EXHIBIT 10.24
FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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This FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this
"Amendment"), dated as of March 31, 2002, is between PEGASUS SOLUTIONS,
INC., formerly known as Pegasus Systems, Inc., a Delaware corporation
("Borrower"), and JPMORGAN CHASE BANK (formerly known as The Chase Manhattan
Bank, successor by merger to Chase Bank of Texas, N.A.), a New York banking
corporation, as Administrative Agent ("Administrative Agent").
RECITALS:
A. Borrower and Administrative Agent have entered into that
certain Amended and Restated Credit Agreement dated as of August 31, 2001,
which amended and restated a Credit Agreement dated as of April 17, 2000 (as
the same has been or may be amended, restated or modified from time to time,
the ("Agreement").
B. Pursuant to the Agreement Pegasus No. 1, LLC, a Delaware
limited liability company; Pegasus No.2, LLC, a Delaware limited liability
company; Pegasus GP. LLC, a Delaware limited liability company Pegasus
Business intelligence LP, a Delaware limited partnership, (successor by
merger to Pegasus Commission Processing LP, a Delaware limited partnership,
and Pegasus Electronic Distribution LP, a Delaware limited partnership); and
Pegasus Solutions Companies, a Delaware corporation (successor by merger to
Pegasus Solutions Acquisition Company [formerly known as REZ Inc.], Anasazi
Service Corporation, and Anasazi Travel Resources, Inc., and formerly known
as Rezoluitions, Inc.) executed that certain Guaranty Agreement dated as of
April 17, 2000 (the "Guaranty"), which guaranteed to the Administrative
Agent and the Lenders the payment and performance of the Obligations (as
defined in the Agreement).
C. Borrower Administrative Agent and Lenders now desire to amend
the Agreement to modify certain covenants, to extend the maturity date and
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
1.1 Definitions. Capitalized terms used in this Amendment to the extent
not otherwise defined herein, shall have the same meanings as in the
Agreement, as amended hereby.
ARTICLE II
Amendments
2.1 Amendments to Certain Definitions. (a) The table below
parenthetical (b) in the definition of "Applicable Margin" in Section 1.01
of the Agreement is hereby deleted in its entirety and is replaced to read
as follows:
Consolidated Leverage Applicable Applicable Applicable
Ratio Margin for Margin for Margin for
Base Rate Eurodollar Commitment
Borrowings Borrowings Fee
------------------------ ---------- ---------- ----------
Greater than or equal to 1.25% 2.25% 0.50%
1.50 to 1.00
Less than 1.50 to 1.00, 1.00% 2.00% 0.375%
but greater than or equal
to 1.00 to 1.00
Less than 1.00 to 1.00, 0.75% 1.75% 0.375%
but greater than or equal
to 0.50 to 1.00
Less than 0.50 to 1.00 0.50% 1.50% 0.375%
(b) The definition of "Deposit Liabilities" in Section 1.01 of the
Agreement is amended and restated in its entirety to read as follows:
"Deposit Liabilities" means (a) any and all obligations of
Borrower or any Subsidiary with respect to deposits received for
hotel reservations, (b) any and all deposits and prepaid fees paid
under agreements between the Borrower or any Subsidiary and their
respective customers and (c) any other cash restricted from the
Borrower's or any Subsidiary's general use by any agreement.
(b) The definition of "Maturity Date" in Section 1.01 of the Agreement
is amended and restated in its entirety to read as follows:
"Maturity Date" means March 31, 2004.
2.2 Addition of Certain Definitions. The following new definitions are
added to Section 1.01 in appropriate alphabetical sequence:
"Consolidated Asset Coverage Ratio" means the ratio of (i) (a)
cash plus cash equivalents plus short term investments, each as
reflected on the Borrower's consolidated balance sheet, plus (b) eighty
percent (80%) of the accounts receivable of the Borrower and its
Subsidiaries, net of any reserves related thereto, (c) less Deposit
Liabilities and current and noncurrent uncleared commission checks as
reflected in the liability section of the Borrower's consolidated
balance sheet to (ii) Consolidated Funded Debt
"Consolidated 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, without duplication (a)
all obligations for borrowed money, (b) all Capital Lease Obligations,
(c) all obligations for the deferred purchase price of properly, and
(d) all Letters of Credit
2.3 Deletion of Certain Definitions. The definition of "Consolidated
Liquidity" and all references thereto in the Agreement are hereby deleted in
their entirety.
2.4 Amendment to Section 9.03. Effective as of the date hereof,
Section9.03 of the Agreement is hereby deleted in its entirety and is
replaced to read as follows:
Section 9.03. Consolidated Asset Coverage Ratio. The Borrower
will, and will cause its Subsidiaries to, at all times maintain a.
Consolidated Asset Coverage Ratio of at least 1.25 to 1.00.
2.5 Undated Schedules. Effective as of the date hereof, Schedules 1.01
through 8.08 attached to the Agreement shall be updated and replaced with
Schedules 1.01 through 8.08 attached hereto.
2.6 Compliance Certificate. The Compliance Certificate attached to the
Credit Agreement as Exhibit G shall be replaced by Exhibit G attached
hereto.
ARTICLE Ill
Ratifications. Covenants.. Representations and Warranties
3.1 Ratifications. The terms and provisions set faith in this
Amendment shall modify and supersede all inconsistent terms and provisions
set forth in the Agreement and except 83 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,
Administrative Agent and Lenders agree that the Agreement as amended hereby
shall continue to be legal, valid, binding and enforceable in accordance
with its terms.
