Exhibit 10.25
Sixth Amendment to the Loan Agreement with Chase Bank of Texas, N.A.
SIXTH AMENDMENT TO LOAN AGREEMENT
This SIXTH AMENDMENT TO LOAN AGREEMENT (this "AMENDMENT"), dated as of
June 2,1999, is among SONIC CORP., a Delaware corporation (the "BORROWER"),
each of the banks or other lending institutions which is or may from time to
time become a signatory or party to the Agreement (hereinafter defined) or
any successor or permitted assignee thereof (each a "BANK" and collectively,
the "BANKS"), and CHASE BANK OF TEXAS, NATIONAL ASSOCIATION (formerly known
as Texas Commerce Bank National Association), a national banking association
("CHASE"), as agent for itself and the other Banks and as issuer of Letters
of Credit under the Agreement (in such capacity, together with its successors
in such capacity, the "AGENT").
RECITALS:
A. Borrower, Agent and Banks have entered into that certain Loan
Agreement dated as of July 12, 1995, as amended by (i) that certain First
Amendment to Loan Agreement dated as of August 16, 1996, (ii) that certain
Second Amendment to Loan Agreement dated as of September 27, 1996, (iii) that
certain Third Amendment to Loan Agreement dated as of June 19, 1997, (iv)
that certain Fourth Amendment to Loan Agreement dated as of January 27, 1998,
and (v) that certain Fifth Amendment to Loan Agreement dated as of April 2,
1998 (as amended, the "AGREEMENT").
B. Pursuant to the Agreement, the undersigned guarantors (each a
"GUARANTOR" and, collectively, the "GUARANTORS") have executed Guaranties
which guarantee to Agent the payment and performance of the Obligations.
C. Borrower, Agent and Banks now desire to amend the Agreement (i) to
modify the restriction on stock repurchases, (ii) to modify the covenant
regarding loans and investments, (iii) to decrease the minimum amount for
Floating Rate Advances, and (iv) as otherwise provided herein.
NOW, THEREFORE, in consideration of the premises herein contained and
other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto, agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. Capitalized terms used in this Amendment,
to the extent no otherwise defined herein, shall have the same meanings as in
the Agreement, as amended hereby.
ARTICLE II
AMENDMENTS
Section 2.1 AMENDMENT TO MINIMUM AMOUNT FOR FLOATING, RATE ADVANCES.
Effective as of the date hereof, the amount "$500,000" appearing the fourth
sentence of Section 2.5 of the Agreement is hereby amended to read "$250,000".
Section 2.2 AMENDMENT REGARDING STOCK PURCHASES. Effective as of the
date hereof, Section 9.4 of the Agreement is hereby amended to read in its
entirety as follows:
Section 9.4 STOCK REPURCHASES. The Borrower will not, and will
not permit any of the Subsidiaries to, redeem, purchase, retire, or
otherwise acquire any capital stock of such Person, or set apart any
money for a sinking or other analogous fund for any redemption,
purchase, retirement, or other acquisition of any of its capital stock,
provided that the Borrower and the Subsidiaries shall be permitted to do
any of the foregoing so long as immediately after giving effect to such
action no Default shall exist.
Section 2.3 AMENDMENT REGARDING LOANS AND INVESTMENTS. Effective as
of the date hereof, Section 9.5 of the Agreement is amended to read in its
entirety as follows:
Section 9.5 LOANS AND INVESTMENTS. The Borrower will not make,
or permit any of the Subsidiaries to make, any advance, loan, extension
of credit, or capital contribution to or investment in, or purchase, or
permit any Subsidiary to purchase any stock, bonds, notes, debentures,
or other securities of, any Person, except:
(a) investments in the categories of investments specified in
Section II B of the Borrower's Working Capital Investment Policy in
effect as of April 27, 1999 (the "BORROWER INVESTMENT POLICY"), a copy
of which is attached hereto as Schedule 8, which are made in compliance
with the other requirements set forth in the Borrower Investment Policy;
(b) Permitted Loans;
(c) stock and other equity interests in the Subsidiaries existing
on the date hereof; and
(d) acquisitions permitted by Section 9.3.
Section 2.4 AMENDMENT TO ADD SCHEDULE 8. Effective as of the date
hereof, the Agreement is hereby amended to add Schedule 8 thereto, which
Schedule 8 shall read in its entirety as set forth on Annex II hereto.
2
ARTICLE III
CONDITIONS PRECEDENT
Section 3.1 CONDITIONS. The effectiveness of this Amendment is
subject to the satisfaction of each of the following conditions precedent:
A. REPRESENTATIONS AND WARRANTIES. The representations and warranties
contained herein and in all other Loan Documents, as amended hereby, shall be
true and correct as of the date hereof as if made on the date hereof;
B. NO DEFAULT. No Event of Default shall have occurred and be
continuing and no event or condition shall have occurred that with the giving
of notice or lapse of time or both would be an Event of Default; and
C. CORPORATE MATTERS. All corporate proceedings taken in connection
with the transactions contemplated by this Amendment and all documents,
instruments, and other legal matters incident thereto shall be satisfactory
to Agent and its legal counsel, Winstead Sechrest & Minick P.C.
ARTICLE IV
Section 4.1 RATIFICATIONS, REPRESENTATIONS AND WARRANTIES
Section 4.2 RATIFICATIONS. The terms and provisions set forth in
this Amendment shall modify and supersede all inconsistent terms and
provisions set forth in the Agreement and except as expressly modified and
superseded by this Amendment, the terms and provisions of the Agreement are
ratified and confirmed and shall continue in full force and effect.
Borrower, Agent and the Banks agree that the Agreement as amended hereby
shall continue to be legal, valid, binding and enforceable in accordance with
its terms.
