EXHIBIT 10.87
EZCORP, INC.
SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
DATED AS OF OCTOBER 30, 2002
XXXXX FARGO BANK TEXAS, NATIONAL ASSOCIATION,
AS AGENT
AND
ISSUING BANK
TABLE OF CONTENTS
PAGE
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ARTICLE I Definitions....................................................... 1
Section 1.1 Definitions....................................................... 1
Section 1.2 Other Definitional Provisions..................................... 18
ARTICLE II Revolving Credit Loan, Tranche B Loan and Swing Loan.............. 19
Section 2.1 Revolving Credit Commitments...................................... 19
Section 2.2 Tranche B Commitments............................................. 19
Section 2.3 Revolving Credit Notes and Tranche B Notes........................ 19
Section 2.4 Repayment of Revolving Credit Loan and Tranche B Loan............. 20
Section 2.5 Interest.......................................................... 20
Section 2.6 Revolving Credit Loan and Tranche B Loan Borrowing Procedure...... 20
Section 2.7 Conversions and Continuations..................................... 21
Section 2.8 Swing Loans....................................................... 21
Section 2.9 Use of Proceeds................................................... 23
Section 2.10 Fees.............................................................. 23
Section 2.11 Determination of Eurodollar Margin and Base Rate Margin........... 23
Section 2.12 Reduction or Termination of Commitments........................... 24
Section 2.13 Tranche B Non-Payment Fee......................................... 25
ARTICLE III Letters of Credit................................................. 25
Section 3.1 Letters of Credit................................................. 25
Section 3.2 Procedure for Issuing Letters of Credit........................... 26
Section 3.3 Presentment and Reimbursement..................................... 27
Section 3.4 Payment........................................................... 27
Section 3.5 Letter of Credit Fee.............................................. 28
Section 3.6 Obligations Absolute.............................................. 28
Section 3.7 Limitation of Liability........................................... 28
ARTICLE IV Payments.......................................................... 29
Section 4.1 Method of Payment................................................. 29
Section 4.2 Voluntary Prepayment.............................................. 29
Section 4.3 Mandatory Prepayments............................................. 30
Section 4.4 Pro Rata Treatment................................................ 31
Section 4.5 Non-Receipt of Funds by the Agent................................. 32
Section 4.6 Taxes............................................................. 32
Section 4.7 Tax Forms......................................................... 33
Section 4.8 Computation of Interest........................................... 35
Section 4.9 Proceeds of Collateral and Collections under the Guaranty......... 35
ARTICLE V Yield Protection; Limitations on Advances; Capital Adequacy....... 36
Section 5.1 Additional Costs.................................................. 36
Section 5.2 Limitation on Types of Advances................................... 37
TABLE OF CONTENTS
(continued)
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Section 5.3 Illegality........................................................ 38
Section 5.4 Treatment of Affected Advances.................................... 38
Section 5.5 Compensation...................................................... 38
Section 5.6 Capital Adequacy.................................................. 39
Section 5.7 Additional Costs in Respect of Letters of Credit.................. 39
ARTICLE VI Conditions Precedent.............................................. 39
Section 6.1 Initial Extension of Credit....................................... 39
Section 6.2 All Extensions of Credit.......................................... 41
ARTICLE VII Representations and Warranties.................................... 41
Section 7.1 Existence......................................................... 41
Section 7.2 Financial Statements.............................................. 41
Section 7.3 Action; No Breach................................................. 42
Section 7.4 Operation of Business............................................. 42
Section 7.5 Litigation and Judgments.......................................... 42
Section 7.6 Rights in Properties; Liens....................................... 42
Section 7.7 Enforceability.................................................... 42
Section 7.8 Approvals......................................................... 43
Section 7.9 Debt.............................................................. 43
Section 7.10 Taxes............................................................. 43
Section 7.11 Use of Proceeds; Margin Securities................................ 43
Section 7.12 ERISA............................................................. 43
Section 7.13 Disclosure........................................................ 43
Section 7.14 Subsidiaries...................................................... 44
Section 7.15 Agreements........................................................ 44
Section 7.16 Compliance with Laws.............................................. 44
Section 7.17 Investment Company Act............................................ 44
Section 7.18 Public Utility Holding Company Act................................ 44
Section 7.19 Environmental Matters............................................. 44
ARTICLE VIII Positive Covenants................................................ 45
Section 8.1 Reporting Requirements............................................ 45
Section 8.2 Maintenance of Existence; Conduct of Business..................... 48
Section 8.3 Maintenance of Properties......................................... 48
Section 8.4 Taxes and Claims.................................................. 48
Section 8.5 Insurance......................................................... 48
Section 8.6 Inspection Rights; Audits......................................... 49
Section 8.7 Keeping Books and Records......................................... 49
Section 8.8 Compliance with Laws.............................................. 49
Section 8.9 Compliance with Agreements........................................ 49
Section 8.10 Further Assurances................................................ 49
Section 8.11 ERISA............................................................. 50
Section 8.12 Landlord's Waivers or Subordinations.............................. 50
TABLE OF CONTENTS
(continued)
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ARTICLE IX Negative Covenants................................................ 50
Section 9.1 Debt.............................................................. 50
Section 9.2 Limitation on Liens............................................... 50
Section 9.3 Mergers, Etc...................................................... 52
Section 9.4 Restricted Payments............................................... 52
Section 9.5 Investments....................................................... 52
Section 9.6 Limitation on Issuance of Capital Stock........................... 53
Section 9.7 Transactions With Affiliates...................................... 53
Section 9.8 Disposition of Assets............................................. 53
Section 9.9 Nature of Business................................................ 53
Section 9.10 Environmental Protection.......................................... 54
Section 9.11 Accounting........................................................ 54
Section 9.12 Prepayment of Debt................................................ 54
Section 9.13 Pay-Day Advance Loans............................................. 54
Section 9.14 Sales and Leasebacks.............................................. 54
ARTICLE X Financial Covenants............................................... 54
Section 10.1 Consolidated Net Worth............................................ 54
Section 10.2 Leverage Ratio.................................................... 54
Section 10.3 Capital Expenditures.............................................. 55
Section 10.4 Inventory Turnover................................................ 55
Section 10.5 Fixed Charge Coverage Ratio....................................... 55
ARTICLE XI Default........................................................... 55
Section 11.1 Events of Default................................................. 55
Section 11.2 Remedies.......................................................... 57
Section 11.3 Cash Collateral................................................... 58
Section 11.4 Performance by the Agent.......................................... 58
ARTICLE XII The Agent......................................................... 58
Section 12.1 Appointment, Powers and Immunities................................ 58
Section 12.2 Rights of Agent as a Lender....................................... 60
Section 12.3 Sharing of Payments, Etc.......................................... 60
Section 12.4 Indemnification................................................... 61
Section 12.5 Independent Credit Decisions...................................... 61
Section 12.6 Several Commitments............................................... 62
Section 12.7 Successor Agent................................................... 62
Section 12.8 Agent May File Proofs of Claim.................................... 62
Section 12.9 Collateral and Guaranty Matters................................... 63
ARTICLE XIII Miscellaneous..................................................... 63
Section 13.1 Expenses.......................................................... 63
Section 13.2 INDEMNIFICATION................................................... 64
TABLE OF CONTENTS
(continued)
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Section 13.3 Limitation of Liability........................................... 65
Section 13.4 No Duty........................................................... 65
Section 13.5 No Fiduciary Relationship......................................... 65
Section 13.6 Equitable Relief.................................................. 65
Section 13.7 No Waiver; Cumulative Remedies.................................... 65
Section 13.8 Successors and Assigns............................................ 65
Section 13.9 Survival.......................................................... 68
Section 13.10 Amendments, Etc................................................... 68
Section 13.11 Maximum Interest Rate............................................. 68
Section 13.12 Notices........................................................... 69
Section 13.13 Governing Law; Venue; Service of Process.......................... 69
Section 13.14 Binding Arbitration............................................... 70
Section 13.15 Counterparts...................................................... 71
Section 13.16 Severability...................................................... 71
Section 13.17 Headings.......................................................... 71
Section 13.18 Non-Application of Chapter 346 of Texas Finance Code.............. 72
Section 13.19 Construction...................................................... 72
Section 13.20 Independence of Covenants......................................... 72
Section 13.21 Confidentiality................................................... 72
Section 13.22 WAIVER OF JURY TRIAL.............................................. 72
Section 13.23 ENTIRE AGREEMENT.................................................. 72
Section 13.24 Amendment and Restatement; Release................................ 72
INDEX TO EXHIBITS
Exhibit Description of Exhibit
------- ----------------------
A Form of Revolving Credit Note
B Form of Tranche B Note
C Form of Swing Note
D Advance Request Form
E Letter of Credit Request Form
F Form of Borrowing Base Report
G Form of Assignment and Acceptance
INDEX TO SCHEDULES
Schedule Description of Schedule
-------- -----------------------
1.1(a) Commitments
1.1(b) Existing LCs
1.1(c) Pay-Day Advance Loan Documents
1.1(d) Real Property
7.14 List of Subsidiaries
8.2 Subsidiaries to Be Dissolved
9.1 Existing Debt
9.2 Existing Liens
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS SECOND AMENDED AND RESTATED CREDIT AGREEMENT (the "Agreement"), dated
as of October 30, 2002, is among EZCORP, INC., a Delaware corporation (the
"Borrower"), each of the banks or other lending institutions which is or which
may from time to time become a signatory hereto or any successor or assignee
thereof (individually, a "Lender" and, collectively, the "Lenders"), and XXXXX
FARGO BANK TEXAS, NATIONAL ASSOCIATION, a national banking association, as agent
for itself and the other Lenders (in such capacity, together with its successors
in such capacity, the "Agent") and as the Issuing Bank (hereinafter defined).
R E C I T A L S
A. The Borrower, the Agent, the Issuing Bank and certain banks or other
lending institutions party thereto have entered into that certain Amended and
Restated Credit Agreement dated as of December 15, 2000, as amended by (a) that
certain First Amendment to Amended and Restated Credit Agreement dated as of May
1, 2001, (b) that certain Second Amendment to Amended and Restated Credit
Agreement dated as of October 10, 2001, (c) that certain Third Amendment to
Amended and Restated Credit Agreement dated as of December 3, 2001, (d) that
certain Fourth Amendment to Amended and Restated Credit Agreement dated as of
September 30, 2002 and (e) that certain Fifth Amendment to Amended and Restated
Credit Agreement dated as of October 15, 2002 (as amended, the "Existing Credit
Agreement").
B. The Borrower has requested and the Agent, the Issuing Bank and the
Lenders have agreed to restructure the existing revolving credit facility,
standby letter of credit subfacility and swing-line subfacility, and to amend
and modify the Existing Credit Agreement upon the terms and conditions
hereinafter set forth.
NOW THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto agree as follows:
Definitions
Definitions. As used in this Agreement, the following terms have the following
meanings:
"AAA" is defined in Section 13.14(b).
"Additional Costs" is defined in Section 5.1.
"Adjusted Eurodollar Rate" means, for any Eurodollar Advance for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary, to
the nearest 1/16 of 1%) determined by the Agent to be equal to the Eurodollar
Rate for such Eurodollar Advance for such Interest Period.
"Adjustment Date" is defined in Section 2.11.
"Advance" means an advance of funds by the Lenders or any of them to the
Borrower pursuant to Article II (inclusive of the Revolving Credit Loan, Tranche
B Loan and the Swing Loan) and the Continuation or Conversion thereof pursuant
to Section 2.6 and Article V hereof.
"Advance Request Form" means a certificate, in substantially the form of
Exhibit D hereto, properly completed and signed by the Borrower requesting an
Advance.
"Affiliate" means, as to any Person, any other Person (a) that directly or
indirectly, through one or more intermediaries, controls or is controlled by, or
is under common control with, such Person; (b) that directly or indirectly
beneficially owns or holds 5% or more of any class of voting stock of such
Person; or (c) 5% or more of the voting stock of which is directly or indirectly
beneficially owned or held by the Person in question. The term "control" means
the possession, directly or indirectly, of the power to direct or cause
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract, or otherwise; provided, however, in
no event shall the Agent or any Lender be deemed an Affiliate of the Borrower or
any of its Subsidiaries.
"Agent" has the meaning set forth in the introductory paragraph of this
Agreement.
"Agreement" has the meaning set forth in the introductory paragraph of
this Agreement, as the same may from time to time be amended, restated,
supplemented or modified.
"Applicable Lending Office" means for each Lender and each Type of
Advance, the Lending Office of such Lender (or of an Affiliate of such Lender)
designated for such Type of Advance below its name on the signature pages hereof
or such other office of such Lender (or of an Affiliate of such Lender) as such
Lender may from time to time specify to the Borrower and the Agent as the office
by which its Advances of such Type are to be made and maintained.
"Applicable Rate" means: (a) during the period that an Advance is a Base
Rate Advance, the Base Rate, plus the Base Rate Margin, and (b) during the
period that a an Advance under the Revolving Credit Loan or the Tranche B Loan
is a Eurodollar Advance, the Adjusted Eurodollar Rate, plus the Eurodollar
Margin.
"Approved Fund" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Assignee" is defined in Section 13.8(b).
"Assigning Lender" is defined in Section 13.8(b).
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender and its assignee and accepted by the Agent pursuant to Section
13.8, in substantially the form of Exhibit G hereto.
"Average Inventory" means Inventory calculated by dividing the total of
all ending Inventory for each month for the most recent 13 months by 13.
"Base Rate" means as of any date of determination, a rate per annum
equal to the greater of (a) the Prime Rate in effect on such day, or (b) the sum
of the Federal Funds Rate in effect on
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such day plus 0.5%. Any change in the Base Rate due to a change in the Prime
Rate or the Federal Funds Rate shall be effective on the effective date of such
change in the Prime Rate or the Federal Funds Rate, respectively, without notice
to the Borrower.
"Base Rate Advances" means Advances that bear interest at rates
based upon the Base Rate.
"Base Rate Margin" has the meaning set forth in Section 2.11.
"Borrower" is defined in the introductory paragraph of this Agreement.
"Borrower Security Agreement" means that certain Amended and Restated
Borrower Security Agreement dated as of the date hereof, executed by the
Borrower in favor of the Agent for the benefit of the Lenders, in form and
substance satisfactory to the Agent and Lenders, as the same may be amended,
restated, supplemented, or modified from time to time.
"Borrowing Base" means, at any time, an amount equal to the sum of (a) 65%
of Eligible Accounts, which Eligible Accounts will not include more than
$4,000,000 in the aggregate of the Borrower's or any Subsidiary's interest in
Pay-Day Advance Loans net of any valuation reserves (the amount under this
clause (a) hereinafter referred to as the "Eligible Accounts Amount"), plus (b)
the sum of (x) 65% of Eligible Jewelry Inventory, plus (y) 40% of Eligible
General Merchandise Inventory, minus (z) customer deposits received on layaway
Inventory of the Borrower or the applicable Subsidiary (the amount under this
clause (b) hereinafter referred to as the "Eligible Total Inventory Amount");
provided that (i) 50% of the sum of Eligible Jewelry Inventory plus the Eligible
General Merchandise Inventory included for purposes of the Borrowing Base shall
consist of Eligible Jewelry Inventory, and (ii) the total Eligible Total
Inventory Amount included in the Borrowing Base shall not be greater than the
Eligible Accounts Amount.
"Business Day" means (a) any day on which commercial banks are not
authorized or required to close in Austin, Texas and (b) with respect to all
borrowings, payments, Conversions, Continuations, Interest Periods, and notices
in connection with Eurodollar Advances, any day on which dealings in Dollar
deposits are carried out in the London interbank market.
"Capital Expenditures" means, for any period, all expenditures of the
Borrower and its Subsidiaries which are classified as additions to property,
plant and equipment on the consolidated statement of cash flows of the Borrower
in accordance with GAAP, including all such expenditures so classified as
"recurring capital expenditures" and all such expenditures associated with
Capital Lease Obligations.
"Capital Lease Obligation" means, as to any Person, the obligations of
such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) real and/or personal property, which obligations are
required to be classified and accounted for as a capital lease on a balance
sheet of such Person under GAAP. For purposes of this Agreement, the amount of
such Capital Lease Obligations shall be the capitalized amount thereof,
determined in accordance with GAAP.
"Cash Equivalent Investment" means, as to any Person, (a) securities
issued or directly and fully guaranteed or insured by the United States or any
agency or instrumentality thereof
3
(provided that the full faith and credit of the United States is pledged in
support thereof) having maturities of not more than six months from the date of
acquisition, (b) time deposits and certificates of deposit of any commercial
bank having, or which is the principal banking subsidiary of a bank holding
company having, a long-term unsecured debt rating of at least "AAA" or the
equivalent thereof from Standard & Poor's Corporation or "Aaa" or the equivalent
thereof from Xxxxx'x Investors Service, Inc. with maturities of not more than
six months from the date of acquisition by such Person, (c) repurchase
obligations with a term of not more than seven days for underlying securities of
the types described in clause (a) above entered into with any bank meeting the
qualifications specified in clause (b) above, (d) commercial paper issued by any
Person incorporated in the United States rated at least A-1 or the equivalent
thereof by Standard & Poor's Corporation or at least P-1 or the equivalent
thereof by Xxxxx'x Investors Service, Inc. and in each case maturing not more
than six months after the date of acquisition by such Person and (e) investments
in money market funds substantially all of whose assets are comprised of
securities of the types described in clauses (a) through (d) above.
"Code" means the Internal Revenue Code of 1986, as amended, and the
regulations promulgated and rulings issued thereunder.
"Collateral" means the property in which Liens have been granted to the
Agent for the benefit of the Lenders pursuant to the Borrower Security
Agreement, the Subsidiary Security Agreement, the Real Property Security
Documents, or any other agreement, document, or instrument executed by the
Borrower or a Guarantor in accordance with Section 8.13 of the Original Credit
Agreement, whether such Liens are now existing or hereafter arise.
"Commitment" means, as to each Lender, the obligation of such Lender to
purchase participations (or with respect to the Swing Lender or the Issuing
Bank, hold other interests in) the Swing Loan and in Letters of Credit as
described in Articles II and III hereunder, the Revolving Credit Commitment and
the Tranche B Commitment.
"Commitment Fee" is defined in Section 2.10.
"Commitment Fee Rate" means 0.375% per annum.
"Compliance Certificate" is defined in Section 8.1(c).
"Consolidated Net Income" means, at any time, the aggregate net income or
loss of the Borrower and its consolidated Subsidiaries determined on a
consolidated basis as determined in accordance with GAAP.
"Consolidated Net Worth" means, at any particular time, all amounts which,
in conformity with GAAP, would be included as stockholders' equity on a
consolidated balance sheet of the Borrower and the Subsidiaries; provided,
however, there shall be excluded therefrom any amount at which shares of capital
stock of the Borrower appear as an asset on the Borrower's balance sheet.
"Continue," "Continuation," and "Continued" shall refer to the
continuation pursuant to Section 2.7 of a Eurodollar Advance as a Eurodollar
Advance from one Interest Period to the next Interest Period.
4
"Contribution and Indemnification Agreement" means that certain Amended
and Restated Contribution and Indemnification Agreement dated as of the date
hereof executed by the Borrower and the Guarantors, in form and substance
satisfactory to the Agent and the Lenders, as the same may be amended, restated,
supplemented or modified from time to time.
"Convert," "Conversion," and "Converted" shall refer to a conversion
pursuant to Section 2.7 or Article V of one Type of Advance into another Type of
Advance.
"Debt" means as to any Person at any time (without duplication): (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, notes, debentures, or other similar instruments, (c)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable of such Person arising in the ordinary
course of business that are not past due by more than 90 days, (d) all Capital
Lease Obligations of such Person, (e) all Debt or other obligations of others
Guaranteed by such Person, (f) all obligations secured by a Lien existing on
property owned by such Person, whether or not the obligations secured thereby
have been assumed by such Person or are non-recourse to the credit of such
Person, (g) all reimbursement obligations of such Person (whether contingent or
otherwise) in respect of letters of credit, bankers' acceptances, surety or
other bonds and similar instruments, and (h) all liabilities of such Person in
respect of unfunded vested benefits under any Plan.
"Default" means an Event of Default or the occurrence of an event or
condition which with notice or lapse of time or both would become an Event of
Default.
"Default Rate" means the lesser of (a) the Maximum Rate or, (b) the sum of
the Base Rate in effect from day to day plus 5% per annum.
"Deposit and Cash Management Services" means the deposit and/or cash
management products and services provided by a Lender in connection with any
deposit or other accounts of the Borrower or any of its Subsidiaries, including
without limitation, the extensions of credit made by a Lender to or for the
account of the Borrower or any of its Subsidiaries in the ordinary course of
business in connection therewith.
"Disposition" is defined in Section 9.8.
"Dollars" and "$" mean lawful money of the United States of America.
"EBITDA" means Consolidated Net Income, plus, to the extent that any of
the following were deducted in calculating such Consolidated Net Income,
interest expense, tax expenses, and depreciation and amortization, but excluding
all extraordinary items of income and loss.
"Eligible Accounts" means, at any time, (i) all pawn loan receivables of
the Borrower and its Subsidiaries reasonably satisfactory to the Agent, and (ii)
all of the Borrower's and its Subsidiaries' interests in Pay-Day Advance Loans
reasonably satisfactory to the Agent and as to clause (i) above that satisfy the
following conditions:
The account complies in all material respects with all applicable laws, rules,
and regulations, including, without limitation, usury laws, the Federal Truth in
Lending Act, Regulation Z of the Board of Governors of the Federal Reserve
System, as applicable, the provisions of the Texas
5
Pawnshop Act (Chapter 371 of the Texas Finance Code) and similar laws governing
the operation of pawnshops in other states and local jurisdictions where the
Borrower or any of the Subsidiaries conduct business and the consumer loan
provisions of the Texas Finance Code;
The account has not been outstanding at or beyond the date applicable state law
permits the pawned item relative to the subject account to be sold by the
applicable Subsidiary and is not further subject to any federal or local laws,
rules or ordinances;
The account arises from an enforceable contract, the performance of which has
been completed by the applicable Subsidiary;
The applicable Subsidiary has good and indefeasible title to the account and the
account is not subject to any Lien except Liens in favor of Agent and, such Lien
is subordinated only to the limited extent as may be provided in the Subsidiary
Security Agreement and Real Property Security Documents with respect to limited
portions of Collateral in store locations in Texas;
The account is subject to a first priority, perfected Lien in favor of the
Agent;
The account does not arise out of a contract with an account debtor that, by its
terms, prohibits or makes void or unenforceable the grant of a security interest
by the Subsidiary to the Agent in and to such account;
The account is not subject to any setoff, counterclaim, defense, dispute,
recoupment, or adjustment;
The account is not evidenced by chattel paper unless such chattel paper has been
delivered to Agent;
The account debtor has not notified the applicable Subsidiary of any dispute
concerning the transaction giving rise to the account;
The account is payable in Dollars by the account debtor;
and as to clause (ii) above that satisfy the following condition:
(a) The account arises from a Pay-Day Advance Loan which has not
been due for more than 90 days from the date such Pay-Day Advance Loan was
made.
"Eligible Assignee" means (a) a Lender, (b) an Affiliate of a Lender, (c)
an Approved Fund, and (d) any other Person (other than a natural person)
approved by the Agent, and, unless a Default has occurred and is continuing at
the time any assignment is effected, in accordance with Section 13.8, the
Borrower, such approval not to be unreasonably withheld or delayed by the
Borrower; provided, however, that neither the Borrower nor an Affiliate of the
Borrower shall qualify as an Eligible Assignee.
"Eligible General Merchandise Inventory" means, at any time, the
difference of (a) all Inventory of the Borrower and the Subsidiaries (excluding
Jewelry Inventory), relative to transactions occurring and maintained at store
locations or the central jewelry processing location in Austin, Texas which
Inventory is (i) located at locations either owned by the Borrower or applicable
Subsidiary, or leased by the Borrower or the applicable Subsidiary,
6
(ii) held for sale or disposition in the ordinary course of such Subsidiary's
business, (iii) subject to a first priority, perfected Lien in favor of the
Agent and, such Lien is subordinated only to the limited extent as may be
provided in the Subsidiary Security Agreement and Real Property Security
Documents with respect to limited portions of Collateral in store locations in
Texas, and (iv) if located at a location leased by the Borrower or the
applicable Subsidiary, then for all such locations if for at least 85% of all
such leased locations either (x) the Borrower or applicable Subsidiary has
provided the Agent with landlord's waiver letters in form and content reasonably
acceptable to the Agent or (y) the Agent has actual knowledge that the landlord
of such location has no contractual, statutory or common law Lien on such
Inventory (those certain leased locations for which the requirements in clauses
(x) or (y) have been satisfied hereinafter referred to as "Qualified Leased
Locations"), or if less than 85% of all such leased locations are Qualified
Leased Locations, then for the Qualified Leased Locations, minus (b) the pro
rata portion of the Inventory Valuation Reserve on such Inventory. Eligible
General Merchandise Inventory shall not include (A) Inventory that has been
shipped or delivered to a customer on consignment, a sale-or-return basis, a
rent or lease basis, or on the basis of any similar understanding, (B) Inventory
with respect to which a claim exists disputing the Borrower's or such
Subsidiary's title to or right to possession of such Inventory and (C) Inventory
that the Agent in its sole discretion, has reasonably determined to be
unmarketable.
"Eligible Jewelry Inventory" means, at any time, the difference of (a) the
sum of (I) all Jewelry Inventory of the Borrower and the Subsidiaries, relative
to transactions occurring and maintained at store locations or the central
jewelry processing location in Austin, Texas which Jewelry Inventory is (i)
located at locations either owned by the Borrower or applicable Subsidiary, or
leased by the Borrower or the applicable Subsidiary, (ii) held for sale or
disposition in the ordinary course of such Subsidiary's business, (iii) subject
to a first priority, perfected Lien in favor of the Agent and, such Lien is
subordinated only to the limited extent as may be provided in the Subsidiary
Security Agreement and Real Property Security Documents with respect to limited
portions of Collateral in store locations in Texas, and (iv) if located at a
location leased by the Borrower or the applicable Subsidiary, then for all
locations if at least 85% of all such leased locations are Qualified Leased
Locations, or if less than 85% of all such leased locations are Qualified Leased
Locations, then for the Qualified Leased Locations, plus (II) all Jewelry
Inventory of the Borrower and the Subsidiaries in transit or located at a
refining facility or with refining processor so long as (x) the criteria in
clauses (ii) and (iii) above are satisfied and (y) the Agent has received such
documentation in form and substance satisfactory to the Agent from the Borrower
or the applicable Subsidiary related to such Jewelry Inventory minus (b) the pro
rata portion of the Inventory Valuation Reserve on such Inventory. Eligible
Jewelry Inventory shall not include (A) Jewelry Inventory that has been shipped
or delivered to a customer on consignment, a sale-or-return basis, a rent or
lease basis, or on the basis of any similar understanding, (B) Jewelry Inventory
with respect to which a claim exists disputing the Borrower's or such
Subsidiary's title to or right to possession of such Jewelry Inventory and (C)
Jewelry Inventory that the Agent in its sole discretion, has reasonably
determined to be unmarketable.
"Environmental Laws" means any and all federal, state, and local laws,
regulations, and requirements pertaining to health, safety, or the environment,
as such laws, regulations, and requirements may be amended or supplemented from
time to time.
