CREDIT AGREEMENT
among
SPEEDWAY MOTORSPORTS, INC.,
SPEEDWAY FUNDING CORP.,
as Borrowers,
CERTAIN SUBSIDIARIES AND RELATED PARTIES
FROM TIME TO TIME PARTY HERETO,
as Guarantors,
THE SEVERAL LENDERS FROM TIME TO TIME PARTY HERETO,
NATIONSBANK, N.A.,
as Administrative Agent
AND
FIRST UNION NATIONAL BANK,
as Syndication Agent
AND
CREDIT LYONNAIS ATLANTA AGENCY,
as Documentation Agent
AND
BANC OF AMERICA SECURITIES LLC,
as Lead Arranger and Book Manager
DATED AS OF MAY 28, 1999
TABLE OF CONTENTS
SECTION 1 DEFINITIONS 1
1.1 Definitions.....
1.2 Computation of Time Periods.
1.3 Accounting Terms.
SECTION 2 CREDIT FACILITY
2.1 Revolving Loans.
2.2 Letter of Credit Subfacility.
2.3 Swingline Loan Subfacility.
SECTION 3 OTHER PROVISIONS RELATING TO CREDIT FACILITIES
3.1 Default Rate...
3.2 Extension and Conversion.
3.3 Prepayments...
3.4 Termination and Reduction of Revolving Commitments.
3.5 Fees................
3.6 Capital Adequacy.
3.7 Inability To Determine Interest Rate.
3.8 Illegality.........
3.9 Requirements of Law.
3.10 Taxes............
3.11 Indemnity.....
3.12 Pro Rata Treatment.
3.13 Sharing of Payments.
3.14 Place and Manner of Payments.
SECTION 4 GUARANTY
4.1 The Guaranty.
4.2 Obligations Unconditional.
4.3 Reinstatement.
4.4 Certain Additional Waivers.
4.5 Remedies.......
4.6 Continuing Guarantee.
SECTION 5 CONDITIONS
5.1 Closing Conditions.
5.2 Conditions to all Extensions of Credit.
SECTION 6 REPRESENTATIONS AND WARRANTIES
6.1 Financial Condition.
6.2 No Change.....
6.3 Organization; Existence; Compliance with Law.
6.4 Power; Authorization; Enforceable Obligations.
6.5 No Legal Bar..
6.6 No Material Litigation.
6.7 No Default.....
6.8 Ownership of Property; Liens.
6.9 Intellectual Property.
6.10 No Burdensome Restrictions.
6.11 Taxes............
6.12 ERISA..........
6.13 Governmental Regulations, Etc.
6.14 Subsidiaries..
6.15 Purpose of Loans.
6.16 Environmental Matters.
6.17 Solvency......
6.18 No Untrue Statement.
6.19 Year 2000 Compliance.
SECTION 7 AFFIRMATIVE COVENANTS
7.1 Information Covenants.
7.2 Preservation of Existence and Franchises.
7.3 Books and Records.
7.4 Compliance with Law.
7.5 Payment of Taxes and Other Indebtedness.
7.6 Insurance........
7.7 Maintenance of Property.
7.8 Performance of Obligations.
7.9 Use of Proceeds.
7.10 Audits/Inspections.
7.11 Financial Covenants.
7.12 Additional Credit Parties.
7.13 Ownership of Subsidiaries.
SECTION 8 NEGATIVE COVENANTS
8.1 Indebtedness..
8.2 Liens..............
8.3 Nature of Business.
8.4 Consolidation, Merger, Sale or Purchase of Assets, etc.
8.5 Advances, Investments, Loans, etc.
8.6 Restricted Payments.
8.7 Prepayments of Indebtedness, etc.
8.8 Transactions with Affiliates.
8.9 Fiscal Year.....
8.10 Limitation on Restrictions on Dividends and Other
Distributions, etc.
8.11 Issuance and Sale of Subsidiary Stock.
8.12 Sale Leasebacks.
8.13 Capital Expenditures.
8.14 No Further Negative Pledges.
SECTION 9 EVENTS OF DEFAULT
9.1 Events of Default.
9.2 Acceleration; Remedies.
SECTION 10 AGENCY PROVISIONS
10.1 Appointment.
10.2 Delegation of Duties.
10.3 Exculpatory Provisions.
10.4 Reliance on Communications.
10.5 Notice of Default.
10.6 Non-Reliance on Administrative Agent and Other Lenders.
10.7 Indemnification.
10.8 Administrative Agent in its Individual Capacity.
10.9 Successor Agent.
SECTION 11 MISCELLANEOUS
11.1 Notices.........
11.2 Right of Set-Off.
11.3 Benefit of Agreement.
11.4 No Waiver; Remedies Cumulative.
11.5 Payment of Expenses, etc.
11.6 Amendments, Waivers and Consents.
11.7 Counterparts.
11.8 Headings......
11.9 Survival of Indemnification.
11.10 Governing Law; Submission to Jurisdiction; Venue.
11.11 Severability.
11.12 Entirety......
11.13 Survival of Representations and Warranties.
11.14 Binding Effect; Termination.
11.15 Borrowers' Obligations Joint and Several.
SCHEDULES
Schedule 1.1A Pre-Closing Financial Information
Schedule 1.1B Existing Letters of Credit
Schedule 1.1C Investments
Schedule 1.1D Existing Liens
Schedule 2.1(a) Lenders, Committed Amounts and Commitment
Percentages
Schedule 2.1(b)(i) Form of Notice of Borrowing
Schedule 2.1(e) Form of Revolving Note
Schedule 2.3(e) Form of Swingline Note
Schedule 3.2 Form of Notice of Extension/Conversion
Schedule 5.1(e) Form of Opinion
Schedule 6.2(a) General Disclosure Schedule
Schedule 6.4 Required Consents, Authorizations, Notices
and Filings
Schedule 6.6 Litigation
Schedule 6.9 Intellectual Property
Schedule 6.11 Taxes
Schedule 6.14 Subsidiaries
Schedule 6.16 Phase I Environmental Site Assessments
Schedule 7.1(c) Form of Officer's Compliance Certificate
Schedule 7.12 Form of Joinder Agreement
Schedule 8.1 Existing Indebtedness
Schedule 11.3(b) Form of Assignment and Acceptance
CREDIT AGREEMENT
THIS CREDIT AGREEMENT (the "Credit Agreement") is entered into as of
May 28, 1999 among SPEEDWAY MOTORSPORTS, INC., a Delaware corporation ("Speedway
Motorsports"), SPEEDWAY FUNDING CORP., a Delaware corporation ("Speedway
Funding") (each a "Borrower", and collectively the "Borrowers"), certain
subsidiaries and related parties identified on the signature pages hereto and
such other subsidiaries and related parties as may from time to time become a
party hereto (the "Guarantors"), the several lenders identified on the signature
page hereto and such other lenders as may from time to time become a party
hereto (the "Lenders"), NATIONSBANK, N.A., as Administrative Agent for the
Lenders (in such capacity, the "Administrative Agent"), FIRST UNION NATIONAL
BANK, as Syndication Agent (in such capacity, the "Syndication Agent"), CREDIT
LYONNAIS ATLANTA AGENCY, as Documentation Agent (in such capacity, the
"Documentation Agent"), and BANC OF AMERICA SECURITIES LLC, as Lead Arranger and
Book Manager for the Lenders, and FIRST SECURITY BANK OF NEVADA, FLEET NATIONAL
BANK, SOUTHTRUST BANK, N.A. and SUNTRUST BANK, ATLANTA, as co-agents.
WHEREAS, the Borrowers and Guarantors have requested that the Lenders
provide $250,000,000 credit facility for the purposes of (i) refinancing
existing indebtedness of the Borrowers, (ii) financing seasonal working capital
needs of Speedway Motorsports and its Subsidiaries, (iii) financing letter of
credit needs of Speedway Motorsports and its Subsidiaries, (iv) financing
general corporate needs of Speedway Motorsports and its Subsidiaries including
capital expenditures, (v) financing permitted investments and (vi) financing the
acquisition of additional motor speedways and related businesses; and
WHEREAS, the Lenders have agreed to make the requested credit facility
available on the terms and conditions hereinafter set forth.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS
-----------
1.1 Definitions.
As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:
"Additional Credit Party" means each Person that becomes a
Guarantor after the Closing Date by execution of a Joinder Agreement.
"Affiliate" means, with respect to any Person, any other
Person (i) directly or indirectly controlling or controlled by or under
direct or indirect common control with such Person or (ii) directly or
indirectly owning or holding five percent (5%) or more of the equity
interest in such Person. For purposes of this definition, "control"
when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative
to the foregoing.
"Administrative Agent" shall have the meaning assigned to such
term in the heading hereof.
"Agent's Fee Letter" means the letter from the Agent to the
Borrowers dated April 13, 1999;
"Agent's Fees" shall have the meaning assigned to such term in
Section 3.5(c).
"Applicable Percentage" means
for purposes of calculating the applicable interest rate for
any day for any Loan, the applicable Standby Letter of Credit Fee for
any day for purposes of Section 3.5 (b) or the applicable Trade Letter
of Credit Fee for any day for purposes of Section 3.5 (b) or the
applicable Commitment Fee for any day for purposes of Section 3.5(a),
the appropriate applicable percentage set forth below corresponding to
the Consolidated Total Debt Ratio in effect as of the most recent
Calculation Date:
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Pricing Consolidated Total Applicable Applicable Applicable Applicable Applicable
Level Debt Ratio Percentage Percentage Percentage for Percentage Percentage for
Standby for Trade Commit-
for
Eurodollar for Base Letter of Letter of ment Fee
Loans Rate Loans Credit Fee Credit Fee
--------------------------------------------------------------------------------------------------------------------------
Less than or equal to 2.50
I to 1.00 0.50% 0% 0.50% 0.125% 0.175%
--------------------------------------------------------------------------------------------------------------------------
Less than or equal to 3.00
to 1.00 but greater than
II 2.50 to 1.00 0.75% 0% 0.75% 0.125% 0.20%
--------------------------------------------------------------------------------------------------------------------------
Less than or equal to 3.50
to 1.00 but greater than
III 3.00 to 1.00 1.00% 0% 1.00% 0.125% 0.225%
--------------------------------------------------------------------------------------------------------------------------
IV Greater than 3.50 to 1.00 1.25% 0% 1.25% 0.125% 0.25%
--------------------------------------------------------------------------------------------------------------------------
Determination of the appropriate Applicable Percentages shall be made
as of each Calculation Date. The Consolidated Total Debt Ratio in
effect as of a Calculation Date shall establish the Applicable
Percentages for the Loans, the Standby Letter of Credit Fee, the Trade
Letter of Credit Fee and the Commitment Fee that shall be effective as
of the date designated by the Administrative Agent as the Applicable
Percentage Change Date. The Administrative Agent shall determine the
Applicable Percentages as of each Calculation Date and shall promptly
notify the Borrowers and the Lenders of the Applicable Percentages so
determined and of the Applicable Percentage Change Date. Such
determinations by the Administrative Agent of the Applicable
Percentages shall be conclusive absent demonstrable error. The initial
Applicable Percentage[s] shall be based on Pricing Level IV until the
first Applicable Percentage Change Date occurring after the Closing
Date.
"Applicable Percentage Change Date" means, with respect to any
Calculation Date, a date designated by the Administrative Agent that is
not more than five (5) Business Days after receipt by the
Administrative Agent of the Required Financial Information for such
Calculation Date.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the
United States Code, as amended, modified, succeeded or replaced from
time to time.
"Base Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest whole multiple of 1/100 of 1%)
equal to the greater of (a) the Federal Funds Rate in effect on such
day plus 1/2 of 1% or (b) the Prime Rate in effect on such day. If for
any reason the Administrative Agent shall have determined (which
determination shall be conclusive absent manifest error) that it is
unable after due inquiry to ascertain the Federal Funds Rate for any
reason, including the inability or failure of the Administrative Agent
to obtain sufficient quotations in accordance
with the terms hereof, the Base Rate shall be determined without regard
to clause (a) of the first sentence of this definition until the
circumstances giving rise to such inability no longer exist. Any change
in the Base Rate due to a change in the Prime Rate or the Federal Funds
Rate shall be effective on the effective date of such change in the
Prime Rate or the Federal Funds Rate, respectively.
"Base Rate Loan" means any Loan bearing interest at a rate
determined by reference to the Base Rate.
"Borrowers" means the Persons identified as such in the
heading hereof, together with any successors and permitted assigns.
"Borrowers' Obligations" means, without duplication, (i) all
of the obligations of either of the Borrowers to the Lenders and the
Administrative Agent, whenever arising, under this Credit Agreement,
the Notes or any of the other Credit Documents (including, but not
limited to, all interest accruing from and after the commencement of
any case, proceeding or action under any existing or future laws
relating to bankruptcy or insolvency with respect to either of the
Borrowers, regardless of whether such interest is an allowed claim
under the Bankruptcy Code in Title 11 of the United States Code) and
(ii) all obligations owing from either of the Borrowers to any Lender,
or any Affiliate of a Lender, arising under any Hedge Agreements
relating to the Obligations hereunder.
"Business Day" means a day other than a Saturday, Sunday or
other day on which commercial banks in Charlotte, North Carolina are
authorized or required by law to close, except that, when used in
connection with a Eurodollar Loan, such day shall also be a day on
which dealings between banks are carried on in Dollar deposits in
London, England and New York, New York.
"Calculation Date" means the last day of each fiscal quarter
of the Borrowers.
"Capital Lease" means, as applied to any Person, any lease of
any Property (whether real, personal or mixed) by that Person as lessee
which, in accordance with GAAP is or should be accounted for as a
capital lease on the balance sheet of that Person.
"Capital Stock" means (i) in the case of a corporation,
capital stock, (ii) in the case of an association or business entity,
any and all shares, interests, participations, rights or other
equivalents (however designated) of Capital Stock, (iii) in the case of
a partnership, partnership interests (whether general or limited), (iv)
in the case of a limited liability company, membership interests and
(v) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distributions
of assets of, the issuing Person.
"Cash Consideration" means cash paid to or for the account of
a seller for the
acquisitions permitted by Section 8.4(c) plus (i) any notes given to
such seller having a maturity date shorter than the Termination Date
and (ii) any Funded Indebtedness assumed in the transaction.
"Cash Equivalents" means (a) securities issued or directly and
fully guaranteed or insured by the United States of America or any
agency or instrumentality thereof (provided that the full faith and
credit of the United States of America is pledged in support thereof)
having maturities of not more than twelve months from the date of
acquisition, (b) Dollar denominated time deposits and certificates of
deposit of (i) any Lender, (ii) any domestic commercial bank of
recognized standing having capital and surplus in excess of
$500,000,000 or (iii) any bank whose short-term commercial paper rating
from S&P is at least A-1 or the equivalent thereof or from Moody's is
at least P-1 or the equivalent thereof (any such bank being an
"Approved Lender"), in each case with maturities of not more than 270
days from the date of acquisition, (c) commercial paper and variable or
fixed rate notes issued by any Approved Lender (or by the parent
company thereof) or any variable rate notes issued by, or guaranteed
by, any domestic corporation whose senior unsecured indebtedness for
borrowed money is rated A-1 (or the equivalent thereof) or better by
S&P or P-1 (or the equivalent thereof) or better by Moody's and
maturing within six months of the date of acquisition, (d) repurchase
agreements with a bank or trust company (including any of the Lenders)
or recognized securities dealer having capital and surplus in excess of
$500,000,000 for direct obligations issued by or fully guaranteed by
the United States of America or any agency or instrumentality thereof
in which the Borrowers shall have a perfected first priority security
interest (subject to no other Liens) and having, on the date of
purchase thereof, a fair market value of at least 100% of the amount of
the repurchase obligations, (e) obligations of any state of the United
States or any political subdivision thereof, the interest with respect
to which is exempt from federal income taxation under Section 103 of
the Code, having a long term rating of at least Aa-3 or AA- by Moody's
or S&P, respectively, and maturing within three years from the date of
acquisition thereof, (f) Investments in municipal or corporate auction
preferred stock (i) rated AAA (or the equivalent thereof) or better by
S&P or Aaa (or the equivalent thereof) or better by Moody's and (ii)
with dividends that reset at least once every 365 days and (g)
Investments, classified in accordance with GAAP as current assets, in
money market investment programs registered under the Investment
Company Act of 1940, as amended, which are administered by reputable
financial institutions having capital of at least $100,000,000 and the
portfolios of which are limited to Investments of the character
described in the foregoing subdivisions (a) through (f).
"Change of Control" means the occurrence of any of the
following events: any Person or two or more Persons (acting as a
"group" within the meaning of Section 13(d)(3) of the Exchange Act),
excluding Persons who are on the Closing Date executive officers or
directors of Speedway Motorsports or Permitted Transferees, shall have
acquired beneficial ownership, directly or indirectly, of, or
shall have acquired by contract or otherwise, or shall have entered
into a contract or arrangement that, upon consummation, will result in
its or their acquisition of, control over, Voting Stock of either of
the Borrowers (or other securities convertible into such Voting Stock)
representing more than 25% of the combined voting power of all Voting
Stock of such Borrower and shall have filed or shall have become
required to file, a Schedule 13D with the SEC disclosing that it is the
intention of such Person or group to acquire control of either of the
Borrowers. As used herein, "beneficial ownership" shall have the
meaning provided in Rule 13d-3 of the SEC under the Exchange Act. A
Change of Control shall also occur if a majority of the Board of
Directors of either of the Borrowers existing on the Closing Date
changes.
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986, as amended,
and any successor thereto, as interpreted by the rules and regulations
issued thereunder, in each case as in effect from time to time.
References to sections of the Code shall be construed also to refer to
any successor sections.
"Commitment" means the LOC Commitment, the Revolving
Commitment, and the Swingline Commitment.
"Commitment Fee" shall have the meaning given such term in
Section 3.5(a).
"Commitment Percentage" mean the Revolving Commitment
Percentage.
"Consolidated Capital Charges Coverage Ratio" means, as of any
Calculation Date, the ratio of (i) Consolidated EBIT for the
four-quarter period ended as of such Calculation Date, to (ii)
Consolidated Interest Expense plus dividends paid on preferred stock
for the four-quarter period ended as of such Calculation Date.
"Consolidated Capital Expenditures" means, for any period, all
capital expenditures of Speedway Motorsports and its Subsidiaries on a
consolidated basis for such period, as determined in accordance with
GAAP.
"Consolidated EBIT" means, for any period, the sum of (i)
Consolidated Net Income for such period, plus (ii) an amount which, in
the determination of Consolidated Net Income for such period, has been
deducted for (A) Consolidated Interest Expense and (B) total federal,
state, local and foreign income, value added and similar taxes all as
determined in accordance with GAAP; provided, however, that
Consolidated EBIT for any fiscal quarter (or portion thereof) ended
prior to the Closing Date shall be the amount indicated for such fiscal
quarter on Schedule 1.1A.
"Consolidated EBITDA" means, for any period, the sum of (i)
Consolidated Net Income for such period, plus (ii) an amount which, in
the determination of Consolidated Net Income for such period, has been
deducted for (A) Consolidated
Interest Expense, (B) total federal, state, local and foreign income,
value added and similar taxes and (C) depreciation and amortization
expense, all as determined in accordance with GAAP; provided, however,
that Consolidated EBITDA for any fiscal quarter (or portion thereof)
ended prior to the Closing Date shall be the amount indicated for such
fiscal quarter on Schedule 1.1A.
"Consolidated Interest Expense" means, for any period, with
respect to the combined results of Speedway Motorsports and its
Subsidiaries on a consolidated basis and Las Vegas Motor Speedway LLC
on a pro forma basis as if acquired January 1, 1998, gross interest
expense (both expensed and capitalized) for such period, as determined
in accordance with GAAP.
"Consolidated Net Income" means, for any period, with respect
to the combined results of Speedway Motorsports and its Subsidiaries
and Las Vegas Motor Speedway LLC on a pro forma basis as if acquired
January 1, 1998, the gross revenues from operations (including payments
received of interest income) less all operating and non-operating
expenses including taxes on income, all determined in accordance with
GAAP; but excluding as income: (i) net gains on the sale, conversion or
other disposition of capital assets, (ii) net gains on the acquisition,
retirement, sale or other disposition of Capital Stock and other
securities issued by Speedway Motorsports and its Subsidiaries, (iii)
net gains on the collection of proceeds of life insurance policies,
(iv) any write-up of any asset, and (v) any other gain or loss of an
extraordinary nature as determined in accordance with GAAP.
"Consolidated Net Worth" means, as of any date, total
shareholders' equity of Speedway Motorsports and its Subsidiaries less
preferred stock redeemable at the holder's discretion and preferred
stock having a first call of fifteen years or less all on a
consolidated basis as of such date, as determined in accordance with
GAAP.
"Consolidated Total Debt Ratio" means, as of any Calculation
Date, the ratio of (i) Funded Indebtedness of Speedway Motorsports and
its Subsidiaries on a consolidated basis as of such Calculation Date,
to (ii) Consolidated EBITDA for the four-quarter period ended as of
such Calculation Date.