Section 4.3 RELEASE OF CLAIMS. The Borrower and the Guarantors each
hereby acknowledge and agree that to their knowledge none of them has any and
there are no claims or offsets against or defenses or counterclaims to the
terms and provisions of or the obligations of the Borrower, any Guarantor or
any Subsidiary created or evidenced by the Agreement or any of the other Loan
Documents, and to the extent any such claims, offsets, defenses or
counterclaims exist, the Borrower and the Guarantors each hereby waive, and
hereby release the Agent and each of the Banks from, any and all claims,
offsets, defenses and counterclaims that are known to the Borrower or any
Guarantor as of the date hereof, such waiver and release being with full
knowledge and understanding of the circumstances and effects of such waiver
and release and after having consulted legal counsel with respect thereto.
3
Section 4.4 REPRESENTATIONS AND WARRANTIES. Borrower hereby
represents and warrants to Agent and the Banks that (i) the execution,
delivery and performance of this Amendment and any and all other Loan
Documents executed and/or delivered in connection herewith have been
authorized by all requisite corporate, partnership and trust action on the
part of Borrower and the Guarantors and will not violate the articles of
incorporation, bylaws, partnership agreement or other organizational
documents of Borrower or the Guarantors, (ii) the representations and
warranties contained in the Agreement, as amended hereby, and any other Loan
Document are true and correct on and as of the date hereof as though made on
and as of the date hereof, (iii) no Event of Default has occurred and is
continuing and no event or condition has occurred that with the giving of
notice or lapse of time or both would be an Event of Default, and (iv)
Borrower is in full compliance with all covenants and agreements contained in
the Agreement as amended hereby.
ARTICLE V
MISCELLANEOUS
Section 5.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made in this Amendment or any other Loan
Document including any Loan Document furnished in connection with this
Amendment shall survive the execution and delivery of this Amendment and the
other Loan Documents, and no investigation by Agent or any Bank or any
closing shall affect the representations and warranties or the right of Agent
and the Banks to rely upon them.
Section 5.2 REFERENCE TO AGREEMENT. Each of the Loan Documents,
including the Agreement and any and all other agreements, documents, or
instruments now or hereafter executed and delivered pursuant to the terms
hereof or pursuant to the terms of the Agreement as amended hereby, are
hereby amended so that any reference in such Loan Documents to the Agreement
shall mean a reference to the Agreement as amended hereby.
Section 5.3 EXPENSES OF AGENT. As provided in the Agreement,
Borrower agrees to pay on demand all reasonable costs and expenses incurred
by Agent in connection with the preparation, negotiation, and execution of
this Amendment and the other Loan Documents executed pursuant hereto and any
and all amendments, modifications, and supplements thereto, including without
limitation the reasonable costs and fees of Agent's legal counsel.
Section 5.4 SEVERABILITY. Any provision of this Amendment held by a
court of competent jurisdiction to be invalid or unenforceable shall not
impair or invalidate the remainder of this Amendment and the effect thereof
shall be confined to the provision so held to be invalid or unenforceable.
Section 5.5 APPLICABLE LAW. THIS AMENDMENT AND ALL OTHER LOAN
DOCUMENTS EXECUTED PURSUANT HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND TO
BE PERFORMABLE IN DALLAS, DALLAS COUNTY, TEXAS AND
4
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF TEXAS.
Section 5.6 SUCCESSORS AND ASSIGNS. This Amendment is binding upon
and shall inure to the benefit of Borrower, Agent and the Banks and their
respective successors and permitted assigns, except Borrower may not assign
or transfer any of its rights or obligations hereunder without the prior
written consent of Agent.
Section 5.7 COUNTERPARTS. This Amendment maybe executed in one or
more counterparts, each of which when so executed shall be deemed to be an
original, but all of which when taken together shall constitute one and the
same instrument.
Section 5.8 EFFECT OF WAIVER. No consent or waiver, express or
implied, by Agent or any Bank to or for any breach of or deviation from any
covenant, condition or duty by Borrower or any Guarantor shall be deemed a
consent or waiver to or of any other breach of the same or any other
covenant, condition or duty.
Section 5.9 HEADINGS. The headings, captions, and arrangements used
in this Amendment are for convenience only and shall not affect the
interpretation of this Amendment.
Section 5.10 NON-APPLICATION OF CHAPTER 346 OF TEXAS FINANCE CODE.
The provisions of Chapter 15 of the Texas Finance Code (formerly Chapter 15
of the Texas Credit Code (Vernon's Annotated Texas Statutes, Article
5069-15)), as amended, are specifically declared by the parties not to be
applicable to this Amendment or any of the Loan Documents or the transactions
contemplated hereby.
Section 5.11 ENTIRE AGREEMENT. THIS AMENDMENT AND ALL OTHER
INSTRUMENTS, DOCUMENTS AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION
WITH THIS AMENDMENT EMBODY THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES
HERETO REGARDING THIS AMENDMENT AND SUPERSEDE ANY AND ALL PRIOR COMMITMENTS,
AGREEMENTS, REPRESENTATIONS AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL,
RELATING TO THIS AMENDMENT, 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 ORAL AGREEMENTS AMONG THE PARTIES HERETO.
Executed as of the date first written above.
BORROWER:
SONIC CORP.
By: /s/ W. Scott McLain
--------------------------------
W. Scott McLain
Chief Financial Officer
5
AGENT AND BANKS:
CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION (formerly known as Texas
Commerce Bank National Association),
as Agent and as a Bank
By: /s/ Mae K. Reeves
--------------------------------
Name: Mae K. Reeves
Title: Vice President
NATIONSBANK, N.A. (formerly Boatmen's
National Bank of Oklahoma, formerly
Bank IV Oklahoma, N.A.)
By: /s/ Michael S. Reeves
--------------------------------
Name: Michael S. Reeves
Title: SVP
UMB OKLAHOMA BANK
By: /s/ Richard J. Lehrter
--------------------------------
Name: Richard J. Lehrter
Title: Executive Vice President
SUMMIT BANK
By: /s/ Gary W. Tyrrell
--------------------------------
Name: Gary W. Tyrrell
Title: Vice President
BANCFIRST
By: /s/ Brian K. Renz
--------------------------------
Name: Brian K. Renz
Title: Senior Vice President
6
Each Guarantor hereby (a) consents and agrees to this Amendment, (b)
agrees that its respective Guaranty shall continue to be the legal, valid and
binding obligation of such Guarantor enforceable against such Guarantor in
accordance with its terms, and (c) represents and warrants that each of the
representations and warranties set forth in this Amendment with regard to
each such Guarantor are true and correct in all respects.