3.2 Representations and Warranties. Borrower hereby represents and
warrants to Administrative Agent and Lenders 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 action on the part of Borrower and
will not violate the articles of incorporation or bylaws of Borrower, (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 Default
has occurred and is continuing, and (iv) Borrower is in full compliance with
all covenants and agreements contained in the Agreement as amended hereby.
3.3 Amended and Restated Security Agreement. The Borrower agrees that
it will, and will cause each Subsidiary to, execute an Amended and Restated
Security Agreement with updated Schedules I through 2 on or before April
30,2002 in order to update such schedules and the names of each Subsidiary.
3.4 Incumbency Certificates. The Borrower agrees that it will, and
will cause each Subsidiary to, execute a certificate of incumbency an or
before April 30, 2002, which certificate(s) shall be certified by the
Secretary or an Assistant Secretary of the Borrower and each Subsidiary,
certifying the names of the officers of the Borrower or applicable
Subsidiary authorized to sign the Loon Documents to which the Borrower or
such Subsidiary is or is to be a party, together with specimen signatures of
such officers. Resolutions authorizing this Amendment and current
organizational documents shall be attached to each certificate of
incumbency.
3.5 Governmental Certificates. The Borrower agrees that it will
provide, on or before April 30, 2002, certificates of the appropriate
government officials of the state of organization of the Borrower and each
Subsidiary as to the existence and good standing of the Borrower and each
Subsidiary and certificates of the appropriate government officials of each
state where the nature of the Borrowe9s and each Subsidiaries business in
such state makes qualification to do business necessary and where failure to
so qualify would have a material adverse effect, as to the qualification and
good standing of the Borrower and each Subsidiary in such states.
3.6 Schedules. The Borrower agrees that it will provide. on or before
April 30, 2002, updated Schedules 1.01 through 8.08 to the Agreement current
as of the date of this Amendment.
ARTICLE IV
Conditions Precedent to Effectiveness
4.1 Conditions. The effectiveness of this Amendment is subject to the
full satisfaction of each of the following conditions precedent:
(1) Documents. Administrative Agent shall have received nil of
the followings in form and substance satisfactory to Administrative
Agent:
(a) Amendment A counterpart of this Amendment signed on
behalf of each party or written evidence satisfactory to the
Administrative Agent (which may include telecopy transmission of a
signed signature page of this Amendment) that such party has
signed a counterpart of this Amendment.
(b) Stock Certificates. Original stock certificates and blank
stock transfer powers far Pegasus Solutions Companies.
(c) Guaranty. An amended and restated Guaranty executed by
each of the Guarantors.
(d) Contribution and Indemnification Agreement. An amended
and restated Contribution and Indemnification Agreement executed
by the Borrower and each of the Guarantors.
(2) No Default. No Default or Event of Default shall have
occurred and be continuing, or would result from the execution of this
Amendment the other Loan Documents, or the transactions contemplated
therein.
(3) No Material Adverse Effect. No Material Adverse Effect shall
have occurred since the date of the mast recent financial statements
delivered by the Borrower to the Lender or could reasonably be expected
to occur, and no material adverse change shall have occurred in the
business condition (financial or otherwise), operations, prospects, or
properties of the Borrower or any Subsidiary.
(4) Representations and Warranties. All of the representations
and warranties contained in Article V of the Agreement and in the other
Loan Documents shall be true and correct on and as of the date hereof
with the same force and effect as if such representations and
warranties had been made on and as of the date hereof.
(5) Legal Matters. The corporate capital, legal, ownership and
management structure of the Borrower and such Subsidiary, all
shareholder agreements and all tax assumptions and aspects of the
transactions contemplated by this Amendment, the Loan Documents and 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 the Lender.
ARTICLE V
Consents and Waivers
5.1 No Waiver. Except as otherwise specifically provided for in tins
Amendment nothing contained herein shall be construed as a waiver by the
Administrative Agent of any covenant or provision of the Agreement the other
Loan Documents, this Amendment or of any other contract or instrument
between the Borrower, Administrative Agent and the Lenders, and the failure
of the Administrative Agent or any Lender at any time or times hereafter to
require strict compliance by the Borrower of any provision thereof shall not
waive, affect & diminish any right of the Administrative Agent or any Lender
to thereafter demand strict compliance therewith. The Administrative Agent
and each Lender hereby reserve all rights granted under the Agreement, the
other Loan Documents, this Amendment and any other contract or instrument
between the Borrower, the Administrative Agent and the Lenders.
5.2 Consent to Prepayment of Subordinated Note. The Lenders and the
Agent hereby acknowledge their consent to the prepayment in full of all
outstanding principal, accrued interest and other amounts due under the
Subordinated Note in full satisfaction of all of Borrower's obligations
under the Subordinated Note, to the extent such prepayment would otherwise
violate the covenants set forth in Section 8.06 or Section 8.12 of the
Agreement, and hereby waive any Default existing under Section l10.01 of the
Agreement due to such prepayment.
ARTICLE VI
Miscellaneous
6.1 Survival of Representations and Warranties. All representations and
warranties made in this Amendment or any other Loan Document including any
Loan Document finished in connection with this Amendment shall survive the
execution and delivery of this Amendment and the other Loan Documents, and
no investigation by Administrative Agent any Lender or any closing shall
affect the representations and warranties or the right of Administrative
Agent or any Lender to rely upon them.
6.2 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.
6.3 Expenses of Administrative Agent. As provided in the Agreement,
Borrower agrees to pay on demand all reasonable costs and expenses incurred
by Administrative Agent in connection with the preparation, negotiation4 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 fees and expenses of
Administrative Agent's legal counsel.