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"Environmental Liabilities" means, as to any Person, all liabilities,
obligations, responsibilities, Remedial Actions, losses, damages, punitive
damages, consequential damages, treble damages, costs, and expenses, (including,
without limitation, all reasonable fees, disbursements and expenses of counsel,
expert and consulting fees and costs of investigation and feasibility studies),
fines, penalties, sanctions, and interest incurred as a result of any claim or
demand, by any Person, whether based in contract, tort, implied or express
warranty, strict liability, criminal or civil statute, including any
Environmental Law, permit, order or agreement with any Governmental Authority or
other Person, arising from environmental, health or safety conditions or the
Release or threatened Release of a Hazardous Material into the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations and published interpretations
thereunder.
"ERISA Affiliate" means any corporation or trade or business which is a
member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) as the Borrower, which is under common control
(within the meaning of Section 414(c) of the Code) with the Borrower, or which
is otherwise affiliated with the Borrower (within the meaning of Section 414(m)
or Section 414(o) of the Code).
"Eurodollar Advances" means Advances the interest rates on
which are determined on the basis of the rates referred to in the
definition of "Adjusted Eurodollar Rate" in this Section 1.1.
"Eurodollar Margin" is defined in Section 2.11.
"Eurodollar Rate" means, for any Eurodollar Advance for any Interest
Period, the rate per annum obtained by dividing (a) the rate per annum
determined by the Agent at approximately 11:00 a.m. (London time) on the date
which is two Business Days prior to the beginning of such Interest Period by
reference to the British Bankers' Association Interest Settlement Rates for
deposits in Dollars (as set forth by any service selected by the Agent which has
been nominated by the British Bankers' Association as an authorized information
vendor for the purpose of displaying such rates) for a period equal to such
Interest Period; provided that, to the extent that an interest rate is not
ascertainable pursuant to the foregoing provisions of this definition, the
"Eurodollar Rate" shall be the interest rate per annum determined by the Agent
to be the average of the rates per annum at which deposits in Dollars are
offered for such Interest Period to major banks in the London interbank market
in London, England at approximately 11:00 a.m. (London time) on the date which
is two Business Days prior to the beginning of such Interest Period by (b) a
percentage equal to 100% minus the stated maximum rate of all reserve
requirements (including any marginal, emergency, supplemental, special or other
reserves) applicable to any member bank of the Federal Reserve System in respect
of "Eurocurrency liabilities" as defined in Regulation D (or any successor
category of liabilities under Regulation D). Each determination by the Agent
pursuant to this definition shall be conclusive absent manifest error.
"Event of Default" is defined in Section 11.1.
"Exchange Act" means the Securities and Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
"Existing Credit Agreement" is defined in the recitals of this Agreement.
8
"Existing Debt" means the Debt listed on Schedule 9.1.
"Existing LCs" means those letters of credit described on Schedule 1.1(b)
issued pursuant to the Original Credit Agreement or the Existing Credit
Agreement.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/16 of 1%) equal to the weighted average
of the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day, provided that (a) if the day for which such rate is to be determined is not
a Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (b) if such rate is not so published on such next
succeeding Business Day, the Federal Funds Rate for any day shall be the average
rate charged to Xxxxx Fargo Bank Texas, National Association on such day on such
transactions as determined by the Agent.
"Fiscal Quarter" means any three-month period ending December 31, March
31, June 30 or September 30.
"Fiscal Year" means each 12 month period ending September 30 of each year.
"Fixed Charge Coverage Ratio" means, for each Fiscal Quarter, the quotient
determined by dividing (a) the sum of EBITDA plus Rental Expense minus
Unfinanced Capital Expenditures minus taxes paid in cash by the Borrower and its
consolidated Subsidiaries, in each case for the period of the four prior Fiscal
Quarters most recently ended by (b) the sum of the aggregate interest expense
and Rental Expense of the Borrower and its consolidated Subsidiaries, in each
case for the period of the four prior Fiscal Quarters most recently ended.
"Foreign Lender" is defined in Section 4.7.
"Fund" means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"Funded Debt" means, at any particular time, the sum of the following,
calculated on a consolidated basis for the Borrower and the Subsidiaries in
accordance with GAAP: (a) all obligations for borrowed money, including but not
limited to senior bank debt, senior notes and subordinated debt, (b) all
obligations relating to the deferred purchase price of property and services,
(c) all Capital Lease Obligations, (d) all obligations as a reimbursement
obligor with respect to an issued letter of credit or similar instrument
(whether drawn or undrawn), and (e) all obligations under a Guarantee of
borrowed money, or any other type of direct or contingent obligation.
"GAAP" means generally accepted accounting principles, applied on a
consistent basis, as set forth in Opinions of the Accounting Principles Board of
the American Institute of Certified Public Accountants and/or in statements of
the Financial Accounting Standards Board and/or their respective successors and
which are applicable in the circumstances as of the date in question. Accounting
principles are applied on a "consistent basis" when the accounting
9
principles applied in a current period are comparable in all material respects
to those accounting principles applied in a preceding period.
"Governmental Authority" means any nation or government, any state or
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory, or administrative functions of or pertaining to
government.
"Guarantee" by any Person means any obligation, contingent or otherwise,
of such Person directly or indirectly guaranteeing any Debt or other obligation
of any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (a) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt or other obligation (whether arising by virtue of partnership arrangements,
by agreement to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise) or (b)
entered into for the purpose of assuring in any other manner the obligee of such
Debt or other obligation of the payment thereof or to protect the obligee
against loss in respect thereof (in whole or in part), provided that the term
Guarantee shall not include endorsements for collection or deposit in the
ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning.
"Guarantor" means each and every domestic Subsidiary of the Borrower
whether now in existence or hereafter created which include but are not limited
to those Subsidiaries listed on Schedule 7.14.
"Guaranty" means that certain Amended and Restated Guaranty Agreement
dated as of the date hereof, executed by the Guarantors in favor of the Agent
and the Lenders, in form and substance satisfactory to the Agent and the
Lenders, as the same has been or may be amended, restated, supplemented, or
otherwise modified from time to time.
"Hazardous Material" means any substance, product, waste, pollutant,
material, chemical, contaminant, constituent, or other material which is or
becomes listed, regulated, or addressed under any Environmental Law.
"Indemnity Accounts" means collectively, any and all indemnity accounts
established and maintained by the Borrower or any Subsidiary to secure the
Borrower's and its Subsidiaries' obligations to be incurred with County Bank of
Rehoboth Beach, Delaware in connection with Pay-Day Advance Loans, such
obligations to be established and governed by the Pay-Day Advance Loan
Documents.
"Interest Period" means the period commencing, with respect to any
Eurodollar Advances, on the date such Eurodollar Advances are made or Converted
from Advances of another Type or, in the case of each subsequent, successive
Interest Period applicable to a Eurodollar Advance, the last day of the next
preceding Interest Period with respect to such Advance, and ending on the
numerically corresponding day in the first, second, third or sixth calendar
month thereafter, as the Borrower may select as provided in Section 2.5 or 2.6
hereof, except that each such Interest Period which commences on the last
Business Day of a calendar month (or on any day for which there is no
numerically corresponding day in the appropriate subsequent calendar month)
shall end on the last Business Day of the first, second, third or sixth calendar
month thereafter, as the case may be. Notwithstanding the foregoing: (a) each
Interest Period which would otherwise end on a day which is not a Business Day
shall end on the next
10
succeeding Business Day or, if such succeeding Business Day falls in the next
succeeding calendar month, on the next preceding Business Day; (b) any Interest
Period for Eurodollar Advances under the Tranche B Loan which would otherwise
extend beyond the Tranche B Termination Date shall end on the Termination Date
and the provisions of Section 5.5 shall apply; (c) any Interest Period for
Eurodollar Advances under the Revolving Credit Loan which would otherwise extend
beyond the Revolving Credit Termination Date shall end on the Revolving Credit
Termination Date and the provisions of Section 5.5 shall apply; and (d) no
Interest Period for any Eurodollar Advances shall have a duration of less than
one month, and, if the Interest Period for any Eurodollar Advances would
otherwise be a shorter period, such Advances shall not be available hereunder.
"Inventory" means at any particular time, inventory (as defined in the
UCC) of the Borrower or any of the Subsidiaries including, without limitation,
all materials and goods held by or for the benefit of the Borrower or any of the
Subsidiaries for sale, lease or consumption.
"Inventory Turnover" means, for each Fiscal Quarter, the quotient
determined by dividing the cost of Inventory items sold during the most recent
12 month period by the Average Inventory for such period.
"Inventory Valuation Reserve" means a valuation account on the Inventory
of the Borrower and its Subsidiaries used to reduce such Inventory's carrying
value to the lesser of cost or fair market value, as determined by the Borrower
after taking into account such factors as obsolescence and broken or
unmarketable Inventory.
"Issuing Bank" means, with respect to any Letter of Credit, Xxxxx Fargo
Bank Texas, National Association.
"Jewelry Inventory" means, at any time, all gold, silver and jewelry
Inventory of the Borrower or any Subsidiary.
"Landlord Change" means any change in the landlord for a Leased Location.
"LC Participation" means, with respect to any Lender, at any time, the
amount of participating interest held by such Lender (or in the case of the
Issuing Bank, other interests) in respect of a Letter of Credit.
"Leased Location" means any location which is leased by the Borrower or
any Subsidiary and at which the Borrower or the applicable Subsidiary maintains
Collateral.
"Lender" is defined in the introductory paragraph of this Agreement.
"Lending Party" is defined in Section 13.21.
"Letter of Credit" means, any standby letter of credit issued by the
Issuing Bank for the account of the Borrower pursuant to Article III.
"Letter of Credit Disbursement" means a disbursement by the Issuing Bank
to the beneficiary of a Letter of Credit in connection with a drawing
thereunder.
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"Letter of Credit Liabilities" means, at any time, the sum of (a) the
aggregate face amounts of all outstanding Letters of Credits and (b) the
aggregate amount of all Letter of Credit Disbursements for which the Issuing
Bank has not been reimbursed by the Borrower.
"Letter of Credit Request Form" means, a certificate, in substantially the
form of Exhibit E hereto, properly completed and signed by the Borrower
requesting issuance of a Letter of Credit.
"Leverage Ratio" means, as of any Fiscal Quarter end, the ratio of Funded
Debt to EBITDA, in each case for such Fiscal Quarter and the prior three Fiscal
Quarters.
"Lien" means any lien, mortgage, security interest, tax lien, financing
statement, pledge, charge, hypothecation, assignment, preference, priority, or
other encumbrance of any kind or nature whatsoever (including, without
limitation, any conditional sale or title retention agreement), whether arising
by contract, operation of law, or otherwise.
"Litigation Fund Accounts" means collectively, any and all litigation fund
accounts established and maintained by the Borrower or any Subsidiary to secure
the Borrower's and its Subsidiaries' obligations to be incurred with County Bank
of Rehoboth Beach, Delaware in connection with Pay-Day Advance Loans, such
obligations to be established and governed by the Pay-Day Advance Loan
Documents.
"Loan Documents" means this Agreement, the Notes, the Guaranty, the
Contribution and Indemnification Agreement, the Borrower Security Agreement, the
Subsidiary Security Agreement, the Real Property Security Documents and all
other promissory notes, security agreements, assignments, deeds of trust,
guaranties, and other instruments, documents, and agreements now or hereafter
executed and delivered pursuant to or in connection with this Agreement, as such
instruments, documents, and agreements may be amended, modified, renewed,
extended, or supplemented from time to time.
"Loans" means, collectively, the Revolving Credit Loan, the Tranche B Loan
and the Swing Loan.
"Material Adverse Effect" means a material adverse effect on (a) the
business, condition (financial or otherwise), operations, prospects, or
properties of the Borrower and the Subsidiaries taken as a whole, or (b) the
validity of enforceability of this Agreement or any of the other Loan Documents
or the rights or remedies of the Agent or the Lenders hereunder or thereunder.
In determining whether any individual event could reasonably be expected to
result in a Material Adverse Effect, notwithstanding that such event does not
itself have such effect, a Material Adverse Effect shall be deemed to have
occurred if the cumulative effect of such event and all other then existing
events could reasonably be expected to result in a Material Adverse Effect.
"Material Debt" is defined in Section 11.1(h).
"Maximum Rate" means, at any time and with respect to any Lender, the
maximum rate of interest under applicable law that such Lender may charge the
Borrower. The Maximum Rate shall be calculated in a manner that takes into
account any and all fees, payments, and other charges in respect of the Loan
Documents that constitute interest under applicable law. Each change in any
interest rate provided for herein based upon the Maximum Rate resulting from a
12
change in the Maximum Rate shall take effect without notice to the Borrower at
the time of such change in the Maximum Rate. For purposes of determining the
Maximum Rate under Texas law, the applicable rate ceiling shall be the
applicable weekly ceiling described in, and computed in accordance with, Chapter
303 of the Texas Finance Code.
"Monthly Payment Date" means the third day of each calendar month of each
year, the first of which shall be November 3, 2002.
"Multiemployer Plan" means a multiemployer plan defined as such in Section
3(37) of ERISA to which contributions have been made by the Borrower or any
ERISA Affiliate and which is covered by Title IV of ERISA.
"Net Proceeds" from any issuance, sale or disposition of any shares of
equity securities (or any securities convertible or exchangeable for any such
shares, or any rights, warrants, or options to subscribe for or purchase any
such shares) means the amount equal to (a) the aggregate gross proceeds of such
issuance, sale or other disposition, less (b) the following: (i) placement agent
fees, (ii) underwriting discounts and commissions, (iii) bank and other lender
fees, and (iv) reasonable legal fees and other reasonable expenses payable by
the issuer in connection with such issuance, sale or other disposition. "Net
Proceeds" from any disposition of assets means the amount equal to (a) the
aggregate gross proceeds of such disposition, less (b) the following: (i) sales
or other similar taxes paid or payable by the seller in connection with such
disposition, (ii) reasonable broker fees in connection with such disposition,
(iii) reasonable legal fees and other reasonable expenses payable by the seller
in connection with such disposition and (iv) the amount of any Debt secured by
the assets that must be repaid in connection with such disposition so long as it
is a Debt permitted under this Agreement.
"Notes" means, collectively, the Revolving Credit Notes, the Tranche B
Notes and the Swing Note.
"Obligated Party" means each Guarantor and any other Person who is or
becomes party to any written agreement that guarantees or secures payment and
performance of the Obligations or any part thereof.
"Obligations" means, collectively, the Primary Obligations and the
Secondary Obligations.
"Original Credit Agreement" means that certain Credit Agreement dated as
of December 10, 1998, by and among the Borrower, the Agent, the Issuing Bank and
certain banks or other lending institutions party thereto, as amended by (a)
that certain First Amendment to Credit Agreement dated as of September 29, 1999,
(b) that certain Second Amendment to Credit Agreement dated as of March 31, 2000
and (c) that certain Third Amendment to Credit Agreement dated as of June 30,
2000.
"Other Taxes" is defined in Section 4.6(b).
"Pay-Day Advance Loan Documents" means the documents, instruments and
agreements which are acceptable to the Agent and the Lenders and are more
specifically described on Schedule 1.1(c) attached hereto, and all amendments,
modifications, renewals, extensions, restatements and supplements thereto,
copies of which have been provided to the Agent and the
13
Lenders and are satisfactory in form and substance to the Agent and the Lenders;
provided that if such amendments, modifications, renewals, extensions,
restatements and supplements are non-substantive from the perspective of the
economics of the transactions evidenced by such documents, instruments and
agreements described on Schedule 1.1(c), prior approval by the Agent and the
Lenders is not required.
"Pay-Day Advance Loans" means loans which are anticipated to be repaid by
the proceeds of post-dated checks or through an ACH debit from the account of
the borrower of the Pay-Day Advance Loan.
"Payment Office" means the operational office of the Agent in Denver,
Colorado, presently located at 0000 Xxxxxxx, 0xx Xxxxx, MAC #C7300-034, Xxxxxx,
Xxxxxxxx 00000.
"Payor" is defined in Section 4.5.
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to all or any of its functions under ERISA.
"Permitted Debt" means (a) the Obligations, (b) Existing Debt and (c)
other Debt permitted by Section 9.1.
"Permitted Liens" means Liens permitted by Section 9.2.
"Person" means any individual, corporation, business trust, association,
company, partnership, joint venture, Governmental Authority, or other entity.
"Plan" means any employee benefit plan (within the meaning of Section 3(3)
of ERISA) established or maintained by the Borrower or any ERISA Affiliate,
which plan is subject to the provisions of ERISA.
"Primary Obligations" means all obligations, indebtedness, and liabilities
of the Borrower to the Agent, the Issuing Bank, and the Lenders, or any of them,
arising pursuant to any of the Loan Documents, now existing or hereafter
arising, whether direct, indirect, related, unrelated, fixed, contingent,
liquidated, unliquidated, joint, several, or joint and several, including,
without limitation, the obligations, indebtedness, and liabilities of the
Borrower under this Agreement, the Notes and the other Loan Documents (including
without limitation, all of the Borrower's contingent reimbursement obligations
in respect of Letters of Credit), and all interest accruing thereon and all
attorneys' fees and other expenses incurred in the enforcement or collection
thereof.
"Prime Rate" means, at any time, the rate of interest per annum then most
recently announced by Xxxxx Fargo Bank, National Association at its principal
office in San Francisco as its prime rate, which rate may not be the lowest rate
of interest charged by Xxxxx Fargo Bank, National Association to its borrowers.
Each change in any interest rate provided for herein based upon the Prime Rate
resulting from a change in the Prime Rate shall take effect on the date the
change is announced by Xxxxx Fargo Bank, National Association without notice to
the Borrower at the time of such change in the Prime Rate.
14
"Principal Office" means the principal office of the Agent in Austin,
Texas, presently located at 000 Xxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000.
"Prohibited Transaction" means any transaction set forth in Section 406 or
407 of ERISA or Section 4975(c)(1) of the Code for which there does not exist a
statutory or administrative exemption.
"Qualified Leased Location" is defined in the definition of Eligible
General Merchandise Inventory.
"Quarterly Payment Date" means the third day of each January, April, July
and October of each year, the first of which shall be January 3, 2003.
"Real Property" means the fee owned real property and interests in fee
owned real property of the Borrower and the Subsidiaries, including without
limitation, that fee owned real property identified on Schedule 1.1(d) attached
hereto, and all improvements and fixtures thereon and all appurtenances thereto,
whether now existing or hereinafter arising.
"Real Property Security Documents" means all deeds of trust, mortgages and
other instruments, documents and agreements executed and delivered by the
Borrower or any Guarantor in favor of the Agent for the benefit of the Lenders,
which creates a Lien on such Person's interests in the Real Property, as the
same may be amended, supplemented or modified.
"Register" is defined in Section 13.8(d).
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as the same may be amended or supplemented from time to time.
"Regulatory Change" means, with respect to any Lender, any change after
the date of this Agreement in United States federal, state, or foreign laws or
regulations (including Regulation D) or the adoption or making after such date
of any interpretations, directives, or requests applying to a class of lenders
including such Lender of or under any United States federal or state, or any
foreign, laws or regulations (whether or not having the force of law) by any
court or governmental or monetary authority charged with the interpretation or
administration thereof.
"Release" means, as to any Person, any release, spill, emission, leaking,
pumping, injection, deposit, disposal, disbursement, leaching, or migration of
Hazardous Materials into the indoor or outdoor environment or into or out of
property owned by such Person, including, without limitation, the movement of
Hazardous Materials through or in the air, soil, surface water, ground water, or
property in violation of Environmental Laws.
"Released Parties" is defined in Section 13.24.
"Remedial Action" means all actions required to (a) clean up, remove,
treat, or otherwise address Hazardous Materials in the indoor or outdoor
environment, (b) prevent the Release or threat of Release or minimize the
further Release of Hazardous Materials so that they do not migrate or endanger
or threaten to endanger public health or welfare or the indoor or outdoor
15
environment, or (c) perform pre-remedial studies and investigations and
post-remedial monitoring and care.
"Rental Expense" means the amounts paid by the Borrower and each
Subsidiary to lease facilities for business operations.
"Reportable Event" means any of the events set forth in Section 4043
of ERISA.
"Required Lenders" means at any time while no Advances or Letters of
Credit Liabilities are outstanding, two or more Lenders having at least 66
2/3% of the aggregate amount of the Commitments and, at any time while
Advances or Letter of Credit Liabilities are outstanding, two or more
Lenders holding at least 66 2/3% of the outstanding aggregate principal
amount of the Revolving Credit Advances, the LC Participations, and the SL
Participations.
"Required Payment" is defined in Section 4.5.
"Reserve Requirement" means, for any Eurodollar Advance for any
Interest Period therefor, the average maximum rate at which reserves
(including any marginal, supplemental or emergency reserves) are required
to be maintained during such Interest Period under Regulation D by member
banks of the Federal Reserve System in New York City with deposits
exceeding one billion Dollars against "Eurocurrency Liabilities" as such
term is used in Regulation D. Without limiting the effect of the
foregoing, the Reserve Requirement shall reflect any other reserves
required to be maintained by such member banks by reason of any Regulatory
Change against (i) any category of liabilities which includes deposits by
reference to which the Adjusted Eurodollar Rate is to be determined, or
(ii) any category of extensions of credit or other assets which include
Eurodollar Advances.
"Revolving Credit Commitment" means, as to each Lender, the
obligation of such Lender to make the Revolving Credit Loan as described
in Article II hereunder in the principal amount up to but not exceeding
the amount set forth opposite the name of such Lender on Schedule 1.1(a)
hereto under the heading "Revolving Credit Commitment", as the same may be
reduced pursuant to Section 2.12 or terminated pursuant to Section 2.12 or
11.2. As of the date hereof, the aggregate amount of the Revolving Credit
Commitments of all Lenders equals $40,000,000.
"Revolving Credit Loan" means the revolving credit loan made or to be made
hereunder to Borrower pursuant to Section 2.1.
"Revolving Credit Loan Advance" means an Advance under the Revolving
Credit Loan.
"Revolving Credit Notes" means the promissory notes of the Borrower
payable to the order of the Lenders in the aggregate principal amount of the
Revolving Credit Loan, in substantially the form of Exhibit A hereto, and all
extensions, renewals, and modifications thereof.
16
"Revolving Credit Termination Date" means 10:00 a.m. (Austin, Texas time)
on March 31, 2005 or such earlier date and time on which the Revolving Credit
Commitments and Swing Commitment terminate as provided in this Agreement.
"Rules" is defined in Section 13.14(b).
"Secondary Obligations" means all obligations, indebtedness, and
liabilities of the Borrower to the Lenders or any of them, arising pursuant to
or in connection with the Deposit and Cash Management Services, now existing or
hereafter arising, whether direct, indirect, related, unrelated, fixed,
contingent, liquidated, unliquidated, joint, several, or joint and several,
including without limitation, the obligations of the Borrower to pay all fees,
costs and expenses (including without limitation, reasonable attorneys' fees)
provided for in connection with the documentation governing the Deposit and Cash
Management Services.
"SL Participation" means, with respect to any Lender, at any time, the
amount of participating interest held by such Lender (or in the case of the
Swing Lender, other interests) in respect of the Swing Loan.
"Subsidiary" means any corporation (or other entity) of which at least a
majority of the outstanding shares of stock (or other ownership interests)
having by the terms thereof ordinary voting power to elect a majority of the
board of directors (or similar governing body) of such corporation (or other
entity) (irrespective of whether or not at the time stock (or other ownership
interests) of any other class or classes of such corporation (or other entity)
shall have or might have voting power by reason of the happening of any
contingency) is at the time directly or indirectly owned or controlled by the
Borrower or one or more of the Subsidiaries or by the Borrower and one or more
of the Subsidiaries.
"Subsidiary Security Agreement" means collectively, those certain Amended
and Restated Subsidiary Security Agreements dated as of the date hereof executed
by the Guarantors in favor of the Agent for the benefit of the Lenders, in form
and substance satisfactory to the Agent and the Lenders, as the same may be
amended, restated, supplemented, or modified from time to time.
"Swing Commitment" means an amount (subject to reduction or cancellation
as herein provided) equal to $3,000,000.
"Swing Lender" means Xxxxx Fargo Bank Texas, National Association.
"Swing Loan" means the swing loan made or to be made hereunder to the
Borrower pursuant to Section 2.8.
"Swing Loan Advance" means an Advance under the Swing Loan.
"Swing Note" means the promissory note of the Borrower payable to the
order of the Swing Lender in the principal amount of the Swing Commitment in
substantially the form of Exhibit C hereto, and all extensions, renewals, and
modifications thereof.
"Taxes" is defined in Section 4.6(a).
"Tranche B Advance" means an Advance under the Tranche B Loan.
17
"Tranche B Commitment" means, as to each Lender, the obligation of such
Lender to make the Tranche B Loan as described in Article II hereunder in the
principal amount up to but not exceeding the amount set forth opposite the name
of such Lender on Schedule 1.1(a) hereto under the heading "Tranche B
Commitment", as the same may be reduced pursuant to Section 2.12 or terminated
pursuant to Section 2.12 or 11.2. As of the date hereof, the aggregate amount of
the Tranche B Commitments of all Lenders equals $7,500,000.
"Tranche B Non-Payment Fee" is defined in Section 2.13.
"Tranche B Loan" means the revolving credit loan made or to be made
hereunder to the Borrower pursuant to Section 2.2.
"Tranche B Notes" means the promissory notes of the Borrower payable to
the order of the Lenders in the aggregate principal amount of the Tranche B
Loan, in substantially the form of Exhibit B hereto, and all extensions,
renewals, and modifications thereof.
"Tranche B Termination Date" means 10:00 a.m. (Austin, Texas time) on
March 3, 2003 or such earlier date and time on which the Tranche B Commitments
terminate as provided in this Agreement.
"Type" means any type of Advance (i.e., Base Rate Advance or Eurodollar
Advance).
"UCC" means the Uniform Commercial Code as in effect in the State of Texas
from time to time.
"Unfinanced Capital Expenditures" means, for any period, all Capital
Expenditures made with funds other than Advances.
"Waiver" is defined in Section 8.12.
Other Definitional Provisions. All definitions contained in this Agreement are
equally applicable to the singular and plural forms of the terms defined. The
words "hereof", "herein", and "hereunder" and words of similar import referring
to this Agreement refer to this Agreement as a whole and not to any particular
provision of this Agreement. Unless otherwise specified, all Article and Section
references pertain to this Agreement. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP. Terms used herein
that are defined in the UCC, unless otherwise defined herein, shall have the
meanings specified in the UCC. In the event of any changes in accounting
principles required by GAAP or recommended by the Borrower's certified public
accountants and implemented by the Borrower occur and such changes result in a
change in the method of the calculation of financial covenants, standards, or
terms under this Agreement, then the Borrower, the Agent, and the Lenders agree
to enter into negotiations in order to amend such provisions of this Agreement
so as to equitably reflect such changes with the desired result that the
criteria for evaluating such covenants, standards, or terms shall be the same
after such changes as if such changes had not been made. Until such time as such
an amendment shall have been executed and delivered by the Agent, the Borrower
and the Required Lenders, all financial covenants, standards, and terms in this
Agreement shall continue to be calculated or construed as if such changes had
not occurred.