"Controlled Group" means (i) the controlled group of
corporations as defined in Section 414(b) of the Code and the
applicable regulations thereunder, or (ii) the group of trades or
businesses under common control as defined in Section 414(c) of the
Code and the applicable regulations thereunder, of which Speedway
Motorsports or any of its Subsidiaries is a member.
"Credit Documents" means a collective reference to this Credit
Agreement, the Notes, the Pledge Agreement, each Joinder Agreement, the
Hedge Agreements, the Agent's Fee Letter and all other related
agreements and documents issued or delivered hereunder or thereunder or
pursuant hereto or thereto.
"Credit Party" means any of the Borrowers and the Guarantors.
"Debt Transactions" means, with respect to Speedway
Motorsports or any of its Subsidiaries, any sale, issuance or placement
of Funded Indebtedness, whether or not evidenced by a promissory note
or other written evidence of indebtedness, except for Funded
Indebtedness permitted to be incurred pursuant to Section 8.1.
"Default" means any event, act or condition which, with notice
or lapse of time, or both, would constitute an Event of Default.
"Dollars" and "$" means dollars in lawful currency of the
United States of America.
"Domestic Subsidiary" means, with respect to any Person, any
Subsidiary of such Person which is incorporated or organized under the
laws of any state of the United States or the District of Columbia.
"Effective Date" means the date hereof provided that the
conditions set forth in Section 5.1 shall have been fulfilled (or
waived in the sole discretion of the Lenders).
"Eligible Assignees" means (i) any Lender or any Affiliate or
Subsidiary of a Lender and (ii) any other commercial bank, financial
institution or "accredited investor" (as defined in Regulation D of the
SEC) having total assets in excess of $300,000,000 and which is
reasonably acceptable to the Administrative Agent and the Borrowers,
unless an Event of Default has occurred and is continuing at the time
any assignment is effected in accordance with Section 11.3(b) in which
case only reasonable acceptance of the Administrative Agent is
required.
"Environmental Claim" means any investigation, written notice,
violation, written demand, written allegation, action, suit,
injunction, judgment, order, consent decree, penalty, fine, lien,
proceeding, or written claim whether administrative, judicial, or
private in nature from activities or events taking place during or
prior to the Borrower's or any of its Subsidiaries' ownership or
operation of any real property and arising (a) pursuant to, or in
connection with, an actual or alleged violation of, any Environmental
Law, (b) in connection with any Hazardous Material, (c) from any
assessment, abatement, removal, remedial, corrective, or other response
action required by an Environmental Law or other order of a
Governmental Authority or (d) from any actual or alleged damage,
injury, threat, or harm to health, safety, natural resources, or the
environment.
"Environmental Laws" means any and all lawful and applicable
Federal, state, local and foreign statutes, laws, regulations,
ordinances, rules, judgments, orders, decrees, permits, concessions,
grants, franchises, licenses, agreements or other governmental
restrictions relating to the environment or to emissions,
discharges, releases or threatened releases of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances
or wastes into the environment including, without limitation, ambient
air, surface water, ground water, or land, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes.
"Equity Transaction" means any issuance by Speedway
Motorsports or any of its Subsidiaries of (i) shares of its Capital
Stock, (ii) any shares of its Capital Stock pursuant to the exercise of
options or warrants or (iii) any shares of its Capital Stock pursuant
to the conversion of any debt securities to equity; excluding, however,
any shares at any time issued or issuable to any key employees,
directors, consultants and other individuals providing services to
Speedway Motorsports or any of its Subsidiaries pursuant to the 1994
Stock Option Plan of Speedway Motorsports or any other "employee
benefit plan" within the meaning of Rule 405 promulgated by the SEC
under the Securities Act of 1933, as amended.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute thereto, as interpreted by
the rules and regulations thereunder, all as the same may be in effect
from time to time. References to sections of ERISA shall be construed
also to refer to any successor sections.
"ERISA Affiliate" means an entity, whether or not
incorporated, which is under common control with any Credit Party
within the meaning of Section 4001(a)(14) of ERISA, or is a member of a
group which includes Speedway Motorsports or any of its Subsidiaries
and which is treated as a single employer under Sections 414(b), (c),
(m), or (o) of the Code.
"Eurodollar Loan" means any Loan bearing interest at a rate
determined by reference to the Eurodollar Rate.
"Eurodollar Rate" means, for the Interest Period for each
Eurodollar Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate
determined pursuant to the following formula:
Eurodollar Rate ' Interbank Offered Rate
----------------------
1 - Eurodollar Reserve Percentage
"Eurodollar Reserve Percentage" means for any day, that
percentage (expressed as a decimal) which is in effect from time to
time under Regulation D of the Board of Governors of the Federal
Reserve System (or any successor), as such regulation may be amended
from time to time or any successor regulation, as the
maximum reserve requirement (including, without limitation, any basic,
supplemental, emergency, special, or marginal reserves) applicable with
respect to Eurocurrency Liabilities as that term is defined in
Regulation D (or against any other category of liabilities that
includes deposits by reference to which the interest rate of Eurodollar
Loans is determined), whether or not Lender has any Eurocurrency
Liabilities subject to such reserve requirement at that time.
Eurodollar Loans shall be deemed to constitute Eurocurrency Liabilities
and as such shall be deemed subject to reserve requirements without
benefits of credits for proration, exceptions or offsets that may be
available from time to time to a Lender. The Eurodollar Rate shall be
adjusted automatically on and as of the effective date of any change in
the Eurodollar Reserve Percentage.
"Event of Default" means such term as defined in Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and any successor thereto.
"Federal Funds Rate" means, for any day, the rate of interest
per annum (rounded, if necessary, to the nearest whole multiple of
1/100 of 1%) equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank of New York on the Business Day next succeeding
such day, provided that (A) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions
on the next preceding Business Day and (B) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate
for such day shall be the average rate quoted to the Administrative
Agent on such day on such transactions as determined by the
Administrative Agent.
"Fees" means all fees payable pursuant to Section 3.5.
"Foreign Subsidiary" means any Subsidiary of either of the
Borrowers that is not a Domestic Subsidiary.
"Funded Indebtedness" means, with respect to any Person,
without duplication, (i) all Indebtedness of such Person for borrowed
money (including all Indebtedness evidenced by the Senior Notes), (ii)
all purchase money Indebtedness of such Person, including without
limitation the principal portion of all obligations of such Person
under Capital Leases, (iii) all Guaranty Obligations of such Person
with respect to Funded Indebtedness of another Person, (iv) the maximum
available amount of all letters of credit or acceptances issued or
created for the account of such Person, (v) all Funded Indebtedness of
another Person secured by a Lien on any Property of such Person,
whether or not such Funded Indebtedness has been assumed and (vi)
preferred stock redeemable at the holder's discretion or preferred
stock having a first call of fifteen years or less. The Funded
Indebtedness of any Person
(x) shall include the Funded Indebtedness of any partnership or joint
venture in which such Person is a general partner or a joint venturer
and (y) shall not include any Intercompany Indebtedness of such Person.
"GAAP" means generally accepted accounting principles in the
United States applied on a consistent basis and subject to the terms of
Section 1.3 hereof.
"Governmental Authority" means any Federal, state, local or
foreign court or governmental agency, authority, instrumentality or
regulatory body.
"Guarantor" means each of those Persons identified as a
"Guarantor" on the signature pages hereto, and each Additional Credit
Party which may hereafter execute a Joinder Agreement, together with
their successors and permitted assigns.
"Guaranty Obligations" means, with respect to any Person,
without duplication, any obligations of such Person (other than
endorsements in the ordinary course of business of negotiable
instruments for deposit or collection) guaranteeing or intended to
guarantee any Indebtedness of any other Person in any manner, whether
direct or indirect, and including without limitation any obligation,
whether or not contingent, (i) to purchase any such Indebtedness or any
Property constituting security therefor, (ii) to advance or provide
funds or credit support for the payment or purchase of any such
Indebtedness or to maintain working capital, solvency or other balance
sheet condition of such other Person (including without limitation keep
well agreements, maintenance agreements, comfort letters or similar
agreements or arrangements) for the benefit of any holder of
Indebtedness of such other Person, (iii) to lease or purchase Property,
securities or services primarily for the purpose of assuring the holder
of such Indebtedness, or (iv) to otherwise assure or hold harmless the
holder of such Indebtedness against loss in respect thereof. The amount
of any Guaranty Obligation hereunder shall (subject to any limitations
set forth therein) be deemed to be an amount equal to the outstanding
principal amount (or maximum principal amount, if larger) of the
Indebtedness in respect of which such Guaranty Obligation is made.
"Hazardous Materials" means any substance, material or waste
defined or regulated in or under any Environmental Laws.
"Hedge Agreements" mean interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar
agreements designed to hedge against fluctuations in interest rates or
foreign exchange rates.
"Indebtedness" of any Person means (i) all obligations of such
Person for borrowed money, (ii) all obligations of such Person
evidenced by bonds, debentures, notes or similar instruments, or upon
which interest payments are customarily made, (iii) all obligations of
such Person under conditional sale or other title retention
agreements relating to Property purchased by such Person (other than
customary reservations or retentions of title under agreements with
suppliers entered into in the ordinary course of business), (iv) all
obligations, including without limitation intercompany items, of such
Person issued or assumed as the deferred purchase price of Property or
services purchased by such Person (other than trade debt incurred in
the ordinary course of business and due within six months of the
incurrence thereof) which under GAAP would appear as liabilities on a
balance sheet of such Person, (v) all obligations of such Person under
take-or-pay or similar arrangements or under commodity futures
contracts, (vi) all Indebtedness of others secured by (or for which the
holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on, or payable out of the
proceeds of production from, Property owned or acquired by such Person,
whether or not the obligations secured thereby have been assumed, (vii)
all Guaranty Obligations of such Person, (viii) the principal portion
of all obligations of such Person under Capital Leases, (ix) all
obligations of such Person in respect of Hedge Agreements and (x) the
maximum amount of all letters of credit issued or bankers' acceptances
facilities created for the account of such Person and, without
duplication, all drafts drawn thereunder (to the extent unreimbursed).
The Indebtedness of any Person shall include the Indebtedness of any
partnership or joint venturer in which such Person is a general partner
or joint venturer.
"Indenture" means that certain Indenture dated as of August 4,
1997 and that certain Indenture dated as of May 11, 1999 among Speedway
Motorsports as issuer, the Guarantors and First Trust National
Association, as trustee, as the same may be modified, supplemented or
amended from time to time.
"Interbank Offered Rate" means, with respect to any Eurodollar
Loan for the Interest Period applicable thereto, the average (rounded
upward to the nearest one-sixteenth (1/16) of one percent) per annum
rate of interest determined by the office of the Administrative Agent
(each such determination to be conclusive and binding) as of two
Business Days prior to the first day of such Interest Period, as the
effective rate at which deposits in immediately available funds in
Dollars are being, have been, or would be offered or quoted by the
Administrative Agent to major banks in the applicable interbank market
for Eurodollar deposits at any time during the Business Day which is
the second Business Day immediately preceding the first day of such
Interest Period, for a term comparable to such Interest Period and in
the amount of the requested Eurodollar Loan. If no such offers or
quotes are generally available for such amount, then the Administrative
Agent shall be entitled to determine the Eurodollar Rate by estimating
in its reasonable judgment the per annum rate (as described above) that
would be applicable if such quote or offers were generally available.
"Intercompany Indebtedness" means any Indebtedness of a Credit
Party which (i) is owing to any other Credit Party and (ii) by its
terms is specifically subordinated in right of payment to the prior
payment of the obligations of the Credit
Parties under this Credit Agreement and the other Credit Documents on
terms and conditions reasonably satisfactory to the Required Lenders.
"Interest Payment Date" means (i) as to any Base Rate Loan the
last day of each March, June, September and December, the date of
repayment of principal of such Loan and the Termination Date, (ii) as
to Swingline Loans, such dates as to which the Swingline Lender may
agree and (iii) as to any Eurodollar Loan, the last day of each
Interest Period for such Loan and the Termination Date, and in addition
where the applicable Interest Period is more than three months, then
also on the date three months from the beginning of the Interest
Period, and each three months thereafter. If an Interest Payment Date
falls on a date which is not a Business Day, such Interest Payment Date
shall be deemed to be the next succeeding Business Day, except that in
the case of Eurodollar Loans where the next succeeding Business Day
falls in the next succeeding calendar month, then on the next preceding
Business Day.
"Interest Period" means, (i) as to Eurodollar Loans, a period
of one, two, three or six months' duration, as the Borrowers may elect,
commencing in each case, on the date of the borrowing (including
conversions, extensions and renewals) and (ii) as to any Swingline
Loan, a period of such duration, not to exceed 15 days, as the
applicable Borrower may request and the Swingline Lender may agree in
accordance with the provisions of Section 2.3(b)(i), commencing in each
case, on the date of borrowing; provided, however, (A) if any Interest
Period would end on a day which is not a Business Day, such Interest
Period shall be extended to the next succeeding Business Day (except
that in the case of Eurodollar Loans where the next succeeding Business
Day falls in the next succeeding calendar month, then on the next
preceding Business Day), (B) no Interest Period shall extend beyond the
Termination Date, and (C) in the case of Eurodollar Loans, where an
Interest Period begins on a day for which there is no numerically
corresponding day in the calendar month in which the Interest Period is
to end, such Interest Period shall end on the last day of such calendar
month.
"Investment", in any Person, means any loan or advance to such
Person, any purchase or other acquisition of any Capital Stock,
warrants, rights, options, obligations or other securities of such
Person, any capital contribution to such Person or any other investment
in such Person, including, without limitation, any Guaranty Obligation
incurred for the benefit of such Person.
"Issuing Lender" means NationsBank.
"Issuing Lender Fees" shall have the meaning assigned to such
term in Section 3.5(b)(iii).
"Joinder Agreement" means a Joinder Agreement substantially in
the form of Schedule 7.12 hereto, executed and delivered by an
Additional Credit Party in
accordance with the provisions of Section 7.12.
"Lenders" means each of the Persons identified as a "Lender"
on the signature pages hereto, and each Person which may become a
Lender by way of assignment in accordance with the terms hereof,
together with their successors and permitted assigns.
"Letter of Credit" means (i) any letter of credit issued by
the Issuing Lender for the account of the Borrowers in accordance with
the terms of Section 2.2 and (ii) existing letters of credit issued by
the Issuing Lender for the account of any Credit Party and set forth on
Schedule 1.1B.
"Lien" means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, security interest, encumbrance, lien (statutory or
otherwise), preference, priority or charge of any kind (including any
agreement to give any of the foregoing or any conditional sale or other
title retention agreement, any financing or similar statement or notice
filed under the Uniform Commercial Code as adopted and in effect in the
relevant jurisdiction or other similar recording or notice statute, any
lease in the nature thereof).
"Loan" or "Loans" means the Revolving Loans and the Swingline
Loans.
"LOC Commitment" means the commitment of the Issuing Lender to
issue, and to honor payment obligations under, Letters of Credit
hereunder and with respect to each Lender, the commitment of each
Lender to purchase participation interests in the Letters of Credit up
to such Lender's Revolving Commitment Percentage of LOC Committed
Amount as specified in Schedule 2.1(a), as such amount may be reduced
in accordance with the provisions hereof.
"LOC Committed Amount" shall have the meaning assigned to such
term in Section 2.2.
"LOC Documents" means, with respect to any Letter of Credit,
such Letter of Credit, any amendments thereto, any documents delivered
in connection therewith, any application therefor, and any agreements,
instruments, guarantees or other documents (whether general in
application or applicable only to such Letter of Credit) governing or
providing for (i) the rights and obligations of the parties concerned
or at risk or (ii) any collateral security for such obligations.
"LOC Obligations" means, at any time, the sum of (i) the
maximum amount which is, or at any time thereafter may become,
available to be drawn under Letters of Credit then outstanding,
assuming compliance with all requirements for drawings referred to in
such Letters of Credit plus (ii) the aggregate amount of all drawings
outstanding under Letters of Credit honored by the Issuing Lender but
not theretofore reimbursed.
"Material Adverse Change" means a material adverse change in
(i) the condition (financial or otherwise), operations, assets or
liabilities of Speedway Motorsports and its Subsidiaries taken as a
whole, (ii) the ability of the Credit Parties taken as a whole to
perform any material obligation under the Credit Documents or (iii) the
material rights and remedies of the Lenders under the Credit Documents.
"Material Adverse Effect" means a material adverse effect on
(i) the condition (financial or otherwise), operations, assets or
liabilities of Speedway Motorsports and its Subsidiaries taken as a
whole, (ii) the ability of the Credit Parties taken as a whole to
perform any material obligation under the Credit Documents or (iii) the
material rights and remedies of the Lenders under the Credit Documents.
"Materials of Environmental Concern" means any gasoline or
petroleum (including crude oil or any fraction thereof) or petroleum
products or any hazardous or toxic substances, materials or wastes,
defined or regulated as such in or under any Environmental Laws,
including, without limitation, asbestos, polychlorinated biphenyls and
urea-formaldehyde insulation.
"Moody's" means Moody's Investors Service, Inc., or any
successor or assignee of the business of such company in the business
of rating securities.
"Multiemployer Plan" means a Plan which is a multiemployer
plan as defined in Sections 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which any Credit Party
or any ERISA Affiliate and at least one employer other than a Credit
Party or any ERISA Affiliate are contributing sponsors.
"NationsBank" means NationsBank, N.A. and its successors.
"Net Proceeds" means proceeds received by Speedway Motorsports
or any of its Subsidiaries from time to time in connection with any
Equity Transaction, net of the actual costs and taxes incurred by such
Person in connection with and attributable to such Equity Transaction.
"Note" or "Notes" means any Revolving Note and/or Swingline
Note.
"Notice of Borrowing" means a written notice of borrowing in
substantially the form of Schedule 2.1(b)(i), as required by Section
2.1(b)(i).
"Notice of Extension/Conversion" means the written notice of
extension or conversion in substantially the form of Schedule 3.2 as
required by Section 3.2.
"Obligations" means, collectively, the Loans and the LOC
Obligations.
"Operating Lease" means, as applied to any Person, any lease
(including, without limitation, leases which may be terminated by the
lessee at any time) of any Property (whether real, personal or mixed)
which is not a Capital Lease other than any such lease in which that
Person is the lessor.
"Participation Interest" means the purchase by a Lender of a
participation in Letters of Credit as provided in Section 2.2(c) and in
Swingline Loans as provided in Section 2.3(b)(iii) and in Loans as
provided in Section 3.13.
"PBGC" means the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA and any
successor thereof.
"Permitted Investments" means Investments which are either (i)
cash and Cash Equivalents; (ii) accounts receivable created, acquired
or made by any Credit Party in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms;
(iii) Investments consisting of stock, obligations, securities or other
property received by any Credit Party in settlement of accounts
receivable (created in the ordinary course of business) from insolvent
obligors; (iv) Investments existing as of the Closing Date and set
forth in Schedule 1.1C; (v) Guaranty Obligations permitted by Section
8.1, (vi) acquisitions permitted by Section 8.4(c); (vii) loans to
directors, officers, employees, agents, customers or suppliers that do
not exceed an aggregate principal amount of $500,000 at any one time
outstanding for Speedway Motorsports and all of its Subsidiaries taken
together; (viii) Investments received as consideration in connection
with or arising by virtue of any merger, consolidation, sale or other
transfer of assets permitted under Section 8.4; (ix) Intercompany
Indebtedness; (x) Capital Stock or other securities of any Person which
is traded on the New York Stock Exchange, the American Stock Exchange,
the London Stock Exchange, the Paris Bourse or NASDAQ, provided the
aggregate basis at any one time in such Investments does not exceed
$2,500,000 and such investments have not been purchased on margin; (xi)
loans or advances to Persons to the extent necessary to enable them to
pay taxes, fees and other expenses as and when required to maintain
liquor licenses provided such loans or advances (A) are customary in
Speedway Motorsports' business and (B) the aggregate principal amount
outstanding at any one time of such loans or advances does not exceed
$2,000,000; and (xii) loans or advances to any Subsidiary that is not a
Credit Party that do not exceed an aggregate principal amount of
$15,000,000 at any one time outstanding.