GUARANTORS:
SONIC RESTAURANTS, INC.
By: /s/ W. Scott McLain
--------------------------------
W. Scott McLain
Chief Financial Officer
SONIC INDUSTRIES INC.
By: /s/ W. Scott McLain
--------------------------------
W. Scott McLain
Chief Financial Officer
AMERICA'S DRIVE-IN CORP.
By: /s/ W. Scott McLain
--------------------------------
Name: W. Scott McLain
Title: Chief Financial Officer
AMERICA'S DRIVE-IN TRUST
By: /s/ W. Scott McLain
--------------------------------
Name: W. Scott McLain
Title: Chief Financial Officer
7
EACH OF THE PARTNERSHIPS SPECIFIED ON
ANNEX I HERETO, each an Oklahoma general
partnership
By: Sonic Restaurants, Inc.,
Managing General Partner of
each of such partnerships
By: /s/ W. Scott McLain
--------------------------------
W. Scott McLain
Chief Financial Officer
8
ANNEX I
PARTNERSHIPS
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF ALBERTVILLE, AL (US HWY 431 NORTH) 62 -
SONIC DRIVE-IN OF ALEXANDER CITY, AL (174 BROAD) 72 -
SONIC DRIVE-IN OF ANNISTON, AL (GREENBRIAR DEAR RD) 80 -
SONIC DRIVE-IN OF ARAB, AL (NORTH MAIN ST) 90 -
SONIC DRIVE-IN OF ASHEBORO, NC (N FAYETTEVILLE) 80 -
SONIC DRIVE-IN OF ATCHINSON, KS (MAIN ST) 69 -
SONIC DRIVE-IN OF ATHENS, AL 70 -
SONIC DRIVE-IN OF AUBURN AL 99 -
SONIC DRIVE-IN OF BALDWIN CITY, KS (AMES ST) 90 -
SONIC DRIVE-IN OF BAYTOWN, TX (GARTH RD) 51 -
SONIC DRIVE-IN OF BEAUMONT, TX (8345 COLLEGE) 70 -
SONIC DRIVE-IN OF BEREA, KY (WOODFORD AVE) 76 -
SONIC DRIVE-IN OF BETHANY, OK (NW 23RD ST) 51 -
SONIC DRIVE-IN OF BETHANY, OK (NW 39TH ST) 56 -
SONIC DRIVE-IN OF BLYTHEVILLE, AR (E MAIN) 71 -
SONIC DRIVE-IN OF BLYTHEVILLE, AR (N 6TH STREET) 71 -
SONIC DRIVE-IN OF BRISTOL, TENNESSE 65 -
SONIC DRIVE-IN OF BRISTOL, VA (OLD AIRPORT RD) 77 -
SONIC DRIVE-IN OF BROOKFIELD, MO (S MAIN) 80 -
SONIC DRIVE-IN OF BUCKNER, MO (EAST MONROE) 76 -
SONIC DRIVE-IN OF BURLINGTON, NC (CHURCH) 85 -
SONIC DRIVE-IN OF CABOT, AR (S SECOND) 76 -
SONIC DRIVE-IN OF CALLAWAY, FLORIDA 55 -
SONIC DRIVE-IN OF CAMERON, MISSOURI 65 -
SONIC DRIVE-IN OF CAMPBELLSVILLE, KY 90 -
SONIC DRIVE-IN OF CASSVILLE, MO (MAIN STREET) 78 -
Page 1 of 12
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF CHANDLER, OKLAHOMA 75 -
SONIC DRIVE-IN OF CHANNELVIEW, TX. (SHELDON) 60 -
SONIC DRIVE-IN OF CHATSWORTH, GA (N THIRD AVE) 86 -
SONIC DRIVE-IN OF CHATTANOOGA, TN (BRAINERD) 80 -
SONIC DRIVE-IN OF CHATTANOOGA, TN HIXON 74 -
SONIC DRIVE-IN OF CHILLICOTHE, MISSOURI 60 -
SONIC DRIVE-IN OF CHRISTIANSBURG, VA 77 -
SONIC DRIVE-IN OF CLEAR LAKE CITY, TX (BAY AREA) 63 -
SONIC DRIVE-IN OF CLEMMONS, NORTH CAROLINA 80 -
SONIC DRIVE-IN OF CLINTON, TENNESSEE 73 -
SONIC DRIVE-IN OF COLLINSVILLE, VA 65 -
SONIC DRIVE-IN OF COLUMBUS, GA (FLOYD RD) 99 -
SONIC DRIVE-IN OF COLUMBUS, GA (MANCHESTER) 81 -
SONIC DRIVE-IN OF COLUMBUS, GA (WYNNTON) 99 -
SONIC DRIVE-IN OF COOL VALLEY, MO (S FLORISSANT RD) 51 -
SONIC DRIVE-IN OF CYPRESS, TX (LOUETTA) 70 -
SONIC DRIVE-IN OF DALLAS, TX - (FRANKFORD RD) 70 -
SONIC DRIVE-IN OF DALLAS, TX - (INWOOD) 80 -
SONIC DRIVE-IN OF DALLAS, TX (2960 W WHEATLAND) 51 -
SONIC DRIVE-IN OF DALLAS, TX (3555 FOREST LANE) 65 -
SONIC DRIVE-IN OF DALLAS, TX (BUCKNER BLVD) 85 -
SONIC DRIVE-IN OF DALLAS, TX (EAST NW HWY) 85 -
SONIC DRIVE-IN OF DALLAS, TX (FOREST LANE) 70 -
SONIC DRIVE-IN OF DALLAS, TX (FT WORTH AVE) 51 -