18
Revolving Credit Loan, Tranche B Loan and Swing Loan
Revolving Credit Commitments. Subject to the terms and conditions of this
Agreement, each Lender severally agrees to make one or more Revolving Credit
Loan Advances to the Borrower from time to time from the date hereof to but
excluding the Revolving Credit Termination Date in an aggregate principal amount
at any time outstanding up to but not exceeding the amount of such Lender's
Revolving Credit Commitment as then in effect, provided that the aggregate
amount of all Revolving Credit Loan Advances at any time outstanding shall not
exceed (a) the lesser of (i) the Revolving Credit Commitments or (ii) the
Borrowing Base minus the outstanding Tranche B Advances, minus (b) the sum of
the outstanding Swing Loan Advances and the Letter of Credit Liabilities.
Subject to the foregoing limitations, and the other terms and provisions of this
Agreement, the Borrower may borrow, repay, and reborrow hereunder the amount of
the Revolving Credit Commitments by means of Base Rate Advances and Eurodollar
Advances and, until the Revolving Credit Termination Date, the Borrower may
Convert Revolving Credit Loan Advances of one Type into Revolving Credit Loan
Advances of another Type. Revolving Credit Loan Advances of each Type made by
each Lender shall be made and maintained at such Lender's Applicable Lending
Office for Advances of such Type.
Tranche B Commitments. Subject to the terms and conditions of this Agreement,
each Lender severally agrees to make one or more Tranche B Advances to the
Borrower from time to time from the date hereof to but not excluding the Tranche
B Termination Date in an aggregate principal amount at any time outstanding up
to but not exceeding the amount of such Lender's Tranche B Commitment as then in
effect, provided that (a) the aggregate amount of all Tranche B Advances at any
time outstanding shall not exceed the sum of (i) the lesser of (x) the Tranche B
Commitments or (y) the Borrowing Base minus the sum of the outstanding Swing
Loan Advances, the Revolving Credit Loan Advances, and the Letter of Credit
Liabilities, minus (ii) the outstanding Tranche B Advances, and (b) the sum of
the outstanding Revolving Credit Loan Advances, Swing Loan Advances and Letter
of Credit Liabilities is not less than the lesser of (i) the Revolving Credit
Commitments or (ii) the Borrowing Base minus the outstanding Tranche B Loans.
Subject to the foregoing limitations, and the other terms and provisions of this
Agreement, the Borrower may borrow, repay and reborrow hereunder the amount of
the Tranche B Commitments by means of Base Rate Advances and Eurodollar Advances
and, until the Tranche B Termination Date, the Borrower may Convert Tranche B
Advances of one Type into Tranche B Advances of another Type. Tranche B Advances
of each Type made by each Lender shall be made and maintained at such Lender's
Applicable Lending Office for Advances of such Type.
Revolving Credit Notes and Tranche B Notes. The obligation of the Borrower to
repay each Lender for Revolving Credit Loan Advances made by such Lender and
interest thereon shall be evidenced by a Revolving Credit Note executed by the
Borrower, payable to the order of such Lender, in the principal amount of such
Lender's Revolving Credit Commitment dated the date hereof. The obligation of
the Borrower to repay each Lender for Tranche B Advances made by such Lender and
interest thereon shall be evidenced by a Tranche B Note executed by the
Borrower, payable to the order of such Lender, in the principal amount of such
Lender's Tranche B Commitment dated the date hereof.
19
Repayment of Revolving Credit Loan and Tranche B Loan. The Borrower shall repay
the outstanding principal amount of the Revolving Credit Loan and the Swing Loan
on the Revolving Credit Termination Date. The Borrower shall repay the
outstanding principal amount of the Tranche B Loan on the Tranche B Termination
Date.
Interest. The unpaid principal amount of the Revolving Credit Loan and the
Tranche B Loan shall bear interest at a varying rate per annum equal from day to
day to the lesser of (a) the Maximum Rate or (b) the greater of 4.50% or the
Applicable Rate. If at any time the Applicable Rate for any Advance shall exceed
the Maximum Rate, thereby causing the interest accruing on such Advance to be
limited to the Maximum Rate, then any subsequent reduction in the Applicable
Rate for such Advance shall not reduce the rate of interest on such Advance
below the Maximum Rate until the aggregate amount of interest accrued on such
Advance equals the aggregate amount of interest which would have accrued on such
Advance if the Applicable Rate had at all times been in effect. Accrued and
unpaid interest on the Revolving Credit Loan Advances and the Tranche B Advances
shall be due and payable as follows:
in the case of all Base Rate Advances, on each Monthly Payment Date;
in the case of all Eurodollar Advances, on the last day of the Interest Period
with respect thereto and, in the case of an Interest Period with a duration
greater than three months, at three-month intervals after the first day of such
Interest Period;
upon the payment or prepayment of any Eurodollar Advance or the Conversion of
any Eurodollar Advance to an Advance of another Type (but only on the principal
amount so paid, prepaid, or Converted);
with respect to Revolving Credit Loan Advances and Swing Loan Advances, on the
Revolving Credit Termination Date; and
with respect to Tranche B Advances, on the Tranche B Termination Date.
Notwithstanding the foregoing, upon the occurrence and during the
continuance of an Event of Default, the outstanding principal amounts of all
Advances and (to the fullest extent permitted by law) any other amounts payable
by the Borrower under any Loan Document shall bear interest at the Default Rate
at the Required Lenders' option beginning upon the occurrence of such Event of
Default or such later date as selected by the Required Lenders. Interest payable
at the Default Rate shall be payable from time to time on demand.
Revolving Credit Loan and Tranche B Loan Borrowing Procedure. The Borrower shall
give the Agent notice by means of an Advance Request Form of each requested
Revolving Credit Loan Advance and each Tranche B Advance at least one Business
Day before the requested date of each Base Rate Advance, and at least three
Business Days before the requested date of each Eurodollar Advance, specifying:
(a) the requested date of such Revolving Credit Loan Advance or such Tranche B
Advance (which shall be a Business Day), (b) the amount of such Revolving Credit
Loan Advance or such Tranche B Advance, (c) the Type of Revolving Credit Loan
Advance or such Tranche B Advance, and (d) in the case of a Eurodollar Advance,
the duration of the Interest Period for such Revolving Credit Loan Advance or
such Tranche B Advance. Each Eurodollar Advance under the Revolving Credit Loan
or the Tranche B Loan shall be in a minimum principal amount of $1,000,000 or an
integral multiple of $500,000. Each Base Rate
20
Advance under the Revolving Credit Loan or the Tranche B Loan shall be in a
minimum principal amount of $500,000 or in greater increments of $100,000. The
Agent shall notify each Lender of the contents of each such notice promptly. Not
later than 1:00 p.m. (Austin, Texas time) on the date specified for each
Revolving Credit Loan Advance or each Tranche B Advance hereunder, each Lender
will make available to the Agent at the Principal Office in immediately
available funds, for the account of the Borrower, its pro rata share of each
Revolving Credit Loan Advance or each Tranche B Advance. After the Agent's
receipt of such funds and subject to the other terms and conditions of this
Agreement, the Agent will make each Revolving Credit Loan Advance or each
Tranche B Advance available to the Borrower by depositing the same, in
immediately available funds, in an account of the Borrower (designated by the
Borrower) maintained with the Agent at the Principal Office. All notices by the
Borrower under this Section shall be irrevocable and shall be given not later
than 11:00 a.m. (Austin, Texas time) on the day which is not less than the
number of Business Days specified above for such notice.
Conversions and Continuations. The Borrower shall have the right from time to
time to Convert all or part of a Revolving Credit Loan Advance or a Tranche B
Advance of one Type into an Advance of another Type or to Continue Eurodollar
Advances as Eurodollar Advances by giving the Agent written notice at least one
Business Day before Conversion into a Base Rate Advance, and at least three
Business Days before Conversion into or Continuation of a Eurodollar Advance,
specifying: (a) the Conversion or Continuation date, (b) the amount of the
Advance to be Converted or Continued, (c) in the case of Conversions, the Type
of Advance to be Converted into, and (d) in the case of a Continuation of or
Conversion into a Eurodollar Advance, the duration of the Interest Period
applicable thereto; provided that (i) Eurodollar Advances may only be Converted
on the last day of the Interest Period, (ii) except for Conversions into Base
Rate Advances, no Conversions shall be made while a Default has occurred and is
continuing, and (iii) no more than five Interest Periods shall be in effect at
the same time. The Agent shall notify each Lender of the contents of each such
notice promptly and in any event not later than one Business Day after receipt
thereof. All notices by the Borrower under this Section shall be irrevocable and
shall be given not later than 11:00 a.m. (Austin, Texas time) on the day which
is not less than the number of Business Days specified above for such notice. If
the Borrower shall fail to give the Agent the notice as specified above for
Continuation or Conversion of a Eurodollar Advance prior to the end of the
Interest Period with respect thereto, such Eurodollar Advance shall be Converted
automatically into a Base Rate Advance on the last day of the then current
Interest Period for such Eurodollar Advance.
Swing Loans.
Making Swing Loans; Interest Rate. For the convenience of the parties and as an
integral part of the transactions contemplated by the Loan Documents, the Swing
Lender, solely for its own account, agrees, on the terms and conditions
hereinafter set forth, to make Swing Loans to the Borrower (which the Borrower
may repay and reborrow from time to time in accordance with the terms and
provisions hereof) from time to time on any Business Day during the period from
the date hereof to but excluding the Revolving Credit Termination Date in an
aggregate principal amount at any one time outstanding which shall not exceed
the Swing Commitment; provided that, the Swing Lender shall not be obligated to
make any Swing Loan (i) which when added to the then outstanding Revolving
Credit Loan Advances plus the outstanding Letter of Credit Liabilities plus the
outstanding Swing Loan Advances would exceed the lesser of (1) the Commitments
and (2) the Borrowing Base minus the outstanding Tranche B Advances, and
21
(ii) at any time after any Lender has refused to purchase a participation in any
Swing Loan as provided in Section 2.8(d). All Swing Loans shall bear interest at
the lesser of (A) the Maximum Rate and (B) the Applicable Rate for Base Rate
Advances (subject to Section 2.5) and shall be included within the Primary
Obligations hereunder. Each Swing Loan shall be subject to all the terms and
conditions applicable to the Revolving Credit Loan; provided that, (i) there
shall be no minimum Swing Loan Advance amount or repayment for a Swing Loan
except as provided in Section 2.8(c), and (ii) each Swing Loan shall be
available and may be prepaid on same day telephonic notice to be followed
promptly with an Advance Request Form (except for telephonic notices of
prepayment) from the Borrower to the Swing Lender, so long as such notice is
received by the Swing Lender prior to 3:00 p.m. (Austin, Texas time).
Swing Note. The Swing Loans made by the Swing Lender shall be evidenced by a
single promissory note of the Borrower in substantially the form of Exhibit C
hereto, payable to the order of the Swing Lender in a principal amount equal to
the Swing Commitment as originally in effect and otherwise duly completed.
Repayment of Swing Loans. Upon the earlier to occur of (i) the date 10 Business
Days after each Swing Loan Advance, and (ii) demand by the Swing Lender, the
Borrower shall promptly borrow Revolving Credit Loans from the Lenders, pursuant
to Section 2.1 hereof and apply the proceeds of such Revolving Credit Loans to
the repayment of such Swing Loan Advance then due.
Participation of Lenders. In the event the Borrower shall fail to repay when due
any Swing Loan, each Lender with a Revolving Credit Commitment shall irrevocably
and unconditionally purchase from the Swing Lender an SL Participation in such
Swing Loan in lawful money of the United States and in the same day funds, in an
amount equal to such Lender's pro rata share (based on the Revolving Credit
Commitments) of the principal amount of such Swing Loans then due; provided
that, no Lender shall be obligated to purchase a participation in the Swing
Loans which would cause the outstanding Advances owed to such Lender plus such
Lender's pro rata part of outstanding Letter of Credit Liabilities to exceed
such Lender's Revolving Credit Commitment. If such amount is not in fact made
available to the Swing Lender by any Lender with a Revolving Credit Commitment,
the Swing Lender shall be entitled to recover such amount on demand from such
Lender together with accrued interest thereon, for each day from the date of
demand therefor, if made prior to 1:00 p.m. (Austin, Texas time) on any Business
Day, or, if made at any other time, from the next Business Day following the
date of such demand, until the date such amount is paid to the Swing Lender by
such Lender at the Federal Funds Rate. If such Lender does not pay such amount
forthwith upon the Swing Lender's demand therefor, and until such time as such
Lender makes the required payment, the Swing Lender shall be deemed to continue
to have outstanding a Swing Loan in the amount of such unpaid participation
obligation for all purposes under the Loan Documents other than those provisions
requiring the other Lenders with a Revolving Credit Commitment to purchase a
participation therein. Thereafter, each payment of all or any part of the
Primary Obligations evidenced by the Swing Note shall be paid to the Swing
Lender for the ratable benefit of the Swing Lender and the Lenders who are
participants in the Swing Loan; provided that, with respect to any participation
hereunder, all interest accruing on the Swing Loan (or any portion thereof) to
which such participation relates prior to the date of purchase of any
participation hereunder shall be payable solely to the Swing Lender for its own
account.
22
Use of Proceeds. The proceeds of Advances shall be used by the Borrower to
refinance Debt of the Borrower under the Existing Credit Agreement, for working
capital in the ordinary course of business and other general corporate purposes.
Fees. (a) On the date hereof and on or prior to each October 30 during the term
hereof, the Borrower agrees to pay to the Agent for the account of the Agent an
annual agent fee in an amount to be agreed to by the Borrower and the Agent
pursuant to a side letter agreement, and (b) the Borrower agrees to pay to the
Agent for the account of each Lender a Commitment Fee (herein so called) on the
average daily unused amount of such Lender's Commitment for the period from and
including the date of this Agreement to and including the Revolving Credit
Termination Date (or the Tranche B Termination Date, if applicable), at the
Commitment Fee Rate, based on a 360 day year and the actual number of days
elapsed. The accrued Commitment Fee shall be payable in arrears on each
Quarterly Payment Date and on the Revolving Credit Termination Date (or the
Tranche B Termination Date, if applicable). For the purpose of calculating the
Commitment Fee hereunder, the Commitments shall be deemed utilized by the amount
of all Revolving Credit Loan Advances, Tranche B Advances and all Letter of
Credit Liabilities and without giving effect to any Swing Loan Advances.
Determination of Eurodollar Margin and Base Rate Margin. The Eurodollar Margin
and the Base Rate Margin shall be defined and determined as follows:
"Base Rate Margin" shall mean (i) during the period commencing on
the date hereof and ending on but not including the first Adjustment Date,
1.50% per annum, and (ii) during each period, from and including one
Adjustment Date to but excluding the next Adjustment Date (herein a
"Calculation Period"), the percent per annum set forth in the table below
in this Section 2.11 under the heading "Base Rate Margin" opposite the
Leverage Ratio calculated for the completed four Fiscal Quarters which
immediately preceded the beginning of the applicable Calculation Period.
"Eurodollar Margin" shall mean (i) during the period commencing on
the date hereof and ending on but not including the first Adjustment Date,
3.00% per annum, and (ii) during each Calculation Period, the percent per
annum set forth in the table below in this Section 2.11 under the heading
"Eurodollar Margin" opposite the Leverage Ratio calculated for the
completed four Fiscal Quarters which immediately preceded the beginning of
the applicable Calculation Period.
LEVERAGE RATIO BASE RATE MARGIN EURODOLLAR MARGIN
-------------- ---------------- -----------------
Greater than 2.50:1.00 1.75% 3.25%
Equal to or less than 1.50% 3.00%
2.50:1.00, but greater
than 2.25:1.00
Equal to or less than 1.25% 2.75%
2.25:1.00, but greater
than 2.00:1.00
Less than 2.00:1.00 1.00% 2.50%
Upon delivery of the Compliance Certificate pursuant to Section
8.1(c) in connection with the financial statements required to be
delivered pursuant to
23
Section 8.1(b) at the end of each Fiscal Quarter commencing with such
Compliance Certificate delivered at the end of the Fiscal Quarter ending
on March 31, 2003, the Eurodollar Margin and the Base Rate Margin shall
automatically be adjusted as set forth in the table above, such automatic
adjustment to take effect as of the first Business Day after the receipt
by the Agent of the related Compliance Certificate (each such Business Day
when the Eurodollar Margin or Base Rate Margin is adjusted pursuant to
this sentence or below, herein an "Adjustment Date"). If the Borrower
fails to deliver such Compliance Certificate which so sets forth the
Leverage Ratio within the period of time required by Section 8.1(c), the
Eurodollar Margin and the Base Rate Margin shall automatically be adjusted
to highest applicable percentage set forth in the grid above, such
automatic adjustment to take effect as of the first Business Day after the
last day on which the Borrower was required to deliver the applicable
Compliance Certificate in accordance with Section 8.1(c) and to remain in
effect until subsequently adjusted in accordance herewith upon the
delivery of a Compliance Certificate.
Reduction or Termination of Commitments.
Optional. The Borrower shall have the right to terminate in whole or reduce in
part the unused portion of the Commitments (including the Swing Commitment) upon
at least three Business Days prior notice (which notice shall be irrevocable) to
the Agent and each Lender specifying the effective date thereof, whether a
termination or reduction is being made, and the amount of any partial reduction,
provided that each partial reduction shall be in the amount of $5,000,000 (or in
the case of the Swing Commitment, $1,000,000) or an integral multiple thereof
and the Revolving Credit Commitments (other than the Swing Commitment) shall not
be reduced below the outstanding Letter of Credit Liabilities, and the Borrower
shall simultaneously prepay the amount by which (i) the unpaid principal amount
of the Revolving Credit Loan Advances, the Swing Loan Advances and outstanding
Letter of Credit Liabilities exceeds the Revolving Credit Commitments (after
giving effect to such notice) plus accrued and unpaid interest on the principal
amount so prepaid and (ii) the unpaid principal amount of the Tranche B Advances
exceeds the Tranche B Commitments (after giving effect to such notice) plus
accrued and unpaid interest on the principal amount so prepaid. The Commitments
may not be reinstated after they have been terminated or reduced. In addition
the Swing Commitment may never be more than the Revolving Credit Commitments
(exclusive of the amount of the Swing Commitment). Notwithstanding anything to
the contrary contained herein, any such termination or reduction in the
Commitments shall be applied first to the Tranche B Commitments, then any
remaining reduction shall be applied to the Revolving Credit Commitments.
Mandatory.
Upon the occurrence of any event requiring a mandatory prepayment under Section
4.3(c), (A) the Commitments shall automatically reduce by the amount equal to
100% of the Net Proceeds from the issuance, sale or other disposition of any
shares of equity securities or other equity interests and (B) the Borrower shall
simultaneously prepay the amount by which the unpaid principal amount of the
Advances plus the Letter of Credit Liabilities exceeds the Commitments (after
giving effect to such reduction) plus accrued and unpaid interest on the
principal amount so prepaid. Any such reductions in the Commitments shall be
applied first to the Tranche B Commitments, then any remaining reduction shall
be applied to the Revolving Credit Commitments.
Upon the occurrence of any event requiring a mandatory prepayment under Section
4.3(d) and so long as either the Tranche B Commitment or the Tranche B Loan is
outstanding, (A) the Tranche B Commitments shall automatically reduce by the
amount equal to 100% of the Net Proceeds from the sale of assets occurring on
such date, and (B) the Borrower shall simultaneously prepay the amount by which
the unpaid principal amount of the Tranche B Advances exceeds the Tranche B
Commitments (after giving effect to such reduction) plus accrued and unpaid
interest on the principal amount so prepaid. In the event that the amount of Net
Proceeds received under this clause (ii) exceeds the Tranche B Commitment, the
amount of such excess Net Proceeds shall be subject to Section 2.12(b)(iii).
24
Upon the occurrence of any event requiring a mandatory prepayment under Section
4.3(d) and so long as the Tranche B Commitments have been terminated and the
Borrower has paid the outstanding Tranche B Loan, (A) the Commitments shall
automatically reduce by the amount equal to 100% of the Net Proceeds from the
sale of assets occurring on such date to the extent such amount exceeds either
(x) $1,000,000 per Disposition or (y) $3,000,000 in the aggregate for all
Dispositions which have occurred since the date hereof, (including without
limitation, any Dispositions requiring a Tranche B Commitment reduction as
provided in Section 2.12(b)(ii)) and (B) the Borrower shall simultaneously
prepay the amount by which the unpaid principal amount of the Advances plus the
Letter of Credit Liabilities exceeds the Commitments (after giving effect to
such reduction) plus accrued and unpaid interest on the principal amount so
prepaid.
On each Monthly Payment Date beginning December 3, 2002, (A) the Tranche B
Commitments shall automatically reduce by $250,000, and (B) the Borrower shall
simultaneously prepay the amount by which the unpaid principal amount of the
Tranche B Advances exceeds the Tranche B Commitments (after giving effect to
such reduction) plus accrued and unpaid interest in the principal amount so
prepaid.
Tranche B Non-Payment Fee. The Borrower agrees to pay to the Agent for the
account of the Lenders a fee (the "Tranche B Non-Payment Fee") in an amount
equal to 3% of the Commitments outstanding as of the date immediately prior to
the Tranche B Termination Date which shall be fully earned and due and payable
on the Tranche B Termination Date. The Agent and the Lenders shall forgive
payment of the Tranche B Non-Payment Fee if the Borrower has terminated the
Tranche B Commitments and paid in full the outstanding Tranche B Loan on or
before the Tranche B Termination Date.
Letters of Credit
Letters of Credit.
Subject to the terms and conditions of this Agreement, the Issuing Bank agrees
to issue one or more standby Letters of Credit for the account of the Borrower
from time to time from the date hereof to but excluding the Revolving Credit
Termination Date; provided, however, that the outstanding Letter of Credit
Liabilities shall not at any time exceed the lesser of (i) $2,000,000, and (ii)
an amount equal to (A) the lesser of (1) the Revolving Credit Commitments and
(2) the Borrowing Base minus the outstanding Tranche B Advances, minus (B) the
sum of the outstanding Revolving Credit Loan Advances and Swing Loan Advances.
Each Letter of Credit
25
shall have an expiration date not beyond five Business Days prior to the
Revolving Credit Termination Date, shall be payable in Dollars, must support a
transaction that is entered into in the ordinary course of the Borrower's
business, must be satisfactory in form and substance to the Issuing Bank, and
shall be issued pursuant to such documents and instruments (including, without
limitation, the Issuing Bank's standard application for issuance of letters of
credit as then in effect) as the Issuing Bank may require. No Letter of Credit
shall require any payment by the Issuing Bank to the beneficiary thereunder
pursuant to a drawing prior to the third Business Day following presentment of a
draft and any related documents to the Issuing Bank.
By the issuance of each Letter of Credit and without any further action on the
part of the Issuing Bank or any of the Lenders in respect thereof, the Issuing
Bank hereby grants to each Lender with a Revolving Credit Commitment and each
Lender with a Revolving Credit Commitment hereby agrees to acquire from the
Issuing Bank a participation in each Letter of Credit and the related Letter of
Credit Liabilities, effective upon the issuance thereof without recourse or
warranty, equal to such Lender's pro rata share (based on the Revolving Credit
Commitments) of such Letter of Credit and Letter of Credit Liabilities. In
furtherance of the foregoing, each Lender with a Revolving Credit Commitment
hereby absolutely and unconditionally agrees to pay to the Issuing Bank, as and
when required by Section 3.4, such Lender's pro rata share of each Letter of
Credit Disbursement. Each Lender acknowledges and agrees that its obligation to
acquire participations pursuant to this Section 3.1(b) in respect of each Letter
of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including without limitation the occurrence and
continuance of any Default, and that each such payment shall be made without any
offset, abatement, withholding, or reduction whatsoever. This agreement to grant
and acquire participations is an agreement between the Issuing Bank and the
Lenders, and neither the Borrower nor any beneficiary of a Letter of Credit
shall be entitled to rely thereon. The Borrower agrees that each Lender
purchasing a participation from the Issuing Bank pursuant to this Section 3.1(b)
may exercise all its rights to payment against the Borrower including the right
of setoff, with respect to such participation as fully as if such Lender were
the direct creditor of the Borrower in the amount of such participation.
The Issuing Bank agrees with each Lender that it shall transfer to such Lender,
without any offset, abatement, withholding, or reduction whatsoever, such
Lender's proportionate share of any payment of a reimbursement obligation of the
Borrower with respect to a Letter of Credit Disbursement, including interest
payments made to the Issuing Bank on such Letter of Credit Disbursement, based
on the proportion that the payment made by such Lender to the Issuing Bank in
respect of the principal amount of such Letter of Credit Disbursement bears to
the outstanding principal amount of such Letter of Credit Disbursement.
Schedule 1.1(b) contains a description of all letters of credit which were
issued pursuant to the Original Credit Agreement or the Existing Credit
Agreement and which are to remain outstanding under this Agreement. Each of the
Existing LCs shall constitute a Letter of Credit for all purposes of this
Agreement and shall, for purposes of this Agreement, be deemed issued on the
date hereof.
Procedure for Issuing Letters of Credit. Each Letter of Credit shall be issued
on at least three Business Days prior notice from the Borrower to the Issuing
Bank by means of a Letter of Credit Request Form describing the transaction
proposed to be supported thereby and specifying (a) the date on which such
Letter of Credit is to be issued (which shall be a Business Day) and the face
amount thereof, (b) the name and address of the beneficiary, (c) whether such
Letter of Credit
26
shall permit a single drawing or multiple drawings, (d) the conditions
permitting the drawing or drawings thereunder, (e) whether the draft thereunder
shall be a sight or time draft and, if the latter, the date when the draft shall
be payable, (f) the form of the draft and any other documents required to be
presented at the time of any drawing (such notice to set forth the exact wording
of such documents or to attach copies thereof), and (g) the expiration date of
such Letter of Credit. Upon fulfillment of the applicable conditions precedent
in Article VI, the Issuing Bank shall make the applicable Letter of Credit
available to the Borrower or, if so requested by the Borrower, to the
beneficiary of the Letter of Credit.
Presentment and Reimbursement. (a) Promptly upon receipt of any documents
purporting to represent a demand for payment under a Letter of Credit, the
Issuing Bank shall give notice to the Borrower of the receipt thereof, which
notice may be telephonic. If the Issuing Bank shall have determined that a
demand for payment under a Letter of Credit appears on its face to be in
conformity with the terms and conditions of such Letter of Credit, the Issuing
Bank shall give notice to the Borrower, which notice may be telephonic, of the
receipt and amount of such drawing and the date on which payment thereon will be
made. If the Borrower shall not have discharged in full by 10:00 a.m. (Austin,
Texas time) on the date of such payment, its obligation to reimburse the Issuing
Bank in the amount of such drawing under such Letter of Credit, then the amount
of such drawing for which the Issuing Bank shall not have been reimbursed by the
Borrower shall be paid by the Borrower to the Issuing Bank or, to the extent the
Issuing Bank shall have received payments with respect to such drawing from the
Lenders, to the Issuing Bank for the account of the Lenders, within three
Business Days after the date of such drawing (but in any event before the
Revolving Credit Termination Date), together with interest on such amount at the
Default Rate from the date of payment by the Issuing Bank to the beneficiary
under the Letter of Credit (each such payment made after 10:00 a.m. (Austin,
Texas time) on such due date to be deemed to be made on the next succeeding
Business Day). The obligations of the Borrower under this Section 3.3 shall be
unconditional, absolute, and irrevocable in all respects.