"Permitted Liens" means:
(i) Liens in favor of the Administrative
Agent on behalf of the Lenders;
(ii) Liens (other than Liens created or
imposed under ERISA) for taxes, assessments or governmental
charges or levies not yet due or Liens for taxes being
contested in good faith by appropriate proceedings for which
adequate reserves determined in accordance with GAAP have been
established (and as to which the Property subject to any such
Lien is not yet subject to foreclosure, sale or loss on
account thereof);
(iii) statutory Liens of landlords and Liens
of carriers, warehousemen, mechanics, materialmen and
suppliers and other Liens imposed by law or pursuant to
customary reservations or retentions of title arising in the
ordinary course of business, provided that such Liens secure
only amounts not yet due and payable or, if due and payable,
are being contested in good faith by appropriate proceedings
for which adequate reserves determined in accordance with GAAP
have been established (and as to which the Property subject to
any such Lien is not yet subject to foreclosure, sale or loss
on account thereof);
(iv) Liens (other than Liens created or
imposed under ERISA) incurred or deposits made by the Credit
Parties in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types
of social security, or to secure the performance of tenders,
statutory obligations, bids, leases, government contracts,
performance and return-of-money bonds and other similar
obligations (exclusive of obligations for the payment of
borrowed money);
(v) Liens arising in connection with
attachments or judgments (including judgment or appeal bonds),
provided that the judgments secured shall, within 60 days
after the entry thereof, be discharged within 30 days or the
execution thereof be stayed pending appeal and be discharged
within 30 days after the expiration of any such stay;
(vi) easements, rights-of-way, restrictions
(including zoning restrictions), minor defects or
irregularities in title and other similar charges or
encumbrances not, in any material respect, impairing the use
of the encumbered Property for its intended purposes;
(vii) Liens on Property securing purchase
money Indebtedness (including Capital Leases) to the extent
permitted under Section 8.1(c), provided that any such Lien
attaches to such Property concurrently with or within 90 days
after the acquisition thereof;
(viii) normal and customary rights of setoff
upon deposits of cash in favor of banks or other depository
institutions;
(ix) Liens existing as of the Closing Date
and set forth on
Schedule 1.1D; and
(x) Liens arising under leases permitted
hereunder (other than Capital Leases).
"Permitted Transferee" means (i) either of the Borrowers, (ii)
Sonic Financial Corporation or any successor thereof (provided at least
51% of the Voting Stock of Sonic Financial Corporation is owned by O.
Bruton Smith, Family Members (as hereinafter defined) or another
Permitted Transferee), (iii) O. Bruton Smith or the spouse or any
lineal descendant of O. Bruton Smith and/or any parent of any such
holder (collectively, the "Family Members"), (iv) the trustee of a
trust (including a voting trust) for the benefit of such holder and/or
Family Members, (v) a corporation in respect of which such holder
and/or Family Members hold beneficial ownership of all shares of
Capital Stock of such corporation, (vi) a partnership in respect of
which such holder and/or Family Members hold beneficial ownership of
all partnership shares of or interests in such partnership, (vii) a
limited liability company in respect of which such holder and/or Family
Members hold beneficial ownership of all memberships in or interests of
such company, (viii) the estate of such holder and/or Family Members or
(ix) any other holder of Capital Stock of Speedway Motorsports who or
which becomes a holder in accordance with clause (iii), (iv), (v),
(vi), (vii) or (viii) hereof; provided, however, that none of the
foregoing will be deemed a Permitted Transferee if the transfer results
in the failure of Speedway Motorsports to meet the criteria for listing
on the New York Stock Exchange.
"Person" means any individual, partnership, joint venture,
firm, corporation, limited liability company, association, trust or
other enterprise (whether or not incorporated) or any Governmental
Authority.
"Plan" means any employee benefit plan (as defined in Section
3(3) of ERISA) which is covered by ERISA and with respect to which any
Credit Party or any of its Subsidiaries or any ERISA Affiliate is (or,
if such plan were terminated at such time, would under Section 4069 of
ERISA be deemed to be) an "employer" within the meaning of Section 3(5)
of ERISA.
"Pledge Agreement" means the pledge agreement dated as of the
Closing Date executed in favor of the Administrative Agent by each of
the Borrowers, as amended, modified, restated or supplemented from time
to time.
"Prime Rate" means the per annum rate of interest established
from time to time by the Administrative Agent at its principal office
in Charlotte, North Carolina as its Prime Rate with each change in the
Prime Rate being effective on the date such change is publicly
announced as effective (it being understood and agreed that the Prime
Rate is a reference rate used by NationsBank in determining interest
rates on certain loans and is not intended to be the lowest rate of
interest charged on any extension of credit by NationsBank to any
debtor).
"Pro Forma Basis" means, with respect to any transaction, that
such transaction shall be deemed to have occurred as of the first day
of the four fiscal-quarter period ending as of the most recent
Calculation Date preceding the date of such transaction with respect to
which the Administrative Agent has received the Required Financial
Information. As used herein, "transaction" shall include, but not be
limited to, (i) any corporate merger or consolidation as referred to in
Section 8.4(a), (ii) any sale or other disposition of assets as
referred to in Section 8.4(b) or (iii) any acquisition of Capital Stock
or securities or any purchase, lease or other acquisition of Property
as referred to in Section 8.4(c).
"Property" means any interest in any kind of property or
asset, whether real, personal or mixed, or tangible or intangible.
"Regulation D, G, T, U, or X" means Regulation D, G, T, U or
X, respectively, of the Board of Governors of the Federal Reserve
System as from time to time in effect and any successor to all or a
portion thereof.
"Reportable Event" means any of the events set forth in
Section 4043(b) of ERISA, other than those events as to which the
post-event notice requirement is waived under subsections .13, .14,
.18, .19 or .20 of PBGC Reg. '2615.
"Required Financial Information" means, with respect to the
applicable Calculation Date, (i) the financial statements of Speedway
Motorsports required to be delivered pursuant to Section 7.1 for the
fiscal period or quarter ending as of such Calculation Date, and (ii)
the certificate of the chief financial officer, chief executive officer
or president of Speedway Motorsports required by Section 7.1 to be
delivered with the financial statements described in clause (i) above.
"Required Lenders" means, at any time, (i) Lenders which are
then in compliance with their obligations hereunder (as determined by
the Administrative Agent) and holding in the aggregate more than fifty
percent (50%) of the Commitments, or (ii) if the Commitments have been
terminated, Lenders having more than fifty percent (50%) of the
aggregate principal amount of the Obligations outstanding (taking into
account in each case Participation Interests or obligation to
participate therein).
"Requirement of Law" means, as to any Person, the certificate
of incorporation and by-laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or to
which any of its material property is subject.
"Restricted Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class
of stock of any Credit Party, now or
hereafter outstanding, (ii) any redemption, retirement, sinking fund or
similar payment, purchase or other acquisition for value, direct or
indirect, of any shares of any class of stock of Speedway Motorsports
or any of its Subsidiaries, now or hereafter outstanding, (iii) any
payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of
stock of Speedway Motorsports or any of its Subsidiaries or (iv) any
payment or prepayment of principal of, premium, if any, or interest on,
redemption, purchase, retirement, defeasance, sinking fund or similar
payment with respect to, any Intercompany Indebtedness.
"Revolving Commitment" means the commitment of each Lender to
make Revolving Loans in an aggregate principal amount at any time
outstanding of up to such Lender's Revolving Commitment Percentage
multiplied by the Revolving Committed Amount (as such Revolving
Committed Amount may be reduced from time to time pursuant to Section
3.4).
"Revolving Commitment Percentage" means, for any Lender, the
percentage identified as its Revolving Commitment as specified in
Schedule 2.1(a).
"Revolving Committed Amount" means, collectively, the
aggregate amount of all the Revolving Commitments as referenced in
Section 2.1(a) and individually, the amount of each Lender's Commitment
as specified in Schedule 2.1(a).
"Revolving Loans" shall have the meaning assigned to such term
in Section 2.1(a).
"Revolving Note" or "Revolving Notes" means the promissory
notes of the Borrowers in favor of each of the Lenders evidencing the
Revolving Loans in substantially the form attached as Schedule 2.1(e),
individually or collectively, as appropriate as such promissory notes
may be amended, modified, supplemented, extended, renewed or replaced
from time to time.
"SEC" means the Securities and Exchange Commission or any
agency or instrumentality of the United States of America succeeding to
the powers and duties thereof.
"Senior Notes" means the senior subordinated notes due 2007 of
Speedway Motorsports in the aggregate original principal amount of
$125,000,000 issued pursuant to the Indenture dated as of August 4,
1997 and in the aggregate original principal amount of $125,000,000
issued pursuant to the Indenture dated as of May 11, 1999.
"S&P" means Standard & Poor's Ratings Group, a division of
McGraw Hill, Inc., or any successor or assignee of the business of such
division in the business of rating securities.
"Single Employer Plan" means any Plan which is covered by
Title IV of ERISA, but which is not a Multiemployer Plan.
"Solvent" or "Solvency" means, with respect to any Person as
of a particular date, that on such date (i) such Person is able to
realize upon its assets and pay its debts and other liabilities,
contingent obligations and other commitments as they mature in the
normal course of business, (ii) such Person does not intend to, and
does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature in their
ordinary course, (iii) such Person is not engaged in a business or a
transaction, and is not about to engage in a business or a transaction,
for which such Person's Property would constitute unreasonably small
capital after giving due consideration to the prevailing practice in
the industry in which such Person is engaged or is to engage, (iv) the
fair value of the Property of such Person is greater than the total
amount of liabilities, including, without limitation, contingent
liabilities, of such Person and (v) the present fair saleable value of
the assets of such Person is not less than the amount that will be
required to pay the probable liability of such Person on its debts as
they become absolute and matured. In computing the amount of contingent
liabilities at any time, it is intended that such liabilities will be
computed at the amount which, in light of all the facts and
circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.
"Speedway Funding" shall have the meaning assigned to such
term in the heading hereof.
"Speedway Motorsports" shall have the meaning assigned to such
term in the heading hereof.
"Standby Letter of Credit Fee" shall have the meaning assigned
to such term in Section 3.5(b)(i).
"Subsidiary" means, as to any Person, (a) any corporation more
than 50% of whose stock of any class or classes having by the terms
thereof ordinary voting power to elect a majority of the directors of
such corporation (irrespective of whether or not at the time, any class
or classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is at the time owned by
such Person directly or indirectly through Subsidiaries, and (b) any
partnership, association, joint venture or other entity in which such
Person directly or indirectly through Subsidiaries has more than 50%
equity interest at any time.
"Swingline Commitment" means the commitment of the Swingline
Lender to make Swingline Loans in an aggregate principal amount at any
time outstanding up to the Swingline Committed Amount and the
commitment of the Lenders to purchase participation interests in the
Swingline Loans up to their respective
Revolving Commitment Percentage of the Swingline Committed Amount as
provided in Section 2.3(b)(iii), as such amounts may be reduced from
time to time in accordance with the provisions hereof.
"Swingline Committed Amount" shall have the meaning assigned
to such term in Section 2.3(a).
"Swingline Lender" means the Administrative Agent.
"Swingline Loan" shall have the meaning assigned to such term
in Section 2.3(a).
"Swingline Note" means the promissory note of the Borrower in
favor of the Swingline Lender in the original principal amount of
$10,000,000, as such promissory note may be amended, modified, restated
or replaced from time to time.
"Termination Date" means May 31, 2004.
"Termination Event" means (i) with respect to any Plan, the
occurrence of a Reportable Event or the substantial cessation of
operations (within the meaning of Section 4062(e) of ERISA); (ii) the
withdrawal of any Credit Party or any of its Subsidiaries or any ERISA
Affiliate from a Multiple Employer Plan during a plan year in which it
was a substantial employer (as such term is defined in Section
4001(a)(2) of ERISA), or the termination of a Multiple Employer Plan;
(iii) the distribution of a notice of intent to terminate or the actual
termination of a Plan pursuant to Section 4041(a)(2) or 4041A of ERISA;
(iv) the institution of proceedings to terminate or the actual
termination of a Plan by the PBGC under Section 4042 of ERISA; (v) any
event or condition which might constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to
administer, any Plan; or (vi) the complete or partial withdrawal of any
Credit Party of its Subsidiaries or any ERISA Affiliate from a
Multiemployer Plan.
"Trade Letter of Credit Fee" shall have the meaning assigned
to such term in Section 3.5(b)(ii).
"Voting Stock" means, with respect to any Person, Capital
Stock issued by such Person the holders of which are ordinarily, in the
absence of contingencies, entitled to vote for the election of
directors (or persons performing similar functions) of such Person,
even though the right so to vote has been suspended by the happening of
such a contingency.
1.2 Computation of Time Periods.
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding."
1.3 Accounting Terms.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with
this Credit Agreement shall (except as otherwise expressly provided herein) be
made by application of GAAP applied on a basis consistent with the most recent
annual or quarterly financial statements delivered pursuant to Section 7.1
hereof (or, prior to the delivery of the first financial statements pursuant to
Section 7.1 hereof, consistent with the financial statements as at December 31,
1998); provided, however, if (a) Speedway Motorsports shall object in writing to
determining such compliance on such basis at the time of delivery of such
financial statements due to any change in GAAP or the rules promulgated with
respect thereto or (b) the Administrative Agent or the Required Lenders shall so
object in writing within 30 days after delivery of such financial statements,
then such calculations shall be made on a basis consistent with the most recent
financial statements delivered by Speedway Motorsports to the Lenders as to
which no such objection shall have been made.
SECTION 2
CREDIT FACILITY
---------------
2.1 Revolving Loans.
(a) Revolving Commitment. Subject to the terms and conditions
hereof and in reliance upon the representations and warranties set
forth herein, each Lender severally agrees to make revolving credit
loans ("Revolving Loans") to the Borrowers from time to time from the
Closing Date until the Termination Date, or such earlier date as the
Revolving Commitments shall have been terminated as provided herein for
the purposes hereinafter set forth; provided, however, that the sum of
the aggregate principal amount of outstanding Revolving Loans shall not
exceed the Revolving Committed Amount and; provided, further, (i) with
regard to each Lender individually, such Lender's share of outstanding
Loans shall not exceed such Lender's Revolving Commitment Percentage of
the Revolving Committed Amount, (ii) with regard to the Lenders
collectively, the aggregate principal amount of outstanding Obligations
shall not exceed TWO HUNDRED FIFTY MILLION DOLLARS ($250,000,000) (as
such aggregate maximum amount may be reduced from time to time as
provided in Section 3.4, the "Revolving Committed Amount") and (iii)
with regard to the Lenders collectively, the aggregate principal amount
of the Obligations shall not exceed the Revolving Committed Amount.
Revolving Loans may consist of Base Rate Loans or Eurodollar Loans, or
a combination thereof, as the Borrowers may request, and may be repaid
and reborrowed in accordance with the provisions hereof; provided,
however, that no more than six
Eurodollar Loans shall be outstanding hereunder at any time. For
purposes hereof, Eurodollar Loans with different Interest Periods shall
be considered as separate Eurodollar Loans, even if they begin on the
same date and have the same duration, although borrowings, extensions
and conversions may, in accordance with the provisions hereof, be
combined at the end of existing Interest Periods to constitute a new
Eurodollar Loan with a single Interest Period. Revolving Loans
hereunder may be repaid and reborrowed in accordance with the
provisions hereof.
(b) Revolving Loan Borrowings.
(i) Notice of Borrowing. The Borrowers shall
request a Revolving Loan borrowing by written notice (or
telephone notice promptly confirmed in writing) to the
Administrative Agent not later than 11:00 A.M. (Charlotte,
North Carolina time) on the Business Day prior to the date of
the requested borrowing in the case of Base Rate Loans, and on
the third Business Day prior to the date of the requested
borrowing in the case of Eurodollar Loans. Each such request
for borrowing shall be irrevocable and shall specify (A) that
a Revolving Loan is requested, (B) the date of the requested
borrowing (which shall be a Business Day), (C) the aggregate
principal amount to be borrowed and (D) whether the borrowing
shall be comprised of Base Rate Loans, Eurodollar Loans or a
combination thereof, and if Eurodollar Loans are requested,
the Interest Period(s) therefor. If any such Notice of
Borrowing shall fail to specify (I) an applicable Interest
Period in the case of a Eurodollar Loan, then such notice
shall be deemed to be a request for an Interest Period of one
month, or (II) the type of Revolving Loan requested, then such
notice shall be deemed to be a request for a Base Rate Loan
hereunder. The Administrative Agent shall give notice to each
Lender before 5:00 p.m. (Charlotte, North Carolina time) on
the day of receipt of each Notice of Borrowing specifying the
contents thereof and each such Lender's share of any borrowing
to be made pursuant thereto.
(ii) Minimum Amounts. Each Revolving Loan
borrowing shall be in a minimum aggregate amount of $1,000,000
and integral multiples of $100,000 in excess thereof (or the
remaining amount of the Commitment, if less).
(iii) Advances. Each Lender will make its
Commitment Percentage of each Revolving Loan borrowing
available to the Administrative Agent for the account of the
Borrowers at the office of the Administrative Agent specified
in Schedule 2.1(a), or at such other office as the
Administrative Agent may designate in writing, by 12:00 P.M.
(Charlotte, North Carolina time) on the date specified in the
applicable Notice of Borrowing in Dollars and in funds
immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrowers by the
Administrative Agent by crediting the account of the
Borrowers on the books of such office with the aggregate of
the amounts made available to the Administrative Agent by the
Lenders and in like funds as received by the Administrative
Agent.
(c) Repayment. The principal amount of all Revolving Loans
shall be due and payable in full on the Termination Date.
(d) Interest. Subject to the provisions of Section 3.1,
Revolving Loans shall bear interest as follows:
(i) Base Rate Loans. During such periods as
Revolving Loans shall be comprised of Base Rate Loans, the sum
of the Base Rate plus the Applicable Percentage;
(ii) Eurodollar Loans. During such periods
as Revolving Loans shall be comprised of Eurodollar Loans, the
Eurodollar Rate plus the Applicable Percentage.
Interest on Revolving Loans shall be payable in arrears on each
Interest Payment Date.
(e) Revolving Notes. The Revolving Loans made by each Lender
shall be evidenced by a duly executed promissory note of the Borrowers
to each Lender in substantially the form of Schedule 2.1(e).
2.2 Letter of Credit Subfacility.
(a) Issuance. Subject to the terms and conditions hereof and
of the LOC Documents, if any, the Issuing Lender agrees from time to
time to issue such Letters of Credit from the Closing Date until the
Termination Date as the Borrowers may request for their own account or
for the account of another Credit Party as provided herein, and the
Issuing Lender shall issue such Letters of Credit in a form acceptable
to the Issuing Lender; provided, however, that (i) the LOC Obligations
shall not at any time exceed TEN MILLION DOLLARS ($10,000,000) (the
"LOC Committed Amount") and (ii) the sum of the aggregate principal
amount of the Obligations shall not at any time exceed the aggregate
Committed Amount. No Letter of Credit shall (x) have an original expiry
date more than two years from the date of issuance; provided, however,
so long as no Event of Default has occurred and is continuing and
subject to the other terms and conditions to the issuance of Letters of
Credit, such Letters of Credit may provide that the expiry dates of
Letters of Credit shall be extended annually on each anniversary date
of their date of issuance for an additional period not to exceed one
year unless the Administrative Agent has given not less than sixty (60)
days prior notice of its intent not to renew or (y) as originally
issued or as extended, have an expiry date extending beyond the
Termination Date. Each Letter of Credit shall comply with the related
LOC Documents. The issuance and expiry
date of each Letter of Credit shall be a Business Day.
(b) Notice and Reports. The request for the issuance of a
Letter of Credit shall be submitted by the Borrowers to the Issuing
Lender at least three (3) Business Days prior to the requested date of
issuance. The Issuing Lender will, at least quarterly and more
frequently upon reasonable request, disseminate to each of the Lenders
a detailed report specifying the Letters of Credit which are then
issued and outstanding and any activity with respect thereto which may
have occurred since the date of the prior report, and including
therein, among other things, the beneficiary, the face amount, expiry
date as well as any payment or expirations which may have occurred.
(c) Participation. Each Lender, upon issuance of a Letter of
Credit in accordance with the terms hereof, shall be deemed to have
purchased without recourse a participation from the applicable Issuing
Lender in such Letter of Credit and the obligations arising thereunder
and the related LOC Documents in each case in an amount equal to its
pro rata share of the obligations under such Letter of Credit (based on
the respective Commitment Percentages of the Lenders) and shall
absolutely, unconditionally and irrevocably be obligated to pay to the
Issuing Lender its pro rata share (based upon the Revolving Commitment
Percentage of such Lender) of any unreimbursed drawing under such
Letter of Credit. Without limiting the scope and nature of each
Lender's participation in any Letter of Credit, to the extent that the
Issuing Lender has not been reimbursed for any drawing as required
hereunder or under any such Letter of Credit, each such Lender shall
pay to the Issuing Lender its pro rata share of such unreimbursed
drawing in same day funds pursuant to the provisions of subsection (d)
hereof. The obligation of each Lender to so reimburse the Issuing
Lender shall be absolute and unconditional and shall not be affected by
the occurrence of a Default, an Event of Default or any other
occurrence or event. Any such reimbursement shall not relieve or
otherwise impair the obligation of the Borrowers to reimburse the
Issuing Lender under any Letter of Credit, together with interest as
hereinafter provided.