SONIC DRIVE-IN OF DALLAS, TX (GREENVILLE) 51 -
SONIC DRIVE-IN OF DALLAS, TX (INWOOD ROAD) 68 -
Page 2 of 12
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF DALLAS, TX (PLANO @ KINGSLEY) 85 -
SONIC DRIVE-IN OF DALLAS, TX (SPRING VALLEY) 80 -
SONIC DRIVE-IN OF DALLAS, TX (W DAVIS) 60 -
SONIC DRIVE-IN OF DALLAS, TX (WESTMORELAND & BUR 51 -
SONIC DRIVE-IN OF DALTON, GA (AIRPORT) 51 -
SONIC DRIVE-IN OF DANVILLE, KY (BAUGHMAN) 84 -
SONIC DRIVE-IN OF DANVILLE, VA PINEY FOREST 80 -
SONIC DRIVE-IN OF DARDANELLE, AR (UNION ST) 75 -
SONIC DRIVE-IN OF DAYTON, TX 55 -
SONIC DRIVE-IN OF DECATUR, AL (6TH AVE SE) 85 -
SONIC DRIVE-IN OF DEER PARK, TEXAS 58 -
SONIC DRIVE-IN OF EDEN, NC (E HARRIS PLACE) 67 -
SONIC DRIVE-IN OF ELIZABETHTON, TENNESSEE 69 -
SONIC DRIVE-IN OF ELKIN, NC (BRIDGE ST) 90 -
SONIC DRIVE-IN OF EODORA, KS (CHURCH ST) 80 -
SONIC DRIVE-IN OF ERVlN, TENNESSEE 70 -
SONIC DRIVE-IN OF FLORENCE, AL (HELTON) 85 -
SONIC DRIVE-IN OF FRANKFORT, KY (LOUISVILLE RD) 84 -
SONIC DRIVE-IN OF GADSDEN, AL (HOOD) 60 -
SONIC DRIVE-IN OF'GADSDEN, AL (MEIGHAN) 60 -
SONIC DRIVE-IN OF GALAX, VIRGINIA 80 -
SONIC DRIVE-IN OF GALENA PARK, TX (CLINTON DR) 85 -
SONIC DRIVE-IN OF GARLAND, TX (N. JUPITER RD) 80 -
SONIC DRIVE-IN OF GEORGETOWN, KENTUCKY 99 -
SONIC DRIVE-IN OF GOSNELL, ARKANSAS 71 -
SONIC DRIVE-IN OF GRAHAM, NC (S MAIN) 90 -
Page 3 of 12
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF GRANDVIEW, MO (BLUE RIDGE) 65 -
SONIC DRIVE-IN OF GREENEVILLE, TN (E ANDREW JOHNSON 70 -
SONIC DRIVE-IN OF GREENSBORO, NC - W MARKET ST 70 -
SONIC DRIVE-IN OF GREENSBORO, NC (ELM) 85 -
SONIC DRIVE-IN OF GREENSBORO, NC (HIG POINT) 70 -
SONIC DRIVE-IN OF GREENSBORO, NC (SPRING GARDEN) 90 -
SONIC DRIVE-IN OF GREENSBORO, NORTH CAROLINA 75 -
SONIC DRIVE-IN OF GROVES, TX 70 -
SONIC DRIVE-IN OF GULF BREEZE, FL (G BREEZE PKW) 99 1
SONIC DRIVE-IN OF HALLS, TN (CROSSROADS) 65 -
SONIC DRIVE-IN OF HIGH POINT NC (E PARRIS AVE) 80 -
SONIC DRIVE-IN OF HIGH POINT NC (S MAIN) 80 -
SONIC DRIVE-IN OF HIGHLANDS, TEXAS 68 -
SONIC DRIVE-IN OF HOMER, LOUISIANA 60 -
SONIC DRIVE-IN OF HOUSTON TX (DURHAM) 54 -
SONIC DRIVE-IN OF HOUSTON, TX - (W. LITTLE YORK) 75 -
SONIC DRIVE-IN OF HOUSTON, TX (1437 FM 1960) 64 -
SONIC DRIVE-IN OF HOUSTON, TX (3711 LITTLE YORK) 70 -
SONIC DRIVE-IN OF HOUSTON, TX (AIRLINE) 65 -
SONIC DRIVE-IN OF HOUSTON, TX (ALDINE) 68 -
SONIC DRIVE-IN OF HOUSTON, TX (ANTOINE) 70 -
SONIC DRIVE-IN OF HOUSTON, TX (BARKER-CYPRESS) 65 -
SONIC DRIVE-IN OF HOUSTON, TX (BISSONETT) 65 -
SONIC DRIVE-IN OF HOUSTON, TX (BLALOCK) 65 -
SONIC DRIVE-IN OF HOUSTON, TX (DAIRY) 85 -
SONIC DRIVE-IN OF HOUSTON, TX (E SAM HOUSTON) 63 -
Page 4 of 12
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF HOUSTON, TX (FUQUA) 70 -
SONIC DRIVE-IN OF HOUSTON, TX (GESSNER) 76 -
SONIC DRIVE-IN OF HOUSTON, TX (HILLCROFT ST) 70 -
SONIC DRIVE-IN OF HOUSTON, TX (HWY 6 N) 60 -
SONIC DRIVE-IN OF HOUSTON, TX (JONES) 61 -
SONIC DRIVE-IN OF HOUSTON, TX (KUYKENDAHL RD) 75 -
SONIC DRIVE-IN OF HOUSTON, TX (LITTLE YORK) 80 -
SONIC DRIVE-IN OF HOUSTON, TX (MANGUM) 60 -
SONIC DRIVE-IN OF HOUSTON, TX (MESA DR) 80 -
SONIC DRIVE-IN OF HOUSTON, TX (N FREEWAY) 70 -
SONIC DRIVE-IN OF HOUSTON, TX (N HOUSTON) 60 -
SONIC DRIVE-IN OF HOUSTON, TX (POST OAK) 65 -
SONIC DRIVE-IN OF HOUSTON, TX (SCARSDALE) 85 -
SONIC DRIVE-IN OF HOUSTON, TX (TELEPHONE) 75 -