Payment. If the Issuing Bank shall pay any draft presented under a Letter of
Credit issued by it and if the Borrower shall not have discharged in full its
reimbursement obligation by 10:00 a.m. (Austin, Texas time) on the date of such
Letter of Credit Disbursement, then the Issuing Bank shall as promptly as
practicable give telephonic (which shall be promptly confirmed in writing) or
facsimile notice to each Lender with a Revolving Credit Commitment of the date
of such payment and the amount of such payment and each Lender with a Revolving
Credit Commitment shall pay to the Issuing Bank, in immediately available funds,
not later than 3:00 p.m. (Austin, Texas time) on the date of such payment (or,
if Issuing Bank shall notify the Lenders of such payment after 11:00 a.m.
(Austin, Texas time) then not later than 12:00 p.m. (Austin, Texas time) on the
next succeeding Business Day), an amount equal to such Lender's pro rata share
of such drawing; provided that, if any Lender shall for any reason fail to pay
the Issuing Bank its pro rata share of the drawing on the date of such payment,
the Issuing Bank shall itself fund such Lender's pro rata share while retaining
the right to proceed against such Lender for reimbursement therefor. In the
event that the Issuing Bank shall fund a Lender's pro rata share of a drawing,
the amount so funded shall bear interest at a rate per annum equal to the
Federal Funds Rate and shall be payable by such Lender when it reimburses the
Issuing Bank for funding its pro rata part (with interest to accrue from and
including the date of such funding to and excluding the date of reimbursement).
In the event that a Lender, after notice, pays its pro rata share of a drawing
hereunder and such payment is not required to fund a Letter of Credit
Disbursement, the Issuing Bank shall return such payment to the Lender with
interest calculated
27
at a rate per annum equal to the Federal Funds Rate (with interest to accrue
from and including the date of such funding to and excluding the date of
return). The obligation of each Lender with a Revolving Credit Commitment to pay
to the Issuing Bank such Lender's pro rata part of any drawing under a Letter of
Credit shall be absolute and unconditional under any and all circumstances
(including without limitation the passage of the Termination Date), and such
obligations shall be several and not joint.
Letter of Credit Fee. The Borrower shall pay to the Agent, for the account of
the Lenders with Revolving Credit Commitments, a nonrefundable letter of credit
fee for each Letter of Credit payable in arrears on each quarterly anniversary
date of the issuance date thereof in an amount equal to the applicable
Eurodollar Margin multiplied by the undrawn amount of such Letter of Credit,
based on a 360 day year and the actual number of days in the stated term of such
Letter of Credit. In addition, the Borrower shall pay to the Issuing Bank,
solely for its own account as issuer of Letters of Credit, nonrefundable
fronting, amendment, transfer, negotiation and other fees as determined in
accordance with the Issuing Bank's then current fee policy.
Obligations Absolute. The obligations of the Borrower under this Agreement and
the other Loan Documents (including without limitation the obligation of the
Borrower to reimburse the Issuing Bank for draws under any Letter of Credit)
shall be absolute, unconditional, and irrevocable, and shall be performed
strictly in accordance with the terms of this Agreement and the other Loan
Documents under all circumstances whatsoever, including without limitation the
following circumstances:
Any lack of validity or enforceability of any Letter of Credit or any other Loan
Document;
Any amendment or waiver of or any consent to departure from any Loan Document;
The existence of any claim, set-off, counterclaim, defense or other rights which
the Borrower, any Obligated Party, or any other Person may have at any time
against any beneficiary of any Letter of Credit, the Issuing Bank, any Lender,
the Agent, or any other Person, whether in connection with this Agreement or any
other Loan Document or any unrelated transaction;
Any statement, draft, or other document presented under any Letter of Credit
proving to be forged, fraudulent, invalid, or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect whatsoever;
Payment by the Issuing Bank under any Letter of Credit against presentation of a
draft or other document which does not comply with the terms of such Letter of
Credit; or
Any other circumstance or happening whatsoever, whether or not similar to any of
the foregoing.
Limitation of Liability. The Borrower assumes all risks of the acts or omissions
of any beneficiary of any Letter of Credit with respect to its use of such
Letter of Credit. Neither the Issuing Bank, the Lenders, the Agent, nor any of
their officers or directors shall have any responsibility or liability to the
Borrower or any other Person for: (a) the failure of any draft to bear any
reference or adequate reference to any Letter of Credit, or the failure of any
documents to accompany any draft at negotiation, or the failure of any Person to
surrender or to take up any Letter of Credit or to send documents apart from
drafts as required by the terms of any Letter of Credit, or the failure of any
Person to note the amount of any instrument on any Letter of Credit,
28
each of which requirements, if contained in any Letter of Credit itself, it is
agreed may be waived by the Issuing Bank, (b) errors, omissions, interruptions,
or delays in transmission or delivery of any messages, (c) the validity,
sufficiency, or genuineness of any draft or other document, or any
endorsement(s) thereon, even if any such draft, document or endorsement should
in fact prove to be in any and all respects invalid, insufficient, fraudulent,
or forged or any statement therein is untrue or inaccurate in any respect, (d)
the payment by the Issuing Bank to the beneficiary of any Letter of Credit
against presentation of any draft or other document that does not comply with
the terms of the Letter of Credit, or (e) any other circumstance whatsoever in
making or failing to make any payment under a Letter of Credit. The Borrower
shall have a claim against the Issuing Bank, and the Issuing Bank shall be
liable to the Borrower, to the extent of any direct, but not consequential,
damages suffered by the Borrower which the Borrower proves in a final
nonappealable judgment were caused by (i) the Issuing Bank's willful misconduct
or gross negligence in determining whether documents presented under any Letter
of Credit complied with the terms thereof or (ii) the Issuing Bank's willful
failure to pay under any Letter of Credit after presentation to it of documents
strictly complying with the terms and conditions of such Letter of Credit. The
Issuing Bank may accept documents that appear on their face to be in order,
without responsibility for further investigation, regardless of any notice or
information to the contrary.
Payments
Method of Payment. Except as provided in Article III, all payments of principal,
interest, and other amounts to be made by the Borrower under this Agreement and
the other Loan Documents shall be made to the Agent at the Payment Office for
the account of each Lender's Applicable Lending Office in Dollars and in
immediately available funds by credit to Account Number 4518-151436, without
setoff, deduction, or counterclaim, not later than 1:00 p.m. (Austin, Texas
time) on the date on which such payment shall become due (each such payment made
after such time on such due date to be deemed to have been made on the next
succeeding Business Day). The Borrower shall, at the time of making each such
payment, specify to the Agent the sums payable by the Borrower under this
Agreement and the other Loan Documents to which such payment is to be applied
(and in the event that the Borrower fails to so specify, or if an Event of
Default has occurred and is continuing, the Agent may apply such payment to the
Obligations in such order and manner as it may elect in its sole discretion,
subject to Section 4.4 hereof). Each payment received by the Agent under this
Agreement or any other Loan Document for the account of a Lender shall be paid
by the Agent to such Lender, in immediately available funds, for the account of
such Lender's Applicable Lending Office within one Business Day following
receipt thereof. Whenever any payment under this Agreement or any other Loan
Document shall be stated to be due on a day that is not a Business Day, such
payment may be made on the next succeeding Business Day, and such extension of
time shall in such case be included in the computation of the payment of
interest, the Commitment Fee and any other fees, as the case may be.
Voluntary Prepayment. The Borrower may, upon at least one Business Day prior
notice to the Agent in the case of Base Rate Advances (except as otherwise
provided for under Section 2.8(a) for Swing Loan Advances), and at least three
Business Days prior notice to the Agent in the case of Eurodollar Advances,
voluntarily prepay the Advances in whole at any time or from time to
29
time in part without premium or penalty but with accrued interest to the date of
prepayment on the amount so prepaid, provided that (a) Eurodollar Advances may
be prepaid only on the last day of the Interest Period for such Advances, and
(b) each partial prepayment shall be in the principal amount of $5,000,000 or an
integral multiples of $1,000,000. All notices under this Section shall be
irrevocable and shall be given not later than 11:00 a.m. (Austin, Texas time) on
the day which is not less than the number of Business Days specified above for
such notice. Any such voluntary prepayments shall be applied first to Base Rate
Advances under the Tranche B Loan, then to Eurodollar Advances under the Tranche
B Loan, then to the Swing Loan Advances, then to Letter of Credit Disbursements
for which the Issuing Bank has not been reimbursed by the Borrower, then to Base
Rate Advances under the Revolving Credit Loan and then to the remaining Letter
of Credit Liabilities. Any prepayments hereunder shall be accompanied with
accrued and unpaid interest on the amount prepaid to the date of prepayment and
any partial prepayments thereof shall be applied to the principal installments
due in the inverse order of maturity.
Mandatory Prepayments.
If at any time the amount equal to (I) the sum of (i) the outstanding principal
amount of all Tranche B Advances, Revolving Credit Loan Advances and the Swing
Loan Advances, plus (ii) the Letter of Credit Liabilities, exceeds (II) the
lesser of (A) the aggregate amount of the Commitments and (B) the Borrowing
Base, the Borrower shall promptly prepay Tranche B Advances, Revolving Credit
Loan Advances, Swing Loan Advances and the Letter of Credit Disbursements by the
amount of the excess or, if no Tranche B Advances, Revolving Credit Loan
Advances, Swing Loan Advances or Letter of Credit Disbursements are outstanding,
the Borrower shall immediately pledge to the Agent cash or Cash Equivalent
Investments (subject to no other Liens) in an amount equal to the excess as
security for the Obligations. Any such mandatory prepayments shall be applied
first to Base Rate Advances under the Tranche B Loan, then to Eurodollar
Advances under the Tranche B Loan, then to Swing Loan Advances, then to Letter
of Credit Disbursements for which the Issuing Bank has not been reimbursed by
the Borrower, then to Base Rate Advances under the Revolving Credit Loan, then
to Eurodollar Advances under the Revolving Credit Loan, and then to the
remaining Letter of Credit Liabilities. Any prepayments hereunder shall be
accompanied with accrued and unpaid interest on the amount prepaid to the date
of prepayment.
After any reduction in the Commitments pursuant to Section 2.12, the Borrower
shall promptly prepay (i) first the outstanding Tranche B Advances by the amount
which the sum of the outstanding principal amount of the Tranche B Advances
exceeds the Tranche B Commitments, as reduced and (ii) then, the outstanding
Revolving Credit Loan Advances and Swing Loan Advances by the amount which the
sum of the outstanding principal amount of the Advances under the Revolving
Credit Loan and the Swing Loan plus the Letter of Credit Liabilities exceeds the
aggregate amount of the Revolving Credit Commitments, as reduced.
Upon the issuance, sale or other disposition of any shares of equity securities
(or any securities convertible or exchangeable for any such shares, or any
rights, warrants, or options to subscribe for or purchase any such shares), by
the Borrower or any Subsidiary, the Borrower shall promptly prepay the Advances
by an amount equal to 100% of the Net Proceeds of any such issuances. Any such
mandatory prepayments shall be applied first to Base Rate Advances under the
Tranche B Loan, then to Eurodollar Advances under the Tranche B Loan, then to
the Swing Loan Advances, then to Letter of Credit Disbursements for which the
Issuing Bank has not been
30
reimbursed by the Borrower, then to Base Rate Advances under the Revolving
Credit Loan, then to Eurodollar Advances under the Revolving Credit Loan and
then to the remaining Letter of Credit Liabilities. Any prepayments hereunder
shall be accompanied with accrued and unpaid interest on the amount prepaid to
the date of prepayment and any partial prepayments thereof shall be applied to
the principal installments due in the inverse order of maturity.
Upon the Disposition of any assets (other than Dispositions of assets permitted
under Sections 9.8(a) and (c)), the Borrower shall promptly prepay the Advances
by an amount equal to the Net Proceeds of such Disposition; provided however,
with respect to any Dispositions permitted under Sections 9.8(b) and (d), the
Borrower shall promptly prepay the Advances by an amount equal to (A) the Net
Proceeds of such Disposition so long as either the Tranche B Commitments or the
Tranche B Loan is outstanding or (B) the Net Proceeds of such Disposition to the
extent such amount exceeds either (i) $1,000,000 per Disposition or (ii)
$3,000,000 in the aggregate for all Dispositions which have occurred since the
date hereof (including without limitation any Disposition described in clause
(A) above) so long as the Tranche B Commitments have been terminated and the
Borrower has paid the outstanding Tranche B Loan. Any such mandatory prepayments
shall be applied first to Base Rate Advances under the Tranche B Loan, then to
Eurodollar Advances under the Tranche B Loan, then to the Swing Loan Advances,
then to Letter of Credit Disbursements for which the Issuing Bank has not been
reimbursed by the Borrower, then to the Base Rate Advances under the Revolving
Credit Loan, then to Eurodollar Advances under the Revolving Credit Loan, and
then to the remaining Letter of Credit Liabilities. Accrued and unpaid interest
on the amount prepaid hereunder to the date of prepayment shall be due and
payable at the next Monthly Payment Date or at any other time at the request of
the Agent.
Pro Rata Treatment. Except to the extent otherwise provided herein: (a) each
Advance shall be made by the Lenders under Section 2.1, each payment of the
Commitment Fee under Section 2.10, each payment of the Tranche B Non-Payment Fee
under Section 2.13 and each payment of the Letter of Credit fee under Section
3.5 (except as provided therein) shall be made for the account of the Lenders,
pro rata according to their respective Commitments; (b) each termination or
reduction of the Commitments under Section 2.12 shall be applied first to the
Tranche B Commitments of the Lenders, pro rata according to the respective
Tranche B Commitments and then to the Revolving Credit Commitments of the
Lenders, pro rata according to the respective Revolving Credit Commitments; (c)
the making, Conversion, and Continuation of Advances of a particular Type (other
than Conversions provided for by Section 5.4) shall be made pro rata among the
Lenders holding Advances of such Type according to the amounts of their
respective Commitments; (d) each payment and prepayment of principal of or
interest on Advances by the Borrower or any Obligated Party of a particular Type
of Loan shall be made to the Agent first for the account of the Lenders holding
Tranche B Advances of such Type pro rata in accordance with the respective
unpaid principal amounts of such Tranche B Advances held by such Lenders, and
then for the account of the Lenders holding Revolving Credit Loan Advances of
such Type of Loan pro rata in accordance with the respective unpaid principal
amounts of such Advances of such Revolving Credit Loan held by such Lenders; (e)
any and all other monies received by the Agent from any source other than
pursuant to any of clauses (a) through (d) hereinabove (including, without
limitation, from the Borrower or any Guarantor) to be applied first against the
outstanding Tranche B Loan shall be for the pro rata benefit and account of the
Lenders based upon each Lender's aggregate outstanding Tranche B Advances of all
Types and to the aggregate outstanding Tranche B Advances of all Types of all
Lenders, then against
31
the Primary Obligations shall be for the pro rata benefit and account of the
Lenders based upon each Lender's aggregate outstanding Advances of all Types and
LC Participations and SL Participations to the aggregate outstanding Advances of
all Types and LC Participations and SL Participations of all Lenders and then
against the Secondary Obligations shall be for the pro rata benefit and account
of the Lenders based upon their respective unpaid amounts of the Secondary
Obligations; and (f) the Lenders with Revolving Credit Commitments shall
purchase from the Issuing Bank and the Swing Lender pursuant to Section 3.1 and
Section 2.8 respectively, participations in the Letters of Credit and the
related Letter of Credit Liabilities and the Swing Loans respectively, pro rata
in accordance with their Revolving Credit Commitments.
Non-Receipt of Funds by the Agent. Unless the Agent shall have been notified by
a Lender or the Borrower (the "Payor") prior to the date on which such Lender is
to make payment to the Agent hereunder or the Borrower is to make a payment to
the Agent for the account of one or more of the Lenders, as the case may be
(such payment being herein called the "Required Payment"), which notice shall be
effective upon receipt, that the Payor does not intend to make the Required
Payment to the Agent, the Agent may assume that the Required Payment has been
made and may, in reliance upon such assumption (but shall not be required to),
make the amount thereof available to the intended recipient on such date and, if
the Payor has not in fact made the Required Payment to the Agent, (a) the
recipient of such payment shall, on demand, pay to the Agent the amount made
available to it together with interest thereon in respect of the period
commencing on the date such amount was so made available by the Agent until the
date the Agent recovers such amount at a rate per annum equal to (i) if
recovered from a Lender, at the Federal Funds Rate for such period and (ii) if
recovered from the Borrower, the rate of interest applicable to the Loan, as
determined pursuant to Section 2.5 and (b) Agent shall be entitled to offset
against any and all sums to be paid to such recipient, the amount calculated in
accordance with the foregoing clause (a).
Taxes.
Any and all payments by the Borrower to or for the account of the Agent or any
Lender under any Loan Document shall be made free and clear of and without
deduction for any and all present or future taxes, duties, levies, imposts,
deductions, assessments, fees, withholdings or similar charges, and all
liabilities with respect thereto, excluding, in the case of the Agent and each
Lender, taxes imposed on or measured by its overall net income, and franchise
taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any
political subdivision thereof) under the laws of which the Agent or such Lender,
as the case may be, is organized or maintains a lending office (all such
non-excluded taxes, duties, levies, imposts, deductions, assessments, fees,
withholdings or similar charges, and liabilities being hereinafter referred to
as "Taxes"). If the Borrower shall be required by any laws to deduct any Taxes
from or in respect of any sum payable under any Loan Document to the Agent or
any Lender, (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section), each of the Agent and such Lender receives an
amount equal to the sum it would have received had no such deductions been made,
(ii) the Borrower shall make such deductions, (iii) the Borrower shall pay the
full amount deducted to the relevant taxation authority or other authority in
accordance with applicable laws, and (iv) within 30 days after the date of such
payment, the Borrower shall furnish to the Agent (which shall forward the same
to such Lender) the original or a certified copy of a receipt evidencing payment
thereof.
32
In addition, the Borrower agrees to pay any and all present or future stamp,
court or documentary taxes and any other excise or property taxes or charges or
similar levies which arise from any payment made under any Loan Document or from
the execution, delivery, performance, enforcement or registration of, or
otherwise with respect to, any Loan Document (hereinafter referred to as "Other
Taxes").
If the Borrower shall be required to deduct or pay any Taxes or Other Taxes from
or in respect of any sum payable under any Loan Document to the Agent or any
Lender, the Borrower shall also pay to the Agent or to such Lender, as the case
may be, at the time interest is paid, such additional amount that the Agent or
such Lender specifies is necessary to preserve the after-tax yield (after
factoring in all taxes, including taxes imposed on or measured by net income)
that the Agent or such Lender would have received if such Taxes or Other Taxes
had not been imposed.
The Borrower agrees to indemnify the Agent and each Lender for (i) the full
amount of Taxes and Other Taxes (including any Taxes or Other Taxes imposed or
asserted by any jurisdiction on amounts payable under this Section) paid by the
Agent and such Lender, (ii) amounts payable under Section 4.6(c) and (iii) any
liability (including additions to tax, penalties, interest and expenses) arising
therefrom or with respect thereto paid by the Agent and such Lender, in each
case whether or not such Taxes or Other Taxes were correctly or legally imposed
or asserted by the relevant Governmental Authority. Payment under this clause
(d) shall be made within 30 days after the date the Lender or the Agent makes a
demand therefor.
Tax Forms.
(b) Each Lender that is not a "United States person" within the
meaning of Section 7701(a)(30) of the Code (a "Foreign Lender")
shall deliver to the Agent, prior to receipt of any payment subject
to withholding under the Code (or upon accepting an assignment of an
interest herein), two duly signed completed copies of either IRS
Form W-8BEN or any successor thereto (relating to such Foreign
Lender and entitling it to an exemption from, or reduction of,
withholding tax on all payments to be made to such Foreign Lender by
the Borrower pursuant to this Agreement) or IRS Form W-8ECI or any
successor thereto (relating to all payments to be made to such
Foreign Lender by the Borrower pursuant to this Agreement) or such
other evidence satisfactory to the Borrower and the Agent that such
Foreign Lender is entitled to an exemption from, or reduction of,
U.S. withholding tax, including any exemption pursuant to Section
881(c) of the Code. Thereafter and from time to time, each such
Foreign Lender shall (A) promptly submit to the Agent such
additional duly completed and signed copies of one of such forms (or
such successor forms as shall be adopted from time to time by the
relevant United States taxing authorities) as may then be available
under then current United States laws and regulations to avoid, or
such evidence as is satisfactory to the Borrower and the Agent of
any available exemption from or reduction of, United States
withholding taxes in respect of all payments to be made to such
Foreign Lender by the Borrower pursuant to this Agreement, (B)
promptly notify the Agent of any change in circumstances which would
modify or render invalid any claimed exemption or reduction, and (C)
take such steps as shall not be materially disadvantageous to it, in
the reasonable judgment of such Lender, and as may be reasonably
necessary (including the re-designation of its Lending Office) to
avoid any requirement of applicable laws that the
33
Borrower make any deduction or withholding for taxes from amounts
payable to such Foreign Lender.
Each Foreign Lender, to the extent it does not act or ceases to act for its own
account with respect to any portion of any sums paid or payable to such Lender
under any of the Loan Documents (for example, in the case of a typical
participation by such Lender), shall deliver to the Agent on the date when such
Foreign Lender ceases to act for its own account with respect to any portion of
any such sums paid or payable, and at such other times as may be necessary in
the determination of the Agent (in the reasonable exercise of its discretion),
(A) two duly signed completed copies of the forms or statements required to be
provided by such Lender as set forth above, to establish the portion of any such
sums paid or payable with respect to which such Lender acts for its own account
that is not subject to U.S. withholding tax, and (B) two duly signed completed
copies of IRS Form W-8IMY (or any successor thereto), together with any
information such Lender chooses to transmit with such form, and any other
certificate or statement of exemption required under the Code, to establish that
such Lender is not acting for its own account with respect to a portion of any
such sums payable to such Lender.
The Borrower shall not be required to pay any additional amount to any Foreign
Lender under Section 4.6 (A) with respect to any Taxes required to be deducted
or withheld on the basis of the information, certificates or statements of
exemption such Lender transmits with an IRS Form W-8IMY pursuant to this Section
4.7 or (B) if such Lender shall have failed to satisfy the foregoing provisions
of this Section 4.7(a); provided that if such Lender shall have satisfied the
requirement of this Section 4.7(a) on the date such Lender became a Lender or
ceased to act for its own account with respect to any payment under any of the
Loan Documents, nothing in this Section 4.7(a) shall relieve the Borrower of its
obligation to pay any amounts pursuant to Section 4.6 in the event that, as a
result of any change in any applicable law, treaty or governmental rule,
regulation or order, or any change in the interpretation, administration or
application thereof, such Lender is no longer properly entitled to deliver
forms, certificates or other evidence at a subsequent date establishing the fact
that such Lender or other Person for the account of which such Lender receives
any sums payable under any of the Loan Documents is not subject to withholding
or is subject to withholding at a reduced rate.
The Agent may, without reduction, withhold any Taxes required to be deducted and
withheld from any payment under any of the Loan Documents with respect to which
the Borrower is not required to pay additional amounts under this Section
4.7(a).
Upon the request of the Agent, each Lender that is a "United States person"
within the meaning of Section 7701(a)(30) of the Code shall deliver to the Agent
two duly signed completed copies of IRS Form W-9. If such Lender fails to
deliver such forms, then the Agent may withhold from any interest payment to
such Lender an amount equivalent to the applicable back-up withholding tax
imposed by the Code, without reduction.
If any Governmental Authority asserts that the Agent did not properly withhold
or backup withhold, as the case may be, any tax or other amount from payments
made to or for the account of any Lender, such Lender shall indemnify the Agent
therefor, including all penalties and interest, any taxes imposed by any
jurisdiction on the amounts payable to the Agent under this Section, and costs
and expenses (including attorney's fees and expenses) of the Agent. The
obligation of the Lenders under this Section shall survive the termination of
the Commitments, repayment of all other Obligations hereunder and the
resignation of the Agent.
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Computation of Interest. Interest on the Advances and all other amounts payable
by the Borrower hereunder shall be computed on the basis of a year of 360 days
and the actual number of days elapsed (including the first day but excluding the
last day) unless such calculation would result in a usurious rate, in which case
interest shall be calculated on the basis of a year of 365 or 366 days, as the
case may be.
Proceeds of Collateral and Collections under the Guaranty.
Proceeds. Except as otherwise permitted by Section 4.3, any proceeds received by
the Agent from the sale or other liquidation of the Collateral and from
collections under the Guaranty shall first be applied as payment of the accrued
and unpaid fees of the Agent hereunder and then to all other unpaid or
unreimbursed Obligations (including reasonable attorneys' fees and expenses)
owing to the Agent in its capacity as Agent only. Any amount of such proceeds
remaining after the applications described in the preceding sentence shall be
distributed:
first, to the Lenders, pro rata, in accordance with the respective unpaid
amounts of the Primary Obligations (including in such Primary Obligations for
purposes of this calculation all Letter of Credit Liabilities) until all Primary
Obligations are paid in full and provided that each Lender's pro rata portion of
such proceeds applicable to Letter of Credit Liabilities shall be held by the
Agent (and not disbursed to the Lenders) as collateral for the Letter of Credit
Liabilities relating thereto;
then to the Lenders, pro rata, in accordance with the respective unpaid amounts
of the Secondary Obligations; and
after all Primary Obligations are paid in full, and all Letter of Credit
Liabilities have terminated or are otherwise satisfied, all remaining portions
of the proceeds of the Collateral then held by the Agent or such Lender as
collateral for the Letter of Credit Liabilities shall be distributed to the
Lenders, pro rata, in accordance with their respective unpaid amounts of the
Secondary Obligations.
Noncash Proceeds. Notwithstanding anything to the contrary contained herein, if
the Agent shall ever acquire any Collateral through foreclosure or by a
conveyance in lieu of foreclosure or by retaining any of the Collateral in
satisfaction of all or part of the Obligations or if any proceeds of Collateral
received by the Agent to be distributed and shared pursuant to this Section 4.9
are in a form other than immediately available funds, the Agent shall not be
required to remit any share thereof under the terms hereof and the Lenders shall
only be entitled to their undivided interests in the Collateral or noncash
proceeds as determined hereby. The Lenders shall receive the application
portions (in accordance with Section 4.9(a)) of any immediately available funds
consisting of proceeds from such Collateral or proceeds of such noncash proceeds
so acquired only if any when paid in connection with the subsequent disposition
thereof. While any Collateral or other property to be shared pursuant to this
Section 4.9 is held by the Agent pursuant to this clause (b), the Agent shall
hold such Collateral or other property for the benefit of the Lenders and all
matters relating to the management, operation, further disposition or any other
aspect of such Collateral or other property shall be resolved by the agreement
of the Required Lenders.
Payments Set Aside. To the extent that any payment by or on behalf of the
Borrower is made to the Agent or any Lender, or the Agent or any Lender
exercises its right of set-off, and such
35
payment or the proceeds of such set-off or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Agent or such Lender
in its discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under the Bankruptcy Code of the United States of
America, or any other liquidation, conservatorship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization or similar laws of the applicable jurisdictions or otherwise,
then (i) to the extent of such recovery, the obligation or part thereof
originally intended to be satisfied shall be revived and continued in full force
and effect as if such payment had not been made or such set-off had not
occurred, and (ii) each Lender severally agrees to pay to the Agent upon demand
its applicable share of any amount so recovered from or repaid by the Agent,
plus interest thereon from the date of such demand to the date such payment is
made at a rate per annum equal to the Federal Funds Rate from time to time in
effect.
Yield Protection; Limitations on Advances; Capital Adequacy
Additional Costs.
The Borrower shall pay directly to each Lender from time to time such amounts as
such Lender may determine to be necessary to compensate it for any costs
incurred by such Lender which such Lender determines are attributable to its
making or maintaining of any Eurodollar Advances hereunder or its obligation to
make any of such Advances hereunder, or any reduction in any amount receivable
by such Lender hereunder in respect of any such Advances or such obligation
(such increases in costs and reductions in amounts receivable being herein
called "Additional Costs"), resulting from any Regulatory Change which:
changes the basis of taxation of any amounts payable to such Lender under this
Agreement or its Note in respect of any of such Advances (other than taxes
imposed on the overall net income of such Lender or its Applicable Lending
Office for any of such Advances by the jurisdiction in which such Lender has its
principal office or such Applicable Lending Office);
imposes or modifies any reserve, special deposit, minimum capital, capital
ratio, or similar requirement relating to any extensions of credit or other
assets of, or any deposits with or other liabilities or commitments of, such
Lender (including any of such Advances or any deposits referred to in the
definition of "Eurodollar Rate" in Section 1.1 hereof); or
imposes any other condition affecting this Agreement or the Notes or any of such
extensions of credit or liabilities or commitments.
Each Lender will notify the Borrower of any event occurring after the date of
this Agreement which will entitle such Lender to compensation pursuant to this
Section 5.1(a) as promptly as practicable after it obtains knowledge thereof and
determines to request such compensation, and will designate a different
Applicable Lending Office for the Advances affected by such event if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the sole opinion of such Lender, violate any law, rule, or
regulation or be in any way disadvantageous to such Lender, provided that such
Lender shall have no obligation to so designate an Applicable Lending Office
located in the United States of America. Each Lender
36
will furnish the Borrower with a certificate setting forth the basis and the
amount of each request of such Lender for compensation under this Section
5.1(a). If any Lender requests compensation from the Borrower under this Section
5.1(a), the Borrower may, by notice to such Lender (with a copy to the Agent)
suspend the obligation of such Lender to make or Continue making, or Convert
Advances into, Advances of the Type with respect to which such compensation is
requested until the Regulatory Change giving rise to such request ceases to be
in effect (in which case the provisions of Section 5.4 hereof shall be
applicable).
Without limiting the effect of the foregoing provisions of this Section 5.1, in
the event that, by reason of any Regulatory Change, any Lender either (i) incurs
Additional Costs based on or measured by the excess above a specified level of
the amount of a category of deposits or other liabilities of such Lender which
includes deposits by reference to which the interest rate on Eurodollar Advances
is determined as provided in this Agreement or a category of extensions of
credit or other assets of such Lender which includes Eurodollar Advances or (ii)
becomes subject to restrictions on the amount of such a category of liabilities
or assets which it may hold, then, if such Lender so elects by notice to the
Borrower (with a copy to the Agent), the obligation of such Lender to make or
Continue making, or Convert Advances into, Eurodollar Advances hereunder shall
be suspended until such Regulatory Change ceases to be in effect (in which case
the provisions of Section 5.4 hereof shall be applicable).
Determinations and allocations by any Lender for purposes of this Section 5.1 of
the effect of any Regulatory Change on its costs of maintaining its obligations
to make Eurodollar Advances or of making or maintaining Eurodollar Advances or
on amounts receivable by it in respect of Eurodollar Advances, and of the
additional amounts required to compensate such Lender in respect of any
Additional Costs, shall be conclusive, provided that such determinations and
allocations are made on a reasonable basis.
Limitation on Types of Advances. Anything herein to the contrary
notwithstanding, if with respect to any Eurodollar Advances for any Interest
Period therefor:
The Agent determines (which determination shall be conclusive) that quotations
of interest rates for the relevant deposits referred to in the definition of
"Eurodollar Rate" in Section 1.1 hereof are not being provided in the relative
amounts or for the relative maturities for purposes of determining the rate of
interest for such Advances as provided in this Agreement; or
Required Lenders determine (which determination shall be conclusive absent
manifest error) and notify the Agent that the relevant rates of interest
referred to in the definition of "Eurodollar Rate" in Section 1.1 hereof on the
basis of which the rate of interest for such Advances for such Interest Period
is to be determined do not accurately reflect the cost to the Lenders of making
or maintaining such Advances for such Interest Period;
then the Agent shall give the Borrower prompt notice thereof specifying the
relevant amounts or periods, and so long as such condition remains in effect,
the Lenders shall be under no obligation to make additional Eurodollar Advances
or to Convert Base Rate Advances into Eurodollar Advances and the Borrower
shall, on the last day(s) of the then current Interest Period(s) for the
outstanding Eurodollar Advances, either prepay such Eurodollar Advances or
Convert such Eurodollar Advances into Base Rate Advances in accordance with the
terms of this Agreement.
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Illegality. Notwithstanding any other provision of this Agreement, in the event
that it becomes unlawful for any Lender or its Applicable Lending Office to (a)
honor its obligation to make Eurodollar Advances hereunder or (b) maintain
Eurodollar Advances hereunder, then such Lender shall promptly notify the
Borrower (with a copy to the Agent) thereof and such Lender's obligation to make
or maintain Eurodollar Advances and to Convert Base Rate Advances into
Eurodollar Advances hereunder shall be suspended until such time as such Lender
may again make and maintain Eurodollar Advances (in which case the provisions of
Section 5.4 hereof shall be applicable).
Treatment of Affected Advances. If the Eurodollar Advances of any Lender (such
Eurodollar Advances being hereinafter called "Affected Advances") are to be
Converted pursuant to Section 5.1 or 5.3 hereof, such Lender's Affected Advances
shall be automatically Converted into Base Rate Advances on the last day(s) of
the then current Interest Period(s) for the Affected Advances (or, in the case
of a Conversion required by Section 5.1(b) or 5.3 hereof, on such earlier date
as such Lender may specify to the Borrower with a copy to the Agent) and, unless
and until such Lender gives notice as provided below that the circumstances
specified in Section 5.1 or 5.3 hereof which gave rise to such Conversion no
longer exist:
To the extent that such Lender's Affected Advances have been so Converted, all
payments and prepayments of principal which would otherwise be applied to such
Lender's Affected Advances shall be applied instead to its Base Rate Advances;
and
All Affected Advances which would otherwise be made or Continued by such Lender
as Eurodollar Advances shall be made as or Converted into Base Rate Advances and
all Affected Advances of such Lender which would otherwise be Converted into
Eurodollar Advances shall be Converted instead into (or shall remain as) Base
Rate Advances.
If such Lender gives notice to the Borrower (with a copy to the Agent) that the
circumstances specified in Section 5.1 or 5.3 hereof which gave rise to the
Conversion of such Lender's Affected Advances pursuant to this Section 5.4 no
longer exist (which such Lender agrees to do promptly upon such circumstances
ceasing to exist) at a time when Affected Advances are outstanding, such
Lender's Base Rate Advances shall be automatically Converted, on the first
day(s) of the next succeeding Interest Period(s) for such outstanding Affected
Advances to the extent necessary so that, after giving effect thereto, all
Eurodollar Advances held by the Lenders holding Eurodollar Advances and by such
Lender are held pro rata (as to principal amounts, and Interest Periods) in
accordance with their respective Commitments.
Compensation. The Borrower shall pay to the Agent for the account of each
Lender, upon the request of such Lender through the Agent, such amount or
amounts as shall be sufficient (in the reasonable opinion of such Lender) to
compensate it for any loss, cost, or expense incurred by it as a result of:
Any payment, prepayment or Conversion of a Eurodollar Advance for any reason
(including, without limitation, the acceleration of the outstanding Advances
pursuant to Section 11.2) on a date other than the last day of an Interest
Period for such Eurodollar Advance; or
Any failure by the Borrower for any reason (including, without limitation, the
failure of any conditions precedent specified in Article VI to be satisfied) to
borrow, Convert, or prepay a
38
Eurodollar Advance on the date for such borrowing, Conversion, or prepayment,
specified in the relevant notice of borrowing, prepayment, or Conversion under
this Agreement.
Capital Adequacy. If after the date hereof, any Lender shall have determined
that the adoption or implementation of any applicable law, rule, or regulation
regarding capital adequacy, or any change therein, or any change in the
interpretation or administration thereof by any central bank or other
Governmental Authority charged with the interpretation or administration
thereof, or compliance by such Lender (or its parent) with any guideline,
request, or directive regarding capital adequacy (whether or not having the
force of law) of any central bank or other Governmental Authority, has or would
have the effect of reducing the rate of return on such Lender's (or its
parent's) capital as a consequence of its obligations hereunder or the
transactions contemplated hereby to a level below that which such Lender (or its
parent) could have achieved but for such adoption, implementation, change or
compliance (taking into consideration such Lender's policies with respect to
capital adequacy) by an amount deemed by such Lender to be material, then from
time to time, within 10 Business Days after demand by such Lender (with a copy
to the Agent), the Borrower shall pay to such Lender such additional amount or
amounts as will compensate such Lender (or its parent) for such reduction. A
certificate of such Lender claiming compensation under this Section and setting
forth the additional amount or amounts to be paid to it hereunder shall be
conclusive, provided that the determination thereof is made on a reasonable
basis. In determining such amount or amounts, such Lender may use any reasonable
averaging and attribution methods.
Additional Costs in Respect of Letters of Credit. If as a result of any
Regulatory Change there shall be imposed, modified, or deemed applicable any
tax, reserve, special deposit, or similar requirement against or with respect to
or measured by reference to Letters of Credit issued or to be issued hereunder
or the Issuing Bank's commitment to issue Letters of Credit hereunder, and the
result shall be to increase the cost to the Issuing Bank of issuing or
maintaining any Letter of Credit or its commitment to issue Letters of Credit
hereunder or reduce any amount receivable by the Issuing Bank hereunder in
respect of any Letter of Credit (which increase in cost, or reduction in amount
receivable, shall be the result of the Issuing Bank's reasonable allocation of
the aggregate of such increases or reductions resulting from such event), then,
upon demand by the Issuing Bank, the Borrower agrees to pay the Issuing Bank,
from time to time as specified by the Issuing Bank, such additional amounts as
shall be sufficient to compensate the Issuing Bank for such increased costs or
reductions in amount. A statement as to such increased costs or reductions in
amount incurred by the Issuing Bank, submitted by the Issuing Bank to the
Borrower, shall be conclusive as to the amount thereof, provided that the
determination thereof is made on a reasonable basis.
Conditions Precedent
Initial Extension of Credit. The obligation of each Lender to make its initial
Advance and of the Issuing Bank to issue the initial Letter of Credit, is
subject to the condition precedent that the Agent shall have received on or
before the day of such Advance or Letter of Credit all of the following, each
dated (unless otherwise indicated) the date hereof, in form and substance
satisfactory to the Agent:
39
Resolutions. Resolutions of the Board of Directors of the Borrower and each
Guarantor certified by its Secretary or an Assistant Secretary which authorize
the execution, delivery, and performance of the Loan Documents to which it is or
is to be a party;
Incumbency Certificate. A certificate of incumbency certified by the Secretary
or an Assistant Secretary of the Borrower and each Guarantor certifying the
names of each of its officers authorized to sign the Loan Documents to which it
is or is to be a party (including the certificates contemplated herein) together
with specimen signatures of such officers;
Certificate or Articles of Incorporation and Certificate of Limited Partnership.
The certificate or articles of incorporation or certificate of limited
partnership, as applicable, of the Borrower and each Guarantor certified by the
Secretary of State of the State of its organization;
Bylaws and Limited Partnership Agreement. The bylaws or limited partnership
agreement, as applicable, of the Borrower and each Guarantor certified by the
Secretary or an Assistant Secretary of such Person;
Existence and Good Standing. Certificates of the appropriate government
officials of the state of organization of the Borrower and each Guarantor as to
its existence and good standing and certificates of appropriate government
officials of each state in which the Borrower and each Guarantor is required to
qualify to do business and where failure to so qualify could reasonably be
expected to have a Material Adverse Effect, as to the Borrower's and each
Guarantor's qualification to do business and good standing in such state, all
dated a current date;
Notes. The Notes executed by the Borrower;
Guaranty. The Guaranty executed by the Guarantors;
Contribution and Indemnification Agreement. The Contribution and Indemnification
Agreement executed by the Borrower and the Guarantors;
Borrower Security Agreement. The Borrower Security Agreement executed by the
Borrower;
Subsidiary Security Agreement. The Subsidiary Security Agreement executed by
each Guarantor, as applicable;
Amendments to Deed of Trust or Mortgage. The amendments to deed of trust or
mortgage executed by certain Guarantors, each in form and substance satisfactory
to the Agent;
Opinion of Counsel. A favorable opinion of legal counsel to the Borrower and
each Guarantor satisfactory to the Agent, as to such matters as the Agent or the
Required Lenders may reasonably request;
Fees of Lenders. Evidence that all fees of the Agent and the Lenders payable
pursuant to side letter agreements shall have been paid in full by the Borrower;
and
Attorneys' Fees and Expenses. Evidence that the costs and expenses (including
attorneys' fees) referred to in Section 13.1, to the extent incurred, shall have
been paid in full by the Borrower.
40
All Extensions of Credit. The obligation of each Lender to make any Advance and
of the Issuing Bank to issue any Letter of Credit (including the initial Advance
and the initial Letter of Credit) is subject to the following additional
conditions precedent:
Advance Request Form, Telephonic Request, or Letter of Credit Request Form. The
Agent in respect of Revolving Credit Loan Advances and Tranche B Advances, the
Swing Lender in respect of Swing Loan Advances, and the Issuing Bank in respect
of Letters of Credit shall have received, in accordance with Section 2.6, 2.8 or
3.2, as the case may be, an Advance Request Form, a telephonic request, or
Letter of Credit Request Form, as applicable, executed by an authorized officer
of the Borrower;
No Default or Event of Default. No Default or Event of Default shall have
occurred and be continuing, or would result from such Advance or Letter of
Credit;
Representations and Warranties. All of the representations and warranties
contained in Article VII hereof and in the other Loan Documents shall be true
and correct in all material respects on and as of the date of such Advance or
issuance of Letter of Credit with the same force and effect as if such
representations and warranties had been made on and as of such date except to
the extent such representations and warranties speak to a specific date;
No Material Adverse Effect. Neither any Material Adverse Effect or any material
adverse change in the financial or capital markets shall have occurred since the
date of the most recent financial statements delivered to the Agent and the
Lenders pursuant to Section 8.1 hereof; and
Additional Documentation. The Agent shall have received such additional
approvals, opinions, or documents as the Agent or its legal counsel, Xxxxxxxx
Xxxxxxxx & Xxxxxx P.C., may reasonably request.
Representations and Warranties
To induce the Agent, the Issuing Bank, and the Lenders to enter into
this Agreement, the Borrower represents and warrants to the Agent, the Issuing
Bank, and the Lenders that:
Existence. The Borrower and each Subsidiary (a) is a corporation (or other
entity as set forth on Schedule 7.14) duly organized, validly existing, and in
good standing under the laws of the jurisdiction of its incorporation or
organization; (b) has all requisite power and authority to own its assets and
carry on its business as now being or as proposed to be conducted; and (c) is
qualified to do business in all jurisdictions in which the nature of its
business makes such qualification necessary and where failure to so qualify
would have a Material Adverse Effect. The Borrower and each Guarantor have the
power and authority to execute, deliver, and perform its obligations under the
Loan Documents to which it is or may become a party.
Financial Statements. The Borrower has delivered to the Agent audited
consolidated financial statements of the Borrower and its Subsidiaries as at and
for the fiscal year ended September 30, 2001, and unaudited consolidated
financial statements of the Borrower and its Subsidiaries for the 12-month
period ended September 30, 2002. Such financial statements are true and correct,
have been prepared in accordance with GAAP, and fairly and accurately present,
on a
41
consolidated basis, the financial condition of the Borrower and its Subsidiaries
as of the respective dates indicated therein and the results of operations for
the respective periods indicated therein. As of the date hereof, neither the
Borrower nor any of its Subsidiaries has any material contingent liabilities,
liabilities for taxes, unusual forward or long-term commitments, or unrealized
or anticipated losses from any unfavorable commitments except as referred to or
reflected in such financial statements, and there has been no Material Adverse
Effect since the effective date of the most recent financial statements referred
to in this Section.
Action; No Breach. The execution, delivery, and performance by the Borrower and
each Guarantor of the Loan Documents to which it is or may become a party, and
compliance with the terms and provisions hereof and thereof have been duly
authorized by all requisite action on the part of the Borrower and each
Guarantor and do not and will not (a) violate or conflict with, or result in a
breach of, or require any consent, other than such consents which have been
obtained and copies of which have been provided to the Agent, under (i) the
articles of incorporation or bylaws or the applicable organizational documents
of the Borrower or any Guarantor, (ii) any applicable law, rule, or regulation
or any order, writ, injunction, or decree of any Governmental Authority or
arbitrator, including without limitation, the provisions of the Texas Pawn Shop
Act (Chapter 371 of the Texas Finance Code) and the consumer loan provisions of
the Texas Finance Code, or (iii) any agreement or instrument to which the
Borrower or any of the Guarantors is a party or by which any of them or any of
their property is bound or subject, or (b) constitute a default under any such
agreement or instrument, or result in the creation or imposition of any Lien
upon any of the revenues or assets of the Borrower or any Guarantor (except for
Liens in favor of the Agent for the benefit of the Lenders).
Operation of Business. The Borrower and each of its Subsidiaries possess all
licenses, permits, franchises, patents, copyrights, trademarks, and tradenames,
or rights thereto, necessary to conduct their respective businesses
substantially as now conducted and as presently proposed to be conducted, and
the Borrower and each of its Subsidiaries are not in violation of any valid
rights of others with respect to any of the forgoing except where such violation
individually or in combination with all other such violations could not
reasonably be expected to have a Material Adverse Effect.
Litigation and Judgments. There is no action, suit, investigation, or proceeding
before or by any Governmental Authority or arbitrator pending, or to the
knowledge of the Borrower, threatened against or affecting the Borrower or any
Subsidiary, that could, if adversely determined, reasonably be expected to have
a Material Adverse Effect. As of the date hereof, there are no outstanding
judgments against the Borrower or any Subsidiary, except for those certain
default judgments in an aggregate amount not exceeding $15,000 outstanding on
the date hereof.
Rights in Properties; Liens. The Borrower and each Subsidiary have good and
indefeasible title to or valid leasehold interests in their respective
properties and assets, real and personal, including the properties, assets, and
leasehold interests reflected in the financial statements described in Section
7.2, and none of the properties, assets, or leasehold interests of the Borrower
or any Subsidiary is subject to any Lien, except as permitted by Section 9.2.
Enforceability. The Loan Documents to which the Borrower or a Guarantor is a
party, when delivered, shall constitute the legal, valid, and binding
obligations of the Borrower or such Guarantor, as applicable, enforceable
against the Borrower or such Guarantor, as applicable, in accordance with their
respective terms, except as limited by bankruptcy, insolvency, or other
42
laws of general application relating to the enforcement of creditors' rights and
general principles of equity.
Approvals. No authorization, approval, or consent of, and no filing or
registration with, any Governmental Authority or third party is or will be
necessary for the execution, delivery, or performance by the Borrower of this
Agreement and by the Borrower or any Guarantor of the other Loan Documents to
which the Borrower or such Guarantor, as applicable, is or may become a party or
for the validity or enforceability thereof.
Debt. The Borrower and the Subsidiaries have no Debt, except as permitted by
Section 9.1.
Taxes. The Borrower and each Subsidiary have filed all tax returns (federal,
state, and local) required to be filed, including all income, franchise,
employment, property, and sales tax returns, and have paid all of their
respective liabilities for taxes, assessments, governmental charges, and other
levies that are due and payable other than those being contested in good faith
by appropriate proceedings diligently pursued for which adequate reserves have
been established. The Borrower knows of no pending investigation of the Borrower
or any Subsidiary by any taxing authority or of any pending but unassessed tax
liability of the Borrower or any Subsidiary.
Use of Proceeds; Margin Securities. Neither the Borrower nor any Subsidiary is
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulations T, U, or X of the Board of Governors of the Federal
Reserve System), and no part of the proceeds of any Advance will be used to
purchase or carry any margin stock or to extend credit to others for the purpose
of purchasing or carrying margin stock.
ERISA. As of the date hereof, the Borrower, each Subsidiary, each ERISA
Affiliate, and each Plan are in compliance in all material respects with all
applicable provisions of ERISA and the Code except for events of noncompliance
that will not have a Material Adverse Effect. Neither a Reportable Event nor a
Prohibited Transaction has occurred and is continuing with respect to any Plan.
No notice of intent to terminate a Plan has been filed, nor has any Plan been
terminated. No circumstances exist which constitute grounds entitling the PBGC
to institute proceedings to terminate, or appoint a trustee to administer, a
Plan, nor has the PBGC instituted any such proceedings. Neither the Borrower nor
any ERISA Affiliate has completely or partially withdrawn from a Multiemployer
Plan. The Borrower and each ERISA Affiliate have met their minimum funding
requirements under ERISA with respect to all of their Plans, and no "accumulated
funding deficiency" (for which an excise tax is due or would be due in the
absence of a waiver) as defined in Section 412 of the Code or Section 302(a)(2)
of ERISA, whichever may apply, has been incurred with respect to any Plan,
whether or not waived. The present value of all vested benefits under each Plan
do not exceed the fair market value of all Plan assets allocable to such
benefits, determined on a termination basis as of the most recent valuation date
of the Plan and in accordance with ERISA. Neither the Borrower nor any ERISA
Affiliate has incurred any liability to the PBGC under ERISA. Neither the
Borrower nor any ERISA Affiliate is subject to any lien imposed under Section
412(n) of the Code or Section 302(f) or 4068 of ERISA, whichever may apply, with
respect to any Plan. Neither the Borrower nor any ERISA Affiliate is required to
provide security to a Plan under Section 401(a)(29) of the Code.
Disclosure. All factual information (taken as a whole) furnished by or on behalf
of the Borrower in writing to the Agent or any Lender (including, without
limitation, all information contained in
43
the Loan Documents) for purposes of or in connection with this Agreement, the
other Loan Documents or any transaction contemplated herein or therein is, and
all other such factual information (taken as a whole) hereafter furnished by or
on behalf of the Borrower to the Agent or any Lender, will be true and accurate
in all material respects on the date as of which such information is dated or
certified and not incomplete by omitting to state any fact necessary to make
such information (taken as a whole) not misleading in any material respect at
such time in light of the circumstances under which such information was
provided.
Subsidiaries. As of the date hereof, the Borrower has no Subsidiaries other than
those listed on Schedule 7.14 hereto, and Schedule 7.14 (a) sets forth the type
of each Subsidiary listed thereon, (b) sets forth the jurisdiction of
incorporation or organization of each Subsidiary, and the percentage of the
Borrower's ownership of the outstanding voting stock or other ownership
interests of each Subsidiary. All of the outstanding capital stock of each
corporate Subsidiary has been validly issued, is fully paid, and is
nonassessable. There are no outstanding subscriptions, options, warrants, calls,
or rights to acquire, and no outstanding securities or instruments convertible
into, capital stock of any Subsidiary except as listed on Schedule 7.14.
Agreements. Neither the Borrower nor any Subsidiary is a party to any indenture,
loan, or credit agreement, or to any lease or other agreement or instrument, or
subject to any charter or corporate restriction which could reasonably be
expected to have a Material Adverse Effect. Neither the Borrower nor any
Subsidiary is in default in any material respect in the performance, observance,
or fulfillment of any of the obligations, covenants, or conditions contained in
any agreement or instrument material to its business to which it is a party
other than defaults which could not reasonably be expected to have a Material
Adverse Effect.
Compliance with Laws. Neither the Borrower nor any Subsidiary is in violation of
any law, rule, regulation, order, or decree of any Governmental Authority or
arbitrator, including without limitation, the provisions of the Texas Pawn Shop
Act (Chapter 371 of the Texas Finance Code), the consumer loan provisions of the
Texas Finance Code and provisions of the Xxxxx Law and other laws, rules and
regulations related to the regulation of firearms, other than violations which
could not reasonably be expected to have a Material Adverse Effect.
Investment Company Act. Neither the Borrower nor any Subsidiary is an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
Public Utility Holding Company Act. Neither the Borrower nor any Subsidiary is a
"holding company"' or a "subsidiary company" of a "holding company" or an
"affiliate" of a "holding company" or a "public utility" within the meaning of
the Public Utility Holding Company Act of 1935, as amended.
Environmental Matters. Except for those matters which will not have a Material
Adverse Effect:
The Borrower, each Subsidiary, and all of their respective properties, assets,
and operations are in full compliance with all Environmental Laws. The Borrower
is not aware of, nor has the Borrower received notice of, any past, present, or
future conditions, events, activities, practices, or incidents which may
interfere with or prevent the compliance or continued compliance of the Borrower
and the Subsidiaries with all Environmental Laws;
44
The Borrower and each Subsidiary have obtained all permits, licenses, and
authorizations that are required under applicable Environmental Laws, and all
such permits are in good standing and the Borrower and its Subsidiaries are in
compliance with all of the terms and conditions of such permits;
No Hazardous Materials exist on, about, or within or have been used, generated,
stored, transported, disposed of on, or Released from any of the properties or
assets of the Borrower or any Subsidiary. The use which the Borrower and the
Subsidiaries make and intend to make of their respective properties and assets
will not result in the use, generation, storage, transportation, accumulation,
disposal, or Release of any Hazardous Material on, in, or from any of their
properties or assets except in compliance with Environmental Laws;
Neither the Borrower nor any of its Subsidiaries nor any of their respective
currently or previously owned or leased properties or operations is subject to
any outstanding or, to the best of its knowledge, threatened order from or
agreement with any Governmental Authority or other Person or subject to any
judicial or docketed administrative proceeding with respect to (i) failure to
comply with Environmental Laws, (ii) Remedial Action, or (iii) any Environmental
Liabilities arising from a Release or threatened Release;
There are no conditions or circumstances associated with the currently or
previously owned or leased properties or operations of the Borrower or any of
its Subsidiaries that could reasonably be expected to give rise to any
Environmental Liabilities;
Neither the Borrower nor any of its Subsidiaries is a treatment, storage, or
disposal facility requiring a permit under the Resource Conservation and
Recovery Act, 42 U.S.C. Section 6901 et seq., regulations thereunder or any
comparable provision of state law. The Borrower and its Subsidiaries are in
compliance with all applicable financial responsibility requirements of all
Environmental Laws; Neither the Borrower nor any of its Subsidiaries has filed
or failed to file any notice required under applicable Environmental Law
reporting a Release; and
No Lien arising under any Environmental Law has attached to any property or
revenues of the Borrower or its Subsidiaries.
Positive Covenants
The Borrower covenants and agrees that, as long as the Obligations or
any part thereof are outstanding or any Lender has any Commitment hereunder, or
the Issuing Bank has any obligation to issue Letters of Credit hereunder, the
Borrower will perform and observe the following positive covenants:
Reporting Requirements. The Borrower will furnish to the Agent, the
Issuing Bank, and each Lender:
Annual Audited Financial Statements. As soon as available, and in any event
within 90 days after the end of each Fiscal Year of the Borrower and the
Subsidiaries, beginning with the Fiscal
45
Year ending September 30, 2002, (i) a copy of the annual audited financial
statements of the Borrower and the Subsidiaries for such Fiscal Year containing,
on a consolidated basis, balance sheets and statements of income, retained
earnings, and cash flow as at the end of such Fiscal Year and for the 12-month
period then ended, in each case setting forth in comparative form the figures
for the preceding Fiscal Year, all in reasonable detail and audited and
certified by Ernst & Young, or other independent certified public accountants of
recognized standing acceptable to the Agent, to the effect that such report has
been prepared in accordance with GAAP; and (ii) a certificate of such
independent certified public accountants to the Agent and the Lenders (A)
stating that in the course of their audit they have not become aware of any
Default or Event of Default or specifying any Defaults or Events of Default of
which they are aware, and (B) stating that nothing came to their attention that
the calculations set forth in the officer's certificate delivered simultaneously
therewith, as of the date of the balance sheet, were not prepared in accordance
with the audited financial statements;
Quarterly Financial Statements. As soon as available and in any event within 45
days after the end of each Fiscal Quarter in each Fiscal Year of the Borrower
(for the first three Fiscal Quarters in each Fiscal Year), a copy of an
unaudited financial report of the Borrower and the Subsidiaries as of the end of
such Fiscal Quarter and for the portion of the Fiscal Year then ended,
containing, on a consolidated basis, balance sheets and statements of income,
retained earnings, and cash flow in each case setting forth in comparative form
the figures for the corresponding period of the preceding Fiscal Year, all in
reasonable detail certified by the chief financial officer of the Borrower to
have been prepared in accordance with GAAP and to fairly and accurately present
(subject to year-end audit adjustments) the financial condition and results of
operations of the Borrower and the Subsidiaries, on a consolidated basis, at the
date and for the periods indicated therein;
Compliance Certificate. As soon as available, and in any event within 45 days
after the end of each Fiscal Quarter of each Fiscal Year of the Borrower for the
first three Fiscal Quarters of each Fiscal Year, within 90 days after the end of
the fourth Fiscal Quarter of each Fiscal Year and within 20 days after the end
of each calendar month, a certificate (the "Compliance Certificate") of the
chief financial officer of the Borrower (i) stating that to the best of such
officer's knowledge, no Default has occurred and is continuing, or if a Default
has occurred and is continuing, a statement as to the nature thereof and the
action that is proposed to be taken with respect thereto, and (ii) showing in
reasonable detail the most recent Fiscal Quarter calculations or calendar month
calculations, as applicable, demonstrating compliance with Article X, and
accompanied by a certificate executed by the Borrower representing that attached
thereto is a current (as of the date thereof) list of existing store locations
owned or leased by Borrower and each Guarantor;
Monthly Financial Statements. As soon as available and in any event within 20
days after the end of each calendar month, a copy of an unaudited financial
report of the Borrower and the Subsidiaries as of the end of such month and for
the portion of the Fiscal Year then ended, containing, on a consolidated basis,
balance sheets and statements of income, retained earnings, and cash flow in
each case setting forth in comparative form the figures for the corresponding
period of the preceding Fiscal Year, all in reasonable detail certified by the
chief financial officer of the Borrower to have been prepared in accordance with
GAAP and to fairly and accurately present (subject to year-end audit
adjustments) the financial condition and results of operations
46
of the Borrower and the Subsidiaries, on a consolidated basis, at the date and
for the periods indicated therein, all in form and substance satisfactory to the
Agent and the Lenders;
Projections. As soon as available and in any event not later than 30 days prior
to the end of each Fiscal Year, projections of consolidated financial statements
of the Borrower and its Subsidiaries for the upcoming Fiscal Year;
Borrowing Base Report. As soon as available, and in any event (i) on the first
Tuesday and third Tuesday of each month so long as either the Tranche B
Commitment or Tranche B Loan is outstanding and (ii) within 20 days after the
end of each month so long as the Tranche B Commitments have been terminated and
the Borrower has paid the outstanding Tranche B Loan, a borrowing base report in
the form of Exhibit F attached hereto;
Management Letters. Promptly upon receipt thereof, a copy of any management
letter or written report submitted to the Borrower or any Subsidiary by
independent certified public accountants with respect to the business, condition
(financial or otherwise), operations, prospects, or properties of the Borrower
or any Subsidiary;
Notice of Litigation. Promptly after the commencement thereof, notice of all
actions, suits, and proceedings before any Governmental Authority or arbitrator
affecting the Borrower or any Subsidiary which, if determined adversely to the
Borrower or such Subsidiary, could reasonably be expected to have a Material
Adverse Effect;
Notice of Default. As soon as possible and in any event within 10 days after the
Borrower knows of the occurrence of each Default, a written notice setting forth
the details of such Default and the action that the Borrower has taken and
proposes to take with respect thereto;
ERISA Reports. Promptly after the filing or receipt thereof, copies of all
reports, including annual reports, and notices which the Borrower or any ERISA
Affiliate files with or receives from the PBGC or the U.S. Department of Labor
under ERISA; and as soon as possible and in any event within five days after the
Borrower or any ERISA Affiliate knows or has reason to know that any Reportable
Event (as to which the thirty day notice requirement to the PBGC has not been
waived) or Prohibited Transaction has occurred with respect to any Plan or that
the PBGC or the Borrower or any Subsidiary or any ERISA Affiliate has instituted
or will institute proceedings under Title IV of ERISA to terminate any Plan, a
certificate of the chief financial officer of the Borrower setting forth the
details as to such Reportable Event or Prohibited Transaction or Plan
termination and the action that the Borrower proposes to take with respect
thereto;
Notice of Material Adverse Effect. As soon as possible and in any event within
10 days after the Borrower knows of the occurrence thereof, written notice of
any matter that could reasonably be expected to have a Material Adverse Effect;
Proxy Statements, Etc. As soon as available, one copy of each financial
statement, report, notice or proxy statement sent by the Borrower or any
Subsidiary to its stockholders generally and one copy of each regular, periodic
or special report, registration statement, or prospectus filed by the Borrower
or any Subsidiary with any securities exchange or the Securities and Exchange
Commission or any successor agency;
47
Default under, or Termination of, a Lease. As soon as possible and in any event
within (i) 10 days after the Borrower or any Subsidiary becomes aware of any
default (whether by written or oral notice or due to such Person's actual
knowledge) by such Person under any lease of a Leased Location and (ii) three
days after the Borrower or any Subsidiary receives any notice (written or oral)
of termination of the lease for a Leased Location, a written notice of such
default or termination, which notice shall include (A) a copy of the written
notice, or (B) with respect to all other circumstances, street address and store
number for the Leased Location, the nature of the default and landlord's
remedies (if applicable), the effective date of such termination or landlord's
proposed remedial action and description of the action that the Borrower or the
applicable Subsidiary has taken and proposes to take with respect thereto
(notices of lease terminations made in accordance with clause (ii) above shall
be delivered by telecopy only and shall be deemed given when transmitted,
subject to telephone confirmation of receipt);
Landlord Change. As soon as possible and in any event within 10 days after the
Borrower or any Subsidiary becomes aware of a Landlord Change (whether by oral
or written notice), a written notice of such Landlord Change, which notice shall
include (i) a copy of the written notice or (ii) with respect to all other
circumstances, the street address and store number for the Leased Location and
the name of the new landlord; and
General Information. Promptly, such other information concerning the Borrower or
any Subsidiary as the Agent or any Lender may from time to time reasonably
request.
Maintenance of Existence; Conduct of Business. The Borrower will preserve and
maintain, and will cause each Subsidiary to preserve and maintain, its corporate
(or partnership) existence and all of its leases, privileges, licenses, permits,
franchises, qualifications, and rights that are necessary or desirable in the
ordinary conduct of its business; provided however, the Subsidiaries listed on
Schedule 8.2 may be dissolved, wound up or liquidated on or before 90 days from
the date hereof. The Borrower will conduct, and will cause each Subsidiary to
conduct, its business in an orderly and efficient manner in accordance with good
business practices customary in the industry in which the Borrower and the
Subsidiaries are engaged.
Maintenance of Properties. The Borrower will maintain, keep, and preserve, and
cause each Subsidiary to maintain, keep, and preserve, all of its properties
(tangible and intangible) necessary or useful in the proper conduct of its
business in good working order and condition (ordinary wear and tear excepted).
Taxes and Claims. The Borrower will pay or discharge, and will cause each
Subsidiary to pay or discharge, at or before maturity or before becoming
delinquent (a) all taxes, levies, assessments, and governmental charges imposed
on it or its income or profits or any of its property, and (b) all lawful claims
for labor, material, and supplies, which, if unpaid, might become a Lien upon
any of its property; provided, however, that neither the Borrower nor any
Subsidiary shall be required to pay or discharge any tax, levy, assessment, or
governmental charge which is being contested in good faith by appropriate
proceedings diligently pursued, and for which adequate reserves have been
established.
Insurance. The Borrower will maintain, and will cause each of the Subsidiaries
to maintain, insurance with financially sound and reputable insurance companies
in such amounts and covering such risks as is usually carried by corporations
engaged in similar businesses and owning similar properties in the same general
areas in which the Borrower and the Subsidiaries
48
operate, provided that in any event the Borrower will maintain and cause each
Subsidiary to maintain workmen's compensation insurance, property insurance,
comprehensive general liability insurance, reasonably satisfactory to the Agent.
Inspection Rights; Audits. At any reasonable time and from time to time, the
Borrower will permit, and will cause each Subsidiary to permit, representatives
of the Agent and each Lender to examine, copy, and make extracts from its books
and records, to visit and inspect its properties, and to discuss its business,
operations, and financial condition with its officers, employees, and
independent certified public accountants. In addition, the Borrower will permit,
and will cause each Subsidiary to permit, semi-annual audits of the personal
property of the Borrower and the Subsidiaries by auditors selected by the Agent.
The Borrower shall reimburse the Agent for the reasonable costs and expenses
expended by the Agent in connection with such audits. Audit fees and expenses
shall be payable on the third day of the month following the date of issuance by
the Agent of a request for payment thereof to the Borrower.
Keeping Books and Records. The Borrower will maintain, and will cause each
Subsidiary to maintain, proper books of record and account in which full, true,
and correct entries in conformity with GAAP shall be made of all dealings and
transactions in relation to its business and activities.
Compliance with Laws. The Borrower will comply, and will cause each Subsidiary
to comply, in all respects with all applicable laws, rules, regulations, orders,
and decrees of any Governmental Authority or arbitrator, including without
limitation, the provisions of the Texas Pawn Shop Act (Chapter 371 of the Texas
Finance Code), the consumer loan provisions of the Texas Finance Code and the
provisions of the Xxxxx Law and other laws, rules and regulations related to the
regulation of firearms, other than such non-compliance which could not
reasonably be expected to have a Material Adverse Effect.
Compliance with Agreements. The Borrower will comply, and will cause each
Subsidiary to comply, in all respects with all agreements, contracts, and
instruments binding on it or affecting its properties or business other than
such non-compliance which could not reasonably be expected to have a Material
Adverse Effect.
Further Assurances. The Borrower will, and will cause each Subsidiary to,
execute and deliver such further agreements and instruments and take such
further action as may be reasonably requested by the Agent to carry out the
provisions and purposes of this Agreement and the other Loan Documents. Without
limiting the foregoing, upon the creation or acquisition of any Subsidiary or a
new store by a new Subsidiary or by an existing Subsidiary in a new state, the
Borrower shall (a) provide written notice of such event to the Agent within five
Business Days following the date the Borrower has knowledge thereof, and (b)
cause each such domestic Subsidiary to execute and deliver a Guaranty, a
Contribution and Indemnification Agreement, a Subsidiary Security Agreement,
Real Property Security Documents, Uniform Commercial Code financing statements,
and to provide to the Agent a landlord waiver for each Leased Location (subject
in all respects to a best efforts standard of performance), title insurance
commitments, surveys of Real Property, appraisals of Real Property, lender's
title insurance policy with any required endorsements, and a legal opinion of
the Borrower's and Guarantors' counsel (which may in the Agent's discretion be a
legal opinion of the Borrower's in-house counsel), each in form and substance
satisfactory to the Agent, within 30 calendar days following the date the
Borrower has knowledge thereof. If any Subsidiary is created or acquired after
the date hereof,
49
the Borrower shall execute and deliver to the Agent (a) an amendment to this
Agreement to amend Schedule 7.14 to this Agreement (which only needs the
signature of the Agent to be effective if the only change is the addition of the
new Subsidiary) and (b) any other documents which would have otherwise been
required to be delivered to the Agent and the Lenders if such Subsidiary had
been a Subsidiary as of the date hereof.
ERISA. The Borrower will comply, and will cause each Subsidiary to comply, with
all minimum funding requirements, and all other material requirements of ERISA,
if applicable, so as not to give rise to any liability thereunder which could
reasonably be expected to have a Material Adverse Effect.
Landlord's Waivers or Subordinations. Within 30 days after a Landlord Change,
the Borrower will, and will cause each Subsidiary to, deliver (subject in all
respects to a best efforts standard of performance) to the Agent (a) an updated
waiver or subordination of such landlord's lien in the Collateral (the "Waiver")
or (b) an acknowledgment from the new landlord of the effectiveness of the
Waiver, if any, received from the previous landlord, such waiver or
acknowledgment to be in form and substance satisfactory to the Agent.
Negative Covenants
The Borrower covenants and agrees that, as long as the Obligations or
any part thereof are outstanding or any Lender has any Commitment hereunder or
the Issuing Bank has any obligation to issue Letters of Credit hereunder, the
Borrower will perform and observe the following negative covenants:
Debt. The Borrower will not incur, create, assume, or permit to exist, and will
not permit any Subsidiary to incur, create, assume, or permit to exist, any
Debt, except:
Debt to the Lenders and the Issuing Bank pursuant to the Loan Documents;
Debt listed on Schedule 9.1; and
Purchase money Debt so long as no Default or Event of Default has occurred and
is continuing or would result therefrom.
Limitation on Liens. The Borrower will not incur, create, assume, or permit to
exist, and will not permit any Subsidiary to incur, create, assume, or permit to
exist, any Lien upon any of its property, assets, or revenues, whether now owned
or hereafter acquired, except:
Liens disclosed on Schedule 9.2 hereto and Liens in favor of the Agent for the
benefit of the Lenders;
Liens for taxes, assessments, or other governmental charges which are not
delinquent or which are being diligently contested in good faith and for which
adequate reserves have been established;
50
Liens of mechanics, materialmen, warehousemen, carriers, landlords or other
similar statutory Liens securing obligations that are not yet due and are
incurred in the ordinary course of business;
Liens resulting from good faith deposits to secure payments of workmen's
compensation or other social security programs or to secure the performance of
tenders, statutory obligations, surety and appeal bonds, bids, contracts (other
than for payment of Debt), or leases made in the ordinary course of business;
Purchase money Liens securing Permitted Debt described in Section 9.1(c),
provided that the Debt secured by any such Lien encumbers only the asset so
purchased;
Liens securing Permitted Debt described in Section 9.1(b); provided that, the
Debt secured by any such Lien encumbers only the Real Property refinanced by
such Permitted Debt;
Liens on the Indemnity Accounts in favor of County Bank of Rehoboth Beach,
Delaware; provided however, the aggregate amount held in the Indemnity Accounts
will not at any time exceed the lesser of (i) $1,500,000 or (ii) the greater of
$50,000 or 120% of County Bank of Rehoboth Beach, Delaware's interest in all
outstanding Pay-Day Advance Loans implemented with any of the Borrower and its
Subsidiaries; provided further, however, that the Borrower shall not permit, and
shall not permit any Subsidiary to permit, any amounts contributed, deposited or
paid to either the Indemnity Accounts or the Litigation Fund Accounts to be
drawn by the County Bank of Rehoboth Beach, Delaware in an aggregate amount in
excess of $750,000 cumulatively for all periods of time during the term of this
Agreement for the purposes of making certain payments in compliance with the
Pay-Day Advance Loan Documents;
Liens on the Litigation Fund Accounts in favor of County Bank of Rehoboth Beach,
Delaware; provided however, the aggregate amount held in the Litigation Fund
Accounts will not at any time exceed $50,000; provided further, however, that
the Borrower shall not permit, and shall not permit any Subsidiary to permit,
any amounts contributed, deposited or paid to either the Litigation Fund
Accounts or the Indemnity Accounts to be drawn by the County Bank of Rehoboth
Beach, Delaware in an aggregate amount in excess of $750,000 cumulatively for
all periods of time during the term of this Agreement for the purposes of making
certain payments in compliance with the Pay-Day Advance Loan Documents; and
Financing statements filed in connection with operating lease transactions for
computers.
Neither the Borrower nor any Subsidiary shall enter into or assume any
agreement (other than the Loan Documents) prohibiting the creation or assumption
of any Lien upon its properties or assets whether now owned or hereafter
acquired; provided that in connection with the creation of purchase money Liens
permitted hereby, the Borrower or the Subsidiary may agree that it will not
permit any other Liens (other than the Liens in favor of the Agent for the
benefit of the Lenders) to encumber the assets subject to such purchase money
Lien. Further, the Borrower will not and will not permit any Subsidiaries
directly or indirectly to create or otherwise cause or suffer to exist to become
effective any consensual encumbrance or restriction of any kind on the ability
of any Subsidiary to: (i) pay dividends or make any other distribution on any of
such Subsidiaries' capital stock owned by the Borrower or any Subsidiary of the
Borrower; (ii) subject to subordination provisions pay any Debt owed to the
Borrower or any other Subsidiary;
51
(iii) make loans or advances to the Borrower or any other Subsidiary; or (iv)
transfer any of its properties or assets to the Borrower or any other Subsidiary
not restricted hereby.
Mergers, Etc. The Borrower will not, and will not permit any Subsidiary to
become a party to a merger or consolidation, or to purchase or otherwise acquire
all or a substantial part of the business or assets of any Person or any shares
or other equity interest of any Person (whether or not certificated), or
wind-up, dissolve, or liquidate itself; provided that, (i) a domestic Subsidiary
may wind-up, dissolve or liquidate if no Default exists or would result
therefrom and its assets are transferred to the Borrower or another domestic
Subsidiary; (ii) a foreign Subsidiary may wind-up, dissolve or liquidate if no
Default exists or would result therefrom; (iii) any Subsidiary may merge with
and into the Borrower if the Borrower is the surviving entity and no Default
exists or would result therefrom; (iv) any Subsidiary may merge with and into
any other domestic Subsidiary if the domestic Subsidiary is the surviving
entity, no Default exists or would result therefrom and Section 8.10 is complied
with; (v) any foreign Subsidiary may merge with any other foreign Subsidiary if
no Default exists or would result therefrom; and (vi) the Borrower or a
Subsidiary may make investments permitted under Section 9.5 hereof.
Restricted Payments. The Borrower will not declare or pay any dividends or make
any other payment or distribution (whether in cash, property, or obligations) on
account of its capital stock, or redeem, purchase, retire, or otherwise acquire
any of its capital stock, or permit any of its Subsidiaries to purchase or
otherwise acquire any capital stock of the Borrower or another Subsidiary, or
set apart any money for a sinking or other analogous fund for any dividend or
other distribution on its capital stock or for any redemption, purchase,
retirement, or other acquisition of any of its capital stock.
Investments. Other than pawn loans and Pay-Day Advance Loans extended in the
ordinary course of business, the Borrower will not make, and will not permit any
Subsidiary to make, any advance, loan, extension of credit, or capital
contribution to or investment in, or purchase to own, or permit any Subsidiary
to purchase or own, any stock, bonds, notes, debentures, or other securities of
any Person, except:
readily marketable direct obligations of the United States of America or any
agency thereof with maturities of 18 months or less from the date of
acquisition;
fully insured certificates of deposit with maturities of one year or less from
the date of acquisition issued by any commercial bank operating in the United
States of America having capital and surplus in excess of $50,000,000;
commercial paper of a domestic issuer if at the time of purchase such paper is
rated in one of the two highest rating categories of Standard and Poor's
Corporation or Xxxxx'x Investors Service, Inc.;
auction rate preferred stock and municipal bonds that at the time of purchase
are rated in one of the two highest rating categories of Standard & Poor's
Corporation or Xxxxx'x Investment Services, Inc.;
money market funds and mutual funds that invest in securities deemed acceptable
for outright purchase;
52
investments in Subsidiaries existing on the date of this Agreement and
investments in subsequently created domestic Subsidiaries so long as the
Borrower and the Subsidiaries have complied with the terms and conditions of
Section 8.10; and
any loans or investments not covered in the previous sections of this Section
9.5 not to exceed $1,000,000 in the aggregate.
Notwithstanding anything to the contrary contained herein, neither the Borrower
nor any Subsidiary will make any advance, loan, extension of credit, or capital
contribution to or investment in, or purchase to own, any stock, bonds, notes,
debentures, or other securities of Albemarle & Bond Holdings plc except for
those certain investments in Albemarle & Bond Holdings plc existing on the date
of this Agreement.
Limitation on Issuance of Capital Stock. The Borrower will not permit any of its
Subsidiaries to, at any time issue, sell, assign, or otherwise dispose of (a)
any of its capital stock (or any equivalent interest therein), (b) any
securities exchangeable for or convertible into or carrying any rights to
acquire any of its capital stock (or any equivalent interest therein), or (c)
any option, warrant, or other right to acquire any of its capital stock (or any
equivalent interest therein).
Transactions With Affiliates. The Borrower will not enter into, and will not
permit any Subsidiary to enter into, any transaction, including, without
limitation, the purchase, sale, or exchange of property or the rendering of any
service, with any Affiliate of the Borrower or such Subsidiary, except (a) in
the ordinary course of and pursuant to the reasonable requirements of the
Borrower's or such Subsidiary's business, (b) upon fair and reasonable terms no
less favorable to the Borrower or such Subsidiary than would be obtained in a
comparable arm's-length transaction with a Person not an Affiliate of the
Borrower or such Subsidiary and (c) so long as no Default or Event of Default
has occurred and is continuing or would result therefrom.
Disposition of Assets. The Borrower will not sell, lease, assign, transfer, or
otherwise dispose (collectively "Dispositions") of any of its assets, or permit
any Subsidiary to do so with any of its assets, except for (a) Dispositions of
Inventory in the ordinary course of business, (b) Dispositions of obsolete, worn
or used equipment, (c) Dispositions to a Guarantor as to which Agent has in its
possession an executed Guaranty, Subsidiary Security Agreement and Real Estate
Security Documents, if applicable, and (d) Dispositions of certain store
locations (including sales of Real Property and operating business (which may
include the sale of Inventory and pawn loans and interests in Pay-Day Advance
Loans of the Borrower or any Subsidiary in connection with the sale of such
location), but excluding liquidating sales of Inventory and pawn loans and
interests in Pay-Day Advance Loans of the Borrower or any Subsidiary, which do
not occur in connection with the sale of any Real Property or operating
business) owned by the Borrower or any of its Subsidiaries as of the date hereof
so long as the Net Proceeds of such Disposition are promptly paid to the Agent
in accordance with Section 4.3.
Nature of Business. The Borrower will not, and will not permit any Subsidiary
to, engage in any business other than the businesses in which they are engaged
on the date hereof. Without in any way limiting the foregoing, such businesses
shall include, but not be limited to, the following: check-cashing, money wires,
Pay-Day Advance Loans, jewelry sales and other services incidental to the
foregoing.
53
Environmental Protection. The Borrower will not, and will not permit any of its
Subsidiaries to, (a) use (or permit any tenant to use) any of their respective
properties or assets for the handling, processing, storage, transportation, or
disposal of any Hazardous Material, (b) generate any Hazardous Material, (c)
conduct any activity that is likely to cause a Release or threatened Release of
any Hazardous Material, or (d) otherwise conduct any activity or use any of
their respective properties or assets in any manner that is likely to violate
any Environmental Law or create any Environmental Liabilities for which the
Borrower or any of its Subsidiaries would be responsible.
Accounting. The Borrower will not, and will not permit any of its Subsidiaries
to, change its Fiscal Year or make any change in accounting treatment or
reporting practices, except as permitted by GAAP and disclosed to the Agent.
Prepayment of Debt. The Borrower will not, and will not permit any Subsidiary
to, prepay any Debt except the Obligations.
Pay-Day Advance Loans. The Borrower will not, and will not permit any of its
Subsidiaries to, purchase interests in any Pay-Day Advance Loans originated by a
Person other than the Borrower or any Subsidiary.
Sales and Leasebacks. Neither the Borrower nor any Subsidiary will enter into
any arrangement, directly or indirectly, with any Person whereby the Borrower or
any Subsidiary shall sell or transfer any of its Real Property, whether now
owned or hereafter acquired, and whereby the Borrower or any Subsidiary shall
then or thereafter rent or lease as lessee such Real Property or any part
thereof or other Real Property which the Borrower or any Subsidiary intends to
use for substantially the same purpose or purposes as the Real Property sold or
transferred, except sales and leasebacks of any Real Property permitted to be
sold under Section 9.8(d).
Financial Covenants
The Borrower covenants and agrees that, as long as the Obligations or
any part thereof are outstanding or any Lender has any Commitment hereunder or
the Issuing Bank has any obligation to issue Letters of Credit hereunder, the
Borrower will perform and observe the following financial covenants:
Consolidated Net Worth. Beginning with the calendar month ending September 30,
2002, the Borrower will maintain Consolidated Net Worth in an amount not less
than (a) $102,500,000, plus (b) an amount equal to 100% of Consolidated Net
Income (not less than zero dollars [$0.00]) for all periods subsequent to the
calendar month ending September 30, 2002, plus (c) an amount equal to 100% of
the Net Proceeds of all equity offerings (including conversions of debt
securities into common stock) of the Borrower subsequent to September 30, 2002.
Leverage Ratio. The Borrower will maintain a Leverage Ratio at the end of each
Fiscal Quarter of not greater than (a) 2.75 to 1.00 for the period beginning as
of September 30, 2002 through and including December 31, 2003 and (b) 2.00 to
1.00 thereafter.
54
Capital Expenditures. The Borrower will not permit the aggregate amount of
Capital Expenditures of the Borrower and the Subsidiaries to exceed $6,000,000
during any Fiscal Year.
Inventory Turnover. The Borrower on a consolidated basis will at all times
maintain an Inventory Turnover of not less than 2.00 to 1.00.
Fixed Charge Coverage Ratio. The Borrower will maintain a Fixed Charge Coverage
Ratio at the end of each Fiscal Quarter of not less than (a) 1.35 to 1.00 for
the period beginning September 30, 2002 through and including December 31, 2003,
and (b) 1.40 to 1.00 thereafter.
Default
Events of Default. Each of the following shall be deemed an "Event of Default":
The Borrower shall fail to pay when due the Obligations or any part thereof.
Any representation or warranty made or deemed made by the Borrower or any
Obligated Party (or any of their respective officers) in any Loan Document or in
any certificate, report, notice, or financial statement furnished at any time in
connection with this Agreement shall be false, misleading, or erroneous in any
material respect when made or deemed to have been made.
The Borrower shall fail to perform, observe, or comply with any covenant,
agreement, or term contained in Section 8.1, Article IX, or Article X of this
Agreement; or the Borrower or any Obligated Party shall fail to perform,
observe, or comply with any other covenant, agreement, or term contained in this
Agreement or any other Loan Document (other than covenants to pay the
Obligations) and such failure shall continue for a period of 15 days.
The Borrower, any Subsidiary, or any Obligated Party shall commence a voluntary
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 a 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 generally fail to pay its debts as they become due
or shall take any corporate action to authorize any of the foregoing.
An involuntary proceeding shall be commenced against the Borrower, any
Subsidiary, or any Obligated Party 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 for it or a
substantial part of its property, and such involuntary proceeding shall remain
undismissed and unstayed for a period of 30 days.
The Borrower, any Subsidiary, or any Obligated Party shall fail to discharge
within a period of 45 days after the commencement thereof any attachment,
sequestration, or similar proceeding or
55
proceedings involving an aggregate amount in excess of $250,000 against any of
its assets or properties.
A final judgment or judgments for the payment of money in excess of $250,000 in
the aggregate shall be rendered by a court or courts against the Borrower, any
of its Subsidiaries, or any Obligated Party and the same shall not be discharged
(or provision shall not be made for such discharge), or a stay of execution
thereof shall not be procured, within 45 days from the date of entry thereof and
the Borrower or the relevant Subsidiary or Obligated Party shall not, within
said period of 45 days, or such longer period during which execution of the same
shall have been stayed, appeal therefrom and cause the execution thereof to be
stayed during such appeal.
The Borrower, any Subsidiary, or any Obligated Party shall fail to pay when due
any principal of or interest on any Material Debt (hereinafter defined) (other
than the Obligations), or the maturity of any such Debt shall have been
accelerated, or any such Debt shall have been required to be prepaid prior to
the stated maturity thereof, or any event shall have occurred that permits any
holder or holders of such Debt or any Person acting on behalf of such holder or
holders to accelerate the maturity thereof or require any such prepayment. For
purposes of this clause (h), the term "Material Debt" means Debt owed by the
Borrower or any Subsidiary the principal amount of which exceeds $250,000.
This Agreement or any other Loan Document shall cease to be in full force and
effect or shall be declared null and void or the validity or enforceability
thereof shall be contested or challenged by the Borrower, any Subsidiary, any
Obligated Party or any of their respective shareholders, or the Borrower or any
Obligated Party shall deny that it has any further liability or obligation under
any of the Loan Documents.
Any of the following events shall occur or exist with respect to the Borrower or
any ERISA Affiliate: (i) any Prohibited Transaction involving any Plan; (ii) any
Reportable Event with respect to any Plan; (iii) the filing under Section 4041
of ERISA of a notice of intent to terminate any Plan or the termination of any
Plan; (iv) any event or circumstance that might constitute grounds entitling the
PBGC to institute proceedings under Section 4042 of ERISA for the termination
of, or for the appointment of a trustee to administer, any Plan, or the
institution by the PBGC of any such proceedings; or (v) complete or partial
withdrawal under Section 4201 or 4204 of ERISA from a Multiemployer Plan or the
reorganization, insolvency, or termination of any Multiemployer Plan; and in
each case above, such event or condition, together with all other events or
conditions, if any, have subjected or could in the reasonable opinion of
Required Banks subject the Borrower to any tax, penalty, or other liability to a
Plan, a Multiemployer Plan, the PBGC, or otherwise (or any combination thereof)
which in the aggregate exceed or could reasonably be expected to exceed
$250,000.
Any Person or group of related Persons for purposes of Section 13(d) of the
Exchange Act sells or acquires after the date hereof "beneficial ownership"
(within the meaning of Section 13(d) of the Exchange Act) in excess of 33% of
the total voting power of all classes of capital stock then outstanding of the
Borrower entitled (without regard to the occurrence of any contingency) to vote
in elections of directors of the Borrower.
The Borrower or any of its Subsidiaries, or any of their properties, revenues,
or assets, shall become the subject of an order of forfeiture, seizure, or
divestiture and the same shall not have
56
been discharged (or provisions shall not be made for such discharge) within
30 days from the date of entry thereof.
Any Material Adverse Effect shall occur.
Remedies.
If any Event of Default shall occur and be continuing, the Agent may (and if
directed by Required Lenders, shall) do any one or more of the following:
Acceleration. Declare all outstanding principal of and accrued and unpaid
interest on the Notes, all outstanding Letter of Credit Disbursements, and all
other obligations of the Borrower under the Loan Documents immediately due and
payable, and the same shall thereupon become immediately due and payable,
without notice, demand, presentment, notice of dishonor, notice of acceleration,
notice of intent to accelerate, protest, or other formalities of any kind, all
of which are hereby expressly waived by the Borrower.
Termination of Commitments. Terminate the Commitments and the obligation of the
Issuing Bank to issue Letters of Credit without notice to the Borrower.
Judgment. Reduce any claim to judgment.
Foreclosure. Foreclose or otherwise enforce any Lien granted to the Agent for
the benefit of itself and the Lenders to secure payment and performance of the
Obligations in accordance with the terms of the Loan Documents.
Rights. Exercise any and all rights and remedies afforded by the laws of the
State of Texas or any other jurisdiction, by any of the Loan Documents, by
equity, or otherwise.
Provided, however, that upon the occurrence of an Event of Default
under subsection (d) or (e) of Section 11.1, the Commitments of all of
the Lenders and the obligation of the Issuing Bank to issue Letters of
Credit shall automatically terminate, and the outstanding principal of
and accrued and unpaid interest on the Notes and all other obligations
of the Borrower under the Loan Documents shall thereupon become
immediately due and payable without notice, demand, presentment, notice
of dishonor, notice of acceleration, notice of intent to accelerate,
protest, or other formalities of any kind, all of which are hereby
expressly waived by the Borrower.
If an Event of Default shall have occurred and be continuing, each Lender is
hereby authorized at any time and from time to time, without notice to the
Borrower (any such notice being hereby expressly waived by the Borrower), to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time owing
by such Lender to or for the credit or the account of the Borrower against any
and all of the obligations of the Borrower now or hereafter existing under this
Agreement, such Lender's Note, or any other Loan Document, irrespective of
whether or not the Agent or such Lender shall have made any demand under this
Agreement or such Lender's Note or such other Loan Document and although such
obligations may be unmatured. Each Lender agrees promptly to notify the Borrower
(with a copy to the Agent and to each Lender) after any such setoff and
application, provided that the failure to give such notice shall not affect the
validity of such setoff and
57
application. The rights and remedies of each Lender hereunder are in addition to
other rights and remedies (including, without limitation, other rights of
setoff) which such Lender may have.
Cash Collateral. If an Event of Default shall have occurred and be continuing
the Borrower shall, if requested by the Agent or Required Lenders, pledge to the
Agent as security for the Obligations an amount in immediately available funds
equal to the then outstanding Letter of Credit Liabilities, such funds to be
held in a cash collateral account at the Agent without any right of withdrawal
by the Borrower.
Performance by the Agent. If the Borrower shall fail to perform any covenant or
agreement in accordance with the terms of the Loan Documents, the Agent may, at
the direction of Required Lenders, perform or attempt to perform such covenant
or agreement on behalf of the Borrower. In such event, the Borrower shall, at
the request of the Agent, promptly pay any amount reasonably expended by the
Agent or the Lenders in connection with such performance or attempted
performance to the Agent at the Principal Office, together with interest thereon
at the Default Rate from and including the date of such expenditure to but
excluding the date such expenditure is paid in full. Notwithstanding the
foregoing, it is expressly agreed that neither the Agent nor any Lender shall
have any liability or responsibility for the performance of any obligation of
the Borrower under this Agreement or any of the other Loan Documents.
The Agent
Appointment, Powers and Immunities. In order to expedite the various
transactions contemplated by this agreement, the Lenders and the Issuing Bank
hereby irrevocably appoint and authorize Xxxxx Fargo Bank Texas, National
Association to act as their Agent hereunder and under each of the other Loan
Documents. Xxxxx Fargo Bank Texas, National Association consents to such
appointment and agrees to perform the duties of the Agent as specified herein.
The Lenders and the Issuing Bank authorize and direct the Agent to take such
action in their name and on their behalf under the terms and provisions of the
Loan Documents and to exercise such rights and powers thereunder as are
specifically delegated to or required of the Agent for the Lenders and/or the
Issuing Bank, together with such rights and powers as are reasonably incidental
thereto. The Agent is hereby expressly authorized to act as the Agent on behalf
of itself, the other Lenders and the Issuing Bank:
To receive on behalf of each of the Lenders and the Issuing Bank any payment of
principal, interest, fees (except for the annual agent fee described in Section
2.10(a)) or other amounts paid pursuant to this Agreement and the Notes and to
distribute to each Lender and/or the Issuing Bank its share of all payments so
received as provided in this Agreement;
To receive all documents and items to be furnished under the Loan Documents;
To act as nominee for and on behalf of the Lenders and the Issuing Bank in and
under the Loan Documents;
To arrange for the means whereby the Advances are to be made available to the
Borrower;
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To distribute to the Lenders and the Issuing Bank information, requests,
notices, payments, prepayments, documents and other items received from the
Borrower, the other Obligated Parties, and other Persons;
To execute and deliver to the Borrower, the other Obligated Parties, and other
Persons, all requests, demands, approvals, notices, and consents received from
the Lenders and the Issuing Bank;
To the extent permitted by the Loan Documents, to exercise on behalf of each
Lender and the Issuing Bank all rights and remedies of Lenders and the Issuing
Bank upon the occurrence of any Event of Default;
To serve as liaison between the Lenders, the Issuing Bank and the Borrower with
respect to future negotiations, amendments and waivers of the terms of this
Agreement and transmittal of copies of such amendments and waivers for signature
to each Lender and the Issuing Bank;
To receive signed copies of this Agreement, future amendments hereto, waivers of
any terms hereof, and related documents comprising the Loan Documents, and
provide appropriate signed or reproduction copies thereof to each Lender, the
Issuing Bank and the Borrower;
To forward to each Lender and the Issuing Bank copies of all Loan Documents and
opinions furnished to Agent under this Agreement or any of the other Loan
Documents;
To receive notices of Defaults, copies of which shall be forwarded to all
Lenders and the Issuing Bank, and any waivers of Defaults under this Agreement
and forward copies thereof to all Lenders and the Issuing Bank;
To advise each Lender and the Issuing Bank of all notices received or furnished
by Agent hereunder;
To take such other actions as may be requested by Required Lenders; and
To accept, execute, and deliver any and all security documents as the secured
party.
Neither the Agent nor any of its Affiliates, officers, directors,
employees, attorneys, or agents shall be liable to the Lenders for any action
taken or omitted to be taken by any of them hereunder or otherwise in connection
with this Agreement or any of the other Loan Documents except for its or their
own gross negligence or willful misconduct. Without limiting the generality of
the preceding sentence, the Agent (i) may treat the payee of any Note as the
holder thereof until the Agent receives written notice of the assignment or
transfer thereof signed by such payee and in form satisfactory to the Agent;
(ii) shall have no duties or responsibilities except those expressly set forth
in this Agreement and the other Loan Documents, and shall not by reason of this
Agreement or any other Loan Document be a trustee or fiduciary for any Lender or
the Issuing Bank; (iii) shall not be required to initiate any litigation or
collection proceedings hereunder or under any other Loan Document except to the
extent requested by Required Lenders; (iv) shall not be responsible to the
Lenders or the Issuing Bank for any recitals, statements, representations or
warranties contained in this Agreement or any other Loan Document, or any
certificate or other document referred to or provided for in, or received by any
of them under, this Agreement or any other Loan Document, or for the value,
validity,
59
effectiveness, enforceability, or sufficiency of this Agreement or any other
Loan Document or any other document referred to or provided for herein or
therein or for any failure by any Person to perform any of its obligations
hereunder or thereunder; (v) may consult with legal counsel (including counsel
for the Borrower), independent public accountants, and other experts selected by
it and shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel, accountants, or
experts; and (vi) shall incur no liability under or in respect of any Loan
Document by acting upon any notice, consent, certificate, or other instrument or
writing believed by it to be genuine and signed or sent by the proper party or
parties. As to any matters not expressly provided for by this Agreement, the
Agent shall in all cases be fully protected in acting, or in refraining from
acting, hereunder in accordance with instructions signed by Required Lenders,
and such instructions of Required Lenders and any action taken or failure to act
pursuant thereto shall be binding on all of the Lenders; provided, however, that
the Agent shall not be required to take any action which exposes the Agent to
personal liability or which is contrary to this Agreement or any other Loan
Document or applicable law.
Rights of Agent as a Lender. With respect to its Commitment, the Advances made
by it and the Notes issued to it, Xxxxx Fargo Bank Texas, National Association
in its capacity as a Lender hereunder shall have the same rights and powers
hereunder as any other Lender and may exercise the same as though it were not
acting as the Agent, and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include the Agent in its individual capacity. The
Agent and its Affiliates may (without having to account therefor to any Lender)
accept deposits from, lend money to, act as trustee under indentures of, provide
merchant banking services to, and generally engage in any kind of business with
the Borrower, any of its Subsidiaries, any other Obligated Party, and any other
Person who may do business with or own securities of the Borrower, any
Subsidiary, or any other Obligated Party, all as if it were not acting as the
Agent and without any duty to account therefor to the Lenders.
Sharing of Payments, Etc. If any Lender shall obtain any payment of any
principal of or interest on any Advance made by it under this Agreement or
payment of any other obligation under the Loan Documents then owed by the
Borrower or any other Obligated Party to such Lender, whether voluntary,
involuntary, through the exercise of any right of set-off, banker's lien,
counterclaim or similar right, or otherwise, in excess of its pro rata share
(calculated (i) pursuant to Section 3.5 in respect of letter of credit fees, and
(ii) for all other of the Primary Obligations on the basis of the unpaid
principal of and interest on the Revolving Credit Loan, the Tranche B Loan, the
Swing Loan, LC Participations and SL Participations held by it), such Lender
shall promptly purchase from the other Lenders participations in the Primary
Obligations owed to them hereunder in such amounts, and make such other
adjustments from time to time as shall be necessary to cause such purchasing
Lender to share the excess payment ratably with each of the other Lenders in
accordance with its pro rata portion thereof. To such end, all of the Lenders
shall make appropriate adjustments among themselves (by the resale of
participations sold or otherwise) if all or any portion of such excess payment
is thereafter rescinded or must otherwise be restored. The Borrower agrees, to
the fullest extent it may effectively do so under applicable law, that any
Lender so purchasing a participation in the Advances and LC Participations made
by the other Lenders may exercise all rights of set-off, banker's lien,
counterclaim, or similar rights with respect to such participation as fully as
if such Lender were a direct holder of Advances to, or Letter of Credit
Disbursements for the account of, the Borrower in the amount of such
participation. Nothing contained herein shall require any Lender to exercise any
such right
60
or shall affect the right of any Lender to exercise, and retain the benefits of
exercising, any such right with respect to any other indebtedness or obligation
of the Borrower.
Indemnification. THE LENDERS HEREBY AGREE TO INDEMNIFY THE AGENT AND THE ISSUING
BANK FROM AND HOLD THE AGENT AND THE ISSUING BANK HARMLESS AGAINST (TO THE
EXTENT NOT REIMBURSED UNDER SECTIONS 13.1 AND 13.2, BUT WITHOUT LIMITING THE
OBLIGATIONS OF THE BORROWER UNDER SECTIONS 13.1 AND 13.2), RATABLY IN ACCORDANCE
WITH THEIR RESPECTIVE COMMITMENTS, ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES,
DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, DEFICIENCIES, SUITS, COSTS, EXPENSES
(INCLUDING REASONABLE ATTORNEYS' FEES), AND DISBURSEMENTS OF ANY KIND OR NATURE
WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST THE AGENT
AND THE ISSUING BANK IN ANY WAY RELATING TO OR ARISING OUT OF ANY OF THE LOAN
DOCUMENTS OR ANY ACTION TAKEN OR OMITTED TO BE TAKEN BY THE AGENT AND THE
ISSUING BANK UNDER OR IN RESPECT OF ANY OF THE LOAN DOCUMENTS; PROVIDED,
FURTHER, THAT NO LENDER SHALL BE LIABLE FOR ANY PORTION OF THE FOREGOING TO THE
EXTENT CAUSED BY THE AGENT'S OR THE ISSUING BANK'S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT. WITHOUT LIMITING ANY OTHER PROVISION OF THIS SECTION, EACH LENDER
AGREES TO REIMBURSE THE AGENT AND THE ISSUING BANK PROMPTLY UPON DEMAND FOR ITS
PRO RATA SHARE (CALCULATED ON THE BASIS OF THE COMMITMENTS) OF ANY AND ALL
OUT-OF-POCKET EXPENSES (INCLUDING REASONABLE ATTORNEYS' FEES) INCURRED BY THE
AGENT AND THE ISSUING BANK IN CONNECTION WITH THE PREPARATION, EXECUTION,
DELIVERY, ADMINISTRATION, MODIFICATION, AMENDMENT OR ENFORCEMENT (WHETHER
THROUGH NEGOTIATIONS, LEGAL PROCEEDINGS, OR OTHERWISE) OF, OR LEGAL ADVICE IN
RESPECT OF RIGHTS OR RESPONSIBILITIES UNDER, THE LOAN DOCUMENTS, TO THE EXTENT
THAT THE AGENT OR THE ISSUING BANK IS NOT REIMBURSED FOR SUCH EXPENSES BY THE
BORROWER.
Independent Credit Decisions. Each Lender agrees that it has independently and
without reliance on the Agent, the Issuing Bank or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
credit analysis of the Borrower and decision to enter into this Agreement and
that it will, independently and without reliance upon the Agent, the Issuing
Bank or any other Lender, and based upon such documents and information as it
shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under this Agreement or any of the
other Loan Documents. The Agent shall not be required to keep itself informed as
to the performance or observance by the Borrower or any Obligated Party of this
Agreement or any other Loan Document or to inspect the properties or books of
the Borrower or any Obligated Party. Except for notices, reports and other
documents and information expressly required to be furnished to the Lenders and
the Issuing Bank by the Agent hereunder or under the other Loan Documents,
neither the Agent nor the Issuing Bank shall have any duty or responsibility to
provide any Lender with any credit or other financial information concerning the
affairs, financial condition or business of the Borrower or any Obligated Party
(or any of their Affiliates) which may come into the possession of the Agent,
the Issuing Bank or any of their Affiliates.
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Several Commitments. The Commitments and other obligations of the Lenders under
this Agreement are several. The default by any Lender in making an Advance in
accordance with its Commitment shall not relieve the other Lenders of their
obligations under this Agreement. In the event of any default by any Lender in
making any Advance, each nondefaulting Lender shall be obligated to make its
Advance but shall not be obligated to advance the amount which the defaulting
Lender was required to advance hereunder. In no event shall any Lender be
required to advance an amount or amounts which shall in the aggregate exceed
such Lender's Commitment. No Lender shall be responsible for any act or omission
of any other Lender.
Successor Agent. Subject to the appointment and acceptance of a successor Agent
as provided below, the Agent may resign at any time by giving notice thereof to
the Lenders, the Issuing Bank and the Borrower and the Agent may be removed at
any time with or without cause by Required Lenders. Upon any such resignation or
removal, the Required Lenders will have the right to appoint a successor Agent.
If no successor Agent shall have been so appointed by the Required Lenders and
shall have accepted such appointment within 30 days after the retiring Agent's
giving of notice of resignation or the Required Lenders' removal of the retiring
Agent, then the retiring Agent may, on behalf of the Lenders and the Issuing
Bank, appoint a successor Agent, which shall be a commercial bank organized
under the laws of the United States of America or any State thereof and having
combined capital and surplus of at least One $100,000,000. Upon the acceptance
of its appointment as successor Agent, such successor Agent shall thereupon
succeed to and become vested with all rights, powers, privileges, immunities,
and duties of the resigning or removed Agent, and the resigning or removed Agent
shall be discharged from its duties and obligations under this Agreement and the
other Loan Documents. After any Agent's resignation or removal as Agent, the
provisions of this Article XII shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was the
Agent. After the retiring Agent's resignation or removal hereunder as Agent,
each reference herein to a place of giving of notice or delivery to the Agent
shall be deemed to refer to the principal office of the successor Agent as it
may specify to each party hereto.
In the event that the Agent, for the benefit of itself and the Lenders,
elects or is required to proceed with a foreclosure or other enforcement of any
Lien granted to the Agent for the benefit of itself and the Lenders, the Agent
may, without in any manner limiting its available remedies, and at the request
of the Required Lenders shall, submit a bid for all Lenders (including itself)
in the form of a credit against the Obligations, and the Agent or its designee,
in the event that the Agent or its designee is the successful bidder at any such
foreclosure sale, shall accept title, for the benefit of itself and the Lenders,
to the Collateral sold at such foreclosure sale. The Collateral purchased at any
such sale held shall be owned by the Agent, or its designee, for the benefit of
the Lenders. All monies received or collected by the Agent in respect of the
Collateral in connection with a foreclosure sale, or any other disposition of
the Collateral, shall be paid to the Lenders pro-rata consistent with Section
4.4 hereof.
Agent May File Proofs of Claim. In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to the Borrower or any
Obligated Party, the Agent (irrespective of whether the principal of any Advance
or Letter of Credit Liabilities shall then be due and payable as herein
expressed or by declaration or otherwise and irrespective of whether the Agent
shall have
62
made any demand on the Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise
to file and prove a claim for the whole amount of the principal and interest
owing and unpaid in respect of the Advances, Letter of Credit Liabilities and
all other Obligations that are owing and unpaid and to file such other documents
as may be necessary or advisable in order to have the claims of the Lenders and
the Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Lenders and the Agent and their respective
agents and counsel and all other amounts due the Lenders and the Agent under
Sections 2.10 and 13.1) allowed in such judicial proceeding; and
to collect and receive any monies or other property payable or deliverable on
any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Agent and, in the event that the Agent
shall consent to the making of such payments directly to the Lenders, to pay to
the Agent any amount due for the reasonable compensation, expenses,
disbursements and advances of the Agent and its agents and counsel, and any
other amounts due the Agent under Sections 2.10 and 13.1.
Nothing contained herein shall be deemed to authorize the Agent to
authorize or consent to or accept or adopt on behalf of any Lender any plan of
reorganization, arrangement, adjustment or composition affecting the Obligations
or the rights of any Lender or to authorize the Agent to vote in respect of the
claim of any Lender in any such proceeding.
Collateral and Guaranty Matters. The Lenders irrevocably authorize the
Agent, at its option and in its discretion:
to release any Lien on any property granted to or held by the Agent under any
Loan Document (i) upon termination of the Commitments and payment in full of all
Obligations (other than contingent indemnification obligations) and the
expiration or termination of all Letters of Credit, (ii) that is sold or to be
sold as part of or in connection with any sale permitted hereunder or under any
other Loan Document, or (iii) subject to Section 13.10, if approved, authorized
or ratified in writing by the Required Lenders; and
to release any Guarantor from its obligations under the Guaranty if such Person
ceases to be a Subsidiary as a result of a transaction permitted hereunder.
Upon request by the Agent at any time, the Required Lenders will
confirm in writing the Agent's authority to release its interest in particular
types or items of property, or to release any Guarantor from its obligations
under the Guaranty pursuant to this Section 12.9.
Miscellaneous
Expenses. The Borrower hereby agrees to pay on demand: (a) all reasonable costs
and expenses of the Agent and the Issuing Bank in connection with the
preparation, negotiation, execution, and
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delivery of this Agreement and the other Loan Documents and any and all
amendments, modifications, renewals, extensions, and supplements thereof and
thereto, including, without limitation, the reasonable fees and expenses of
legal counsel for the Agent and the Issuing Bank (including the allocated cost
of internal counsel of the Agent and the Issuing Bank), (b) all costs and
expenses of the Agent, the Issuing Bank and the Lenders in connection with any
Default and the enforcement of this Agreement or any other Loan Document,
including, without limitation, the fees and expenses of legal counsel for the
Agent, the Issuing Bank and the Lenders, (c) all transfer, stamp, documentary,
or other similar taxes, assessments, or charges levied by any Governmental
Authority in respect of this Agreement or any of the other Loan Documents, (d)
all costs, expenses, assessments, and other charges incurred in connection with
any filing, registration, recording, or perfection of any security interest or
Lien contemplated by this Agreement or any other Loan Document, and (e) all
other costs and expenses incurred by the Agent and the Issuing Bank in
connection with this Agreement or any other Loan Document, including without
limitation all reasonable costs and expenses associated with appraisals,
environmental reports and any other collateral reviews performed in connection
with this Agreement, any other Loan Document or the transactions contemplated
therein.
INDEMNIFICATION. THE BORROWER HEREBY AGREES TO INDEMNIFY THE AGENT, THE ISSUING
BANK AND EACH LENDER AND EACH AFFILIATE THEREOF AND THEIR RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES, ATTORNEYS, AND AGENTS FROM, AND HOLD EACH OF THEM HARMLESS
AGAINST, ANY AND ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS,
DISBURSEMENTS, COSTS, AND EXPENSES (INCLUDING REASONABLE ATTORNEYS' FEES) TO
WHICH ANY OF THEM MAY BECOME SUBJECT WHICH DIRECTLY OR INDIRECTLY ARISE FROM OR
RELATE TO (a) THE NEGOTIATION, EXECUTION, DELIVERY, PERFORMANCE, ADMINISTRATION,
OR ENFORCEMENT OF ANY OF THE LOAN DOCUMENTS, (b) ANY OF THE TRANSACTIONS
CONTEMPLATED BY THE LOAN DOCUMENTS, (c) ANY BREACH BY THE BORROWER OF ANY
REPRESENTATION, WARRANTY, COVENANT, OR OTHER AGREEMENT CONTAINED IN ANY OF THE
LOAN DOCUMENTS, (d) THE PRESENCE, RELEASE, THREATENED RELEASE, DISPOSAL,
REMOVAL, OR CLEANUP OF ANY HAZARDOUS MATERIAL LOCATED ON, ABOUT, WITHIN, OR
AFFECTING ANY OF THE PROPERTIES OR ASSETS OF THE BORROWER OR ANY SUBSIDIARY, (e)
THE USE OR PROPOSED USE OF ANY LETTER OF CREDIT, (f) ANY AND ALL TAXES, LEVIES,
DEDUCTIONS, AND CHARGES IMPOSED ON THE ISSUING BANK OR ANY OF THE ISSUING BANK'S
CORRESPONDENTS IN RESPECT OF ANY LETTER OF CREDIT, OR (g) ANY INVESTIGATION,
LITIGATION, OR OTHER PROCEEDING, INCLUDING, WITHOUT LIMITATION, ANY THREATENED
INVESTIGATION, LITIGATION, OR OTHER PROCEEDING RELATING TO ANY OF THE FOREGOING
AND ANY LEGAL PROCEEDING RELATING TO ANY COURT ORDER, INJUNCTION OR OTHER
PROCESS OR DECREE RESTRAINING OR SEEKING TO RESTRAIN THE ISSUING BANK FROM
PAYING ANY AMOUNT UNDER ANY LETTER OF CREDIT. WITHOUT LIMITING ANY PROVISION OF
THIS AGREEMENT OR OF ANY OTHER LOAN DOCUMENT, IT IS THE EXPRESS INTENTION OF THE
PARTIES HERETO THAT EACH PERSON TO BE INDEMNIFIED UNDER THIS SECTION SHALL BE
INDEMNIFIED FROM AND HELD HARMLESS AGAINST ANY AND ALL LOSSES, LIABILITIES,
CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS, AND EXPENSES
(INCLUDING REASONABLE ATTORNEYS' FEES) ARISING
64
OUT OF OR RESULTING FROM THE SOLE OR CONTRIBUTORY NEGLIGENCE OF SUCH PERSON;
PROVIDED HOWEVER, NO PERSON SHALL BE INDEMNIFIED HEREUNDER FOR ITS OWN GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT.
Limitation of Liability. None of the Agent, the Issuing Bank, any Lender, or any
Affiliate, officer, director, employee, attorney, or agent thereof shall have
any liability with respect to, and the Borrower hereby waives, releases, and
agrees not to xxx any of them upon, any claim for any special, indirect,
incidental, or consequential damages suffered or incurred by the Borrower in
connection with, arising out of, or in any way related to, this Agreement or any
of the other Loan Documents, or any of the transactions contemplated by this
Agreement or any of the other Loan Documents, including without limitation, any
damages suffered or incurred by the Borrower in connection with Swing Loan
Advances made by telephonic notice pursuant to Section 2.8(a) hereto, except for
such Person's gross negligence or willful misconduct.
No Duty. All attorneys, accountants, appraisers, and other professional Persons
and consultants retained by the Agent, the Issuing Bank and the Lenders shall
have the right to act exclusively in the interest of the Agent, the Issuing Bank
and the Lenders and shall have no duty of disclosure, duty of loyalty, duty of
care, or other duty or obligation of any type or nature whatsoever to the
Borrower or any of the Borrower's shareholders or any other Person.
No Fiduciary Relationship. The relationship between the Borrower and each of the
Issuing Bank and the Lenders is solely that of debtor and creditor, and neither
the Agent, the Issuing Bank nor any Lender has any fiduciary or other special
relationship with the Borrower, and no term or condition of any of the Loan
Documents shall be construed so as to deem the relationship between the Borrower
and any of the Issuing Bank and the Lenders to be other than that of debtor and
creditor.
Equitable Relief. The Borrower recognizes that in the event the Borrower fails
to pay, perform, observe, or discharge any or all of the Obligations, any remedy
at law may prove to be inadequate relief to the Agent, the Issuing Bank and the
Lenders. The Borrower therefore agrees that the Agent, the Issuing Bank and the
Lenders, if the Agent, the Issuing Bank or the Lenders so request, shall be
entitled to temporary and permanent injunctive relief in any such case without
the necessity of proving actual damages.
No Waiver; Cumulative Remedies. No failure on the part of the Agent, the Issuing
Bank or any Lender to exercise and no delay in exercising, and no course of
dealing with respect to, any right, power, or privilege under this Agreement
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, power, or privilege under this Agreement preclude any other or
further exercise thereof or the exercise of any other right, power, or
privilege. The rights and remedies provided for in this Agreement and the other
Loan Documents are cumulative and not exclusive of any rights and remedies
provided by law.
Successors and Assigns.
This Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns. The Borrower may not assign
or transfer any of its rights or obligations hereunder without the prior written
consent of the Agent, the Issuing Bank and all of the Lenders. Any Lender may
sell participations to one or more banks or other institutions in or to all or a
portion of its rights and obligations under this Agreement and the other Loan
65
Documents (including, without limitation, all or a portion of its Commitments
and the Advances owing to it and the LC Participations held by it); provided,
however, that (i) such Lender's obligations under this Agreement and the other
Loan Documents (including, without limitation, its Commitments) shall remain
unchanged, (ii) such Lender shall remain solely responsible to the Borrower for
the performance of such obligations, (iii) such Lender shall remain the holder
of its Note and LC Participations for all purposes of this Agreement, (iv) the
Borrower shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement and
the other Loan Documents, and (v) such Lender shall not sell a participation
that conveys to the participant the right to vote or give or withhold consents
under this Agreement or any other Loan Document, other than the right to vote
upon or consent to (A) any increase of such Lender's Commitments, (B) any
reduction of the principal amount of, or interest to be paid on, the Advances
and LC Participations of such Lender, (C) any reduction of any commitment fee or
other amount payable to such Lender under any Loan Document, or (D) any
postponement of any date for the payment of any amount payable in respect of the
Advances or LC Participations of such Lender.
The Borrower and each of the Issuing Bank and the Lenders agree that any Lender
(the "Assigning Lender") may at any time assign to one or more Eligible
Assignees all, or a proportionate part of all, of its rights and obligations
under this Agreement and the other Loan Documents (including, without
limitation, its Commitments and Advances and LC Participations) (each an
"Assignee"); provided, however, that (i) each such assignment shall be of a
consistent, and not a varying, percentage of all of the Assigning Lender's
rights and obligations under this Agreement and the other Loan Documents, (ii)
except in the case of an assignment of all of a Lender's rights and obligations
under this Agreement and the other Loan Documents, the amount of the Commitments
of the Assigning Lender being assigned pursuant to each assignment (determined
as of the date of the Assignment and Acceptance with respect to such assignment)
shall in no event be less than $2,500,000, and (iii) the parties to each such
assignment shall execute and deliver to the Agent for its acceptance and
recording in the Register (as defined below), an Assignment and Acceptance,
together with the Note subject to such assignment, and a processing and
recordation fee of $3,000. Upon such execution, delivery, acceptance, and
recording, from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be at least five Business Days after the
execution thereof, or, if so specified in such Assignment and Acceptance, the
date of acceptance thereof by the Agent, (x) the assignee thereunder shall be a
party hereto as a "Lender" and, to the extent that rights and obligations
hereunder have been assigned to it pursuant to such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder and under the Loan
Documents and (y) the Assigning Lender shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights and be released from its obligations under
this Agreement and the other Loan Documents (and, in the case of an Assignment
and Acceptance covering all or the remaining portion of an Assigning Lender's
rights and obligations under the Loan Documents, such Assigning Lender shall
cease to be a party thereto).
By executing and delivering an Assignment and Acceptance, the Assigning Lender
and the Assignee thereunder confirm to and agree with each other and the other
parties hereto as follows: (i) other than as provided in such Assignment and
Acceptance, such Assigning Lender makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties, or
representations made in or in connection with the Loan Documents or the
66
execution, legality, validity, and enforceability, genuineness, sufficiency, or
value of the Loan Documents or any other instrument or document furnished
pursuant thereto; (ii) such Assigning Lender makes no representation or warranty
and assures no responsibility with respect to the financial condition of the
Borrower or any Obligated Party or the performance or observance by the Borrower
or any Obligated Party of its obligations under the Loan Documents; (iii) such
assignee confirms that it has received a copy of the Loan Documents, together
with copies of the financial statements referred to in Section 7.2 and such
other documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and Acceptance; (iv)
such assignee will, independently and without reliance upon the Agent, the
Issuing Bank or any Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Loan Documents;
(v) such assignee confirms that it is an Eligible Assignee; (vi) such assignee
appoints and authorizes the Agent to take such action as agent on its behalf and
exercise such powers under the Loan Documents are as delegated to the Agent by
the terms thereof, together with such powers as are reasonably incidental
thereto; and (vii) such assignee agrees that it will perform in accordance with
their terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.
The Agent shall maintain at its Principal Office a copy of each Assignment and
Acceptance delivered to and accepted by it and a register for the recordation of
the names and addresses of the Lenders and the Commitments of, and principal
amount of the Advances owing to, and LC Participations held by, each Lender from
time to time (the "Register"). The entries in the Register shall be conclusive
and binding for all purposes, absent manifest error, and the Borrower, the
Agent, the Issuing Bank and the Lenders may treat each Person whose name is
recorded in the Register as a Lender hereunder for all purposes under the Loan
Documents. The Register shall be available for inspection by the Borrower, any
Lender or the Issuing Bank at any reasonable time and from time to time upon
reasonable prior notice.
Upon its receipt of an Assignment and Acceptance executed by an Assigning Lender
and assignee representing that it is an Eligible Assignee, together with any
Note subject to such assignment, the Agent shall, if such Assignment and
Acceptance has been completed and is in substantially the form of Exhibit G
hereto, (i) accept such Assignment and Acceptance, (ii) record the information
contained therein in the Register, and (iii) give prompt written notice thereof
to the Borrower. Within five Business Days after its receipt of such notice, the
Borrower, at its expense, shall execute and deliver to the Agent in exchange for
the surrendered Note a new Note to the order of such Eligible Assignee in an
amount equal to the Commitments assumed by it pursuant to such Assignment and
Acceptance and, if the Assigning Lender has retained a Commitment, a new Note to
the order of the Assigning Lender in an amount equal to the Commitments retained
by it hereunder (each such promissory note shall constitute a "Note" for
purposes of the Loan Documents). Such new Notes shall be in an aggregate
principal amount of the surrendered Note, shall be dated the effective date of
such Assignment and Acceptance, and shall otherwise be in substantially the form
of Exhibit A or B, as applicable.
Any Lender may, in connection with any assignment or participation or proposed
assignment or participation pursuant to this Section, disclose to the assignee
or participant or proposed assignee or participant, any information relating to
the Borrower or its Subsidiaries furnished to such Lender by or on behalf of the
Borrower or its Subsidiaries.
67
Survival. All representations and warranties made in this Agreement or any other
Loan Document or in any document, statement, or certificate furnished in
connection with this Agreement shall survive the execution and delivery of this
Agreement and the other Loan Documents, and no investigation by the Agent, the
Issuing Bank or any Lender or any closing shall affect the representations and
warranties or the right of the Agent, the Issuing Bank or any Lender to rely
upon them. Without prejudice to the survival of any other obligation of the
Borrower hereunder, the obligations of the Borrower under Article V and Sections
13.1 and 13.2 shall survive repayment of the Notes and termination of the
Commitments and the Letters of Credit.
Amendments, Etc. No amendment or waiver of any provision of this Agreement, the
Notes, or any other Loan Document to which the Borrower or any Obligated Party
is a party, nor any consent to any departure by the Borrower or Obligated Party
therefrom, shall in any event be effective unless the same shall be agreed or
consented to by Required Lenders and the Borrower or the Obligated Party, as
applicable, and each such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided, that
no amendment, waiver, or consent shall: (a) increase the Commitment of any
Lender or subject any Lender to any additional obligations without the written
consent of such Lender; (b) reduce the principal of, or interest on, the Notes
or any fees or other amounts due to the Lenders (or any of them) hereunder or
under any other Loan Document without the written consent of each Lender
directly affected thereby; (c) postpone any date fixed for any payment of
principal of, or interest on, the Notes or Letter of Credit Disbursements or any
fees or other amounts due to the Lenders (or any of them) hereunder or under any
other Loan Document without the written consent of each Lender directly affected
thereby; (d) waive any of the conditions specified in Article VI without the
written consent of each Lender; (e) change the percentage of the Commitments or
of the aggregate unpaid principal amount of the Notes or Letter of Credit
Liabilities or the number of Lenders which shall be required for the Lenders or
any of them to take any action under this Agreement without the written consent
of each Lender; (f) change any provision contained in this Section 13.10 without
the written consent of each Lender; (g) release the Borrower from any of its
obligations under this Agreement or the other Loan Documents or release any
Guarantor from its obligations under its Guaranty without the written consent of
each Lender; and (h) release any Collateral securing the Obligations except in
accordance with and as contemplated by the Loan Documents without the written
consent of each Lender. Notwithstanding anything to the contrary contained in
this Section, no amendment, waiver, or consent shall be made (a) with respect to
Article XII hereof without the prior written consent of the Agent, (b) with
respect to Section 2.8 hereof without the prior written consent of the Swing
Lender, or (c) with respect to Article III hereof without the prior written
consent of the Issuing Bank.
Maximum Interest Rate. No provision of this Agreement or of any other Loan
Document shall require the payment or the collection of interest in excess of
the maximum amount permitted by applicable law. If any excess of interest in
such respect is hereby provided for, or shall be adjudicated to be so provided,
in any Loan Document or otherwise in connection with this loan transaction, the
provisions of this Section shall govern and prevail and neither the Borrower nor
the sureties, guarantors, successors, or assigns of the Borrower shall be
obligated to pay the excess amount of such interest or any other excess sum paid
for the use, forbearance, or detention of sums loaned pursuant hereto. In the
event any Lender ever receives, collects, or applies as interest any such sum,
such amount which would be in excess of the maximum
68
amount permitted by applicable law shall be applied as a payment and reduction
of the principal of the indebtedness evidenced by the Notes and the LC
Participations; and, if the principal of the Notes and the LC Participations has
been paid in full, any remaining excess shall forthwith be paid to the Borrower.
In determining whether or not the interest paid or payable exceeds the Maximum
Rate, the Borrower and each Lender shall, to the extent permitted by applicable
law, (a) characterize any non-principal payment as an expense, fee, or premium
rather than as interest, (b) exclude voluntary prepayments and the effects
thereof, and (c) amortize, prorate, allocate, and spread the total amount of
interest throughout the entire contemplated term of the indebtedness evidenced
by the Notes and LC Participations so that interest for the entire term does not
exceed the Maximum Rate.
Notices. Except as provided in Sections 2.8 and 8.1(m), all notices and other
communications provided for in this Agreement and the other Loan Documents to
which the Borrower or any Guarantor is a party shall be given or made by telex,
telegraph, telecopy, cable, electronic mail or other electronic media or in
writing and telexed, telecopied, telegraphed, cabled, mailed by certified mail
return receipt requested, or delivered to the intended recipient at the "Address
for Notices" specified below its name on the signature pages hereof or any other
Loan Document, or, as to any party at such other address as shall be designated
by such party in a notice to each other party given in accordance with this
Section. Except as otherwise provided in this Agreement, all such communications
shall be deemed to have been duly given when transmitted by telex or telecopy or
electronic mail or other electronic media, subject to telephone confirmation of
receipt, or delivered to the telegraph or cable office electronic mail address,
subject to telephone confirmation of receipt, or when personally delivered or,
in the case of a mailed notice, when duly deposited in the mails, in each case
given or addressed as aforesaid; provided, however, notices to the Agent
pursuant to Article II and to the Issuing Bank pursuant to Article III shall not
be effective until received by the Agent or the Issuing Bank, as applicable.
Governing Law; Venue; Service of Process. This Agreement shall be governed by
and construed in accordance with the laws of the State of Texas and the
applicable laws of the United States of America. This Agreement has been entered
into in Xxxxxx County, Texas, and it shall be performable for all purposes in
Xxxxxx County, Texas. Subject to Section 13.14 of this Agreement, any action or
proceeding against the Borrower under or in connection with any of the Loan
Documents may be brought in any state or federal court in Xxxxxx County, Texas.
The Borrower hereby irrevocably (a) submits to the nonexclusive jurisdiction of
such courts, and (b) waives any objection it 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. The Borrower agrees that service of process
upon it may be made by certified or registered mail, return receipt requested,
at its address specified or determined in accordance with the provisions of
Section 13.12. Nothing herein or in any of the other Loan Documents shall affect
the right of the Agent, the Issuing Bank or any Lender to serve process in any
other manner permitted by law or shall limit the right of the Agent, the Issuing
Bank or any Lender to bring any action or proceeding against the Borrower or
with respect to any of its property in courts in other jurisdictions. Subject to
Section 13.14 of this Agreement, any action or proceeding by the Borrower
against the Agent, the Issuing Bank or any Lender shall be brought only in a
court located in Xxxxxx County, Texas.
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Binding Arbitration.
Arbitration. The parties hereto agree, upon demand by any party, to submit to
binding arbitration all claims, disputes and controversies between or among them
(and their respective employees, officers, directors, attorneys, and other
agents), whether in tort, contract or otherwise arising out of or relating to in
any way (i) the loan and related Loan Documents which are the subject of this
Agreement and its negotiation, execution, collateralization, administration,
repayment, modification, extension, substitution, formation, inducement,
enforcement, default or termination; or (ii) requests for additional credit.
Governing Rules. Any arbitration proceeding will (i) proceed in a location in
Texas selected by the American Arbitration Association ("AAA"); (ii) be governed
by the Federal Arbitration Act (Title 9 of the United States Code),
notwithstanding any conflicting choice of law provision in any of the documents
between the parties; and (iii) be conducted by the AAA, or such other
administrator as the parties shall mutually agree upon, in accordance with the
AAA's commercial dispute resolution procedures, unless the claim or counterclaim
is at least $1,000,000.00 exclusive of claimed interest, arbitration fees and
costs in which case the arbitration shall be conducted in accordance with the
AAA's optional procedures for large, complex commercial disputes (the commercial
dispute resolution procedures or the optional procedures for large, complex
commercial disputes to be referred to, as applicable, as the "Rules"). If there
is any inconsistency between the terms hereof and the Rules, the terms and
procedures set forth herein shall control. Any party who fails or refuses to
submit to arbitration following a demand by any other party shall bear all costs
and expenses incurred by such other party in compelling arbitration of any
dispute. Nothing contained herein shall be deemed to be a waiver by any party
that is a bank of the protections afforded to it under 12 U.S.C. Section 91 or
any similar applicable state law.
No Waiver of Provisional Remedies, Self-Help and Foreclosure. The arbitration
requirement does not limit the right of any party to (i) foreclose against real
or personal property collateral; (ii) exercise self-help remedies relating to
collateral or proceeds of collateral such as setoff or repossession; or (iii)
obtain provisional or ancillary remedies such as replevin, injunctive relief,
attachment or the appointment of a receiver, before during or after the pendency
of any arbitration proceeding. This exclusion does not constitute a waiver of
the right or obligation of any party to submit any dispute to arbitration or
reference hereunder, including those arising from the exercise of the actions
detailed in clauses (i), (ii) and (iii) of this Section 13.14(c).
Arbitrator Qualifications and Powers. Any arbitration proceeding in which the
amount in controversy is $5,000,000.00 or less will be decided by a single
arbitrator selected according to the Rules, and who shall not render an award of
greater than $5,000,000.00. Any dispute in which the amount in controversy
exceeds $5,000,000.00 shall be decided by majority vote of a panel of three
arbitrators; provided however, that all three arbitrators must actively
participate in all hearings and deliberations. The arbitrator will be a neutral
attorney licensed in the State of Texas with a minimum of ten years experience
in the substantive law applicable to the subject matter of the dispute to be
arbitrated. The arbitrator will determine whether or not an issue is
arbitratable and will give effect to the statutes of limitation in determining
any claim. In any arbitration proceeding the arbitrator will decide (by
documents only or with a hearing at the arbitrator's discretion) any pre-hearing
motions which are similar to motions to dismiss for failure to state a claim or
motions for summary adjudication. The arbitrator shall resolve all disputes in
accordance with the substantive law of Texas and may grant any remedy or relief
that
70
a court of such state could order or grant within the scope hereof and such
ancillary relief as is necessary to make effective any award. The arbitrator
shall also have the power to award recovery of all costs and fees, to impose
sanctions and to take such other action as the arbitrator deems necessary to the
same extent a judge could pursuant to the Federal Rules of Civil Procedure, the
Texas Rules of Civil Procedure or other applicable law. Judgment upon the award
rendered by the arbitrator may be entered in any court having jurisdiction. The
institution and maintenance of an action for judicial relief or pursuit of a
provisional or ancillary remedy shall not constitute a waiver of the right of
any party, including the plaintiff, to submit the controversy or claim to
arbitration if any other party contests such action for judicial relief.
Discovery. In any arbitration proceeding discovery will be permitted in
accordance with the Rules. All discovery shall be expressly limited to matters
directly relevant to the dispute being arbitrated and must be completed no later
than 20 days before the hearing date and within 180 days of the filing of the
dispute with the AAA. Any requests for an extension of the discovery periods, or
any discovery disputes, will be subject to final determination by the arbitrator
upon a showing that the request for discovery is essential for the party's
presentation and that no alternative means for obtaining information is
available.
Class Proceedings and Consolidations. The resolution of any dispute arising
pursuant to the terms of this Agreement shall be determined by a separate
arbitration proceeding and such dispute shall not be consolidated with other
disputes or included in any class proceeding.
Payment Of Arbitration Costs And Fees. The arbitrator shall award all costs and
expenses of the arbitration proceeding.
Miscellaneous. To the maximum extent practicable, the AAA, the arbitrators and
the parties shall take all action required to conclude any arbitration
proceeding within 180 days of the filing of the dispute with the AAA. No
arbitrator or other party to an arbitration proceeding may disclose the
existence, content or results thereof, except for disclosures of information by
a party required in the ordinary course of its business or by applicable law or
regulation. If more than one agreement for arbitration by or between the parties
potentially applies to a dispute, the arbitration provision most directly
related to the Loan Documents or the subject matter of the dispute shall
control. This arbitration provision shall survive termination, amendment or
expiration of any of the Loan Documents or any relationship between the parties.
Counterparts. This Agreement may be executed in one or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument. Signatures hereby transmitted by facsimile or other
electronic means shall be effective as originals.
Severability. Any provision of this Agreement held by a court of competent
jurisdiction to be invalid or unenforceable shall not impair or invalidate the
remainder of this Agreement and the effect thereof shall be confined to the
provision held to be invalid or illegal.
Headings. The headings, captions, and arrangements used in this Agreement are
for convenience only and shall not affect the interpretation of this Agreement.
71
Non-Application of Chapter 346 of Texas Finance Code. The provisions of Chapter
346 of the Texas Finance Code are specifically declared by the parties hereto
not to be applicable to this Agreement or any of the other Loan Documents or to
the transactions contemplated hereby.
Construction. The Borrower, the Agent, the Issuing Bank and each Lender
acknowledges that each of them has had the benefit of legal counsel of its own
choice and has been afforded an opportunity to review this Agreement and the
other Loan Documents with its legal counsel and that this Agreement and the
other Loan Documents shall be construed as if jointly drafted by the parties
hereto.
Independence of Covenants. All covenants hereunder shall be given independent
effect so that if a particular action or condition is not permitted by any of
such covenants, the fact that it would be permitted by an exception to, or be
otherwise within the limitations of, another covenant shall not avoid the
occurrence of a Default if such action is taken or such condition exists.
Confidentiality. The Agent and each Lender (each, a "Lending Party") agrees to
keep confidential any information furnished or made available to it by the
Borrower pursuant to this Agreement that is marked confidential; provided that
nothing herein shall prevent any Lending Party from disclosing such information
(a) to any other Lending Party or any affiliate of any Lending Party, or any
officer, director, employee, agent, or advisor of any Lending Party or affiliate
of any Lending Party, (b) to any other Person if reasonably incidental to the
administration of the credit facility provided herein, (c) as required by any
law, rule, or regulation, (d) upon the order of any court or administrative
agency, (e) upon the request or demand of any regulatory agency or authority,
(f) that is or becomes available to the public or that is or becomes available
to any Lending Party other than as a result of a disclosure by any Lending Party
prohibited by this Agreement, (g) in connection with any litigation to which
such Lending Party or any of its affiliates may be a party, (h) to the extent
necessary in connection with the exercise of any remedy under this Agreement or
any other Loan Document, and (i) subject to provisions substantially similar to
those contained in this Section, to any actual or proposed participant or
assignee.
WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH OF
THE PARTIES HERETO HEREBY IRREVOCABLY AND EXPRESSLY WAIVES ALL RIGHT TO A TRIAL
BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT,
TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS OR
THE TRANSACTIONS CONTEMPLATED THEREBY OR THE ACTIONS OF THE AGENT, THE ISSUING
BANK, OR ANY LENDER IN THE NEGOTIATION, ADMINISTRATION, OR ENFORCEMENT THEREOF.
ENTIRE AGREEMENT. THIS AGREEMENT, THE NOTES, AND THE OTHER LOAN DOCUMENTS
REFERRED TO HEREIN REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES HERETO AND
MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES HERETO.
Amendment and Restatement; Release. This Agreement amends and restates in its
entirety the Existing Credit Agreement. The execution of this Agreement and the
other Loan Documents
72
executed in connection herewith does not extinguish the indebtedness outstanding
in connection with the Existing Credit Agreement nor does it constitute a
novation with respect to such indebtedness. THE BORROWER REPRESENTS AND WARRANTS
THAT AS OF THE DATE HEREOF THERE ARE NO CLAIMS OR OFFSETS AGAINST OR DEFENSES OR
COUNTERCLAIMS TO ITS OR ANY OBLIGATED PARTIES' OBLIGATIONS UNDER THE EXISTING
CREDIT AGREEMENT, THE OTHER LOAN DOCUMENTS AND THE DOCUMENTATION RELATING TO THE
DEPOSIT AND CASH MANAGEMENT SERVICES. TO INDUCE THE AGENT, THE ISSUING BANK AND
THE LENDERS TO ENTER INTO THIS AGREEMENT, THE BORROWER AND, BY THE EXECUTION OF
THE LOAN DOCUMENTS TO WHICH IT IS A PARTY, EACH OBLIGATED PARTY WAIVES ANY AND
ALL CLAIMS, OFFSETS, DEFENSES OR COUNTERCLAIMS, WHETHER KNOWN OR UNKNOWN,
ARISING PRIOR TO THE DATE HEREOF AND HEREBY RELEASES THE AGENT, THE LENDERS, THE
ISSUING BANK AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS AND
ATTORNEYS (COLLECTIVELY, THE "RELEASED PARTIES") FROM ANY AND ALL OBLIGATIONS,
INDEBTEDNESS, LIABILITY, CLAIMS, RIGHTS, CAUSES OF ACTION OR DEMANDS WHATSOEVER,
WHETHER KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED WHICH THE BORROWER OR ANY
OBLIGATED PARTY EVER HAD, NOW HAS, CLAIMS TO HAVE OR MAY HAVE AGAINST ANY
RELEASED PARTY ARISING PRIOR TO THE DATE HEREOF OR FROM OR IN CONNECTION WITH
THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR ANY DOCUMENTATION RELATING TO THE
DEPOSIT AND CASH MANAGEMENT SERVICES OR THE TRANSACTIONS CONTEMPLATED THEREBY.
[Remainder of Page Intentionally Left Blank.]
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
BORROWER:
EZCORP, INC.
By:
------------------------------------
Xxx X. Xxxxxxxx
Senior VP and Chief Financial Officer
74
AGENT:
XXXXX FARGO BANK TEXAS, NATIONAL
ASSOCIATION
By:
--------------------------------------
Xxxxxxx Xxx
Vice President
75
ISSUING BANK:
XXXXX FARGO BANK TEXAS, NATIONAL
ASSOCIATION
By:
--------------------------------------
Xxxxxxx Xxx
Vice President
76
LENDERS:
XXXXX FARGO BANK TEXAS, NATIONAL
ASSOCIATION
By:
--------------------------------------
Xxxxxxx Xxx
Vice President
77
GUARANTY BANK
By:
--------------------------------------
Xxxxx Xxxxxxxxx
Vice President
78
JPMORGAN CHASE BANK
By:
--------------------------------------
Xxxxx X. Shilcutt
Vice President
79
BANK ONE, NA
By:
--------------------------------------
Xxxx Xxxxxx
Vice President
80
COMERICA BANK-TEXAS
By:
--------------------------------------
Xxxxx Xxxx
Vice President
81