(d) Reimbursement. In the event of any drawing under any
Letter of Credit, the Issuing Lender will promptly notify the
Borrowers. Unless the Borrowers shall immediately notify the Issuing
Lender that the Borrowers intend to otherwise reimburse the Issuing
Lender for such drawing, the Borrowers shall be deemed to have
requested that the Lenders make a Revolving Loan in the amount of the
drawing as provided in subsection (e) hereof on the related Letter of
Credit, the proceeds of which will be used to satisfy the related
reimbursement obligations. The Borrowers promise to reimburse the
Issuing Lender on the day of drawing under any Letter of Credit (either
with the proceeds of a Revolving Loan obtained hereunder or otherwise)
in same day funds. If the Borrowers shall fail to reimburse the Issuing
Lender as provided hereinabove, the unreimbursed amount of such drawing
shall bear interest at a per annum rate equal to the Base Rate plus the
sum of (i) the Applicable Percentage for Base Rate Loans in effect from
time to time and (ii) two
percent (2%). The Borrowers' reimbursement obligations hereunder shall
be absolute and unconditional under all circumstances irrespective of
any rights of setoff, counterclaim or defense to payment the Borrowers
may claim or have against the Issuing Lender, the Administrative Agent,
the Lenders, the beneficiary of the Letter of Credit drawn upon or any
other Person, including without limitation any defense based on any
failure of the Borrowers or any other Credit Party to receive
consideration or the legality, validity, regularity or unenforceability
of the Letter of Credit; provided, however, that the Borrowers are not
deemed to have waived such rights by payment. The Issuing Lender will
promptly notify the other Lenders of the amount of any unreimbursed
drawing and each Lender shall promptly pay to the Administrative Agent
for the account of the Issuing Lender, in dollars and in immediately
available funds, the amount of such Lender's pro rata share (based upon
the Revolving Commitment Percentage of such Lender) of such
unreimbursed drawing. Such payment shall be made on the day such notice
is received by such Lender from the Issuing Lender if such notice is
received at or before 2:00 P.M. (Charlotte, North Carolina time), and
otherwise such payment shall be made at or before 12:00 Noon
(Charlotte, North Carolina time) on the Business Day next succeeding
the day such notice is received. If such Lender does not pay such
amount to the Issuing Lender in full upon such request, such Lender
shall, on demand, pay to the Administrative Agent for the account of
the Issuing Lender interest on the unpaid amount during the period from
the date such payment was due until such Lender pays such amount to the
Issuing Lender in full at a rate per annum equal to, if paid within two
(2) Business Days of the date of drawing, the Federal Funds Rate and
thereafter at a rate equal to the Base Rate. Each Lender's obligation
to make such payment to the Issuing Lender, and the right of the
Issuing Lender to receive the same, shall be absolute and
unconditional, shall not be affected by any circumstance whatsoever and
without regard to the termination of this Credit Agreement or the
Commitments hereunder, the existence of a Default or Event of Default
or the acceleration of the obligations of the Borrowers hereunder and
shall be made without any offset, abatement, withholding or reduction
whatsoever. Simultaneously with the making of each such payment by a
Lender to the Issuing Lender, such Lender shall, automatically and
without any further action on the part of the Issuing Lender or such
Lender, acquire a participation in an amount equal to such payment
(excluding the portion of such payment constituting interest owing to
the Issuing Lender) in the related unreimbursed drawing portion of the
LOC Obligation and in the interest thereon and in the related LOC
Documents.
(e) Repayment with Revolving Loans. On any day on which the
Borrowers shall have requested, or been deemed to have requested, a
Revolving Loan advance to reimburse a drawing under a Letter of Credit,
the Administrative Agent shall give notice to the Lenders that a
Revolving Loan advance has been requested or deemed requested by the
Borrowers to be made in connection with a drawing under a Letter of
Credit, in which case a Revolving Loan comprised solely of Base Rate
Loans shall be immediately made to the Borrower by all Lenders
(notwithstanding any termination of the Commitments pursuant to Section
9.2) pro
rata based on the respective Revolving Commitment Percentages of the
Lenders (determined before giving effect to any termination of the
Commitments pursuant to Section 9.2) and the proceeds thereof shall be
paid directly to the Issuing Lender for application to the respective
LOC Obligations. Each such Lender hereby irrevocably agrees to make its
pro rata share of each such Revolving Loan immediately upon any such
request or deemed request in the amount, in the manner and on the date
specified in the preceding sentence notwithstanding (i) the amount of
such borrowing may not comply with the minimum amount for advances of
Revolving Loans otherwise required hereunder, (ii) whether any
conditions specified in Section 5.2 are then satisfied, (iii) whether a
Default or an Event of Default then exists, (iv) failure for any such
request or deemed request for Revolving Loan to be made by the time
otherwise required hereunder, (v) whether the date of such borrowing is
a date on which Revolving Loans are otherwise permitted to be made
hereunder or (vi) any termination of the Commitments relating thereto
immediately prior to or contemporaneously with such borrowing;
provided, however, in no event shall a Lender be required to make an
advance in excess of such Lender's Committed Amount. In the event that
any Revolving Loan cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the
commencement of a proceeding under the Bankruptcy Code with respect to
either of the Borrowers or any other Credit Party), then each such
Lender hereby agrees that it shall, upon written notice of the
unavailability of Revolving Loans and request for participation,
purchase (as of the date such borrowing would otherwise have occurred,
but adjusted for any payments received from the Borrowers on or after
such date and prior to such purchase) from the Issuing Lender such
participation in the outstanding LOC Obligations as shall be necessary
to cause each such Lender to share in such LOC Obligations ratably
(based upon the respective Revolving Commitment Percentages of the
Lenders (determined before giving effect to any termination of the
Commitments pursuant to Section 9.2)), provided that at the time any
purchase of participation pursuant to this sentence is actually made,
the purchasing Lender shall be required to pay to the Issuing Lender,
to the extent not paid to the Issuing Lender by the Borrowers in
accordance with the terms of subsection (d) hereof, interest on the
amount of its unfunded Participation Interest purchased for each day
from and including the day upon which such purchase should otherwise
have occurred to but excluding the date of payment for such
participation, at the rate equal to, if paid within two (2) Business
Days of the date of the Revolving Loan advance, the Federal Funds Rate,
and thereafter at a rate equal to the Base Rate.
(f) Designation of other Credit Parties as Account Parties.
Notwithstanding anything to the contrary set forth in this Credit
Agreement, including without limitation Section 2.2(a) hereof, a Letter
of Credit issued hereunder may contain a statement to the effect that
such Letter of Credit is issued for the account of a Credit Party,
provided that notwithstanding such statement, the Borrowers shall be
the actual account party for all purposes of this Credit Agreement for
such Letter of Credit and such statement shall not affect the
Borrowers' reimbursement obligations hereunder with respect to such
Letter of Credit.
(g) Renewal, Extension. The renewal or extension of any Letter
of Credit shall, for purposes hereof, be treated in all respects the
same as the issuance of a new Letter of Credit hereunder.
(h) Uniform Customs and Practices. The Issuing Lender may have
the Letters of Credit be subject to The Uniform Customs and Practice
for Documentary Credits, as published as of the date of issue by the
International Chamber of Commerce (the "UCP"), in which case the UCP
may be incorporated therein and deemed in all respects to be a part
thereof.
(i) Indemnification; Nature of Issuing Lender's Duties.
(i) In addition to its other obligations
under this Section 2.2, the Borrowers hereby agree to protect,
indemnify, pay and save the Issuing Lender harmless from and
against any and all claims, demands, liabilities, damages,
losses, costs, charges and expenses (including reasonable
attorneys' fees) that the Issuing Lender may incur or be
subject to as a consequence, direct or indirect, of (A) the
issuance of any Letter of Credit or (B) the failure of the
Issuing Lender to honor a drawing under a Letter of Credit as
a result of any act or omission, whether rightful or wrongful,
of any present or future de jure or de facto government or
Governmental Authority (all such acts or omissions being
herein called "Government Acts").
(ii) As among the Borrowers and the Issuing
Lender, the Borrowers shall assume all risks of the acts,
omissions or misuse of any Letter of Credit by the beneficiary
thereof. The Issuing Lender shall not be responsible: (A) for
the form, validity, sufficiency, accuracy, genuineness or
legal effect of any document submitted by any party in
connection with the application for and issuance of any Letter
of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or
forged; (B) for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign
any Letter of Credit or the rights or benefits thereunder or
proceeds thereof, in whole or in part, that may prove to be
invalid or ineffective for any reason; (C) for errors,
omissions, interruptions or delays in transmission or delivery
of any messages, by mail, cable, telegraph, telex or
otherwise, whether or not they be in cipher; (D) for any loss
or delay in the transmission or otherwise of any document
required in order to make a drawing under a Letter of Credit
or of the proceeds thereof; and (E) for any consequences
arising from causes beyond the control of the Issuing Lender,
including, without limitation, any Government Acts. None of
the above shall affect, impair, or prevent the vesting of the
Issuing Lender's rights or powers hereunder.
(iii) In furtherance and extension and not
in limitation of
the specific provisions hereinabove set forth, any action
taken or omitted by the Issuing Lender, under or in connection
with any Letter of Credit or the related certificates, if
taken or omitted in good faith, shall not put such Issuing
Lender under any resulting liability to the Borrowers or any
other Credit Party. It is the intention of the parties that
this Credit Agreement shall be construed and applied to
protect and indemnify the Issuing Lender against any and all
risks involved in the issuance of the Letters of Credit, all
of which risks are hereby assumed by the Borrowers (on behalf
of themselves and each of the other Credit Parties),
including, without limitation, any and all Government Acts.
The Issuing Lender shall not, in any way, be liable for any
failure by the Issuing Lender or anyone else to pay any
drawing under any Letter of Credit as a result of any
Government Acts or any other cause beyond the control of the
Issuing Lender.
(iv) Nothing in this subsection (i) is
intended to limit the reimbursement obligations of the
Borrowers contained in subsection (d) above. The obligations
of the Borrowers under this subsection (i) shall survive the
termination of this Credit Agreement. No act or omissions of
any current or prior beneficiary of a Letter of Credit shall
in any way affect or impair the rights of the Issuing Lender
to enforce any right, power or benefit under this Credit
Agreement.
(v) Notwithstanding anything to the contrary
contained in this subsection (i), the Borrowers shall have no
obligation to indemnify the Issuing Lender in respect of any
liability incurred by the Issuing Lender (A) arising solely
out of the gross negligence or willful misconduct of the
Issuing Lender, as determined by a court of competent
jurisdiction, or (B) caused by the Issuing Lender's failure to
pay under any Letter of Credit after presentation to it of a
request strictly complying with the terms and conditions of
such Letter of Credit, as determined by a court of competent
jurisdiction, except insofar as such payment is prohibited by
any law, regulation, court order or decree.
(j) Responsibility of Issuing Lender. It is expressly
understood and agreed that the obligations of the Issuing Lender
hereunder to the Lenders are only those expressly set forth in this
Credit Agreement and that the Issuing Lender shall be entitled to
assume that the conditions precedent set forth in Section 5.2 have been
satisfied unless it shall have acquired actual knowledge that any such
condition precedent has not been satisfied; provided, however, that
nothing set forth in this Section 2.2 shall be deemed to prejudice the
right of any Lender to recover from the Issuing Lender any amounts made
available by such Lender to the Issuing Lender pursuant to this Section
2.2 in the event that it is determined by a court of competent
jurisdiction that (A) the payment with respect to a Letter of Credit
constituted gross negligence or willful misconduct on the part of the
Issuing Lender, or (B) the Issuing Lender failed to pay under any
Letter of Credit after presentation to it of a request
strictly complying with the terms of such Letter of Credit, except
insofar as such payment is prohibited by any law, regulation, court
order or decree.
(k) Conflict with LOC Documents. In the event of any conflict
between this Credit Agreement and any LOC Document, this Credit
Agreement shall control.
2.3 Swingline Loan Subfacility.
(a) Swingline Commitment. Subject to the terms and conditions
set forth herein, the Swingline Lender, in its individual capacity,
agrees to make certain revolving credit loans to the Borrowers (each a
"Swingline Loan" and, collectively, the "Swingline Loans") at any time
and from time to time, during the period from the Closing Date until
the Termination Date for the purposes hereinafter set forth; provided,
however, (i) the aggregate amount of Swingline Loans outstanding at any
time shall not exceed TEN MILLION DOLLARS ($10,000,000) (the "Swingline
Committed Amount"), and (ii) the sum of the aggregate principal amount
of Obligations outstanding at any time shall not exceed the Revolving
Committed Amount. Swingline Loans hereunder shall be made as Base Rate
Loans in accordance with the provisions of this Section 2.3, and may be
repaid and reborrowed in accordance with the provisions hereof.
(b) Swingline Loan Advances.
(i) Notices; Disbursement. The Borrowers
shall request a Swingline Loan advance hereunder by written
notice (or telephone notice promptly confirmed in writing) to
the Swingline Lender not later than 11:00 A.M. (Charlotte,
North Carolina time) on the Business Day of the requested
Swingline Loan advance. Each such notice shall be irrevocable
and shall specify (A) that a Swingline Loan advance is
requested, (B) the date of the requested Swingline Loan
advance (which shall be a Business Day), (C) the principal
amount of the Swingline Loan advance requested and (D) that
all of the conditions set forth in Section 5.2 are then
satisfied. Each Swingline Loan shall be made as a Base Rate
Loan and shall have such maturity date as the Swingline Lender
and the Borrowers shall agree upon receipt by the Swingline
Lender of any such notice from the Borrowers. The Swingline
Lender shall initiate the transfer of funds representing the
Swingline Loan advance to the Borrowers by 3:00 P.M.
(Charlotte, North Carolina time) on the Business Day of the
requested borrowing.
(ii) Minimum Amounts. Each Swingline Loan
advance shall be in a minimum principal amount of $500,000 and
in integral multiples of $100,000 in excess thereof.
(iii) Repayment of Swingline Loans. The
principal amount of all Swingline Loans shall be due and
payable on the earlier of (A)
the end of the applicable Interest Period or (B) the
Termination Date. The Swingline Lender may, at any time, in
its sole discretion, by written notice to the Borrowers,
demand repayment of their Swingline Loans by way of a
Revolving Loan advance, in which case the Borrowers shall be
deemed to have requested a Revolving Loan advance comprised
solely of Base Rate Loans in the amount of such Swingline
Loans; provided, however, that any such demand shall be deemed
to have been given one Business Day prior to the Termination
Date and on the date of the occurrence of any Event of Default
described in Section 9.1 and upon acceleration of the
Indebtedness hereunder and the exercise of remedies in
accordance with the provisions of Section 9.2. Each Lender, if
so directed by the Administrative Agent in writing, hereby
irrevocably agrees to make its pro rata share of each such
Revolving Loan in the amount, in the manner and on the date
specified in the preceding sentence notwithstanding (I) the
amount of such borrowing may not comply with the minimum
amount for advances of Revolving Loans otherwise required
hereunder, (II) whether any conditions specified in Section
5.2 are then satisfied, (III) whether a Default or an Event of
Default then exists, (IV) failure of any such request or
deemed request for Revolving Loan to be made by the time
otherwise required hereunder, (V) whether the date of such
borrowing is a date on which Revolving Loans are otherwise
permitted to be made hereunder or (VI) any termination of the
Commitments relating thereto immediately prior to or
contemporaneously with or after such borrowing. In the event
that any Revolving Loan cannot for any reason be made on the
date otherwise required above (including, without limitation,
as a result of the commencement of a proceeding under the
Bankruptcy Code with respect to the Borrower or any other
Credit Party), then each Lender hereby agrees that it shall
upon written notice of the unavailability of a Revolving Loan
and request for participation purchase (as of the date such
borrowing would otherwise have occurred, but adjusted for any
payments received from the Borrower on or after such date and
prior to such purchase) from the Swingline Lender such
Participation Interests in the outstanding Swingline Loans as
shall be necessary to cause each such Lender to share in such
Swingline Loans ratably based upon its Revolving Commitment
Percentage (determined before giving effect to any termination
of the Commitments pursuant to Section 3.4), provided that all
interest payable on the Swingline Loans shall be for the
account of the Swingline Lender until the date as of which the
respective Participation Interests are purchased.
(c) Interest on Swingline Loans. Subject to the provisions of
Section 3.1, each Swingline Loan shall bear interest at per annum rate
equal to the Base Rate. Interest on Swingline Loans shall be payable in
arrears on each applicable Interest Payment Date (or at such other
times as may be specified herein).
SECTION 3
OTHER PROVISIONS RELATING TO CREDIT FACILITIES
----------------------------------------------
3.1 Default Rate.
Upon the occurrence, and during the continuance, of an Event of
Default, the principal of and, to the extent permitted by law, interest on the
Loans and any other amounts owing hereunder or under the other Credit Documents
shall bear interest, payable on demand, at a per annum rate 2% greater than the
rate which would otherwise be applicable (or if no rate is applicable, whether
in respect of interest, fees or other amounts, then 2% greater than the Base
Rate).
3.2 Extension and Conversion.
The Borrowers shall have the option on any Business Day, to extend
existing Loans into a subsequent permissible Interest Period or to convert Loans
into Loans of another type; provided, however, that (i) except as provided in
Section 3.8, Eurodollar Loans may be converted into Base Rate Loans only on the
last day of the Interest Period applicable thereto, (ii) Eurodollar Loans may be
extended, and Base Rate Loans may be converted into Eurodollar Loans, only if no
Default or Event of Default is in existence on the date of extension or
conversion, (iii) Loans extended as, or converted into, Eurodollar Loans shall
be subject to the terms of the definition of "Interest Period" set forth in
Section 1.1 and shall be in such minimum amounts as provided in, Section
2.1(b)(ii), (iv) no more than six separate Eurodollar Loans shall be outstanding
hereunder at any time and (v) any request for extension or conversion of a
Eurodollar Loan which shall fail to specify an Interest Period shall be deemed
to be a request for an Interest Period of one month. Each such extension or
conversion shall be effected by the Borrowers by giving a Notice of
Extension/Conversion (or telephone notice promptly confirmed in writing) to the
Administrative Agent prior to 11:00 A.M. (Charlotte, North Carolina time) on the
Business Day of, in the case of the conversion of a Eurodollar Loan into a Base
Rate Loan and on the third Business Day prior to, in the case of the extension
of a Eurodollar Loan as, or conversion of a Base Rate Loan into, a Eurodollar
Loan, the date of the proposed extension or conversion, specifying the date of
the proposed extension or conversion, the Loans to be so extended or converted,
the types of Loans into which such Loans are to be converted and, if
appropriate, the applicable Interest Periods with respect thereto. Each request
for extension or conversion shall constitute a representation and warranty by
the Borrowers of the matters specified in subsections (ii), (iii), (iv) and (v)
of Section 5.2(a). In the event the Borrowers fail to request extension or
conversion of any Eurodollar Loan in accordance with this Section, or any such
conversion or extension is not permitted or required by this Section, then such
Loan shall be automatically converted into a Base Rate Loan at the end of the
Interest Period applicable thereto. The Administrative Agent shall give each
Lender notice as promptly as practicable of any such proposed extension or
conversion affecting any Loan.
3.3 Prepayments.
(a) Voluntary Prepayments. The Borrowers shall have the right
to prepay
Revolving Loans in whole or in part from time to time without premium
or penalty; provided, however, that (i) Eurodollar Loans may only be
prepaid on three Business Days' prior written notice to the
Administrative Agent specifying the applicable Loans to be prepaid,
(ii) any prepayment of Eurodollar Loans will be subject to Section
3.11; and (iii) each such partial prepayment of Revolving Loans shall
be in a minimum principal amount of $1,000,000 and integral multiples
of $100,000 in excess thereof. Subject to the foregoing terms, amounts
prepaid hereunder shall be applied as the Borrowers may elect;
provided, that if the Borrowers fail to specify a voluntary prepayment
then such prepayment shall be applied first to Base Rate Loans and then
to Eurodollar Loans in direct order of Interest Period maturities.
Voluntary prepayments on the Revolving Loans may be reborrowed in
accordance with the provisions hereof. Such voluntary prepayments shall
not reduce the Revolving Committed Amount.
(b) Mandatory Prepayments.
(i) Overadvance. If at any time (i) the
aggregate principal amount of the Obligations exceeds the
Revolving Committed Amount, (ii) the aggregate amount of LOC
Obligations shall exceed the aggregate LOC Committed Amount,
or (iii) the aggregate amount of Swingline Loans shall exceed
the Swingline Committed Amount, the Borrowers jointly and
severally promise to prepay immediately upon demand the
outstanding principal balance on the Loans or provide cash
collateral in the manner and in an aggregate amount necessary
to eliminate such excess in respect of the LOC Obligations. In
the case of a mandatory prepayment required on account of
subsection (ii) in the foregoing sentence, the amount required
to be paid shall serve to temporarily reduce the Revolving
Committed Amount (for purposes of borrowing availability
hereunder, but not for purposes of computation of fees) by the
amount of the payment required until such time as the
situation shall no longer exist. Payments hereunder shall be
applied first to the Revolving Loans and Swingline Loans and
then to a cash collateral account in respect of the LOC
Obligations.
(ii) Application. All prepayments made
pursuant to this Section 3.3(b) shall be subject to Section
3.11 and shall be applied first to Swingline Loans, then to
Base Rate Loans and then to Eurodollars Loans in direct order
of Interest Period maturities. Prepayments under this Section
3.3(b)(ii) shall permanently reduce the Revolving Committed
Amount.
(c) Notice. The Borrowers will provide notice to the
Administrative Agent of any prepayment by 11:00 A.M. (Charlotte, North
Carolina time) on the date of prepayment. Amounts paid on the Loans
under subsection (a) and (b)(i) hereof may be reborrowed in accordance
with the provisions hereof.
