Exhibit 4(g)
FIRST AMENDMENT TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT (this "First Amendment"),
dated as of July 15, 2005, is among HALLMARK FINANCIAL SERVICES, INC., a
Nevada corporation ("Borrower"), AMERICAN HALLMARK INSURANCE COMPANY OF
TEXAS, a Texas insurance corporation ("AHIC"), PHOENIX INDEMNITY INSURANCE
COMPANY, an Arizona insurance corporation ("PIIC"), each other Obligor,
and THE FROST NATIONAL BANK, a national banking association ("Lender").
RECITALS:
Borrower, AHIC, PIIC, and Lender have previously entered into the
Credit Agreement dated as of June 29, 2005 (such agreement, together with
all amendments and restatements, the "Credit Agreement").
Borrower has requested an amendment to certain provisions of the Credit
Agreement.
Lender has agreed to amend the Credit Agreement, subject to the terms
of this First Amendment.
AGREEMENT:
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto agree as follows:
ARTICLE I
Definitions
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1.1 Definitions. All capitalized terms not otherwise defined herein
have the same meanings as in the Credit Agreement.
ARTICLE II
Amendments to Credit Agreement
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2.1 Amendments to Credit Agreement Section 1.1.
The definition of "Applicable Rate" is deleted.
The definition of "Applicable Rate Certificate" is deleted.
The definition of "Eurodollar Rate" is amended by deleting "the
Applicable Rate" and substituting "2.00%" in lieu thereof.
2.2 Amendment to Credit Agreement Section 3.7.
The first sentence of Section 3.7 is amended by deleting "the
Applicable Rate" and substituting "1.00%" in lieu thereof.
2.3 Amendment to Credit Agreement Section 5.1.
The text of Section 5.1(p) is deleted in its entirety and
"[INTENTIONALLY OMITTED]" is substituted in lieu thereof.
2.4 Amendment to Credit Agreement.
Exhibit M (Applicable Rate Certificated) is deleted in its entirety and
"[INTENTIONALLY OMITTED]" is substituted in lieu thereof.
ARTICLE III
Conditions Precedent
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3.1 Conditions. The effectiveness of this First Amendment is subject to
the satisfaction of the following conditions precedent:
(a) Documents. Lender shall have received this First Amendment
executed by Borrower, each other Obligor and Lender.
(b) No Default. No Default or Event of Default shall exist.
(c) Representations and Warranties.
(i) All of the representations and warranties contained in
Article VIII of the Credit Agreement, as amended hereby, and in
the other Loan Documents shall be true and correct on and as of
the date of this First Amendment with the same force and effect
as if such representations and warranties had been made on and
as of such date, except to the extent such representations and
warranties speak to a specific date.
(ii) All of the representations and warranties contained in
Article V shall be true and correct, both before and after giving
effect to this First Amendment.
3.2 Expenses of Lender. As provided in the Credit Agreement, Borrower
shall pay on demand all reasonable costs and expenses incurred by Lender in
connection with the preparation, negotiation, and execution of this First
Amendment and the other Loan Documents executed pursuant hereto, including
without limitation the reasonable fees and expenses of Lender's legal
counsel.
ARTICLE IV
Ratification
------------
4.1 Ratification. The terms and provisions set forth in this First
Amendment shall modify and supersede all inconsistent terms and provisions
set forth in the Credit Agreement and except as expressly modified and
superseded by this First Amendment, the terms and provisions of the Credit
Agreement and the other Loan Documents are ratified and confirmed and shall
continue in full force and effect. Each Obligor agrees that the Credit
Agreement, as amended hereby, and the other Loan Documents to which it
is a party or subject shall continue to be legal, valid, binding and
enforceable in accordance with their respective terms.
ARTICLE V
Representations and Warranties
------------------------------
5.1 Representations and Warranties. Each Obligor hereby represents and
warrants to Lender that (a) the execution, delivery and performance of this
First Amendment and any and all other Loan Documents executed and/or
delivered in connection herewith have been authorized by all requisite
action on the part of such Obligor and will not violate any organizational
document of such Obligor, (b) the representations and warranties contained
in the Credit Agreement, as amended hereby, and each other Loan Document are
true and correct on and as of the date hereof as though made on and as of
the date hereof, except to the extent such representations and warranties
speak to a specific date, (c) no Default or Event of Default exists,
and (d) such Obligor is in full compliance with all covenants and agreements
contained in the Credit Agreement, as amended hereby, and the other Loan
Documents to which it is a party or it or its property is subject.
ARTICLE VI
Miscellaneous
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6.1 Reference to Credit Agreement. Each of the Loan Documents,
including the Credit 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 Credit Agreement as amended hereby,
are hereby amended so that any reference in such Loan Documents to the
Credit Agreement shall mean a reference to the Credit Agreement as amended
hereby.
6.2 Severability. The provisions of this First Amendment are intended
to be severable. If for any reason any provision of this First Amendment
shall be held invalid or unenforceable in whole or in part in any
jurisdiction, such provision shall, as to such jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without in any manner
affecting the validity or enforceability thereof in any other jurisdiction
or the remaining provisions hereof in any jurisdiction.
6.3 Counterparts. This First Amendment may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and any party hereto may execute this First Amendment by signing
any such counterpart.
6.4 INTEGRATION. THIS FIRST AMENDMENT, TOGETHER WITH THE OTHER LOAN
DOCUMENTS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.
6.5 GOVERNING LAW. THIS FIRST AMENDMENT AND THE OTHER LOAN DOCUMENTS
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE
OF TEXAS AND FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
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THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.
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Executed as of the date first written above.
BORROWER: HALLMARK FINANCIAL SERVICES, INC.
By: ________________________________________
Print Name: ________________________________
Print Title: _______________________________
RICS: AMERICAN HALLMARK INSURANCE
COMPANY OF TEXAS
By: ________________________________________
Print Name: ________________________________
Print Title: _______________________________
PHOENIX INDEMNITY INSURANCE
COMPANY
By: ________________________________________
Print Name: ________________________________
Print Title: _______________________________
OTHER OBLIGORS:
ACO HOLDINGS, INC.
By: ___________________________________
Print Name: ___________________________
Print Title: __________________________
ALLRISK INSURANCE AGENCY, INC.
By: ___________________________________
Print Name: ___________________________
Print Title: __________________________
AMERICAN HALLMARK AGENCIES, INC.
By: ___________________________________
Print Name: ___________________________
Print Title: __________________________
EFFECTIVE CLAIMS MANAGEMENT, INC.
By: ___________________________________
Print Name: ___________________________
Print Title: __________________________
HALLMARK CLAIMS SERVICE, INC.
By: ___________________________________
Print Name: ___________________________
Print Title: __________________________
HALLMARK FINANCE CORPORATION
By: ___________________________________
Print Name: ___________________________
Print Title: __________________________
HALLMARK GENERAL AGENCY, INC.
By: ___________________________________
Print Name: ___________________________
Print Title: __________________________
HALLMARK UNDERWRITERS, INC.
By: ___________________________________
Print Name: ___________________________
Print Title: __________________________
LENDER: THE FROST NATIONAL BANK
By: ________________________________________
Print Name: ________________________________
Print Title: _______________________________