6.4 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.
6.5 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 SHALL BE GOVERNED BY AND
CONSTRUED N ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
6.6 Successors and Assigns. This Amendment is binding upon and shall
inure to the benefit of Administrative Agent Lenders and Borrower and their
respective successors and assigns, except Borrower may not assign or
transfer any of its rights or obligations hereunder without the prior
written consent of Administrative Agent and Required Lenders.
6.7 Counterparts. This Amendment may be 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.
6.8 Effect of Waiver. No consent or waiver, express or implied, by
Administrative Agent or any Lender to or for any breach of or deviation from
any covenant, condition or duty by Borrower or Guarantor shall be deemed a.
consent or waiver to or of any other breach of the same or any other
covenant condition or duty.
6.9 Headings. The headings, captions, and arrangements used in this
Amendment are for convenience only and shall not affect the interpretation
of this Amendment.
6.10 Non-Application of Chapter 346 of Texas Finance Code. The
provisions of Chapter 346 of the Texas Finance Code (Vernon's Texas Civil
Statutes) are specifically declared by the parties not to be applicable to
this Amendment or any of the Loan Documents or the transactions contemplated
hereby.
6.11 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 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.
[Remainder of Page Intentionally Left Blank
Executed as of the date first written above.
BORROWER:
PEGASUS SOLUTIONS, INC., formerly known as
PEGASUS SYSTEMS, INC.
By: /s/
Name: Ric Floyd
Tite: Executive Vice President
ADMINISTRATIVE AGENT
JPMORGAN CHASE BANK (formerly known as The
Chase Manhattan Bank, successor by merger to
Chase Bank of Texas, National Association), a
New York banking corporation in its capacity
as Agent
By: /s/
Name: Mae Reeves
Title: Vice President
LENDERS:
JPMORGAN CHASE BANK (formerly known as The
Chase Manhattan Bank; successor by merger to
Chase Bank of Texas, National Association), a
New York banking corporation, in its capacity
as Lender
By: /s/
Name: Mae Reeves
Title: Vice President
COMPASS BANK
By: /s/
Name: R. Bruce Ere
Title: Vice President
WELLS FARGO BANK TEXAS, NATIONAL
ASSOCIATION
By: /s/
Name: David C. Oldani
Title: Vice President
Guarantors hereby consent and agree to this Amendment and agree that
the Guaranty shall remain in full force and effect and shall continue to be
the legal, valid and binding obligation of each Guarantor enforceable
against each Guarantor in accordance with its terms.
PEGASUS NO. 1, LLC
By: /s/
William C. Hammett, Jr.
Manager
PEGASUS NO.2, LLC
By: /s/
William C. Hammett, Jr.
Manager
PEGASUS GP, LLC
By: Pegasus Solutions, Inc., its Sole Member
By: /s/
Ric L.Floyd
Executive Vice President
PEGASUS BUSINESS INTELLIGENCE, LP,
(successor by merger to Pegasus Electronic
Distribution, LP and Pegasus Commission
Processing, LP)
By Pegasus GP. LLC, its General Partner
By: Pegasus Solutions, Inc., its Sole Member
By: /s/
Ric L. Floyd
Executive Vice President
PEGASUS SOLUTIONS COMPANIES, (successor by
merger to Pegasus Solutions Acquisition Company
[formerly known as REZ, Inc ], Anasazi Service
Corporation and Anasazi Travel Resources, Inc,
and formerly known as Rezolutions, Inc.)
By: /s/
Ric L. Floyd
Executive Vice President
EXHIBIT "G"
TO
AMENDED AND RESTATED CREDIT AGREEMENT
Compliance Certificate
[FORM OF COMPLIANCE CERTIFICATE APPEARS HERE]
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AMENDED AND RESTATED GUARANTY
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THIS AMENDED AND RESTATED GUARANTY (this "Guaranty", dated as of March
31, 2002, is executed by the undersigned guarantors (each a "Guarantor" and,
collectively, the "Guarantors"), for the benefit of each of the banks or
lending institutions (each, a 'Lender" and, collectively, the "Lenders")
which is or may from time to time become a signatory to the Credit Agreement
(hereinafter defined) or any successor or permitted assignee thereof, and
JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank, successor
by merger to The Chase Bank of Texas, National Association) (the
"Administrative Agent"), as the Administrative Agent under the Credit
Agreement.
WHEREAS, Pegasus Solutions, Inc., formerly known as Pegasus Systems,
Inc., a Delaware corporation (the "Borrower"), the Lenders, and the
Administrative Agent are parties to that certain Amended and Restated Credit
Agreement dated as of August 31, 2001, as amended of even date hereof (as
the same may be amended, supplemented or modified from time to time, the
"Credit Agreement", which Credit Agreement amended and restated a credit
agreement dated as of April 17, 2000;
WHEREAS, the Guarantors or their predecessors executed a Guaranty
Agreement dated as of April 17, 2000 in connection with the credit agreement
dated as of April 17, 2000, as amended and restated by the Credit Agreement;
WHEREAS, certain of the Guarantors have been restructured since such
date; and
WREREAS, as a condition to the Credit Agreement, each Guarantor is
required to execute and deliver this Guaranty in order to accurately reflect
the names and structure of the Guarantors.
NOW, THEREFORE, for valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the Guarantors hereby jointly and
severally, irrevocably and unconditionally guarantee to the Administrative
Agent and the Lenders the full and prompt payment and performance of the
Guaranteed Indebtedness (hereinafter defined), this Guaranty being upon the
following terms:
1. The term 'Guaranteed Indebtedness", as used herein, means all of the
"Obligations", as defined in the Credit Agreement The term "Guaranteed
Indebtedness" shall include any and all post-petition interest and expenses
(including reasonable attorneys' fees) whether or not allowed under any
bankruptcy, insolvency, or other similar law. All other capitalized terms
used and not otherwise defined herein shall have their respective meanings
as set forth in the Credit Agreement.
2. This instrument shall be an absolute, continuing, irrevocable, and
unconditional guaranty of payment and performance, and not a guaranty of
collection, and each Guarantor shall remain liable on its obligations
hereunder until the payment and performance in full of the Guaranteed
Indebtedness. No set-off, counterclaim, recoupment reduction, or diminution
of any obligation, or any defense of any kind or nature which the Borrower
may have against the Administrative Agent any Lender or any other party, or
which any Guarantor may have against the Borrower, the Administrative Agent,
any Lender or any other party, shall be available to, or shall be asserted
by, any Guarantor against to Administrative Agent, any Lender or any
subsequent holder of the Guaranteed Indebtedness or any part thereof or
against payment of the Guaranteed Indebtedness or any part thereof.
3. The obligations of each Guarantor hereunder shall be limited to an
aggregate amount equal to the largest amount that would not render its
obligations hereunder subject to avoidance under Section 548 of the United
States Bankruptcy Code or to being set aside, avoided, or annulled under any
applicable state law relating to fraudulent transfers or fraudulent
obligations.
4. If any Guarantor becomes liable fir any indebtedness owing by the
Borrower to the Administrative Agent or any Lender by endorsement or
otherwise, other than under this Guaranty, such liability shall not be in
any manner impaired or affected hereby, and the rights of the Administrative
Agent and the Lenders Thereunder shall be cumulative of any and all other
rights that any of them may ever have against any Guarantor. The exercise by
the Administrative Agent or any Lender of any right or remedy hereunder or
under any other instrument, or at law or in equity, shall not preclude the
concurrent or subsequent exercise of any other right or remedy.
5. In the event of default by the Borrower in payment or performance
of the Guaranteed Indebtedness, or any part thereof, when such Guaranteed
Indebtedness becomes due, whether by its terms, by acceleration, or
otherwise, Guarantors jointly and severally agree to promptly pay the amount
due thereon to the Administrative Agent, for the pro rata benefit of the
Administrative Agent and the Lenders, without notice or demand in lawful
currency of the United States of America and it shall not be necessary for
the Administrative Agent or any Lender, in order to enforce such payment by
any Guarantor, first to institute suit or exhaust its remedies against the
Borrower, any Guarantor or others liable on such Guaranteed Indebtedness, or
to enforce any rights against any collateral which shall ever have been
given to secure such Guaranteed Indebtedness. Notwithstanding anything to
the contrary contained in this Guaranty, each Guarantor hereby irrevocably
subordinates to the prior indefeasible payment in Bill of the Guaranteed
indebtedness, any and all rights such Guarantor may now or hereafter have
under any agreement or at law or in equity (including, without limitation,
any law abrogating such Guarantor to the rights of the Administrative Agent
and the Lenders) to assert any claim against or seek contribution,
indemnification or any other form of reimbursement from the Borrower or any
other party liable for payment of any or all of the Guaranteed Indebtedness
for any payment made by such Guarantor under or in connection with this
Guaranty or otherwise.
6. If acceleration of the time for payment of any amount payable by
the Borrower under the Guaranteed Indebtedness is stayed upon the
insolvency, bankruptcy, or reorganization of the Borrower, all such amounts
otherwise subject to acceleration under the terms of the Guaranteed
Indebtedness shall nonetheless be jointly and severally payable by the
(Guarantors hereunder forthwith on demand by the Administrative Agent.
7. Each Guarantor hereby agrees that its obligations under this
Guaranty shall not be released, discharged, diminished, impaired, reduced,
or affected for any reason or by the occurrence of any event, including,
without limitation, one or more of the following events, whether or not with
notice to or the consent of any Guarantor: (a) the taking or accepting of
collateral as security for any or all of the Guaranteed Indebtedness or the
release, surrender, exchange, or subordination of any collateral now or
hereafter securing any or all of the Guaranteed Indebtedness; (b) any
partial release of the liability of any Guarantor hereunder, or the full or
partial release of any other guarantor from liability for any or all of the
Guaranteed Indebtedness; (c) the dissolution, insolvency, or bankruptcy of
the Borrower, any Guarantor, or any other party at any time liable for the
payment of any or all of the Guaranteed indebtedness (d) any renewal,
extension, modification, waiver, amendment, or rearrangement of any or all
of the Guaranteed Indebtedness or any instrument, document or agreement
evidencing, securing, or otherwise relating to any or all of the Guaranteed
Indebtedness; (e) any adjustment, indulgence, forbearance, waiver, or
compromise that may be granted or given by the Administrative Agent or any
Lender to the Borrower, any Guarantor, or any other party ever liable for
any or all of the Guaranteed Indebtedness; (f) any neglect, delay, omission,
failure, or refusal of the Administrative Agent or any Lender to take or
prosecute any action for the collection of any of the Guaranteed
Indebtedness or to foreclose or take or prosecute any action in connection
with any instrument, document, or agreement evidencing, securing, or
otherwise relating to any or all of the Guaranteed Indebtedness; (g) the
unenforceability or invalidity of any or all of the Guaranteed Indebtedness
or of any instrument, document, or agreement evidencing, securing, or
otherwise relating to any or all of the Guaranteed Indebtedness; (h) any
payment by the Borrower or any other party to the Administrative Agent or
any Lender is held to constitute a preference under applicable bankruptcy or
insolvency law or if for any other reason the Administrative Agent or any
Lender is required to refund any payment or pay the amount thereof to
someone else; (i) the settlement or compromise of any of the Guaranteed
Indebtedness; (j) the non-perfection of any security interest or lien
securing any or all of the Guaranteed Indebtedness; (k) any impairment of
any collateral securing any or all of the Guaranteed Indebtedness; (l) the
failure of the Administrative Agent or any Lender to sell any collateral
securing any or all of the Guaranteed Indebtedness in a commercially
reasonable manner or as otherwise required by law; (m) any change in the
corporate existence, structure, or ownership of the Borrower; or (n) any
other circumstance which might otherwise constitute a defense available to,
or discharge at the Borrower or any Guarantor.
8. Each Guarantor represents and warrants to the Administrative Agent
and the Lenders that:
(a) Bach and every representation and warranty contained in the
Credit Agreement is true and correct in all respects.
(b) The value of the consideration received and to be received by
such Guarantor as a result of the Borrower, the London and the
Administrative Agent entering into the Credit Agreement, the extensions
of credit thereunder and such Guarantor executing and delivering this
Guaranty is reasonably equivalent to or greater than the liability and
obligation of such Guarantor hereunder, and such liability and
obligation, the Borrower's entering into the Credit Agreement and the
extensions of credit thereunder have benefited and may reasonably be
expected to benefit such Guarantor directly or indirectly.
(c) Such Guarantor has, independently and without reliance upon
the Administrative Agent or any Lender and based upon such documents
and information as such Guarantor has deemed appropriate, made its own
analysis and decision to enter into this Guaranty.
(d) The ability of the Borrower to borrow from time to time under
the Credit Agreement will enable such Guarantor to obtain credit, will
benefit such Guarantor and the consolidated corporate group of which
such Guarantor is a part and are necessary and convenient to the
conduct, promotion and attainment of the business of such Guarantor.
(e) As additional consideration for entering into this Guaranty,
such Guarantor has obtained certain rights under that certain
Contribution end Indemnification Agreement of even date herewith, among
the Borrower and the Guarantors.
(f) Such Guarantor has adequate capital to conduct its business
as a going concern, as presently conducted and as proposed to be
conducted; such Guarantor will be able to meet its obligations
hereunder and in respect of its other existing and future indebtedness
and liabilities as and when the same shall be due and payable; such
Guarantor is not insolvent (as that term is defined in ii U.S.C. S 101
or applicable law) and will not be rendered insolvent by its
obligations hereunder, and the forgoing representations are supported
by such Guarantor's internal projections and forecasts.
(g) Such Guarantor has determined that the execution and delivery
of this Guaranty is to its advantage and benefit, taking into account
all relevant facts and circumstances.
9. If an Event of Default shall have occurred and be continuing, the
Administrative Agent and each Lender shall have the right to set off and
apply against this Guaranty or the Guaranteed Indebtedness or both, at any
dine and without notice to any Guarantor, any and all deposits (general or
special, time or demand, provisional or final) or other sums at any time
credited by or owing from the Administrative Agent or any Lender to any
Guarantor whether or not the Guaranteed Indebtedness is then due and
irrespective of whether or not the Administrative Agent or any Lender shall
have made any demand under this Guaranty. As security for this Guaranty and
the Guaranteed Indebtedness, each Guarantor hereby grants the Administrative
Agent and each Lender a security interest in all money, instruments,
certificates of deposit and other property of such Guarantor now or
hereafter held by the Administrative Agent and each Lender, including
without limitation, property held in safekeeping In addition to the
Administrative Agents and each Lender's right of setoff and as further
security far this Guaranty and the Guaranteed Indebtedness, each Guarantor
hereby grants the Administrative Agent and each Lender a security interest
in all deposits (genera! or special, time or demand, provisional or final)
and all other accounts of such Guarantor now or hereafter on deposit with or
held by the Administrative Agent or any Lender and all other sums at any
time credited by or owing from the Administrative Agent or any Lender to
such Guarantor. The rights and remedies of the Administrative Agent and each
Lender hereunder arc in addition to other rights and remedies (including
without limitation, other rights of setoff) which the Administrative Agent
and each Lender may have.
10. (a) Each Guarantor hereby agrees that the Subordinated
Indebtedness (hereinafter defined) shall be subordinate and junior in right
of payment to the prior payment in full of all Guaranteed Indebtedness, and
each Guarantor hereby assigns the Subordinated Indebtedness to the
Administrative Agent, for the pro rata benefit of the Administrative Agent
and the Lenders, as security for the Guaranteed Indebtedness, If any sums
shall be paid to any Guarantor by the Borrower or any other Person on
account of the Subordinated Indebtedness, such sums shall be held in trust
by such Guarantor for the benefit of the Administrative Agent and shall
forthwith be paid to the Administrative Agent, for the pro rata benefit of
the Administrative Agent and the Lenders, without affecting the liability of
any Guarantor under this Guaranty and may be applied by the Administrative
Agent and the Lenders against the Guaranteed Indebtedness in such order and
manner as they may determine in their absolute discretion; provided however
that so long as no Event of Default shall have occurred, the Borrower and
the Subsidiaries shall be permitted to pay to any Guarantor, and each
Guarantor shall be permitted to receive and retain, regularly scheduled
payments on account of Subordinated Indebtedness. Upon the request of the
Administrative Agent, each Guarantor shall execute, deliver, and endorse to
the Administrative Agent, for the pro rata benefit of the Administrative
Agent and the Lenders, such documents and instruments as the Administrative
Agent may request to perfect, preserve, and enforce the tights of the
Administrative Agent and the Lenders hereunder. For purposes of this
Guaranty, the term "Subordinated Indebtedness" means all indebtedness,
liabilities, and obligations of the Borrower and the Subsidiaries, or any of
them, to any Guarantor, whether such indebtedness, liabilities, and
obligations now exist or are hereafter incurred or arise, or whether the
obligations of the Borrower or such Subsidiary thereon are direct, indirect,
contingent, primary, secondary, several, joint, joint and several, or
otherwise, and irrespective of whether such indebtedness, liabilities, or
obligations are evidenced by a note, contract, open account, or otherwise,
and irrespective of the Person or Persons in whose favor such indebtedness,
obligations, or liabilities may, at their inception, have been, or may
hereafter be created, or the manner in which they have been or may hereafter
be acquired by any Guarantor.
(b) Each Guarantor agrees that any and an hens, security
interests, judgment liens, charges, or other encumbrances upon the assets of
the Borrower and the Subsidiaries, or any of them, securing payment of any
Subordinated Indebtedness shall be and remain inferior and subordinate to
any and all liens, security interests, judgment liens, charges, or other
encumbrances upon such assets securing payment of the Guaranteed
Indebtedness or any part thereat regardless of whether such encumbrances
securing the Subordinated Indebtedness or the Guaranteed Indebtedness
presently exist or are hereafter created or attached. No Guarantor shall (i)
file suit against the Borrower or any Subsidiary or exercise or enforce any
other creditors right it may have against the Borrower or any Subsidiary; or
(ii) foreclose, repossess, sequester, or otherwise take steps or institute
any action or proceedings (judicial or otherwise, including without
limitation the commencement of, or joinder in, any liquidation, bankruptcy,
rearrangement, debtors relief or insolvency proceeding) to enforce any
liens, security interests, collateral rights, judgments or other
encumbrances held by any Guarantor on assets of the Borrower or any
Subsidiary unless and until the Guaranteed Indebtedness shall have been paid
in full, no Letters of Credit are outstanding, and the Commitments have
expired or terminated.
(c) In the event of any receivership, bankruptcy, reorganization,
rearrangement, debtor's relief, or other insolvency proceeding involving the
Borrower or any Subsidiary as debtor, the Administrative Agent shall have
the right to prove and vote any claim under the Subordinated Indebtedness
and to receive, for the benefit of the Administrative Agent and the Lenders,
directly from the receiver, trustee or other court custodian all dividends,
distributions, and payments made in respect of the Subordinated
Indebtedness. The Administrative Agent and the Lenders may apply any such
dividends, distributions, and payments against the Guaranteed Indebtedness
in such order and manner as they may determine in their absolute discretion.
(d) Each Guarantor agrees that all promissory notes, accounts
receivable, ledgers, records, or any other evidence of Subordinated
Indebtedness shall contain a specific written notice thereon that the
indebtedness evidenced thereby is subordinated under the terms of this
Guaranty.
11. No Guarantor shall prepay any Indebtedness, except the Guaranteed
Indebtedness.
12. No amendment or waiver of any provision of this Guaranty or
consent to any departure by any Guarantor therefrom shall in any event be
effective unless the same shall be in writing and signed by the
Administrative Agent and the Required Lenders. No failure on the part of the
Administrative Agent or any Lender to exercise, and no delay in exercising,
any right, power, or privilege hereunder shall operate as a waiver thereat
nor shall any single or partial exercise of any right, power, or privilege
hereunder preclude any other or further exercise thereof or the exercise of
any other right, power, or privilege. The remedies heroin provided are
cumulative and not exclusive of any remedies provided by law.
13. Any acknowledgment or new promise, whether by payment of principal
or interest or otherwise and whether by the Borrower or others (including
any Guarantor), with respect to any of the Guaranteed Indebtedness shall, if
the statute of limitations in favor of any Guarantor against the
Administrative Agent or any Lender shall have commenced to run, toll the
running of such statute of limitations and, if the period of such statute of
limitations shall have expired, prevent the operation of such statute of
limitations.
14. This Guaranty is for the benefit of the Administrative Agent and
the Lenders and their respective successors and assigns, and in the event of
an assignment of the Guaranteed Indebtedness, or any part thereof the rights
and benefits hereunder, to the extent applicable to the indebtedness so
assigned, may be transferred with such indebtedness. This Guaranty is
binding not only on each Guarantor, but on each Guarantor's successors and
assigns. The Guarantors' obligations and agreements hereunder are joint and
several. The provisions of this Guaranty shall apply to each Guarantor
individually and collectively.
15. Each Guarantor recognizes that the Administrative Agent and the
Lenders are relying upon this Guaranty and the undertakings of each
Guarantor hereunder in making extensions of credit to the Borrower under the
Credit Agreement and further recognizes that the execution and delivery of
this Guaranty is a material inducement to the Administrative Agent and the
Lenders in entering into the Credit Agreement. Each Guarantor hereby
acknowledges that there are no conditions to the full effectiveness of this
Guaranty.
16. THIS GUARANTY IS EXECUTED AND DELIVERED AS AN INCIDENT TO A
LENDING TRANSACTION NEGOTIATED, CONSUMMATED, AND PERFORMABLE IN DALLAS
COUNTY, TEXAS, AND SHALL BE GOVERNED BY ACCORDANCE WITH THE LAWS OF THE
STATE OF TEXAS.
17. The Guarantors jointly and severally agree to pay on demand all
attorneys' fees and all other costs and expenses incurred by the
Administrative Agent and each Lender in connection with the preparation,
administration, enforcement or collection of this Guaranty.
18. Each Guarantor hereby waives promptness, diligence, notice of any
default under the Guaranteed Indebtedness, demand of payment, notice of
acceptance of this Guaranty, presentment notice of protest, notice of
dishonor, notice of intent to accelerate, notice of acceleration, notice of
the incurring by the Borrower of additional indebtedness, and all other
notices and demands wit respect tote Guaranteed Indebtedness and this
Guaranty.
19. Each Guarantor agrees that the Administrative Agent and each
Lender may exercise any and all rights granted to them under the Credit
Agreement and the other Loan Documents without affecting the validity or
enforceability of this Guaranty.
20. Each Guarantor hereby represents and warrants to the
Administrative Agent and the Lenders that such Guarantor has adequate means
to obtain from the Borrower and the Subsidiaries on a continuing basis
information concerning the financial condition and assets of the Borrower
and the Subsidiaries and that such Guarantor is not relying upon the
Administrative Agent or any Lender to provide (and neither the
Administrative Agent nor any Lender shall have any duty to provide) any such
information to such Guarantor either now or in the future.
21. THIS GUARANTY REPRESENTS THE FINAL AGREEMENT AMONG THE PARTIBS AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS. OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO ORAL AGREEMENTS AMONG THE
PARTIES.
22. Each Guarantor acknowledges that it has had the benefit of legal
counsel of its own choice and has been afforded an opportunity to review
this Guaranty with its legal counsel and that this Guaranty shall be
construed as if jointly drafted by the Guarantors, the Administrative Agent
and the Lenders.
23. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH GUARANTOR
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 THIS GUARANTY, THE CREDIT
AGREEMENT, ANY OF THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY OR THE ACTIONS OF THE ADMINISTRATIVE AGENT OR ANY LENDER
IN THE NEGOTIATION, ADMINISTRATION, OR ENFORCEMENT THEREOF.
[REMAINDER OF PAGE INTENTIONALLY BLANK]
EXECUTED as of the day midyear first written above.
GUARANTORS:
PEGASUS NO. 1, LLC
By: /s/
William C. Hammett, Jr.
Manager
PEGASUS NO.2, LLC
By: /s/
William C. Hammett, Jr.
Manager
PEGASUS GP, LLC
By: Pegasus Solutions, Inc., its Sole Member
By: /s/
Ric L.Floyd
Executive Vice President
PEGASUS BUSINESS INTELLIGENCE, LP,
(successor by merger to Pegasus Electronic
Distribution, LP and Pegasus Commission
Processing, LP)
By Pegasus GP. LLC, its General Partner
By: Pegasus Solutions, Inc., its Sole Member
By: /s/
Ric L. Floyd
Executive Vice President
PEGASUS SOLUTIONS COMPANIES, (successor by
merger to Pegasus Solutions Acquisition Company
[formerly known as REZ, Inc ], Anasazi Service
Corporation and Anasazi Travel Resources, Inc,
and formerly known as Rezolutions, Inc.)
By: /s/
Ric L. Floyd
Executive Vice President
****************************************************************************
AMENDED AND RESTATED CONTRIBUTION
AND INDEMNIFICATION AGREEMENT
AMENDED AND RESTATED CONTRIBUTION AND INDEMNIFICATION AGREEMENT
("Agreement") dated us of March 31, 2002, among Pegasus Solutions, Inc.,
formerly known as Pegasus Systems, Inc., a Delaware corporation (the
"Borrower"), and the undersigned guarantors (each a "Guarantor and,
collectively, the "Guarantors," and together with the Borrower, each a
"Company" and, collectively, the "Companies").
RECITALS:
---------
A. Borrower, certain lenders and JPMorgan Chase Bank (formerly known
as The Chase Manhattan Bank, successor by merger to Chase Bank of Texas,
National Association), as administrative agent for such lenders (in such
capacity, together with its successor in such capacity, the "Administrative
Agent"), have entered into a Credit Agreement dated as of April 17, 2000, as
amended and restated on August31, 2001, and as further amended, of even date
herewith (such Credit Agreement, as the same may be amended, supplemented or
modified from time to time, the "Credit Agreement"), providing for loans and
extensions of credit to the Borrower;
B. Concurrently herewith, the Guarantors are executing and delivering
an Amended and Restated Guaranty (the "Guaranty"), pursuant to which the
Guarantors jointly and severally guarantee the full and prompt payment and
performance of the Guaranteed Indebtedness (as defined in the Guaranty);
C. The Guarantors and the Borrower previously executed a Contribution
and Indemnification Agreement dated as of April 17, 2000; however, certain
of the Companies have been restructured since such date; and
D. The Companies wish to enter into this Agreement to effect an
equitable sharing of their risk in respect of the Guaranteed Indebtedness
and to accurately reflect the names and structure of the Companies.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Companies agree as follows:
1. If any Guarantor makes a payment in respect of the Guaranteed
Indebtedness, it shall have the rights of contribution and reimbursement set
forth below against the other Companies and shall be indemnified as set
forth below; provided that no Guarantor shall enforce its rights to any
payment by exercising its rights of contribution, reimbursement or
indemnification until all the Guaranteed Indebtedness shall have been. paid
in full.
2. If any Guarantor makes a payment in respect of the Guaranteed
Indebtedness that is greater than its Pro Rata Percentage (hereinafter
defined) of such Guaranteed Indebtedness, calculated as of the date such
payment is made, the Guarantor making such payment shall have the right to
receive firm each of the other Guarantors, and the other Guarantors jointly
and severally agree to pay to such Guarantor, when permitted by paragraph I
hereof, an amount such that the net payments made by the Guarantors in
respect of such Guaranteed Indebtedness shall be shared among the Guarantors
pro rata in proportion to their respective Pro Rata Percentage of such
Guaranteed Indebtedness. The Guarantors hereby jointly and severally
indemnify each of the other Guarantors and jointly and severally agree to
hold each of them harmless from and against any and all amounts which any
such Guarantor shall ever be required to pay in respect of such Guaranteed
Indebtedness in excess of such Guarantor's respective Pro Rata Percentage of
such Guaranteed Indebtedness.
(a) Notwithstanding anything to the contrary contained in this
paragraph or in this Agreement, no liability or obligation of any Guarantor
that shall accrue pursuant to this Agreement shall be paid nor shall it be
deemed owed pursuant to this Agreement or any Loon Documents until all of
the Guaranteed Indebtedness shall be paid in full.
(b) As used herein, the term "Pro Rata Percentage" shall mean, for
each Guarantor, the percentage derived by dividing (1) the amount by which
the present fair saleable value of such Guarantor's assets on December
31,1999 exceeds its liabilities (without giving effect to the Guaranty)
(such excess for each Guarantor, its "Net Worth") by (2) the Net Worth of
all of the Guarantors, provided that upon the release of any Guarantor, the
pro rata percentage of each remaining Guarantor shall be equitably adjusted
to give effect to such release.
3. If any Guarantor makes any payment in respect of the Guaranteed
Indebtedness, the Guarantor making such payment shall have the right to
receive from the Borrower, and the Borrower agrees to pay to such Guarantor,
when permitted by paragraph 1 hereof, an amount equal to such payment. The
Borrower hereby indemnifies each of the Guarantors and agrees to hold each
of them harmless from and against any and all amounts which any such
Guarantor shall ever be required to pay in respect of such Guaranteed
Indebtedness. Notwithstanding anything to the contrary contained in this
paragraph or in this Agreement no liability or obligation of the Borrower
that shall accrue pursuant to this Agreement or any Loan Document shall be
paid or shall be deemed owed pursuant to this Agreement until all of the
Guaranteed Indebtedness shall be paid in full.
4. Each Company represents and warrants to each other Company and to
their respective successors and assigns that:
(a) the execution, delivery and performance by each Company of this
Agreement are within such Company's organizational powers, have been duly
authorized by all necessary action, require no action by or in respect of,
or filing with, any governmental body, agency or official and do not
contravene, or constitute a default under, any provision of applicable law
or regulation or of the articles of incorporation, bylaws, partnership
agreement or other organizing document of such Company or of any agreement,
judgment injunction, order, decree or other instrument binding upon such
party or result in the creation or imposition of any lien, security interest
or other charge or encumbrance on any asset of such Company,
(b) this Agreement constitutes a legal, valid and binding agreement of
each Company hereto, enforceable against such Company in accordance with its
terms;
(c) each Company is not insolvent (as that term is defined in 11 USC.
S 101 or applicable law) and will not be rendered insolvent by its
obligations hereunder, and the foregoing representation is supported by such
Company's internal projections and forecasts; and
(d) The obligations of the Companies under this Agreement are not
voidable obligations under 11 U.S.C. S548 or under any state law regarding
fraudulent transfers, fraudulent conveyances or fraudulent incurrence of
obligations.
5. No failure or delay by any Guarantor in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights
and remedies herein provided shall be cumulative and non-exclusive of any
rights or remedies provided by law.
6. Any provision of this Agreement may be amended or waived if, but
only if, such amendment or waiver is in writing and is signed by the parties
hereto and consented to by the Administrative Agent.
7. The provisions of this Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
assigns.
8. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED N ACCORDANCE
WITH, THE LAWS OF ThE STATE OF TEXAS.
9. This Agreement may be signed in any number of counterparts, each
of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument. This Agreement shall
become effective when a counterpart hereof shall have been signed by all the
parties hereto.
[The Remainder of This Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year
first above written
BORROWER:
PEGASUS SOLUTIONS, INC.,
a Delaware corporation (formerly known as
Pegasus Systems, Inc.)
By: /s/ Ric L Floyd
Name: Ric L Floyd
Title: Executive Vice President
GUARANTORS:
PEGASUS NO. l, LLC
By: /s/ William C. Hammett, Jr.
William C. Hammett, Jr.
Manager
PEGASUS NO.2, LLC
By: /s/ William C. Hammett, Jr.
William C. Hammett, Jr.
Manager
PEGASUS GP, LLC
By: Pegasus Solutions, Inc., its Sole Member
By: /s/ Ric L. Floyd
Ric L. Floyd
Executive Vice President
Signature Page to Amended and Restated
Contribution and Indemnification Agreement - Page 1 of 2
PEGASUS BUSINESS INTELLIGENCE, LP,
(successor by merger to Pegasus Electronic
Distribution, LP and Pegasus Commission
Processing, LP)
By: Pegasus GP, LLC, its General Partner
By: Pegasus Solutions, Inc., its Sole Member
By: /s/ Ric L. Floyd
Ric L. Floyd
Executive Vice President
PEGASUS SOLUTIONS COMPANIES, (successor
by merger to Pegasus Solutions Acquisition
Company [formerly known as REZ, Inc.], Anasazi
Service Corporation and Anasazi Travel Resources,
Inc., and formerly known as Rezolutions, Inc.)
By: /s/ Ric L. Floyd
Ric L Floyd
Executive Vice President