3.4 Termination and Reduction of Revolving Commitments.
The Borrowers may from time to time permanently reduce or
terminate the aggregate Revolving Committed Amount in whole or in part
(in minimum aggregate amounts of $10,000,000 (or, if less, the full
remaining amount of the Revolving Committed Amount)) upon five Business
Days' prior written notice from the Borrowers to the Administrative
Agent; provided, however, no such termination or reduction shall be
made which would reduce the Revolving Committed Amount to an amount
less than the aggregate principal amount of Revolving Loans
outstanding. The Commitments of the Lenders shall automatically
terminate on the Termination Date. The Administrative Agent shall
promptly notify each of the Lenders of receipt by the Administrative
Agent of any notice from the Borrowers pursuant to this Section 3.4.
3.5 Fees.
(a) Commitment Fee. In consideration of the Revolving
Commitments hereunder, the Borrowers agree to pay the Administrative
Agent for the ratable benefit of the Lenders a commitment fee (the
"Commitment Fee") equal to the Applicable Percentage per annum on the
average daily unused amount of the Revolving Committed Amount for the
applicable period. For the purposes hereof Swingline Loans shall not be
considered usage under the Revolving Commitments. The Commitment Fee
shall be payable (i) quarterly in arrears on the Interest Payment Date
following the last day of each calendar quarter for the immediately
preceding quarter (or portion thereof) beginning with the first such
date to occur after the Closing Date and (ii) on the Termination Date.
(b) Letter of Credit Fees.
(i) Standby Letter of Credit Issuance Fee.
In consideration of the issuance of standby Letters of Credit
hereunder, the Borrowers jointly and severally promise to pay
to the Administrative Agent for the ratable benefit of the
Lenders a fee (the "Standby Letter of Credit Fee") on the
average daily maximum amount available to be drawn under each
such standby Letter of Credit computed at a per annum rate for
each day from the date of issuance to the date of expiration
equal to the Applicable Percentage for Standby Letter of
Credit Fee. The Standby Letter of Credit Fee will be payable
quarterly in arrears on the 15th day of each January, April,
July and October for the immediately preceding fiscal quarter
(or a portion thereof).
(ii) Trade Letter of Credit Drawing Fee. In
consideration of the issuance of trade Letters of Credit
hereunder, the Borrowers jointly and severally promise to pay
to the Administrative Agent for the ratable benefit of the
Lenders a fee (the "Trade Letter of Credit Fee") equal to the
Applicable Percentage for trade Letter of Credit Fee on the
amount of each drawing under any such trade Letter of Credit.
The Trade Letter of Credit
Fee will be payable on each date of drawing under a trade
Letter of Credit.
(iii) Issuing Lender Fees. In addition to
the Standby Letter of Credit Fee payable pursuant to clause
(i) above and the Trade Letter of Credit Fee payable pursuant
to clause (ii) above, the Borrowers jointly and severally
promise to pay, to the Issuing Lender for its own account
without sharing by the other Lenders the letter of credit
fronting and negotiation fees agreed to by the Borrowers and
the Issuing Lender from time to time and the customary charges
from time to time of the Issuing Lender with respect to the
issuance, amendment, transfer, administration, cancellation
and conversion of, and drawings under, such Letters of Credit
(collectively, the "Issuing Lender Fees").
(c) Administrative Fees. The Borrowers jointly and severally
promise to pay to the Administrative Agent, for its own account and for
the account of NationsBanc Capital Markets, Inc., as applicable, the
annual administrative fee, structuring fee and other fees referred to
in the Administrative Agent's Fee Letter (collectively, the "Agent's
Fees").
(d) Upfront Fees. The Borrowers jointly and severally promise
to pay to the Administrative Agent for the benefit of the Lenders in
immediately available funds on or before the Closing Date an upfront
fee (the "Upfront Fee") as outlined in the letter from the
Administrative Agent to the Lenders dated April 21, 1999.
3.6 Capital Adequacy.
If, after the date hereof, any Lender has determined that the adoption
or the becoming effective of after the Closing Date, or any change in after the
Closing Date, or any change after the Closing Date by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof in the interpretation or administration of, any
applicable law, rule or regulation regarding capital adequacy, or compliance by
such Lender with any request or directive after the Closing Date regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on such Lender's capital or assets as a consequence of its
commitments or obligations hereunder to a level below that which such Lender
could have achieved but for such adoption, effectiveness, change or compliance
(taking into consideration such Lender's policies with respect to capital
adequacy), then, upon 10 days' notice, including calculations of the amount due,
from such Lender to the Borrowers, the Borrowers shall be jointly and severally
obligated to pay to such Lender such additional amount or amounts as will
compensate such Lender for such reduction. Each determination by any such Lender
of amounts owing under this Section shall, absent manifest error, be conclusive
and binding on the parties hereto.
3.7 Inability To Determine Interest Rate.
If prior to the first day of any Interest Period, the Administrative
Agent shall have determined (which determination shall be conclusive and binding
upon the Borrowers) that, by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining the
Eurodollar Rate for such Interest Period, the Administrative Agent shall give
telecopy or telephonic notice thereof to the Borrowers and the Lenders as soon
as practicable thereafter. If such notice is given (x) any Eurodollar Loans
requested to be made on the first day of such Interest Period shall be made as
Base Rate Loans and (y) any Loans that were to have been converted on the first
day of such Interest Period to or continued as Eurodollar Loans shall be
converted to or continued as Base Rate Loans. Until such notice has been
withdrawn by the Administrative Agent, no further Eurodollar Loans shall be made
or continued as such, nor shall the Borrower have the right to convert Base Rate
Loans to Eurodollar Loans.
3.8 Illegality.
Notwithstanding any other provision herein, if the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for any Lender to make
or maintain Eurodollar Loans as contemplated by this Credit Agreement, (a) such
Lender shall promptly give written notice of such circumstances to the Borrowers
and the Administrative Agent (which notice shall be withdrawn whenever such
circumstances no longer exist), (b) the commitment of such Lender hereunder to
make Eurodollar Loans, continue Eurodollar Loans as such and convert Base Rate
Loans to Eurodollar Loans shall forthwith be canceled and, until such time as it
shall no longer be unlawful for such Lender to make or maintain Eurodollar
Loans, such Lender shall then have a commitment only to make a Base Rate Loan
when a Eurodollar Loan is requested and (c) such Lender's Loans then outstanding
as Eurodollar Loans, if any, shall be converted automatically to Base Rate Loans
on the respective last days or the then current Interest Periods with respect to
such Loans or within such earlier period as required by law. If any such
conversion of a Eurodollar Loan occurs on a day which is not the last day of the
then current Interest Period with respect thereto, the Borrowers shall jointly
and severally pay to such Lender such amounts, if any, as may be required
pursuant to Section 3.11.
3.9 Requirements of Law.
If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof applicable to any Lender, or compliance by
any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority, in each case made
subsequent to the Closing Date (or, if later, the date on which such Lender
becomes a Lender):
(a) shall subject such Lender to any tax of any kind
whatsoever with respect to any Letter of Credit or any Eurodollar Loans
made by it or its obligation to make Eurodollar Loans, or change the
basis of taxation of payments to such Lender in respect thereof (except
for Non-Excluded Taxes covered by Section 3.10
(including Non-Excluded Taxes imposed solely by reason of any failure
of such Lender to comply with its obligations under Section 3.10(b))
and changes in taxes measured by or imposed upon the overall net
income, or franchise tax (imposed in lieu of such net income tax), of
such Lender or its applicable lending office, branch, or any affiliate
thereof); or
(b) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the Eurodollar Rate
hereunder; or
(c) shall impose on such Lender any other condition (excluding
any tax of any kind whatsoever); and the result of any of the foregoing
is to increase the cost to such Lender, by an amount which such Lender
deems to be material, of making, converting into, continuing or
maintaining Eurodollar Loans or to reduce any amount receivable
hereunder in respect thereof;
then, in any such case, upon notice to the Borrowers from such
Lender, through the Administrative Agent, in accordance herewith, the
Borrowers shall be jointly and severally obligated to pay promptly to
such Lender, upon its demand, any additional amounts necessary to
compensate such Lender for such increased cost or reduced amount
receivable, provided that, in any such case, the Borrowers may elect to
convert the Eurodollar Loans made by such Lender hereunder to Base Rate
Loans by giving the Administrative Agent at least one Business Day's
notice of such election, in which case the Borrowers shall be jointly
and severally obligated to pay promptly to such Lender, upon demand,
without duplication, such amounts, if any, as may be required pursuant
to Section 3.11. If any Lender becomes entitled to claim any additional
amounts pursuant to this subsection, it shall provide prompt notice
thereof to the Borrowers through the Administrative Agent, certifying
(x) that one of the events described in this paragraph (a) has occurred
and describing in reasonable detail the nature of such event, (y) as to
the increased cost or reduced amount resulting from such event and (z)
as to the additional amount demanded by such Lender and a reasonably
detailed explanation of the calculation thereof. Such a certificate as
to any additional amounts payable pursuant to this subsection submitted
by such Lender, through the Administrative Agent, to the Borrowers
shall be conclusive and binding on the parties hereto in the absence of
manifest error. This covenant shall survive the termination of this
Credit Agreement and the payment of the Loans and all other amounts
payable hereunder.
3.10 Taxes.
(a) Except as provided below in this subsection, all payments
made by any Borrower under this Credit Agreement shall be made free and
clear of, and without deduction or withholding for or on account of,
any present or future income,
stamp or other taxes, levies, imposts, duties, charges, fees,
deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any court, or governmental body,
agency or other official, excluding taxes measured by or imposed upon
the overall net income of any Lender or its applicable lending office,
or any branch or affiliate thereof, and all franchise taxes, branch
taxes, taxes on doing business or taxes on the overall capital or net
worth of any Lender or its applicable lending office, or any branch or
affiliate thereof, in each case imposed in lieu of net income taxes,
imposed: (i) by the jurisdiction under the laws of which such Lender,
applicable lending office, branch or affiliate is organized or is
located, or in which its principal executive office is located, or any
nation within which such jurisdiction is located or any political
subdivision thereof; or (ii) by reason of any connection between the
jurisdiction imposing such tax and such Lender, applicable lending
office, branch or affiliate other than a connection arising solely from
such Lender having executed, delivered or performed its obligations, or
received payment under or enforced, this Credit Agreement. If any such
non-excluded taxes, levies, imposts, duties, charges, fees, deductions
or withholdings ("Non-Excluded Taxes") are required to be withheld from
any amounts payable to the Administrative Agent or any Lender
hereunder, (A) the amounts so payable to the Administrative Agent or
such Lender shall be increased to the extent necessary to yield to the
Administrative Agent or such Lender (after payment of all Non-Excluded
Taxes) interest or any such other amounts payable hereunder at the
rates or in the amounts specified in this Credit Agreement, provided,
however, that a Borrower shall be entitled to deduct and withhold any
Non-Excluded Taxes and shall not be required to increase any such
amounts payable to any Lender that is not organized under the laws of
the United States of America or a state thereof if such Lender fails to
comply with the requirements of paragraph (b) of this subsection
whenever any Non-Excluded Taxes are payable by such Borrower, and (B)
as promptly as possible thereafter such Borrower shall send to the
Administrative Agent for its own account or for the account of such
Lender, as the case may be, a certified copy of an original official
receipt received by such Borrower showing payment thereof. If a
Borrower fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the Administrative
Agent the required receipts or other required documentary evidence,
such Borrower shall indemnify the Administrative Agent and the Lenders
for any incremental taxes, interest or penalties that may become
payable by the Administrative Agent or any Lender as a result of any
such failure. The agreements in this subsection shall survive the
termination of this Credit Agreement and the payment of the Loans and
all other amounts payable hereunder.
(b) Each Lender that is not incorporated under the laws of the
United States of America or a state thereof shall:
(X) (i) on or before the date of any
payment by the Borrowers under this Credit Agreement
to such Lender, deliver to the Borrowers and the
Administrative Agent (A) two (2) duly completed
copies of United States Internal Revenue Service Form
1001 or 4224, or successor applicable form, as the
case may be, certifying that it is entitled to
receive payments under this Credit Agreement without
deduction or withholding of any United States federal
income taxes and (B) an Internal Revenue Service Form
W-8 or W-9, or successor applicable form, as the case
may be, certifying that it is entitled to an
exemption from United States backup withholding tax;
(ii) deliver to the Borrowers and the
Administrative Agent two (2) further copies of any
such form or certification on or before the date that
any such form or certification expires or becomes
obsolete and after the occurrence of any event
requiring a change in the most recent form previously
delivered by it to the Borrowers; and
(iii) obtain such extensions of time for
filing and complete such forms or certifications as
may reasonably be requested by the Borrowers or the
Administrative Agent; or
(Y) in the case of any such Lender that is
not a "bank" within the meaning of Section 881(c)(3)(A) of the
Code, (i) represent to the Borrowers (for the benefit of the
Borrowers and the Administrative Agent) that it is not a bank
within the meaning of Section 881(c)(3)(A) of the Code, (ii)
agree to furnish to the Borrowers on or before the date of any
payment by any Borrower, with a copy to the Administrative
Agent two (2) accurate and complete original signed copies of
Internal Revenue Service Form W-8, or successor applicable
form certifying to such Lender's legal entitlement at the date
of such certificate to an exemption from U.S. withholding tax
under the provisions of Section 881(c) of the Code with
respect to payments to be made under this Credit Agreement
(and to deliver to the Borrowers and the Administrative Agent
two (2) further copies of such form on or before the date it
expires or becomes obsolete and after the occurrence of any
event requiring a change in the most recently provided form
and, if necessary, obtain any extensions of time reasonably
requested by the Borrowers or the Administrative Agent for
filing and completing such forms), and (iii) agree, to the
extent legally entitled to do so, upon reasonable request by
the Borrowers, to provide to the Borrowers (for the benefit of
the Borrowers and the Administrative Agent) such other forms
as may be reasonably required in order to establish the legal
entitlement of such Lender to an exemption from withholding
with respect to payments under this Credit Agreement;
unless in any such case any change in treaty, law or regulation has
occurred after the date such Person becomes a Lender hereunder which
renders all such forms inapplicable or which would prevent such Lender
from duly completing and delivering any such form with respect to it
and such Lender so advises the Borrowers
and the Administrative Agent. Each Person that shall become a Lender or
a participant of a Lender pursuant to subsection 11.3 shall, upon the
effectiveness of the related transfer, be required to provide all of
the forms, certifications and statements required pursuant to this
subsection, provided that in the case of a participant of a Lender the
obligations of such participant of a Lender pursuant to this subsection
(b) shall be determined as if the participant of a Lender were a Lender
except that such participant of a Lender shall furnish all such
required forms, certifications and statements to the Lender from which
the related participation shall have been purchased.
3.11 Indemnity.
The Borrowers jointly and severally promise to indemnify each Lender
and to hold each Lender harmless from any loss or expense which such Lender may
sustain or incur (other than through such Lender's gross negligence or willful
misconduct) as a consequence of (a) default by any Borrower in making a
borrowing of, conversion into or continuation of Eurodollar Loans after the
Borrowers have given a notice requesting the same in accordance with the
provisions of this Credit Agreement, (b) default by any Borrower in making any
prepayment of a Eurodollar Loan after the Borrowers have given a notice thereof
in accordance with the provisions of this Credit Agreement or (c) the making of
a prepayment of Eurodollar Loans on a day which is not the last day of an
Interest Period with respect thereto. Such indemnification may include an amount
equal to the excess, if any, of (i) the amount of interest which would have
accrued on the amount so prepaid, or not so borrowed, converted or continued,
for the period from the date of such prepayment or of such failure to borrow,
convert or continue to the last day of the applicable Interest Period (or, in
the case of a failure to borrow, convert or continue, the Interest Period that
would have commenced on the date of such failure) in each case at the applicable
rate of interest for such Eurodollar Loans provided for herein (excluding,
however, the Applicable Percentage included therein, if any) over (ii) the
amount of interest (as reasonably determined by such Lender and confirmed in
writing to the Borrower) which would have accrued to such Lender on such amount
by placing such amount on deposit for a comparable period with leading banks in
the interbank Eurodollar market. This covenant shall survive the termination of
this Credit Agreement and the payment of the Loans and all other amounts payable
hereunder.
3.12 Pro Rata Treatment.
Except to the extent otherwise provided herein:
(a) Loans. Each Loan, each payment or prepayment of principal
of any Loan (other than Swingline Loans) or reimbursement obligations
arising from drawings under Letters of Credit, each payment of interest
on the Loans or reimbursement obligations arising from drawings under
Letters of Credit, each payment of the Commitment Fee, each payment of
the Standby Letter of Credit Fee, each payment of the Trade Letter of
Credit Fee, each reduction of the Revolving Committed Amount and each
conversion or extension of any Loan (other than
Swingline Loans), shall be allocated pro rata among the Lenders in
accordance with the respective principal amounts of their outstanding
Loans and Participation Interests.
(b) Advances. Unless the Administrative Agent shall have been
notified in writing by any Lender prior to a borrowing that such Lender
will not make the amount that would constitute its ratable share of
such borrowing available to the Administrative Agent, the
Administrative Agent may assume that such Lender is making such amount
available to the Administrative Agent, and the Administrative Agent
may, in reliance upon such assumption, make available to the applicable
Borrower a corresponding amount. If such amount is not made available
to the Administrative Agent by such Lender within the time period
specified therefor hereunder, such Lender shall pay to the
Administrative Agent, on demand, such amount with interest thereon at a
rate equal to the Federal Funds Rate for the period until such Lender
makes such amount immediately available to the Administrative Agent. A
certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this subsection shall be conclusive
in the absence of manifest error. If such amount is not made available
to the Administrative Agent by such Lender within two Business Days of
the date of the related borrowing, (i) the Administrative Agent shall
notify the Borrower of the failure of such Lender to make such amount
available to the Administrative Agent and the Administrative Agent
shall also be entitled to recover such amount with interest thereon at
the rate per annum applicable to Base Rate Loans hereunder, on demand,
from the Borrower and (ii) then the Borrower may, without waiving any
rights it may have against such Lender, borrow a like amount on an
unsecured basis from any commercial bank for a period ending on the
date upon which such Lender does in fact make such borrowing available,
provided that at the time such borrowing is made and at all times while
such amount is outstanding the Borrower would be permitted to borrow
such amount pursuant to Section 2.1 of this Credit Agreement.
3.13 Sharing of Payments.
The Lenders agree among themselves that, in the event that any Lender
shall obtain payment in respect of any Loan, LOC Obligations or any other
obligation owing to such Lender under this Credit Agreement through the exercise
of a right of setoff, banker's lien or counterclaim, or pursuant to a secured
claim under Section 506 of Title 11 of the United States Code or other security
or interest arising from, or in lieu of, such secured claim, received by such
Lender under any applicable bankruptcy, insolvency or other similar law or
otherwise, or by any other means, in excess of its pro rata share of such
payment as provided for in this Credit Agreement, such Lender shall promptly
notify the Administrative Agent thereof and purchase from the other Lenders a
participation in such Loans, LOC Obligations and other obligations in such
amounts, and make such other adjustments from time to time, as shall be
equitable to the end that all Lenders share such payment in accordance with
their respective ratable shares as provided for in this Credit Agreement. The
Lenders further agree among themselves that if payment to a Lender obtained by
such
Lender through the exercise of a right of setoff, banker's lien, counterclaim or
other event as aforesaid shall be rescinded or must otherwise be restored, each
Lender which shall have shared the benefit of such payment shall, by repurchase
of a participation theretofore sold, return its share of that benefit (together
with its share of any accrued interest payable with respect thereto) to each
Lender whose payment shall have been rescinded or otherwise restored. The
Borrowers agree that any Lender so purchasing such a participation may, to the
fullest extent permitted by law, exercise all rights of payment, including
setoff, banker's lien or counterclaim, with respect to such participation as
fully as if such Lender were a holder of such Loan, LOC Obligations or other
obligation in the amount of such participation. Except as otherwise expressly
provided in this Credit Agreement, if any Lender or the Administrative Agent
shall fail to remit to the Administrative Agent or any other Lender an amount
payable by such Lender or the Administrative Agent to the Administrative Agent
or such other Lender pursuant to this Credit Agreement on the date when such
amount is due, such payments shall be made together with interest thereon for
each date from the date such amount is due until the date such amount is paid to
the Administrative Agent or such other Lender at a rate per annum equal to the
Federal Funds Rate. If under any applicable bankruptcy, insolvency or other
similar law, any Lender receives a secured claim in lieu of a setoff to which
this Section 3.13 applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent with
the rights of the Lenders under this Section 3.13 to share in the benefits of
any recovery on such secured claim.
3.14 Place and Manner of Payments.
Except as otherwise specifically provided herein, all payments
hereunder shall be made to the Administrative Agent in dollars in immediately
available funds, without offset, deduction, counterclaim or withholding of any
kind, at its offices at the Administrative Agent's office specified in Schedule
2.1(a) not later than 2:00 P.M. (Charlotte, North Carolina time) on the date
when due. Payments received after such time shall be deemed to have been
received on the next succeeding Business Day. The Administrative Agent may (but
shall not be obligated to) debit the amount of any such payment which is not
made by such time to any ordinary deposit account of the Borrowers maintained
with the Administrative Agent (with notice to the Borrowers). The Borrowers
shall, at the time any Borrower makes any payment under this Credit Agreement,
specify to the Administrative Agent the Loans, LOC Obligations, Fees, interest
or other amounts payable hereunder to which such payment is to be applied (and
in the event that it fails so to specify, or if such application would be
inconsistent with the terms hereof, the Administrative Agent shall distribute
such payment to the Lenders in such manner as the Administrative Agent may
determine to be appropriate in respect of obligations owing by the Borrowers
hereunder, subject to the terms of Section 3.12(a)). The Administrative Agent
will distribute such payments to such Lenders, if any such payment is received
prior to 12:00 Noon (Charlotte, North Carolina time) on a Business Day in like
funds as received prior to the end of such Business Day and otherwise the
Administrative Agent will distribute such payment to such Lenders on the next
succeeding Business Day. Whenever any payment hereunder shall be stated to be
due on a day which is not a Business Day, the due date thereof shall be extended
to the next succeeding Business Day (subject to accrual of interest and Fees for
the period of such extension), except that in the case of Eurodollar Loans, if
the extension would cause the payment to be made in the next following calendar
month, then such payment shall instead be made on the next preceding Business
Day. Except as expressly provided otherwise herein, all computations of interest
and fees shall be made on the basis of actual number of days elapsed over a year
of 360 days, except that computations of interest on Base Rate Loans (unless the
Base Rate is determined by reference to the Federal Funds Rate) shall be
calculated based on a year of 365 or 366 days, as appropriate. Interest shall
accrue from and include the date of borrowing, but exclude the date of payment.
SECTION 4
GUARANTY
--------
4.1 The Guaranty.
Each of the Guarantors hereby jointly and severally guarantees to each
Lender and the Administrative Agent as hereinafter provided the prompt payment
of the Borrowers' Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration or otherwise) strictly in accordance with
the terms thereof. The Guarantors hereby further agree that if any of the
Borrowers' Obligations are not paid in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration or otherwise), the
Guarantors will, jointly and severally, promptly pay the same, without any
demand or notice whatsoever, and that in the case of any extension of time of
payment or renewal of any of the Borrowers' Obligations, the same will be
promptly paid in full when due (whether at extended maturity, as a mandatory
prepayment, by acceleration or otherwise) in accordance with the terms of such
extension or renewal.
Notwithstanding any provision to the contrary contained herein or in
any other of the Credit Documents, the obligations of each Guarantor hereunder
shall be limited to an aggregate amount equal to the largest amount that would
not render its Guaranty Obligations hereunder subject to avoidance under Section
548 of the Bankruptcy Code or any comparable provisions of any applicable state
law.
4.2 Obligations Unconditional.
The obligations of the Guarantors under Section 4.1 hereof are joint
and several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Credit Documents, or any
other agreement or instrument referred to therein, or any substitution, release
or exchange of any other guarantee of or security for any of the Borrowers'
Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor,
it being the intent of this Section 4.2 that the obligations of the Guarantors
hereunder shall be absolute and unconditional
under any and all circumstances. Without limiting the generality of the
foregoing, it is agreed that, to the fullest extent permitted by law, the
occurrence of any one or more of the following shall not alter or impair the
liability of any Guarantor hereunder which shall remain absolute and
unconditional as described above:
(i) at any time or from time to time,
without notice to any Guarantor, the time for any performance
of or compliance with any of the Borrowers' Obligations shall
be extended, or such performance or compliance shall be
waived;
(ii) any of the acts mentioned in any of the
provisions of any of the Credit Documents or any other
agreement or instrument referred to therein shall be done or
omitted;
(iii) the maturity of any of the Borrowers'
Obligations shall be accelerated, or any of the Borrowers'
Obligations shall be modified, supplemented or amended in any
respect, or any right under any of the Credit Documents or any
other agreement or instrument referred to therein shall be
waived or any other guarantee of any of the Borrowers'
Obligations or any security therefor shall be released or
exchanged in whole or in part or otherwise dealt with;
(iv) any Lien granted to, or in favor of,
the Administrative Agent or any Lender or Lenders as security
for any of the Borrowers' Obligations shall fail to attach or
be perfected; or
(v) any of the Borrowers' Obligations shall
be determined to be void or voidable (including, without
limitation, for the benefit of any creditor of any Guarantor)
or shall be subordinated to the claims of any Person
(including, without limitation, any creditor of any
Guarantor).
With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest and all notices
whatsoever, and any requirement that the Administrative Agent or any Lender
exhaust any right, power or remedy or proceed against any Person under any of
the Credit Documents or any other agreement or instrument referred to therein,
or against any other Person under any other guarantee of, or security for, any
of the Borrowers' Obligations.
4.3 Reinstatement.
The obligations of the Guarantors under this Section 4 shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Borrowers' Obligations is rescinded
or must be otherwise restored by any holder of any of the Borrowers'
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Administrative Agent and each Lender on demand for all reasonable costs and
expenses (including, without limitation, fees and expenses of counsel) incurred
by the Administrative Agent or such Lender in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.
4.4 Certain Additional Waivers.
Without limiting the generality of the provisions of this Section 4,
each Guarantor hereby specifically waives the benefits of N.C. Gen. Stat. " 26-7
through 26-9, inclusive. Each Guarantor further agrees that such Guarantor shall
have no right of recourse to security for the Borrowers' Obligations. Each of
the Guarantors further agrees that it shall have no right of subrogation,
reimbursement or indemnity, nor any right of recourse to security, if any, for
the Borrowers' Obligations so long as any amounts payable to the Administrative
Agent or the Lenders in respect of the Borrowers' Obligations shall remain
outstanding or any of the Commitments shall not have expired or been terminated.
4.5 Remedies.
The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, the Borrowers' Obligations may be declared to be
forthwith due and payable as provided in Section 9.2 hereof (and shall be deemed
to have become automatically due and payable in the circumstances provided in
said Section 9.2) for purposes of Section 4.1 hereof notwithstanding any stay,
injunction or other prohibition preventing such declaration (or preventing such
Borrowers' Obligations from becoming automatically due and payable) as against
any other Person and that, in the event of such declaration (or such Borrowers'
Obligations being deemed to have become automatically due and payable), such
Borrowers' Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors for purposes of said
Section 4.1.
4.6 Continuing Guarantee.
The guarantee in this Section 4 is a continuing guarantee, and shall
apply to all Borrowers' Obligations whenever arising.
SECTION 5
CONDITIONS
-----------
5.1 Closing Conditions.
The obligation of the Lenders to enter into this Credit Agreement and
to fund the
initial advance hereunder shall be subject to satisfaction of the following
conditions:
(a) The Administrative Agent shall have received original
counterparts of this Credit Agreement executed by each of the parties
hereto;
(b) The Administrative Agent shall have received an
appropriate original Note for each Lender, executed by each of the
Borrowers;
(c) The Administrative Agent shall have received all stock
certificates evidencing the Capital Stock pledged to the Administrative
Agent pursuant to the Pledge Agreement, together with duly executed in
blank, undated stock powers attached thereto (unless, with respect to
the pledged Capital Stock of any Foreign Subsidiary, such stock powers
are deemed unnecessary by the Administrative Agent in its reasonable
discretion under the law of the jurisdiction of incorporation of such
Person);
(d) The Administrative Agent shall have received all documents
it may reasonably request relating to the existence and good standing
of each of the Credit Parties, the corporate or other necessary
authority for and the validity of the Credit Documents, and any other
matters relevant thereto, all in form and substance reasonably
satisfactory to the Administrative Agent;
(e) The Administrative Agent shall have received an incumbency
certificate for each of the Borrowers certified by a secretary or
assistant secretary to be true and correct as of the Effective Date.
(f) The Administrative Agent shall have received a certificate
executed by the chief financial officer of the Borrowers as of the
Closing Date stating that immediately after giving effect to this
Credit Agreement and the other Credit Documents, (i) no Default or
Event of Default exists and (ii) the representations and warranties set
forth in Section 6 (other than the representation set forth in Section
6.17) are true and correct in all material respects;
(g) The Administrative Agent shall have received a legal
opinion of Parker, Poe, Adams and Bernstein, LLP, counsel for the
Credit Parties, dated as of the Closing Date and substantially in the
form of Schedule 5.1(g);
(h) The Lenders shall have received and approved the (i)
audited consolidated and company-prepared consolidating balance sheet
of Speedway Motorsports and its Subsidiaries as of December 31, 1998
together with related consolidated and consolidating statements of
income and cash flow and (ii) company-prepared consolidated and
consolidating balance sheet of Speedway Motorsports and its
Subsidiaries as of March 31, 1999 together with related consolidated
and consolidating statements of income and cash flow;
(i) No Material Adverse Change shall have occurred since the
financial statements as of March 31, 1999;
(j) The Administrative Agent shall have received copies of
insurance policies or certificates of insurance of the Credit Parties
evidencing liability and casualty insurance meeting the requirements of
the Credit Documents;
(k) The Administrative Agent shall have received such other
documents, agreements or information which may be reasonably requested
by the Administrative Agent and/or the Required Lenders; and
(l) The Administrative Agent shall have received for its own
account and for the accounts of the Lenders, all fees and expenses
required by this Credit Agreement or any other Credit Document to be
paid on or before the Closing Date.
5.2 Conditions to all Extensions of Credit.
The obligations of each Lender to make, convert or extend any
Loan (including the initial Loans) and to issue or extend, or
participate in, a Letter of Credit are subject to satisfaction of the
following conditions in addition to satisfaction on the Closing Date
(and on the Closing Date only) of the conditions set forth in Section
5.1 and satisfaction on the Effective Date of the conditions set forth
in Section 5.2:
(i) The Borrowers shall have delivered, an
appropriate Notice of Borrowing, Notice of
Extension/Conversion or LOC Documents;
(ii) The representations and warranties set
forth in Section 6 shall be, subject to the limitations set
forth therein, true and correct in all material respects as of
such date (except for those which expressly relate to an
earlier date);
(iii) There shall not have been commenced
against the Borrowers or any Guarantor an involuntary case
under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or any case, proceeding or
other action for the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar
official) of such Person or for any substantial part of its
Property or for the winding up or liquidation of its affairs,
and such involuntary case or other case, proceeding or other
action shall remain undismissed, undischarged or unbonded;
(iv) No Default or Event of Default shall
exist and be continuing either prior to or after giving effect
thereto and
(v) There shall not have occurred any
Material Adverse
Change since the extension of the last Loan; and
(vi) Immediately after giving effect to the
making of such Loan (and the application of the proceeds
thereof) the sum of Loans outstanding shall not exceed the
Revolving Committed Amount or Swingline Committed Amount, as
applicable.
The delivery of each Notice of Borrowing and each Notice of
Extension/Conversion shall constitute a representation and warranty by the
Borrowers of the correctness of the matters specified in subsections (ii),
(iii), (iv) and (v) and (vi) above.
SECTION 6
REPRESENTATIONS AND WARRANTIES
------------------------------
Each of the Credit Parties hereby represents to the Administrative
Agent and each Lender that:
6.1 Financial Condition.
The audited combined balance sheets, statements of income and
statements of cash flows of Speedway Motorsports for the year ended December 31,
1998 have heretofore been furnished to each Lender. Such financial statements
(including the notes thereto) (i) have been audited by Deloitte & Touche LLP,
(ii) have been prepared in accordance with GAAP consistently applied throughout
the periods covered thereby and (iii) present fairly (on the basis disclosed in
the footnotes to such financial statements) the combined financial condition,
results of operations and cash flows of Speedway Motorsports and its combined
Subsidiaries as of such date and for such periods. The unaudited interim balance
sheets of Speedway Motorsports and its consolidated Subsidiaries as at the end
of, and the related unaudited interim statements of income and of cash flows
for, the fiscal quarter ended March 31, 1999 have heretofore been furnished to
each Lender. Such interim financial statements, for each such quarterly period,
(i) have been prepared in accordance with GAAP consistently applied throughout
the periods covered thereby and (ii) present fairly (on the basis disclosed in
the footnotes to such financial statements) the combined financial condition,
results of operations and cash flows of Speedway Motorsports and its
consolidated Subsidiaries as of such date and for such periods. During the
period from March 31, 1999 to and including the Closing Date, there has been no
sale, transfer or other disposition by it or any of its Subsidiaries of any
material part of the business or property of Speedway Motorsports and its
consolidated Subsidiaries, taken as a whole, and no purchase or other
acquisition by any of them of any business or property (including any Capital
Stock of any other person) material in relation to the combined financial
condition of Speedway Motorsports and its consolidated Subsidiaries, taken as a
whole, in each case which is not reflected in the foregoing financial statements
or in the notes thereto or has not otherwise been disclosed in writing to the
Lenders on or prior to the Closing Date.
6.2 No Change.
Since December 31, 1998, (a) except as and to the extent disclosed on
Schedule 6.2(a), there has been no development or event relating to or affecting
any of the Credit Parties which has had or would be reasonably expected to have
a Material Adverse Effect and (b) except as permitted under this Credit
Agreement (if this Credit Agreement were to have been in effect from and after
December 31, 1998), no dividends or other distributions have been declared, paid
or made upon the Capital Stock or other equity interest in any Credit Party nor
has any of the Capital Stock or other equity interest in any Credit Party been
redeemed, retired, purchased or otherwise acquired for value by such Credit
Party.
6.3 Organization; Existence; Compliance with Law.
Each of the Credit Parties (a) is duly organized, validly existing and
is in good standing under the laws of the jurisdiction of its incorporation or
organization, (b) has the corporate or other necessary power and authority, and
the legal right, to own and operate its property, to lease the property it
operates as lessee and to conduct the business in which it is currently engaged
and (c) is duly qualified as a foreign entity and in good standing under the
laws of each jurisdiction where its ownership, lease or operation of property or
the conduct of its business requires such qualification, other than in such
jurisdictions where the failure to be so qualified and in good standing would
not be reasonably expected to have a Material Adverse Effect, and (d) is in
compliance with all material Requirements of Law.
6.4 Power; Authorization; Enforceable Obligations.
Each of the Credit Parties has the corporate or other necessary power
and authority, and the legal right, to make, deliver and perform the Credit
Documents to which it is a party, and in the case of the Borrowers, to borrow
hereunder, and each of the Borrowers has taken all necessary corporate or other
necessary action to authorize the borrowings on the terms and conditions of this
Credit Agreement, and to authorize the execution, delivery and performance of
the Credit Documents to which each is a party. No consent or authorization of,
filing with, notice to or other similar act by or in respect of, any
Governmental Authority or any other Person is required to be obtained or made by
or on behalf of any Credit Party in connection with the execution, delivery,
performance, validity or enforceability of the Credit Documents to which such
Person is a party, except for consents, authorizations, notices and filings
described in Schedule 6.4, all of which have been obtained or made or have the
status described in such Schedule 6.4. This Credit Agreement has been, and each
other Credit Document to which it is a party will be, duly executed and
delivered on behalf the Credit Parties. This Credit Agreement constitutes, and
each other Credit Document to which it is a party when executed and delivered
will constitute, a legal, valid and binding obligation of such Credit Party,
enforceable against each such Person in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles
(whether enforcement is sought
by proceedings in equity or at law).
6.5 No Legal Bar.
Except as previously disclosed in writing to the Lenders on or prior to
the Closing Date, the execution, delivery and performance of the Credit
Documents by the Credit Parties, the borrowings hereunder and the use of the
proceeds of the borrowings hereunder (a) will not violate any Requirement of Law
or contractual obligation of any Credit Party in any respect that would
reasonably be expected to have a Material Adverse Effect, (b) will not result
in, or require, the creation or imposition of any Lien on any of the properties
or revenues of any of the Credit Parties pursuant to any such Requirement of Law
or contractual obligation and (c) will not violate or conflict with any
provision of the articles of incorporation or by-laws of any Credit Party.
6.6 No Material Litigation.
Except as disclosed on Schedule 6.6 hereof, no litigation,
investigation or proceeding of or before any arbitrator or Governmental
Authority is pending or, to the knowledge of the Credit Parties, threatened by
or against any of the Credit Parties or against their respective properties or
revenues which (a) relates to any of the Credit Documents or any of the
transactions contemplated hereby or thereby or (b) would be reasonably expected
to have a Material Adverse Effect.
6.7 No Default.
None of the Credit Parties is in default under or with respect to any
of their contractual obligations in any respect which would be reasonably
expected to have a Material Adverse Effect. No Default or Event of Default has
occurred and is continuing.
6.8 Ownership of Property; Liens.
Each of the Credit Parties has good record and marketable title in fee
simple to, or a valid leasehold interest in, all its material real property, and
good title to, or a valid leasehold interest in, all its other material
property, and none of such property is subject to any Lien, except for Permitted
Liens.
6.9 Intellectual Property.
Each of the Credit Parties owns, or has the legal right to use, all
United States trademarks, tradenames, copyrights, technology, know-how and
processes necessary for each of them to conduct its business as currently
conducted (the "Intellectual Property") except for those the failure to own or
have such legal right to use would not be reasonably expected to have a Material
Adverse Effect. Except as provided on Schedule 6.9, no claim has been asserted
and is pending by any Person challenging or questioning the use of any such
Intellectual Property or the validity or effectiveness of any such Intellectual
Property, nor
does any Credit Party know of any such claim, and the use of such Intellectual
Property by any Credit Party does not infringe on the rights of any Person,
except for such claims and infringements that in the aggregate would not be
reasonably expected to have a Material Adverse Effect.
6.10 No Burdensome Restrictions.
Except as previously disclosed in writing to the Lenders on or prior to
the Closing Date, no Requirement of Law or contractual obligation of any Credit
Party would be reasonably expected to have a Material Adverse Effect.
6.11 Taxes.
Except as disclosed on Schedule 6.11 hereof, each of the Credit Parties
has filed or caused to be filed all United States federal income tax returns and
all other material tax returns which, to the knowledge of such Credit Party, are
required to be filed and has paid (a) all taxes shown to be due and payable on
said returns or (b) all taxes shown to be due and payable on any assessments of
which it has received notice made against it or any of its property and all
other taxes, fees or other charges imposed on it or any of its property by any
Governmental Authority (other than any (i) taxes, fees or other charges with
respect to which the failure to pay, in the aggregate, would not have a Material
Adverse Effect or (ii) taxes, fees or other charges the amount or validity of
which are currently being contested and with respect to which reserves in
conformity with GAAP have been provided on the books of such Credit Party, as
the case may be; and no tax Lien has been filed, and, to the knowledge of any of
the Credit Parties, no claim is being asserted, with respect to any such tax,
fee or other charge.
6.12 ERISA.
Except as would not result in a Material Adverse Effect:
(a) During the five-year period prior to the date on which
this representation is made or deemed made: (i) no Termination Event
has occurred, and, to the best of the Credit Parties' or any ERISA
Affiliate's knowledge, no event or condition has occurred or exists as
a result of which any Termination Event could reasonably be expected to
occur, with respect to any Plan; (ii) no "accumulated funding
deficiency," as such term is defined in Section 302 of ERISA and
Section 412 of the Code, whether or not waived, has occurred with
respect to any Plan; (iii) each Plan has been maintained, operated, and
funded in compliance with its own terms and in material compliance with
the provisions of ERISA, the Code, and any other applicable federal or
state laws; and (iv) no lien in favor or the PBGC or a Plan has arisen
or is reasonably likely to arise on account of any Plan.
(b) The actuarial present value of all "benefit liabilities"
under each Single Employer Plan (determined within the meaning of
Section 401(a)(2) of the
Code, utilizing the actuarial assumptions used to fund such Plans),
whether or not vested, did not, as of the last annual valuation date
prior to the date on which this representation is made or deemed made,
exceed the current value of the assets of such Plan allocable to such
accrued liabilities.
(c) Neither any of the Credit Parties nor any ERISA Affiliate
has incurred, or, to the best of the Credit Parties' knowledge, are
reasonably expected to incur, any withdrawal liability under ERISA to
any Multiemployer Plan or Multiple Employer Plan. Neither any of the
Credit Parties nor any ERISA Affiliate has received any notification
that any Multiemployer Plan is in reorganization (within the meaning of
Section 4241 of ERISA), is insolvent (within the meaning of Section
4245 of ERISA), or has been terminated (within the meaning of Title IV
of ERISA), and no Multiemployer Plan is, to the best of the Credit
Parties' knowledge, reasonably expected to be in reorganization,
insolvent, or terminated.
(d) No prohibited transaction (within the meaning of Section
406 of ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility has occurred with respect to a Plan which has subjected
or may subject any Credit Party or any ERISA Affiliate to any liability
under Sections 406, 409, 502(i), or 502(l) of ERISA or Section 4975 of
the Code, or under any agreement or other instrument pursuant to which
any Credit Party or any ERISA Affiliate has agreed or is required to
indemnify any person against any such liability.
6.13 Governmental Regulations, Etc.
(a) No part of the proceeds of the Loans will be used,
directly or indirectly, for the purpose of purchasing or carrying any
"margin stock" within the meaning of Regulation G or Regulation U, or
for the purpose of purchasing or carrying or trading in any securities.
If requested by any Lender or the Administrative Agent, the Borrowers
will furnish to the Administrative Agent and each Lender a statement to
the foregoing effect in conformity with the requirements of FR Form U-1
referred to in said Regulation U. No indebtedness being reduced or
retired out of the proceeds of the Loans was or will be incurred for
the purpose of purchasing or carrying any margin stock within the
meaning of Regulation U or any "margin security" within the meaning of
Regulation T. "Margin stock" within the meaning of Regulation U does
not constitute more than 25% of the value of the consolidated assets of
Speedway Motorsports and its Subsidiaries. None of the transactions
contemplated by this Credit Agreement (including, without limitation,
the direct or indirect use of the proceeds of the Loans) will violate
or result in a violation of the Securities Act of 1933, as amended, or
the Exchange Act or regulations issued pursuant thereto, or Regulation
G, T, U or X.
(b) None of the Credit Parties is subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal Power Act
or the Investment Company Act of 1940, each as amended. In addition,
none of the Credit Parties is
(i) an "investment company" registered or required to be registered
under the Investment Company Act of 1940, as amended, and is not
controlled by such a company, or (ii) a "holding company", or a
"subsidiary company" of a "holding company", or an "affiliate" of a
"holding company" or of a "subsidiary" of a "holding company", within
the meaning of the Public Utility Holding Company Act of 1935, as
amended.
(c) No director, executive officer or principal shareholder of
any Credit Party is a director, executive officer or principal
shareholder of any Lender. For the purposes hereof the terms
"director", "executive officer" and "principal shareholder" (when used
with reference to any Lender) have the respective meanings assigned
thereto in Regulation O issued by the Board of Governors of the Federal
Reserve System.
(d) Each of the Credit Parties has obtained all material
licenses, permits, franchises or other governmental authorizations
necessary to the ownership of its respective Property and to the
conduct of its business.
(e) Each of the Credit Parties is not in violation of any
applicable statute, regulation or ordinance of the United States of
America, or of any state, city, town, municipality, county or any other
jurisdiction, or of any agency thereof (including without limitation,
federal, state or local environmental laws and regulations, which
violation could reasonably be expected to have a Material Adverse
Effect.
(f) Each of the Credit Parties is current with all material
reports and documents, if any, required to be filed with any state or
federal securities commission or similar agency and is in full
compliance in all material respects with all applicable rules and
regulations of such commissions.
6.14 Subsidiaries.
Schedule 6.14 sets forth all Subsidiaries of Speedway Motorsports at
the Closing Date, the jurisdiction of incorporation of each such Subsidiary and
the direct or indirect ownership interest of Speedway Motorsports therein.
6.15 Purpose of Loans.
The proceeds of the Loans hereunder shall be used solely (i) to
refinance existing indebtedness of the Borrowers, (ii) to finance seasonal
working capital needs of Speedway Motorsports and its Subsidiaries, (iii) to
finance letter of credit needs of Speedway Motorsports and its Subsidiaries,
(iv) to finance general corporate needs of Speedway Motorsports and its
Subsidiaries including capital expenditures, (v) to finance permitted
investments and (vi) to finance the acquisition of additional motor speedways
and related businesses. No proceeds of the Obligations shall be used by any
Subsidiary that is not a Guarantor.
6.16 Environmental Matters.
Except as set forth in Phase I Environmental Site Assessments
previously delivered to the Lenders and identified on Schedule 6.16:
(a) Each of the facilities and properties owned, leased or
operated by any Credit Party (the "Properties") and all businesses of
any Credit Party at the Properties (the "Businesses") are in compliance
with all applicable Environmental Laws, except where the failure to so
comply would not have a Material Adverse Effect, and, to the best
knowledge of any Credit Party, there are no conditions relating to the
Businesses or Properties that could give rise to liability under any
applicable Environmental Laws, except where such liability would not
have a Material Adverse Effect.
(b) None of the Credit Parties has received any written notice
of, or inquiry from any Governmental Authority regarding, any currently
unresolved material violation, alleged violation, non-compliance,
liability or potential liability regarding environmental matters or
compliance with Environmental Laws with regard to any of the Properties
or the Businesses, nor does any Credit Party have knowledge that any
such notice is being threatened.
(c) Materials of Environmental Concern have not been
transported or disposed of from the Properties, or generated, treated,
stored or disposed of at, on or under any of the Properties or any
other location, in each case by or on behalf of any Credit Party, or to
the knowledge of any Credit Party, by any other Person, in violation
of, or in a manner that would be reasonably likely to give rise to
liability under, any applicable Environmental Law, except where such
liability or the failure to so comply would not have a Material Adverse
Effect.
(d) No judicial proceeding or governmental or administrative
action is pending or, to the knowledge of any Credit Party, threatened,
under any Environmental Law to which any Credit Party is or, to the
knowledge of any Credit Party, will be named as a party, nor are there
any consent decrees or other decrees, consent orders, administrative
orders outstanding under any Environmental Law with respect to any
Credit Party, the Properties or the Businesses.
(e) To the knowledge of any Credit Party, there has been no
release or threat of release of Materials of Environmental Concern at
or from the Properties, related to the operations (including, without
limitation, disposal) of any Credit Party in connection with the
Properties or otherwise in connection with the Businesses, in violation
of or in a manner that would reasonably be expected to give rise to
liability under Environmental Laws, except where such violation or
liability would not have a Material Adverse Effect.
6.17 Solvency.
Speedway Motorsports on a consolidated basis is Solvent.
6.18 No Untrue Statement.
Neither (a) this Credit Agreement nor any other Credit Document or
certificate or document executed and delivered by or on behalf of either of the
Borrowers or any other Credit Party in accordance with or pursuant to any Credit
Document nor (b) any statement, representation, or warranty provided to the
Administrative Agent in connection with the negotiation or preparation of the
Credit Documents contains any misrepresentation or untrue statement of material
fact or omits to state a material fact necessary, in light of the circumstance
under which it was made, in order to make any such warranty, representation or
statement contained therein not misleading;
6.19 Year 2000 Compliance.
Each Credit Party has (i) initiated a review and assessment of all
areas within its and each of its Subsidiaries' business and operations that
could be adversely affected by the "Year 2000 Problem" (that is, the risk that
computer applications used by such Credit Party or any of its Subsidiaries may
be unable to recognize and perform properly date-sensitive functions involving
certain dates prior to and any date after December 31, 1999), (ii) developed a
plan and timeline for addressing the Year 2000 Problem on a timely basis, and
(iii) to date, implemented that plan in accordance with the timetable. Based on
the foregoing, each Credit Party believes that all computer applications that
are material to its and any of its Subsidiaries' business and operations are
reasonably expected on a timely basis to be able to perform properly
date-sensitive functions for all dates before and after January 1, 2000 (that
is, be "Year 2000 compliant"), except to the extent that a failure to do so
could not reasonably be expected to have Material Adverse Effect.
6.20 Subordinate Indebtedness.
Indebtedness represented by the Indenture is subordinate to the Loans.
SECTION 7
AFFIRMATIVE COVENANTS
----------------------
Each Credit Party hereby covenants and agrees that, so long as this
Credit Agreement is in effect or any amounts payable hereunder or under any
other Credit Document shall remain outstanding, and until all of the Commitments
hereunder shall have terminated:
7.1 Information Covenants.
The Borrowers will furnish, or cause to be furnished, to the
Administrative Agent
and each of the Lenders:
(a) Annual Financial Statements. As soon as available, and in
any event within 120 days after the close of each fiscal year of
Speedway Motorsports and its Subsidiaries, a consolidated and
consolidating balance sheet and income statement of Speedway
Motorsports and its Subsidiaries, as of the end of such fiscal year,
together with related consolidated and consolidating statements of
operations and retained earnings and of cash flows for such fiscal
year, setting forth in comparative form consolidated and consolidating
figures for the preceding fiscal year, all such financial information
described above to be in reasonable form and detail and, as to the
consolidated statements only, audited by independent certified public
accountants of recognized national standing reasonably acceptable to
the Administrative Agent and whose opinion shall be unqualified.
(b) Quarterly Financial Statements. As soon as available, and
in any event within 45 days after the close of each fiscal quarter of
Speedway Motorsports and its Subsidiaries (other than the fourth fiscal
quarter, in which case 120 days after the end thereof) a consolidated
and consolidating balance sheet and income statement of Speedway
Motorsports and its Subsidiaries, as of the end of such fiscal quarter,
together with related consolidated and consolidating statements of
operations and retained earnings and of cash flows for such fiscal
quarter in each case setting forth in comparative form consolidated and
consolidating figures for the corresponding period of the preceding
fiscal year, all such financial information described above to be in
reasonable form and detail and reasonably acceptable to the
Administrative Agent, and accompanied by a certificate of the chief
executive officer, chief financial officer or president of Speedway
Motorsports to the effect that such quarterly financial statements
fairly present in all material respects the financial condition of
Speedway Motorsports and its Subsidiaries and have been prepared in
accordance with GAAP, subject to changes resulting from audit and
normal year-end audit adjustments, including without limitation the
addition of footnotes.
(c) Officer's Certificate. At the time of delivery of the
financial statements provided for in Sections 7.1(a) and 7.1(b) above,
a certificate of the chief executive officer, chief financial officer
or president of Speedway Motorsports substantially in the form of
Schedule 7.1(c), (i) demonstrating compliance with the financial
covenants contained in Section 7.11 by calculation thereof as of the
end of each such fiscal period and (ii) stating that no Default or
Event of Default exists, or if any Default or Event of Default does
exist, specifying the nature and extent thereof and what action the
Borrowers propose to take with respect thereto.
(d) Accountant's Certificate. Within the period for delivery
of the annual financial statements provided in Section 7.1(a), a
certificate of the accountants conducting the annual audit stating that
they have reviewed this Credit Agreement and stating further whether,
in the course of their audit, they have become aware of any Default or
Event of Default and, if any such Default or Event of Default exists,
specifying the nature and extent thereof.
(e) Auditor's Reports. Promptly upon receipt thereof, a copy
of any other report or "management letter" submitted by independent
accountants to a Credit Party in connection with any annual, interim or
special audit of the books of a Credit Party.
(f) Reports. Promptly upon transmission or receipt thereof,
(a) copies of any filings and registrations with, and reports to or
from, the SEC, or any successor agency, and copies of all financial
statements, proxy statements, notices and reports as a Credit Party
shall send to its shareholders generally or to the holders of any issue
of Indebtedness owed by a Credit Party in their capacity as such
holders and (b) upon the request of the Administrative Agent, all
reports and written information to and from the United States
Environmental Protection Agency, or any state or local agency
responsible for environmental matters, the United States Occupational
Health and Safety Administration, or any state or local agency
responsible for health and safety matters, or any successor agencies or
authorities concerning environmental, health or safety matters.
(g) Notices. Upon a Credit Party obtaining knowledge thereof,
the Borrowers will give written notice to the Administrative Agent
immediately of (a) the occurrence of an event or condition consisting
of a Default or Event of Default, specifying the nature and existence
thereof and what action the Credit Parties propose to take with respect
thereto, and (b) the occurrence of any of the following with respect to
a Credit Party (i) the pendency or commencement of any litigation,
arbitral or governmental proceeding against such Credit Party which if
adversely determined is likely to have a Material Adverse Effect, (ii)
the institution of any proceedings against the Credit Party with
respect to, or the receipt of written notice by such Person of
potential liability or responsibility for violation, or alleged
violation of any federal, state or local law, rule or regulation,
including but not limited to, Environmental Laws, the violation of
which would likely have a Material Adverse Effect or (iii) any notice
or determination concerning the imposition of any withdrawal liability
by a Multiemployer Plan against such Credit Party or any ERISA
affiliate, the determination that a Multiemployer Plan is, or is
expected to be, in reorganization within the meaning of Title IV of
ERISA or the termination of any Plan.
(h) ERISA. Upon any of the Credit Parties or any ERISA
Affiliate obtaining knowledge thereof, the Borrowers will give written
notice to the Administrative Agent promptly (and in any event within
five business days) of: (i) of any event or condition, including, but
not limited to, any Reportable Event, that constitutes, or might
reasonably lead to, a Termination Event; (ii) with respect to any
Multiemployer Plan, the receipt of notice as prescribed in ERISA or
otherwise of any withdrawal liability assessed against the Borrowers or
any ERISA Affiliate, or of a determination that any Multiemployer Plan
is in reorganization or insolvent (both
within the meaning of Title IV of ERISA); (iii) the failure to make
full payment on or before the due date (including extensions) thereof
of all amounts which any Credit Party or any ERISA Affiliate is
required to contribute to each Plan pursuant to its terms and as
required to meet the minimum funding standard set forth in ERISA and
the Code with respect thereto; or (iv) any change in the funding status
of any Plan that could have a Material Adverse Effect, together, with a
description of any such event or condition or a copy of any such notice
and a statement by the principal financial officer of Speedway
Motorsports briefly setting forth the details regarding such event,
condition, or notice, and the action, if any, which has been or is
being taken or is proposed to be taken by the Credit Parties with
respect thereto. Promptly upon request, the Borrowers shall furnish the
Administrative Agent and each of the Lenders with such additional
information concerning any Plan as may be reasonably requested,
including, but not limited to, copies of each annual report/return
(Form 5500 series), as well as all schedules and attachments thereto
required to filed with the Department of Labor and/or the Internal
Revenue Service pursuant to ERISA and the Code, respectively, for each
"plan year" (within the meaning of Section 3(39) of ERISA).
(i) Other Information. With reasonable promptness upon any
such request, such other information regarding the business, properties
or financial condition of the Credit Parties as the Administrative
Agent or the Required Lenders may reasonably request.
7.2 Preservation of Existence and Franchises.
Each of the Credit Parties will do all things necessary to preserve and
keep in full force and effect its existence, material rights, franchises and
authority.
7.3 Books and Records.
Each of the Credit Parties will keep complete and accurate books and
records of its transactions in accordance with good accounting practices on the
basis of GAAP (including the establishment and maintenance of appropriate
reserves).
7.4 Compliance with Law.
Each of the Credit Parties will comply with all laws, rules,
regulations and orders, and all applicable restrictions imposed by all
Governmental Authorities, applicable to it and its property if noncompliance
with any such law, rule, regulation, order or restriction would have a Material
Adverse Effect.
7.5 Payment of Taxes and Other Indebtedness.
Each of the Credit Parties will pay and discharge (i) all taxes,
assessments and governmental charges or levies imposed upon it, or upon its
income or profits, or upon any
of its properties, before they shall become delinquent, (ii) all lawful claims
(including claims for labor, materials and supplies) which, if unpaid, might
give rise to a Lien upon any of its properties, and (iii) except as prohibited
hereunder, all of its other Indebtedness as it shall become due; provided,
however, that a Credit Party shall not be required to pay any such tax,
assessment, charge, levy, claim or Indebtedness which is being contested in good
faith by appropriate proceedings and as to which adequate reserves therefor have
been established in accordance with GAAP, unless the failure to make any such
payment (i) would give rise to an immediate right to foreclose on a Lien
securing such amounts or (ii) would have a Material Adverse Effect.
7.6 Insurance.
Each of the Credit Parties will at all times maintain in full force and
effect insurance (including worker's compensation insurance, liability
insurance, casualty insurance, business interruption insurance and property
insurance) in such amounts, covering such risks and liabilities and with such
deductibles or self-insurance retentions as are in accordance with normal
industry practice provided by nationally recognized, financially sound insurance
companies rated not less than A (or the equivalent thereof) by Best's Key Rating
Guide or S&P.
7.7 Maintenance of Property.
Each of the Credit Parties will maintain and preserve its properties
and equipment material to the conduct of its business in good repair, working
order and condition, normal wear and tear excepted, and will make, or cause to
be made, in such properties and equipment from time to time all repairs,
renewals, replacements, extensions, additions, betterments and improvements
thereto as may be needed or proper, to the extent and in the manner customary
for companies in similar businesses.
7.8 Performance of Obligations.
Each of the Credit Parties will perform in all material respects all of
its obligations under the terms of all material agreements, indentures,
mortgages, security agreements or other debt instruments to which it is a party
or by which it is bound.
7.9 Use of Proceeds.
The Borrowers will use the proceeds of the Loans solely for the
purposes set forth in Section 6.15.
7.10 Audits/Inspections.
Upon reasonable notice and during normal business hours, each Credit
Party will permit representatives appointed by the Administrative Agent (and
after the occurrence of an Event of Default, representatives of any Lender),
including, without limitation,
independent accountants, agents, attorneys, and appraisers to visit and inspect
its property, including its books and records, its accounts receivable and
inventory, its facilities and its other business assets, and to make photocopies
or photographs thereof and to write down and record any information such
representative obtains and shall permit the Administrative Agent or its
representatives to investigate and verify the accuracy of information provided
to the Lenders and to discuss all such matters with the officers, employees and
representatives of such Credit Party.
7.11 Financial Covenants.
(a) Consolidated Net Worth. Consolidated Net Worth at each
Calculation Date shall be no less than the sum of $250,000,000,
increased on a cumulative basis as of the last day of each fiscal
quarter commencing with the last day of fiscal quarter March 31, 1999,
by an amount equal to (i) 50% of Consolidated Net Income (provided such
Consolidated Net Income is greater than zero) for the fiscal quarter
then ended and (ii) 100% of Net Proceeds from an Equity Transaction for
the fiscal quarter then ended.
(b) Consolidated Total Debt Ratio. The Consolidated Total Debt
Ratio at each Calculation Date shall be no greater than (i) 4.25 to 1.0
on March 31, 1999, June 30, 1999, and September 30, 1999; (ii) 4.0 to
1.0 on December 31, 1999, March 31, 2000, June 30, 2000 and September
30, 2000; (iii) 3.75 to 1.0 on December 31, 2000, March 31, 2001, June
30, 2001 and September 30, 2001 and (iv) 3.5 to 1.0 at each Calculation
Date thereafter.
(c) Consolidated Capital Charges Coverage Ratio. The
Consolidated Capital Charges Coverage Ratio at each Calculation Date
shall be no less than (i) 2.0 to 1.0 on March 31, 1999, June 30, 1999
and September 30, 1999; (ii) 2.5 to 1.0 on December 31, 1999, March 31,
2000, June 30, 2000 and September 30, 2000; and (iii) 3.0 to 1.0 at
each Calculation Date thereafter.
7.12 Additional Credit Parties.
As soon as practicable and in any event within 30 days after any Person
becomes a Subsidiary of any Credit Party, the Borrower shall provide the
Administrative Agent with written notice thereof setting forth information in
reasonable detail describing all of the assets of such Person and shall (a) if
such Person is a Domestic Subsidiary of a Credit Party, cause such Person to
execute a Joinder Agreement in substantially the same form as Exhibit 7.12, (b)
cause 100% (if such Person is a Domestic Subsidiary of a Credit Party) or 65%
(if such Person is a direct Foreign Subsidiary of a Credit Party) of the Capital
Stock of such Person to be delivered to the Administrative Agent (together with
undated stock powers signed in blank (unless, with respect to a Foreign
Subsidiary, such stock powers are deemed unnecessary by the Administrative Agent
in its reasonable discretion under the law of the jurisdiction of incorporation
of such Person)) and pledged to the Administrative Agent pursuant to an
appropriate pledge agreement(s) in form acceptable to the Administrative
Agent and cause such Person to deliver such other documentation as the
Administrative Agent may reasonably request in connection with the foregoing,
including, without limitation, appropriate certified resolutions and other
organizational and authorizing documents of such Person, and favorable opinions
of counsel to such Person all in form, content and scope reasonably satisfactory
to the Administrative Agent.
7.13 Ownership of Subsidiaries.
Except to the extent otherwise provided in Section 8.4(c), Section 8.11
and with respect to North Wilkesboro Speedway, Inc., North Carolina Motor
Speedway, Inc. and Sold USA, Inc., Speedway Motorsports shall directly or
indirectly, own at all times 100% of the Capital Stock of each of its
Subsidiaries.
SECTION 8
NEGATIVE COVENANTS
------------------
Each Credit Party hereby covenants and agrees that, so long as this
Credit Agreement is in effect or any amounts payable hereunder or under any
other Credit Document shall remain outstanding, and until all of the Commitments
hereunder shall have terminated:
8.1 Indebtedness.
None of the Credit Parties will contract, create, incur, assume or
permit to exist any Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement and the
other Credit Documents;
(b) Indebtedness of Speedway Motorsports and any of its
Subsidiaries existing as of the Closing Date and set forth in Schedule
8.1 and any refinancings thereof for the same or less amount;
(c) purchase money Indebtedness (including Capital Leases)
hereafter incurred by Speedway Motorsports and any of its Subsidiaries
to finance the purchase of fixed assets provided (i) such Indebtedness
when incurred shall not exceed the purchase price of the asset(s)
financed; and (ii) no such Indebtedness shall be refinanced for a
principal amount in excess of the principal balance outstanding thereon
at the time of such refinancing;
(d) Indebtedness evidenced by, or any guaranty of, the Senior
Notes;
(e) Indebtedness in respect of Hedge Agreements entered into
with
Lenders in an aggregate notional amount for all such agreements not to
exceed the Committed Amount;
(f) Intercompany Indebtedness; or
(g) Indebtedness incurred or assumed in any transaction
permitted by Section 8.4 hereof provided (i) such Indebtedness when
incurred or assumed shall not exceed the purchase price of the asset(s)
financed; and (ii) no such incurred or assumed Indebtedness shall be
refinanced for a principal amount in excess of the principal balance
outstanding thereon at the time of such refinancing.
