that certain Credit
Agreement dated as of August 30, 1995 between the Company and the
Banks, as the same may be amended, supplemented or otherwise modified
from time to time."
2.3 Section 4.4 of the Term Loan A Credit Agreement is amended in its
entirety to read as follows:
"SECTION 4.4 Computation of Interest. All computations of
interest in respect of the Base Rate, LIBOR and the CD Rate shall be
made on the basis of a year of 365 or 366 days, as the case may be,
and actual days elapsed. Interest shall accrue during each period
during which interest is computed from and including the first day
thereof to but excluding the last day thereof."
2.4 Section 7.7 of the Term Loan A Credit Agreement is amended by deleting
the term "$65,000,000" that appears in such Section and inserting in lieu
thereof the term "$112,000,000".
2.5 Section 7.9 of the Term Loan A Credit Agreement is amended by deleting
the phrase "pursuant to Section 7.16" that appears in such Section.
2.6 Section 9.1(a) of the Term Loan A Credit Agreement is amended in its
entirety to read as follows:
"(a) Nonpayment of the Loans. Default in the payment when due of
the principal of or interest on the Loans, or the payment when due or
any fees or any other amounts payable by the Company hereunder and
continuance of such default for five (5) Business Days after the
applicable due date, or default in the payment when due of the
principal of or interest on any loan made under the Revolving Credit
Agreement or the Term Loan B Credit Agreement, or the payment when due
of any fees or any other amounts payable by the Company under the
Revolving Credit Agreement or the Term Loan B Credit Agreement, and
continuance of such default beyond the applicable grace period as set
forth in the Revolving Credit Agreement or the Term Loan B Credit
Agreement, as the case may be."
2.7 The parties acknowledge the assignment and assumption of a portion of
an interest in the Loan (as such term is defined in the Term Loan A Credit
Agreement) made by ANB to the Company and a corresponding portion of all rights
and obligations of ANB under the Term Loan A Credit Agreement to LaSalle
pursuant to the Assignment Agreement and acknowledge that the outstanding
principal amount of each Loan and each Bank's Commitment Percentage is as set
forth opposite such Bank's name below:
Outstanding Principal
Bank Amount of Such Bank's Loan Commitment Percentage
ANB $4,642,857.14 33.333333%
Firstar $3,714,285.71 26.666667%
LaSalle $3,714,285.71 26.666667%
Bank One $1,857,142.85 13.333333%
Section 3. Effectiveness. This Amendment shall become effective as of
the date hereof upon the execution and delivery of this Amendment.
Section 4. Representations and Warranties. Each of the representations
and warranties made by the Company in Section 6 of the Term Loan A Credit
Agreement is true and correct as of the date hereof with the same effect as
though made on the date hereof (except to the extent that such representations
and warranties expressly refer to an earlier date, in which case they shall be
true and correct as of such earlier date).
Section 5. No Default. No Event of Default, or event which, with the
giving of notice or lapse of time, or both, would constitute an Event of
Default, has occurred and is continuing.
Section 6. Governing Law. This Amendment shall be governed by and
interpreted in accordance with the laws of the State of Illinois, without regard
to its conflicts of laws rules.
Section 7. Headings. Section headings herein are included for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
Section 8. Execution in Counterparts. This Amendment may be executed
in any number of counterparts and by the different parties on separate
counterparts and each such counterpart shall be deemed to be an original, but
all such counterparts shall together constitute only one agreement.
IN WITNESS WHEREOF, the Company and each Bank have caused this Amendment to
be executed and delivered as of day and year first above written.
THE COMPANY: PIONEER FINANCIAL SERVICES, INC.
By:
Title:
THE BANKS: AMERICAN NATIONAL BANK AND TRUST
COMPANY OF CHICAGO
By:
Vice President
FIRSTAR BANK MILWAUKEE, N.A.
By:
Title:
LASALLE NATIONAL BANK
By:
Title:
BANK ONE, ROCKFORD, NA
By:
Title:
