EXHIBIT 10.11
REVOLVING CREDIT AGREEMENT
Dated as of __________ __, 1996
MONEYGRAM PAYMENT SYSTEMS, INC., a Delaware corporation (the "Borrower"),
and FIRST DATA CORPORATION, a Delaware corporation (the "Lender"), agree as
follows:
ARTICLE I
AMOUNTS AND TERMS OF THE ADVANCES
Section 1.01. The Advances. The Lender agrees, on the terms and
conditions hereinafter set forth, to make advances (the "Advances") to the
Borrower from time to time during the period from the date hereof until January
15, 1997 (such date, or the earlier date of termination of the Commitment (as
defined below) pursuant to Section 5.01, being the "Termination Date") in an
aggregate amount not to exceed at any time outstanding $20,000,000 (the
"Commitment"). Each Advance shall be in an amount not less than $500,000 or an
integral multiple of $100,000 in excess thereof, except that an Advance may be
in an amount equal to the entire unused Commitment. Within the limits of the
Commitment, the Borrower may borrow, prepay pursuant to Section 1.04 and
reborrow under this Section 1.01.
SECTION 1.02. Making the Advances. Each Advance shall be made on notice,
given not later than 11:00 A.M. (Denver time) on the fourth Business Day prior
to the date of the proposed Advance, by the Borrower to the Lender, specifying
the date and amount thereof. Not later than 12:00 P.M. (Denver time) on the
date of such Advance and upon fulfillment of the applicable conditions set forth
in Article II, the Lender will make such Advance available to the Borrower in
U.S. dollars at the Lender's address referred to in Section 6.02 in same day
funds. Each notice from the Borrower to the Lender requesting an Advance shall
be irrevocable and binding on the Borrower.
SECTION 1.03. Interest and Repayment. The Borrower shall repay, and shall
pay interest on, the aggregate unpaid principal amount of all Advances in
accordance with a promissory note of the Borrower, in substantially the form of
Exhibit A hereto (the "Note"), evidencing the indebtedness resulting from such
Advances and delivered to the Lender pursuant to Article II.
SECTION 1.04. Optional Prepayments. The Borrower may, upon at least four
Business Days' notice to the Lender stating
the proposed date and principal amount of the prepayment, and if such notice is
given the Borrower shall, prepay the outstanding principal amounts of the
Advances in whole or in part, together with accrued interest to the date of such
prepayment on the principal amount prepaid; provided, however, that each partial
prepayment shall be in a principal amount not less than $100,000.
SECTION 1.05. Mandatory Prepayments. Within three (3) Business Days after
receipt by the Borrower or any subsidiary of the Borrower of any cash proceeds
from the issuance of indebtedness for borrowed money, the Borrower shall make or
cause to be made a mandatory prepayment in an amount equal to the lesser of (i)
such cash proceeds (net of any financing charges associated therewith) and (ii)
the outstanding Commitment in effect at that time. Upon the Lender's receipt of
any mandatory prepayment made pursuant to this Section 1.05, the outstanding
Commitment shall be automatically reduced by the amount of such mandatory
prepayment.
SECTION 1.06. Payments and Computations. The Borrower shall make each
payment hereunder and under the Note not later than 11:00 A.M. (Denver time) on
the day when due in U.S. dollars to the Lender at its address referred to in
Section 6.02 in same day funds. All computations of interest shall be made by
the Lender on the basis of a year of 366 days, as the case may be, in each case
for the actual number of days (including the first day but excluding the last
day) occurring in the period for which such interest is payable. Each
determination by the Lender of an interest rate hereunder shall be conclusive
and binding for all purposes, absent manifest error.
SECTION 1.07. Payment on Non-Business Days. Whenever any payment
hereunder or under the Note shall be stated to be due on a day other than a day
of the year on which banks are not required or authorized to close in Denver
(any such other day being a "Business Day"), such payment shall be made on the
next succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest.
ARTICLE II
CONDITIONS OF LENDING
SECTION 2.01. Conditions Precedent to Initial Advance. The obligation of
the Lender to make its initial Advance is subject to the condition precedent
that the Lender shall have
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received on or before the day of such Advance the following, each dated such
day, in form and substance satisfactory to the Lender:
(a) This Agreement.
(b) The Note.
(c) Certified copies of the resolutions of the Board of Directors of the
Borrower approving this Agreement and the Note, and of all documents evidencing
other necessary corporate action and governmental approvals, if any, with
respect to this Agreement and the Note.
(d) A certificate of the Secretary or an Assistant Secretary of the
Borrower certifying (i) the names and true signatures of the officers of the
Borrower authorized to sign this Agreement and the Note and the other documents
to be delivered by it hereunder, (ii) copies attached thereto of the Certificate
of Incorporation of the Borrower and the By-Laws of the Borrower.
SECTION 2.02. Conditions Precedent to All Advances. The obligation of the
Lender to make each Advance (including the initial Advance) shall be subject to
the further conditions precedent that on the date of such Advance (a) the
following statements shall be true (and each giving of the applicable notice
requesting such Advance and the acceptance by the Borrower of the proceeds of
such Advance shall constitute a representation and warranty by the Borrower that
on the date of such Advance such statements are true):
(i) The representations and warranties contained in Section 3.01 of
this Agreement are correct on and as of the date of such Advance, before
and after giving effect to such Advance and to the application of the
proceeds therefrom, as though made on and as of such date; and
(ii) No event has occurred and is continuing, or would result from
such Advance or from the application of the proceeds therefrom, which
constitutes an Event of Default (as defined in Section 5.01) or would
constitute an Event of Default but for the requirement that notice be given
or time elapse or both;
and (b) the Lender shall have received such other approvals, opinions or
documents as the Lender may reasonably request.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.01. Representations and Warranties of the Borrower. The Borrower
represents and warrants as follows:
(a) The Borrower is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware.
(b) The execution, delivery and performance by the Borrower of this
Agreement and the Note are within the Borrower's corporate powers, have been
duly authorized by all necessary corporate action, and do not contravene (i) the
Borrower's Certificate of Incorporation or By-Laws or (ii) law or any
contractual restriction binding on or affecting the Borrower.
(c) No authorization or approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body is required for
the due execution, delivery and performance by the Borrower of this Agreement
and the Note.
(d) This Agreement and the Note are legal, valid and binding
obligations of the Borrower enforceable against the Borrower in accordance with
their respective terms.
ARTICLE IV
COVENANTS OF THE BORROWER
SECTION 4.01. Affirmative Covenants. So long as the Note shall remain
unpaid or the Lender shall have any Commitment hereunder, the Borrower will,
unless the Lender shall otherwise consent in writing:
(a) Compliance with Laws, Etc. Comply, and cause each of its
subsidiaries to comply, in all material respects with all applicable laws,
rules, regulations and orders, such compliance to include, without limitation,
paying before the same become delinquent all taxes, assessments and governmental
charges imposed upon it or upon its property except to the extent contested in
good faith.
(b) Reporting Requirements. Furnish to the Lender:
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(i) promptly after the sending or filing thereof, copies of all
reports which the Borrower sends to any of its security holders, and copies
of all reports and registration statements which the Borrower or any
subsidiary files with the Securities and Exchange Commission or any
national securities exchange; and
(ii) as soon as possible and in any event within five days after the
occurrence of each Event of Default and each event which, with the giving
of notice or lapse of time, or both, would constitute an Event of Default,
continuing on the date of such statement, a statement of the chief
financial officer of the Borrower setting forth details of such Event of
Default or event and the action which the Borrower has taken and proposes
to take with respect thereto.
SECTION 4.02. Negative Covenants. So long as the Note shall remain
unpaid or the Lender shall have any Commitment hereunder, the Borrower will not,
without the written consent of the Lender, which consent will not be
unreasonably withheld:
(a) Liens, Etc. Create or suffer to exist, or permit any of its
subsidiaries to create or suffer to exist, any lien, security interest or other
charge or encumbrance, or any other type of preferential arrangement, upon or
with respect to any of its properties, whether now owned or hereafter acquired,
or assign, or permit any of its subsidiaries to assign, any right to receive
income, in each case to secure or provide for the payment of any Debt (as
defined below in this subsection (a)) of any person or entity, other than (i)
purchase money liens or purchase money security interests upon or in any
property acquired or held by the Borrower or any subsidiary in the ordinary
course of business to secure the purchase price of such property or to secure
indebtedness incurred solely for the purpose of financing the acquisition of
such property, or (ii) liens or security interests existing on such property at
the time of its acquisition (other than any such lien or security interest
created in contemplation of such acquisition).
"Debt" means (i) indebtedness for borrowed money, (ii) obligations
evidenced by bonds, debentures, notes or other similar instruments, (iii)
obligations to pay the deferred purchase price of property or services, (iv)
obligations as lessee under leases which shall have been or should be, in
accordance with generally accepted accounting principles, recorded as capital
leases, and (v) obligations under direct or indirect guaranties in respect of,
and obligations under direct
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or indirect guaranties in respect of, and obligations (contingent or otherwise)
to purchase or otherwise acquire, or otherwise to assure a creditor against loss
in respect of, indebtedness or obligations of others of the kinds referred to in
clauses (i) through (iv) above.
(b) Dividends, Etc. Declare or make any dividend payment or other
distribution of assets, properties, cash, rights, obligations or securities on
account of any shares of any class of capital stock of the Borrower, or
purchase, redeem or otherwise acquire for value (or permit any of its
subsidiaries to do so) any shares of any class of capital stock of the Borrower
or any warrants, rights or options to acquire any such shares, now or hereafter
outstanding, except that the Borrower may (i) declare and may any dividend
payment or other distribution payable in common stock of the Borrower, (ii)
purchase, redeem or otherwise acquire shares of its common stock or warrants,
rights or options to acquire any such shares with the proceeds received from the
substantially concurrent issue of new shares of its common stock and (iii)
declare or pay quarterly cash dividends to its stockholders to the extent that
the aggregate amount of all such cash dividends would not exceed ten percent
(10.0%) of net income of the Borrower arising after September 30, 1996 and
computed on a cumulative consolidated basis, provided that, immediately after
giving effect to such proposed action, no Event of Default or event which, with
the giving of notice or lapse of time, or both, would constitute an Event of
Default would exist.
(c) Sales of Assets. Sell, assign, transfer, lease, convey or
otherwise dispose of any property (other than in the ordinary course of the
Borrower's business), whether now owned or hereafter acquired, to the extent
that such property is material to the Borrower's business or operations.
(d) Mergers, Etc. Merge or consolidate with or into, or convey,
transfer, lease or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to, or acquire all or substantially all of the
assets of, any person or entity (whether in one transaction or a series of
transactions), except for acquisitions of assets from any person(s) or
entity(ies) which do not exceed in the aggregate $5,000,000 at any time.
(e) Investments. Directly or indirectly make or own any Investment
except:
(i) Investments existing on the date hereof; and
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(ii) Investments which do not exceed $5,000,000 in the aggregate at
any time.
"Investment" means, with respect to any Person, (i) any purchase or
other acquisition by that Person of stock, partnership interest, notes,
debentures or other securities, or of a beneficial interest in stock,
partnership interest, notes, debentures or other securities, issued by any other
Person, and (ii) any loan, advance (other than deposits with financial
institutions available for withdrawal on demand, prepaid expenses, accounts
receivable, advances to employees, bonuses paid to agents and similar items made
or incurred in the ordinary course of business) or capital contribution by that
Person to any other Person.
"Person" means any natural person, corporation, firm, joint venture,
partnership, association, enterprise, trust or other entity or organization, or
any government or political subdivision or any agency, department or
instrumentality thereof.
(f) Transactions with Affiliates. Other than any transaction or
agreement with First Data Corporation or any of its Affiliates, directly or
indirectly enter into or permit to exist any transaction (including, without
limitation, the purchase, sale, lease or exchange of any property or the
rendering of any service) with any holder or holders of any of the capital stock
of the Borrower, or with any Affiliate of the Borrower, on terms that are less
favorable to the Borrower than those that could be obtained in an arm's length
transaction at the time from Persons who are not such a holder or Affiliate.
"Affiliate" of any Person means any other Person directly or
indirectly controlling, controlled by or under common control with such Person.
A Person shall be deemed to control another Person if the controlling Person is
the "beneficial owner" (as defined in Rule 13d-3 under the Securities Exchange
Act) of greater than twenty percent (20%) or more of any class of voting
securities (or other voting interests) of the controlled Person or possesses,
directly or indirectly, the power to direct or cause the direction of the
management or policies of the controlled Person, whether through ownership of
stock, by contract or otherwise.
(g) Other Indebtedness. Not prepay or repay any principal payable in
respect of any indebtedness for borrowed money incurred by Borrower unless such
payment is a regularly scheduled payment under such indebtedness, in which case
the Borrower agrees that it shall, concurrently with any such
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payment, reduce the Commitment hereunder by an amount equal to such payment, and
prepay Advances, if necessary, in an amount sufficient to ensure that the
outstanding Advances hereunder do not exceed the Commitment (after taking into
account such reduction).
ARTICLE V
EVENTS OF DEFAULT
SECTION 5.01. Events of Default. If any of the following events
("Events of Default") shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of, or interest on,
the Note when the same becomes due and payable or
(b) Any representation or warranty made by the Borrower (or any of
its officers) under or in connection with this Agreement shall prove to have
been incorrect in any material respect when made; or
(c) The Borrower shall fail to perform or observe any term, covenant
or agreement contained in this Agreement for a period of twenty (20) days after
written notice thereof shall have been given to the Borrower by the Lender; or
(d) The Borrower shall fail to pay any principal of or premium or
interest on any Debt (as defined in Section 4.02(a)) which is outstanding in a
principal amount of at least $2,000,000 in the aggregate (but excluding Debt
evidenced by the Note) of the Borrower or such subsidiary (as the case may be),
when the same becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement or
instrument relating to such Debt; or any other event shall occur or condition
shall exist under any agreement or instrument relating to any such Debt and
shall continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the maturity of such Debt; or any
such Debt shall be declared to be due and payable, or required to be prepaid
(other than by a regularly scheduled required prepayment), redeemed, purchased
or defeased, or an offer to prepay, redeem, purchase or defease such Debt shall
be required to be made, in each case prior to the stated maturity thereof;
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(e) the Borrower or any of its subsidiaries shall generally not pay
its debts as such debts become due, or shall admit in writing its inability to
pay its debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against the Borrower or
any of its subsidiaries seeking to adjudicate it a bankrupt or insolvent, or
seeking liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for it or for any substantial part of its
property and, in the case of any such proceeding instituted against it (but no
instituted by it), either such proceeding shall remain undismissed or unstayed
for a period of 30 days, or any of the actions sought in such proceeding
(including, without limitation, the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official for, it
or for any substantial part of its property) shall occur; or the Borrower or any
of its subsidiaries shall take any corporate action to authorize any of the
actions set forth above in this subsection (e); or
(f) Any judgment or order for the payment of money in excess of
$2,000,000 shall be rendered against the Borrower or any of its subsidiaries and
either (i) enforcement proceedings shall have been commenced by any creditor
upon such judgment or order or (ii) there shall be any period of 10 consecutive
days during which a stay of enforcement of such judgment or order, by reason of
a pending appeal or otherwise, shall not be in effect; then, in any such event,
the Lender may, by notice to the Borrower, (i) declare its obligation to make
Advances to be terminated, whereupon the same shall forthwith terminate, and
(ii) declare the Note, all interest thereon and all other amounts payable under
this Agreement to be forthwith due and payable, whereupon the Note, all such
interest and all such amounts shall become and be forthwith due and payable,
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived by the Borrower; provided, however, that in the
event of an actual or deemed entry of an order for relief with respect to the
Borrower or any of its subsidiaries under the Federal Bankruptcy Code, (A) the
obligation of the Lender to make Advances shall automatically be terminated and
(B) the Note, all such interest and all such amounts shall automatically become
and be due and payable, without presentment, demand, protest or any notice of
any kind, all of which are hereby expressly waived by the Borrower.
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ARTICLE VI
MISCELLANEOUS
SECTION 6.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement or the Note, nor consent to any departure by the
Borrower therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Lender, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.
SECTION 6.02. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including telecopier or electronic
communication) and mailed, telecopied, transmitted or delivered, if to the
Borrower, at its address at 0000 Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxx
00000, Attention: General Counsel; and if to the Lender, at its address at 0000
X. 000xx Xxx., NP 30, Xxxxx, Xxxxxxxx 00000, Attention: General Counsel,
facsimile no. (000) 000-0000; or, as to each party, at such other address as
shall be designated by such party in a written notice to the other party. All
such notices and communications shall, when mailed, telecopied or transmitted,
be effective when deposited in the mails, telecopied or confirmed by electronic
receipt, respectively, except that notices to the Lender pursuant to the
provisions of Article I shall not be effective until received by the Lender.
SECTION 6.03. No Waiver; Remedies. No failure on the part of the
Lender to exercise, and no delay in exercising, any right hereunder or under the
Note shall operate as a waiver thereof; nor shall any single or partial exercise
of any such right preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
SECTION 6.04. Indemnities. The Borrower agrees to defend, protect,
indemnify and hold harmless the Lender and each of its Affiliates and each of
its and its Affiliates' directors, officers and employees (collectively, the
"Idemnitees") from and against any and all liabilities, obligations, losses
(other than loss of profits), damages, penalties, fees, actions, judgments,
suits, claims, costs, expenses and disbursements of any kind or nature
whatsoever (excluding any taxes and including, without limitation, the
reasonable fees and disbursements of counsel for such Indemnitees in connection
with any investigative, administrative or judicial proceeding, whether or not
such
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Indemnitees shall be designated a party thereto), which any of them may incur
and reasonably pay arising out of or relating to this Agreement or the Note or
any of the transactions contemplated hereby or thereby or the direct or indirect
application or proposed application of the proceeds of any Advance, provided,
however, the Borrower shall have no obligation to an Indemnitee hereunder with
respect to any matter caused solely by or resulting solely from the willful
misconduct or gross negligence of such Indemnitee. The Borrower, upon demand by
the Lender, shall reimburse each Indemnitee for any reasonable legal or other
expenses incurred in connection with investigating or defending any of the
foregoing except if the same is directly due to the willful misconduct or gross
negligence of such Indemnitee. If the undertaking to indemnify, pay and hold
harmless set forth in this Section 6.04 may be unenforceable because it is
violative of any law or public policy, the Borrower shall contribute the maximum
portion which it is permitted to pay and satisfy under applicable law, to the
payment and satisfaction of all liabilities, obligations, losses, damages,
penalties, fees, actions, judgments, suits, claims, costs, expenses or
disbursements incurred by any Indemnitee.
SECTION 6.05. Costs, Expenses and Taxes. The Borrower agrees to pay
on demand all costs and expenses, if any (including reasonable counsel fees and
expenses), in connection with the enforcement (whether through negotiations,
legal proceedings or otherwise) of this Agreement, the Note and the other
documents to be delivered hereunder, including, without limitation, reasonable
counsel fees and expenses in connection with the enforcement of rights under
this Section 6.05. In addition, the Borrower shall pay any and all stamp and
other taxes payable or determined to be payable in connection with the execution
and delivery of this Agreement, the Note and the other documents to be delivered
hereunder, and agrees to save the Lender harmless from and against any and all
liabilities with respect to or resulting from any delay in paying or omission to
pay such taxes.
SECTION 6.06. Binding Effect; Assignability. This Agreement shall be
binding upon and inure to the benefit of the Borrower and the Lender and their
respective successors and assigns, except that the Borrower shall not have the
right to assign its rights hereunder or any interest herein without the prior
written consent of the Lender, which consent will not be unreasonably withheld.
The Lender may at any time, without the consent of the Borrower, assign all or
any portion of its rights under this Agreement and the Note. Any assignee or
transferee of the Note agrees by acceptance thereof to be bound by all the terms
and provisions of this Agreement and the Note.
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SECTION 6.07. Governing Law. This Agreement and the Note shall be
governed by, and construed in accordance with, the laws of the State of New
York.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
BORROWER: MONEYGRAM PAYMENT SYSTEMS, INC.
By: _________________________________
Title:
LENDER: FIRST DATA CORPORATION
By: _________________________________
Vice President
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