SONIC DRIVE-IN OF HOUSTON, TX (UVALDE RD) 70 -
SONIC DRIVE-IN OF HOUSTON, TX (VETERAN'S) 60 -
SONIC DRIVE-IN OF HOUSTON, TX (W TIDWELL) 76 -
SONIC DRIVE-IN OF HOUSTON, TX (WESTHEIMER) 65 -
SONIC DRIVE-IN OF HOUSTON, TX (WOODRIDGE) 65 -
SONIC DRIVE-IN OF HOUSTON, TX CROSSTIMBERS 64 -
SONIC DRIVE-IN OF HUMBLE, TEXAS 68 -
SONIC DRIVE-IN OF HUNTSVILLE, AL (BOB WALLACE) 70 -
SONIC DRIVE-IN OF HUNTSVILLE, AL (NW MEMORIAL) 85 -
SONIC DRIVE-IN OF HUNTSVILLE, AL (PRATT AVE) 85 -
SONIC DRIVE-IN OF INDEPENDENCE, MO (10601 E 23) 56 -
SONIC DRIVE-IN OF INDEPENDENCE, MO (15319 E 23) 51 -
Page 5 of 12
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF INDEPENDENCE, MO (HWY 40) 61 -
SONIC DRIVE-IN OF INDEPENDENCE, MO (S NOLAND) 51 -
SONIC DRIVE-IN OF JACINTO CITY, TEXAS 60 -
SONIC DRIVE-IN OF JEFFERSONVILLE, IN 99 1
SONIC DRIVE-IN OF JEFFERSONVILLE, IN SPRING ST 90 -
SONIC DRIVE-IN OF JOHNSON CITY, TN (MARKET) 61 -
SONIC DRIVE-IN OF JOHNSON CITY, TN (N ROAN) 71 -
SONIC DRIVE-IN OF JONESBORO, LOUISIANA 65 -
SONIC DRIVE-IN OF KANSAS CITY, KS (35TH & STRONG) 55 -
SONIC DRIVE-IN OF KANSAS CITY, KS (LEAVENWORTH) 68 -
SONIC DRIVE-IN OF KANSAS CITY, KS (N 78TH) 60 -
SONIC DRIVE-IN OF KANSAS CITY, MO (INDEP) 60 -
SONIC DRIVE-IN OF KATY, TX (HWY BLVD) 60 -
SONIC DRIVE-IN OF KATY, TX (MASON RD) 63 -
SONIC DRIVE-IN OF KERNERSVILLE, NC (NELSON ST) 63 -
SONIC DRIVE-IN OF KINGSPORT, TN (E STONE) 65 -
SONIC DRIVE-IN OF KINGSTON, TN (N KENTUCKY) 60 -
SONIC DRIVE-IN OF KNOXVILLE TN (KINGSTON) 69 -
SONIC DRIVE-IN OF KNOXVILLE, TN (BROADWAY) 70 -
SONIC DRIVE-IN OF KNOXVILLE, TN (CEDAR) 65 -
SONIC DRIVE-IN OF KNOXVILLE, TN (CHAPMAN) 63 -
SONIC DRIVE-IN OF KNOXVILLE, TN (KINGSTON) 70 -
SONIC DRIVE-IN OF KNOXVILLE, TN (N BROADWAY) 78 -
SONIC DRIVE-IN OF LA FOLLETTE, TENNESSEE 90 -
SONIC DRIVE-IN OF LA GRANGE, KY HWY 53 99 1
SONIC DRIVE-IN OF LA PORTE, TX (W MAIN) 65 -
Page 6 of 12
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF LANETT, AL (S BROAD) 80 -
SONIC DRIVE-IN OF LAWRENCEBURG, KY (CROSSROADS) 89 -
SONIC DRIVE-IN OF LEAGUE CITY, TEXAS 70 -
SONIC DRIVE-IN OF LEAVENWORTH, KANSAS 61 -
SONIC DRIVE-IN OF LEES SUMMIT, MISSOURI 89 -
SONIC DRIVE-IN OF LEE'S SUMMIT, MO-LANGSFORD 85 -
SONIC DRIVE-IN OF LEXINGTON, KY (S. BROADWAY) 89 -
SONIC DRIVE-IN OF LEXINGTON, NC (WINSTON RD) 80 -
SONIC DRIVE-IN OF LEXINGTON, NORTH CAROLINA 66 -
SONIC DRIVE-IN OF LINDALE, TEXAS 51 -
SONIC DRIVE-IN OF LITTLE ROCK, AR (ASHER) 76 -
SONIC DRIVE-IN OF LITTLE ROCK, AR (CANTRELL) 60 -
SONIC DRIVE-IN OF LITTLE ROCK, AR (MABELVALE PL) 64 -
SONIC DRIVE-IN OF LITTLE ROCK, AR (RODNEY PAR) 70 -
SONIC DRIVE-IN OF LITTLE ROCK, AR (WESTHAVEN) 75 -
SONIC DRIVE-IN OF LONOKE, ARKANSAS 76 -
SONIC DRIVE-IN OF LOUDON, TENNESSEE 68 -
SONIC DRIVE-IN OF LOUISVILLE, KY -- SPRINGHURST 90 -
SONIC DRIVE-IN OF LOUISVILLE, KY (AMBROSSE) 87 -
SONIC DRIVE-IN OF LOUISVILLE, KY (PRESTON HWY) 90 -
SONIC DRIVE-IN OF LYNN HAVEN, FLORIDA 55 -
SONIC DRIVE-IN OF MACON, MISSOURI 65 -
SONIC DRIVE-IN OF MADISON, AL (SULLIVAN) 70 -
SONIC DRIVE-IN OF MANSFIELD, LOUISIANA 60 -
SONIC DRIVE-IN OF MARIANNA, FL (4221 W LAF) 80 -
SONIC DRIVE-IN OF MARION, VA (N MAIN ST) 70 -
Page 7 of 12
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF MARTINSVILLE, VA (STARLING ST) 70 -
SONIC DRIVE-IN OF MARY ESTHER, FL 99 1
SONIC DRIVE-IN OF MARYVILLE, MISSOURI 55 -
SONIC DRIVE-IN OF MARYVILLE, TN (E BRDWY) 80 -
SONIC DRIVE-IN OF MARYVILLE, TN (FOOTHILLS) 80 -
SONIC DRIVE-IN OF MAUMELLE, ARKANSAS 80 -
SONIC DRIVE-IN OF MCKINNEY, TX (ELDORADO PKWY) 75 -
SONIC DRIVE-IN OF MIDDLETOWN, KY (SHELBYVILLE) 87 -
SONIC DRIVE-IN OF MIDWEST CITY, OK (DOUGLAS BLVD 51 -
SONIC DRIVE-IN OF MILTON, FL (HWY 90) 99 1
SONIC DRIVE-IN OF MINDEN, LOUISIANA 60 -
SONIC DRIVE-IN OF MINEOLA, TEXAS 60 -
SONIC DRIVE-IN OF MISSOURI CITY, TEXAS 70 -
SONIC DRIVE-IN OF MONROE, LA (DE SIARD) 70 -
SONIC DRIVE-IN OF MONROE, LA (FORSYTHE) 60 -
SONIC DRIVE-IN OF MONROE, LA (STERLINGTON) 60 -
SONIC DRIVE-IN OF MONROE, LA (WINNSBORO) 80 -
SONIC DRIVE-IN OF MONTGOMERY, AL (ATLANTA) 75 -
SONIC DRIVE-IN OF MONTGOMERY, AL (MCGEEHEE) 90 -
SONIC DRIVE-IN OF MONTGOMERY, AL (VAUGHN) 90 -
SONIC DRIVE-IN OF MOREHEAD, KY (STONE) 76 -
SONIC DRIVE-IN OF MORRISTOWN, TN 70 -
SONIC DRIVE-IN OF MORRISTOWN, TN (1153 S CUMB) 70 -
SONIC DRIVE-IN OF MOUNT AIRY, NC (INDEP) 60 -
SONIC DRIVE-IN OF MOUNTAIN GROVE, MISSOURI 80 -
SONIC DRIVE-IN OF MUSCLE SHOALS, AL (AVALON) 85 -
Page 8 of 12
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF N. LITTLE ROCK, AR (CAMP ROB) 76 -
SONIC DRIVE-IN OF NEWCASTLE, OKLAHOMA 90 -
SONIC DRIVE-IN OF NEWPORT, ARKANSAS 85 -
SONIC DRIVE-IN OF NEWPORT, TN (W BROADWAY) 63 -
SONIC DRIVE-IN OF NICHOLASVILLE, KY (VILLAGE PK) 89 -
SONIC DRIVE-IN OF NORMAN, OK (1515 W LINDSEY) 80 -
SONIC DRIVE-IN OF NORMAN, OK (24TH AVE) 60 -
SONIC DRIVE-IN OF NORMAN, OK (E LINDSEY) 60 -
SONIC DRIVE-IN OF NORMAN, OK (N PORTER) 60 -
SONIC DRIVE-IN OF NORTH TAZEWELL, VIRGINIA 70 -
SONIC DRIVE-IN OF OAK GROVE, MISSOURI 56 -
SONIC DRIVE-IN OF OAK RIDGE, TENNESSEE 75 -
SONIC DRIVE-IN OF OKLA CITY, OK (1933 N MACARTHU 51 -
SONIC DRIVE-IN OF OKLA CITY, OK (2400 N PENN) 70 -
SONIC DRIVE-IN OF OKLA CITY, OK (2720 S W 29TH) 65 -
SONIC DRIVE-IN OF OKLA CITY, OK (5111 N MAC ARTH 61 -
SONIC DRIVE-IN OF OKLA CITY, OK (6415 N MERIDIAN 61 -
SONIC DRIVE-IN OF OKLA CITY, OK (N W 23RD) 60 -
SONIC DRIVE-IN OF OKLA CITY, OK (S E 29TH) 75 -
SONIC DRIVE-IN OF:OKLA CITY, OK (S E 44TH) 60 -
SONIC DRIVE-IN OF OKLA CITY, OK (S WESTERN) 70 -
SONIC DRIVE-IN OF OKLAHOMA CITY, OK (GRAND) 65 -
SONIC DRIVE-IN OF OKLAHOMA CITY, OK (NE 23) 69 -
SONIC DRIVE-IN OF OLATHE, KS (BLACKBOB) 90 -
SONIC DRIVE-IN OF OLATHE, KS (E SANTA) 70 -
SONIC DRIVE-IN OF OLATHE, KS (S HARRIS) 80 -
Page 9 of 12
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF OPELIKA, AL (2ND AVE) 81 -
SONIC DRIVE-IN OF OZARK, MISSOURI 70 -
SONIC DRIVE-IN OF PANAMA CITY BEACH, FLORIDA 99 -
SONIC DRIVE-IN OF PANAMA CITY, FLORIDA 51 -
SONIC DRIVE-IN OF PARAGOULD, ARKANSAS 80 -
SONIC DRIVE-IN OF PARIS, KY 90 -
SONIC DRIVE-IN OF PEARLAND, TX (W BROADWAY ST) 59 -
SONIC DRIVE-IN OF PENSACOLA, FL (9TH AVE) 99 1
SONIC DRIVE-IN OF PENSACOLA, FL (NAVY) 99 1
SONIC DRIVE-IN OF PHENIX CITY, AL (SUMMERVILLE) 99 -
SONIC DRIVE-IN OF PORT ARTHUR, TX (MEMORIAL) 65 -
SONIC DRIVE-IN OF PORT ARTHUR, TX (N TWIN CITY) 65 -
SONIC DRIVE-IN OF PRATTVILLE, ALABAMA 80 -
SONIC DRIVE-IN OF PULASKI, VIRGINIA 72 -
SONIC DRIVE-IN OF RADFORD, VA 69 -
SONIC DRIVE-IN OF RAINBOW CITY, ALABAMA 80 -
SONIC DRIVE-IN OF RAYTOWN, MO (6525 RAYTOWN) 68 -
SONIC DRIVE-IN OF REIDSVILLE, NC (SCALES) 90 -
SONIC DRIVE-IN OF RICHARDSON, TX (CENTENNIAL) 80 -
SONIC DRIVE-IN OF RICHMOND, KY (BIG HILL) 72 -
SONIC DRIVE-IN OF RICHMOND, TEXAS 60 -
SONIC DRIVE-IN OF RICHMOND, TEXAS (FM 359) 71 -
SONIC DRIVE-IN OF ROGERSVILLE, TN (E MAIN) 65 -
SONIC DRIVE-IN OF ROLLA, MISSOURI 70 -
SONIC DRIVE-IN OF ROWLETT, TX (DALROCK RD) 74 -
SONIC DRIVE-IN OF SACHSE, TX (SOUTH HIGHWAY 78) 70 -
Page 10 of 12
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF SAINT JOSEPH, MO (3110 N BELT) 55 -
SONIC DRIVE-IN OF SAINT JOSEPH, MO (502 N BELT) 55 -
SONIC DRIVE-IN OF SALEM, MISSOURI 78 -
SONIC DRIVE-IN OF SAVANNAH, MO (E WILLIAM) 70 -
SONIC DRIVE-IN OF SCOTTSBORO, AL (824 S BROAD) 66 -
SONIC DRIVE-IN OF SEABROOK, TX (BAYPORT BLVD) 65 -
SONIC DRIVE-IN OF SEVIERVILLE, TENNESSEE 71 -
SONIC DRIVE-IN OF SEYMOUR, IN (TIPTON ST) 99 1
SONIC DRIVE-IN OF SHALIMAR, FLORIDA 99 1
SONIC DRIVE-IN OF SHELBYVILLE, KY (STONECREST) 90 -
SONIC DRIVE-IN OF SHERWOOD, ARKANSAS 71 -
SONIC DRIVE-IN OF SHREVEPORT, LA (303 W 70TH) 60 -
SONIC DRIVE-IN OF SHREVEPORT, LA (5914 YOUREE) 66.7 -
SONIC DRIVE-IN OF SHREVEPORT, LA (6113 W 70TH) 99 1
SONIC DRIVE-IN OF SHREVEPORT, LA (BERT KOUNS RD) 60 -
SONIC DRIVE-IN OF SOUTH BOSTON, VA (OLD HALIFAX RD) 65 -
SONIC DRIVE-IN OF SPRINGFIELD, MO (E REPUBLIC) 75 -
SONIC DRIVE-IN OF SPRINGFIELD, MO (E SUNSHINE) 80 -
SONIC DRIVE-IN OF SPRINGFIELD, MO (N GLENSTONE) 70 -
SONIC DRIVE-IN OF SPRINGFIELD, MO (S CAMPBELL) 70 -
SONIC DRIVE-IN OF-SPRINGFIELD, MO (S GLENSTONE) 75 -
SONIC DRIVE-IN OF SPRINGFIELD, MO (W SUNSHINE) 72 -
SONIC DRIVE-IN OF ST. JOSEPH, MO (LAKE AVE) 60 -
SONIC DRIVE-IN OF STANLEYVILLE, NORTH CAROLINA 61 -
SONIC DRIVE-IN OF SUGAR CREEK, MISSOURI 56 -
SONIC DRIVE-IN OF SULLIVAN, MISSOURI 60 -
Page 11 of 12
SONIC CORP.
SRI PARTNERSHIP OWNERSHIP INTEREST
PARTNERSHIP NAME SRI% SII%
- -------------------------------------------------------------------------------
SONIC DRIVE-IN OF THOMASVILLE, NC (RANDOLPH) 68 -
SONIC DRIVE-IN OF TOMBALL, TEXAS 64 -
SONIC DRIVE-IN OF TROY, ALABAMA 90 -
SONIC DRIVE-IN OF TUTTLE, OKLAHOMA 78 -
SONIC DRIVE-IN OF UNION, MO 80 -
SONIC DRIVE-IN OF W MONROE, LA-CYPRESS 80 -
SONIC DRIVE-IN OF WALNUT RIDGE, ARKANSAS 80 -
SONIC DRIVE-IN OF WASHINGTON, MO (545 E 5TH) 65 -
SONIC DRIVE-IN OF WATONGA, OKLAHOMA 61 -
SONIC DRIVE-IN OF WEBSTER, TX 70 -
SONIC DRIVE-IN OF WEST MONROE, LA (N 7TH) 65 -
SONIC DRIVE-IN OF WEST MONROE, LA (THOMAS ROAD) 60 -
SONIC DRIVE-IN OF WHITE PINE, TN (STATE) 80 -
SONIC DRIVE-IN OF WICHITA FALLS, TX (9TH) 69 -
SONIC DRIVE-IN OF WICHITA FALLS, TX (JACKSBORO) 85 -
SONIC DRIVE-IN OF WICHITA FALLS, TX (TAFT BLVD) 85 -
SONIC DRIVE-IN OF WlLLS POINT, TX 55 -
SONIC DRIVE-IN OF WINCHESTER, KY (BY PASS ROAD) 66 -
SONIC DRIVE-IN OF WINNFIELD, LOUISIANA 57 -
SONIC DRIVE-IN OF WINNSBORO, TEXAS 55 -
SONIC DRIVE-IN OF WINSTON SALEM, NORTH CAROLINA 90 -
SONIC DRIVE-IN OF WYTHEVILLE, VIRGINIA 69 -
Page 12 of 12
ANNEX II
SCHEDULE 8 - BORROWER INVESTMENT POLICY
SONIC CORP.
WORKING CAPITAL INVESTMENT POLICY
AS OF APRIL 27, 1999
I. INVESTMENT OBJECTIVE
This Investment Policy shall limit investment activities in order to
insure preservation of capital and liquidity. In that regard, when
possible, Sonic will hold investments until they mature. However, to
maintain maximum flexibility, investments are intended to be available
for sale.
Included in this document, by reference, are covenants, agreements, etc.
that govern the establishment, maintenance and investment of Sonic's
funds.
II. POLICIES
A. Sonic shall restrict its working capital investments to effective
maturities of less than 14 months from the settlement date.
Maturities shall be consistent with the liquidity needs of the
corporation as determined by its cash forecast.
Maturity, by definition, shall include demand options to allow
Sonic redemption of capital at a quantifiable price consistent with
the liquidity objectives of the portfolio.
B. Sonic shall restrict its working capital to the following
categories of investments:
1. Direct obligations of, and obligations fully guaranteed by,
the U.S.A. or any agency thereof;
2. Direct obligations of, and obligations fully guaranteed by,
any state or territory of the U.S.A.;
3. Obligations of any governmental body within the U.S. with a
credit quality rating of at least SP-1 or single-A by Standard
& Poor's (or equivalent);
4. Obligations of any corporation who maintains a senior debt
credit quality rating of at least single-A by Standard & Poor's
(or equivalent);
5. Public Securities Association (PSA) repurchase agreements,
master notes or deposits with financial institutions that meet
the requirements stated elsewhere in this policy.
6. Shares in open-ended money market mutual funds as defined
under Rule 2a-7 of the Investment Company Act of 1940. The
corporate parent, or
1
Sonic Corp.
Investment Policy, continued
sponsor of which, must possess a credit quality rating of at
least A-1 or single-A by Standard & Poor's (or equivalent).
7. Investments issued (guaranteed) by a financial institution
that is a member of the Federal Reserve System, provided that
said institution is:
a. Ranked among the fifty largest U.S. institutions by
assets (as listed by AMERICAN BANKER); or,
b. institution with a net worth of at least $500 million; or,
c. Whose corporate credit quality is rated at least A-1 or
single-A by Standard & Poor's (or equivalent).
8. Investments issued (guaranteed) by any non-U.S. financial
institution, provided that said institution is:
a. Ranked among the fifty largest in the world, by assets
(as listed by AMERICAN BANKER); or,
b. An institution with a net worth of at least $750 million;
or,
c. Whose corporate credit quality is rated at least A-1 or
single-A by Standard & Poor's (or equivalent).
C. Sonic shall not employ leverage, whether embedded in a security
structure or as part of a trading strategy. Speculation or extreme
securities, such as those designed to profit from market
volatility, are not appropriate for this portfolio.
D. Sonic shall diversity investments consistent with the objective of
working capital. With the exception of non-action AAA/Aaa rated
pass-through securities whose principal and interest are wholly
derived from uniquely pledged assets or short-term liquidity
deposits (Sub-sections B-(5) and B(6)), based on a trade date
portfolio amounts, investment exposure shall be the aggregate of:
1. The greater of $5 million dollars or ten percent to any one
issuer or guarantor, except for the U.S. Government or any
agency thereof.
2. Twenty-five percent participation in any single securities
action, where insufficient bids may result in a loss of
liquidity.
E. Sonic Corp. shall eliminate foreign currency exposure in regard to
investments.
2
Sonic Corp.
Investment Policy, continued
III. CONTROLS
A. Authorized investors for Sonic include its Chief Financial Officer,
Treasurer, and Assistant Treasurer.
B. Treasury shall prepare and regularly publish an Investment Report
to be circulated to the Investment Committee for their review. The
report shall include dollar amounts and percentages of investments
held, their issuers, maturity dates, and investment ratings.
Corporate Accounting will be responsible for the maintenance of all
necessary records of current holdings. They shall receive all
confirmations of investments and reconcile the investments to the
Investment Report.
C. There shall be at least one unscheduled audit by a non-Treasury
auditor of cash investment activities each year.
D. Sonic's Investment Committee shall include its Chief Executive
Officer, Chief Operating Officer, Chief Financial Officer and
Treasurer. The Chief Financial Officer may appoint other members
to the Investment Committee, as deemed necessary.
1. The Investment Committee shall determine the total return on
investments (ROI) and shall compare this ROI against a fair and
neutral benchmark on an after-tax basis. An evaluation,
including non-investment issues relevant to performance, shall be
tendered quarterly to the Board of Directors.
2. The Investment Committee shall review this corporate
investment policy as mandated by changing conditions, but no
less than annually.
3. It is the responsibility of the Treasurer to immediately
report to the Investment Committee any material event that may
affect an investment's value. The Investment Committee shall
determine a course of action regarding such investment.
The Investment Committee shall also investigate the
transaction to verify the investment's original compliance with
this policy. Assuming the transaction was within this policy's
mandate, no punitive action would be appropriate.
3
Sonic Corp.
Investment Policy, continued
E. The Chief Financial Officer shall have oversight responsibility for
corporate investment and shall take steps to ensure compliance to
policies.
1. The Treasurer shall regularly communicate to all interested
parties a list of authorized investors (names, titles and
signatures), as well as the receiving location for Sonic funds
and investments.
2. Exceptions to the Investment policy may be made by the Chief
Financial Officer, and must be made in writing. Changes in
policy must be approved by the Board of Directors.
F. The Chief Financial Officer, Treasurer or the Assistant Treasurer
shall have the authority to enter into agreements, sign documents
and represent the Investment Committee in matters relating to Sonic
investments.
1. The Treasurer or the Assistant Treasurer shall have the
authority to contract with appropriate organizations which meet
the standards of solvency stated in this investment policy, and
shall appoint such organizations to act as a holders-in-custody
of Sonic funds and investments.
IV. EXPLANATION OF RATINGS
Credit Risk Standard & Poor's
- ----------- -----------------
Prime AAA
Excellent AA
Upper Medium A
Lower Medium BBB
Speculative BB
Very Speculative B, CCC
Default D
MUNICIPAL
Standard & Poor's rating guide is SP-1 (highest) to Sp-4 (lowest).
COMMERCIAL PAPER
Standard & Poor's uses A-1 (highest), A-2, A-3, C and D.
4