8.2 Liens.
None of the Credit Parties will contract, create, incur, assume or
permit to exist any Lien with respect to any of its Property, except for
Permitted Liens and Liens securing Indebtedness permitted under Sections 8.1(c)
and (g) provided that such Liens relate solely to the specific Property being
acquired.
8.3 Nature of Business.
Neither Speedway Motorsports nor any of its Subsidiaries will
substantively alter the character or conduct of the business conducted by any
such Person as of the Closing Date.
8.4 Consolidation, Merger, Sale or Purchase of Assets, etc.
None of the Credit Parties will:
(a) dissolve, liquidate or wind up its affairs, or enter into
any transaction of merger or consolidation; provided, however, that, so
long as no Default or Event of Default would be directly or indirectly
caused as a result thereof, (i) Speedway Motorsports may merge or
consolidate with any of its Subsidiaries provided Speedway Motorsports
is the surviving corporation or (ii) any Credit Party (other than
Speedway Motorsports) may merge or consolidate with any other Credit
Party (other than the Borrowers);
(b) sell, lease, transfer or otherwise dispose of any Property
other than (i) the sale of inventory in the ordinary course of business
for fair consideration, (ii) the sale or disposition of machinery and
equipment no longer used or useful in the conduct of such Person's
business, (iii) subject to the terms of Section 8.8 and 8.12, other
sales and dispositions provided that (A) after giving effect to such
sale or other disposition, the aggregate book value of assets sold or
otherwise disposed of pursuant to this clause (iii) since the Closing
Date does not exceed $10,000,000 and (B) after giving effect on a Pro
Forma Basis to such sale or other disposition, no Default or Event of
Default would exist hereunder; or
(c) except as otherwise permitted by Section 8.4(a) or 8.5,
acquire all or any portion of the Capital Stock or securities of any
other Person or purchase, lease or otherwise acquire (in a single
transaction or a series of related transactions) all or any substantial
part of the Property of any other Person provided, however, that, so
long as no Default or Event of Default would be caused as a result
thereof on an actual or Pro Forma Basis, then any Credit Party may (i)
acquire an interest in additional motor speedways, whether by merger,
stock purchase or asset purchase; provided, however, that the aggregate
Cash Consideration paid for such acquisitions in any fiscal year shall
not exceed 25% of the Consolidated Net Worth of Speedway Motorsports at
the immediately preceding fiscal year end, and (ii) consummate other
acquisitions consistent with the nature of the Borrowers' business,
whether by merger, stock purchase or asset purchase; provided, however,
that the Cash Consideration paid for such other acquisitions shall not
exceed $25,000,000 in the aggregate.
8.5 Advances, Investments, Loans, etc.
Except as permitted under Section 8.4(c), none of the Credit Parties
will make Investments in or advances or loans to any Person other than to
another Credit Party, except for Permitted Investments.
8.6 Restricted Payments.
None of the Credit Parties will directly or indirectly declare, order,
make or set apart any sum for or pay any Restricted Payment, except (i) to make
dividends payable solely in the same class of Capital Stock of such Person, (ii)
to make dividends payable to any Credit Party and (iii) as permitted by Section
8.7.
8.7 Prepayments of Indebtedness, etc.
None of the Credit Parties will (i) after the issuance thereof, amend
or modify (or permit the amendment or modification of) any of the terms of any
Indebtedness (other than this Credit Agreement) if such amendment or
modification would add or change any terms in a manner adverse to the issuer of
such Indebtedness (unless the consent of the issuer of such Indebtedness has
been obtained) or to the Lenders, or shorten the final maturity or average life
to maturity or require any payment to be made sooner than originally scheduled
or increase the interest rate applicable thereto or change any subordination
provision thereof, (ii)(A) if any Default or Event of Default has occurred and
is continuing or would be directly or indirectly caused as a result thereof,
make (or give any notice with respect thereto) any voluntary or optional payment
or prepayment or redemption or acquisition for value of (including without
limitation, by way of depositing money or securities with the trustee with
respect thereto before due for the purpose of paying when due), refund,
refinance or exchange of any other Indebtedness, or (B) amend, modify or change
its articles of incorporation (or corporate charter or other similar
organizational document) or bylaws (or
other similar document) where such change would have a Material Adverse Effect.
8.8 Transactions with Affiliates.
Except for Intercompany Indebtedness and Permitted Investments, none of
the Credit Parties will enter into or permit to exist any transaction or series
of transactions with any officer, director, shareholder, Subsidiary or Affiliate
of such Person other than (a) advances of working capital to any Credit Party,
(b) transfers of cash and assets to any Credit Parties, (c) transactions
permitted by Sections 8.4, 8.5 and Section 8.6, (d) normal reimbursement of
expenses of officers and directors, (e) other transactions for goods and
services not to exceed $100,000 at any one time and (f) except as otherwise
specifically limited in this Credit Agreement, other transactions which are
entered into in the ordinary course of such Person's business on terms and
conditions substantially as favorable to such Person as would be obtainable by
it in a comparable arms-length transactions with a Person other than an officer,
director, shareholder, Subsidiary or Affiliate.
8.9 Fiscal Year.
None of the Credit Parties will change its fiscal year.
8.10 Limitation on Restrictions on Dividends and Other Distributions,
etc.
None of the Credit Parties will, directly or indirectly create or
otherwise cause, incur, assume, suffer or permit to exist or become effective
any consensual encumbrance or restriction of any kind on the ability of any such
Person to (a) pay dividends or make any other distribution on any of such
Person's Capital Stock (other than in connection with a transaction permitted by
Section 8.4(c) hereof), (b) subject to subordination provisions, pay any
Indebtedness owed to the Borrowers or any other Credit Party, (c) make loans or
advances to any Credit Party (other than loans or advances by Speedway Funding),
(d) transfer any of its Property to any other Credit Party other than in the
ordinary course of business, or (e) grant Liens to the Administrative Agent for
the benefit of the Lenders.
8.11 Issuance and Sale of Subsidiary Stock.
None of the Credit Parties will, except to qualify directors where
required by applicable law, sell, transfer or otherwise dispose of, any shares
of Capital Stock of any of its Subsidiaries or permit any of its Subsidiaries to
issue, sell or otherwise dispose of any shares of Capital Stock of any of its
Subsidiaries other than the sale of Capital Stock of SoldUSA, Inc.
8.12 Sale Leasebacks.
Other than as provided in Section 8.4(b), none of the Credit Parties
will, directly or indirectly, become or remain liable as lessee or as guarantor
or other surety with respect to any lease, whether an Operating Lease or a
Capital Lease, of any Property (whether real or
personal or mixed), whether now owned or hereafter acquired, (i) which such
Person has sold or transferred or is to sell or transfer to any other Person or
(ii) which such Person intends to use for substantially the same purpose as any
other Property which has been sold or is to be sold or transferred by such
Person to any other Person in connection with such lease. The Credit Parties
acknowledge that the Purchase Agreement between Texas Motor Speedway, Inc. and
FW Sports Authority, Inc. and the Lease Agreement between FW Sports Authority,
Inc., as lessor, and Texas Motor Speedway, Inc., as lessee, while in form
appearing to be a sale leaseback transaction, is not deemed to be or treated as
a sale leaseback per GAAP.
8.13 Capital Expenditures.
Consolidated Capital Expenditures (exclusive of acquisitions permitted
by Section 8.4(c) and any capital expenditures made in connection with pre-sold
condominium units) for the four quarter period ending March 31, 2000 and each
successive four quarter period thereafter shall not exceed $125,000,000. In no
event shall Consolidated Capital Expenditures (exclusive of acquisitions
permitted by Section 8.4(c) and any capital expenditures made in connection with
pre-sold condominium units) exceed $500,000,000 in the aggregate prior to the
Termination Date.
8.14 No Further Negative Pledges.
Except with respect to prohibitions against other encumbrances on
specific Property encumbered to secure payment of particular Indebtedness (which
Indebtedness relates solely to such specific Property, and improvements and
accretions thereto, and is otherwise permitted hereby), and except as included
in the terms of any Indebtedness permitted by Section 8.1(g) hereof with respect
to prohibiting or restricting the creation or assumption of any Lien upon the
properties or assets acquired with such Indebtedness, none of the Credit Parties
will enter into, assume or become subject to any agreement prohibiting or
otherwise restricting the creation or assumption of any Lien upon its properties
or assets, whether now owned or hereafter acquired, or requiring the grant of
any security for such obligation if security is given for some other obligation.
SECTION 9
EVENTS OF DEFAULT
-----------------
9.1 Events of Default.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment. Any Credit Party shall
(i) default in the payment when due of any
principal of
any of the Loans or of any reimbursement obligations arising
from drawings under Letters of Credit, or
(ii) default in the payment when due of any
interest on the Loans or on any reimbursement obligations
arising from drawings under Letters of Credit, or of any Fees
or other amounts owing hereunder, under any of the other
Credit Documents or in connection herewith or therewith; or
(b) Representations. Any representation, warranty or statement
made or deemed to be made by any Credit Party herein, in any of the
other Credit Documents, or in any statement or certificate delivered or
required to be delivered pursuant hereto or thereto shall prove untrue
in any material respect on the date as of which it was deemed to have
been made; or
(c) Covenants. Any Credit Party shall
(i) default in the due performance or
observance of any term, covenant or agreement contained in
Sections 7.2, 7.9, 7.10, 7.11, 7.12 or 8.1 through 8.14,
inclusive, or
(ii) default in the due performance or
observance by it of any term, covenant or agreement (other
than those referred to in subsections (a), (b) or (c)(i) of
this Section 9.1) contained in this Credit Agreement and such
default shall continue unremedied for a period of at least 30
days after the earlier of a responsible officer of a Credit
Party becoming aware of such default or notice thereof by the
Administrative Agent; or
(d) Other Credit Documents.
(i) Any Credit Party shall default in the
due performance or observance of any term, covenant or
agreement in any of the other Credit Documents (subject to
applicable grace or cure periods) if any, or
(ii) any Credit Document shall fail to be in
full force and effect to give the Administrative Agent and/or
the Lenders the liens, rights, powers and privileges purported
to be created thereby; or
(e) Guaranties. The guaranty given by any Guarantor hereunder
(including any Additional Credit Party) or any provision thereof shall
cease to be in full force and effect, or any Guarantor (including any
Additional Credit Party) hereunder or any Person acting by or on behalf
of such Guarantor shall deny or disaffirm such Guarantor's obligations
under such guaranty; or
(f) Bankruptcy, etc. Any Credit Party shall commence a
voluntary case concerning itself under the Bankruptcy Code; or an
involuntary case is commenced
against any Credit Party under the Bankruptcy Code and the petition is
not dismissed within 60 days, after commencement of the case; or a
custodian (as defined in the Bankruptcy Code) is appointed for, or
takes charge of all or substantially all of the property of any Credit
Party; or any Credit Party commences any other proceeding under any
reorganization, arrangement, adjustment of the debt, relief of
creditors, dissolution, insolvency or similar law of any jurisdiction
whether now or hereafter in effect relating to any Credit Party; or
there is commenced against any Credit Party any such proceeding which
remains undismissed for a period of 60 days; or any Credit Party is
adjudicated insolvent or bankrupt; or any order of relief or other
order approving any such case or proceeding is entered against any
Credit Party; or any Credit Parties suffers appointment of any
custodian or the like for it or for any substantial part of its
property to continue unchanged or unstayed for a period of 60 days; or
any Credit Party makes a general assignment for the benefit of
creditors; or any corporate action is taken by any Credit Party for the
purpose of effecting any of the foregoing; or
(g) Defaults under Other Agreements. With respect to any
Indebtedness (other than Indebtedness outstanding under this Credit
Agreement) in excess of $5,000,000 in the aggregate for all of the
Credit Parties taken as a whole, (i) any Credit Party shall (A) default
in any payment (beyond the applicable grace period with respect
thereto, if any) with respect to any such Indebtedness, or (B) default
in the observance or performance of any covenant or agreement relating
to such Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event or
condition shall occur or condition exist, the effect of which default
or other event or condition is to cause, or permit the holder or
holders of such Indebtedness (or trustee or agent on behalf of such
holders) to cause (determined without regard to whether any notice or
lapse of time is required), any such Indebtedness to become due prior
to its stated maturity; or (ii) any such Indebtedness shall be declared
due and payable, or required to be prepaid other than by a regularly
scheduled required prepayment, prior to the stated maturity thereof; or
(h) Judgments. One or more judgments or decrees shall be
entered against any Credit Party involving a liability of $5,000,000 or
more in the aggregate (to the extent not paid or fully covered by
insurance provided by a carrier who has acknowledged coverage) and any
such judgments or decrees shall not have been vacated, discharged or
stayed or bonded pending appeal within 30 days from the entry thereof;
or
(i) ERISA. Any of the following events or conditions that
result in a Material Adverse Effect: (1) any "accumulated funding
deficiency," as such term is defined in Section 302 of ERISA and
Section 412 of the Code, whether or not waived, shall exist with
respect to any Plan, or any lien shall arise on the assets of any
Credit Party or any ERISA Affiliate in favor of the PBGC or a Plan; (2)
a Termination Event shall occur with respect to a Single Employer Plan,
which is, in
the reasonable opinion of the Administrative Agent, likely to result in
the termination of such Plan for purposes of Title IV of ERISA; (3) a
Termination Event shall occur with respect to a Multiemployer Plan or
Multiple Employer Plan, which is, in the reasonable opinion of the
Administrative Agent, likely to result in (i) the termination of such
Plan for purposes of Title IV of ERISA, or (ii) any Credit Party or any
ERISA Affiliate incurring any liability in connection with a withdrawal
from, reorganization of (within the meaning of Section 4241 of ERISA),
or insolvency or (within the meaning of Section 4245 of ERISA) such
Plan; or (4) any prohibited transaction (within the meaning of Section
406 of ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility shall occur which may subject any Credit Party or any
ERISA Affiliate to any liability under Sections 406, 409, 502(i), or
502(l) of ERISA or Section 4975 of the Code, or under any agreement or
other instrument pursuant to which any Credit Party or any ERISA
Affiliate has agreed or is required to indemnify any Person against any
such liability; or
(j) Ownership. There shall occur a Change of Control.
9.2 Acceleration; Remedies.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived by the Required Lenders
or cured to the satisfaction of the Required Lenders (pursuant to the voting
procedures in Section 11.6), the Administrative Agent shall, upon the request
and direction of the Required Lenders, by written notice to the Credit Parties
take any of the following actions without prejudice to the rights of the
Administrative Agent or any Lender to enforce its claims against the Credit
Parties, except as otherwise specifically provided for herein:
(i) Termination of Commitments. Declare the
Commitments terminated, whereupon the Commitments shall be
immediately terminated.
(ii) Acceleration. Declare the unpaid
principal of and any accrued interest in respect of all Loans,
the LOC Obligations (with accrued interest thereon) and any
and all other indebtedness or obligations of any and every
kind owing by the Borrowers to any of the Lenders hereunder to
be due whereupon the same shall be immediately due and payable
without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrowers. The
Administrative Agent may direct the Borrowers to pay to the
Administrative Agent cash collateral as security for the LOC
Obligations for subsequent drawings under then outstanding
Letters of Credit in an amount equal to the maximum amount
which may be drawn under Letters of Credit then outstanding,
whereupon the same shall immediately become due and payable.
(iii) Enforcement of Rights. Enforce any and
all rights and
interests created and existing under the Credit Documents and
all rights of set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(f) shall occur, then the Commitments shall automatically terminate and all
Loans, all reimbursement obligations arising from drawings under Letters of
Credit, all accrued interest in respect thereof, all accrued and unpaid Fees and
other indebtedness or obligations owing to the Lenders hereunder automatically
shall immediately become due and payable without the giving of any notice or
other action by the Administrative Agent.
SECTION 10
AGENCY PROVISIONS
-----------------
10.1 Appointment.
Each Lender hereby designates and appoints the Administrative Agent to
act as its agent under this Credit Agreement and the other Credit Documents, and
each such Lender hereby authorizes the Administrative Agent as the agent for
such Lender, to take such action on its behalf under the provisions of this
Credit Agreement and the other Credit Documents and to exercise such powers and
perform such duties as are expressly delegated by the terms hereof and of the
other Credit Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere
herein or in the other Credit Documents, the Administrative Agent shall not have
any duties or responsibilities, except those expressly set forth herein and
therein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Credit Agreement or any of the other Credit Documents, or
shall otherwise exist against the Administrative Agent. The provisions of this
Section are solely for the benefit of the Administrative Agent and the Lenders
and none of the Credit Parties shall have any rights as a third party
beneficiary of the provisions hereof. In performing its functions and duties
under this Credit Agreement and the other Credit Documents, the Administrative
Agent shall act solely as agent of the Lenders and does not assume and shall not
be deemed to have assumed any obligation or relationship of agency or trust with
or for any Credit Party.
10.2 Delegation of Duties.
The Administrative Agent may execute any of its duties hereunder or
under the other Credit Documents by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. The Administrative Agent shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable
care.
10.3 Exculpatory Provisions.
Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any
action lawfully taken or omitted to be taken by it or such Person under or in
connection herewith or in connection with any of the other Credit Documents
(except for its or such Person's own gross negligence or willful misconduct), or
(ii) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by any of the Credit Parties
contained herein or in any of the other Credit Documents or in any certificate,
report, document, financial statement or other written or oral statement
referred to or provided for in, or received by the Administrative Agent under or
in connection herewith or in connection with the other Credit Documents, or
enforceability or sufficiency therefor of any of the other Credit Documents, or
for any failure of any Credit Party to perform its obligations hereunder or
thereunder. The Administrative Agent shall not be responsible to any Lender for
the effectiveness, genuineness, validity, enforceability, collectibility or
sufficiency of this Credit Agreement, or any of the other Credit Documents or
for any representations, warranties, recitals or statements made herein or
therein or made by the Borrower or any Credit Party in any written or oral
statement or in any financial or other statements, instruments, reports,
certificates or any other documents in connection herewith or therewith
furnished or made by the Administrative Agent to the Lenders or by or on behalf
of the Credit Parties to the Administrative Agent or any Lender or be required
to ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or of the existence or possible
existence of any Default or Event of Default or to inspect the properties, books
or records of the Credit Parties.
10.4 Reliance on Communications.
The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to any of the Credit Parties, independent accountants and
other experts selected by the Administrative Agent with reasonable care). The
Administrative Agent may deem and treat the Lenders as the owner of its
interests hereunder for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Administrative
Agent in accordance with Section 11.3(b) hereof. The Administrative Agent shall
be fully justified in failing or refusing to take any action under this Credit
Agreement or under any of the other Credit Documents unless it shall first
receive such advice or concurrence of the Required Lenders as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting,
hereunder or under any of the other Credit Documents in accordance with a
request of the Required Lenders (or to the extent specifically provided in
Section 11.6,
all the Lenders) and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders (including their
successors and assigns).
10.5 Notice of Default.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default (other than a
payment Default) hereunder unless the Administrative Agent has received notice
from a Lender or a Credit Party referring to the Credit Document, describing
such Default or Event of Default and stating that such notice is a "notice of
default." In the event that the Administrative Agent receives such a notice, the
Administrative Agent shall give prompt notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Required Lenders.
10.6 Non-Reliance on Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative
Agent nor any of its officers, directors, employees, agents, attorneys-in-fact
or affiliates has made any representations or warranties to it and that no act
by the Administrative Agent or any of its respective affiliates hereinafter
taken, including any review of the affairs of any Credit Party shall be deemed
to constitute any representation or warranty by the Administrative Agent to any
Lender. Each Lender represents to the Administrative Agent that it has,
independently and without reliance upon the Administrative Agent or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
assets, operations, property, financial and other conditions, prospects and
creditworthiness of the Borrowers and the other Credit Parties and made its own
decision to make its Loans hereunder and enter into this Credit Agreement. Each
Lender also represents that it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Credit Agreement, and to make such investigation as it deems necessary to
inform itself as to the business, assets, operations, property, financial and
other conditions, prospects and creditworthiness of the Borrowers and the other
Credit Parties. Except for notices, reports and other documents expressly
required to be furnished to the Lenders by the Administrative Agent hereunder,
the Administrative Agent shall have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, operations,
assets, property, financial or other conditions, prospects or creditworthiness
of the Borrowers and the other Credit Parties which may come into the possession
of the Administrative Agent or any of its officers, directors, employees,
agents, attorneys-in-fact or affiliates.
10.7 Indemnification.
The Lenders agree to indemnify the Administrative Agent in its capacity
as such (to the extent not reimbursed by the Borrowers and without limiting the
obligation of the
Borrowers to do so), ratably according to their respective Commitments (or if
the Commitments have expired or been terminated, in accordance with the
respective principal amounts of outstanding Loans and Participation Interests of
the Lenders), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including without limitation at
any time following the payment of the Borrowers' Obligations) be imposed on,
incurred by or asserted against the Administrative Agent in its capacity as such
in any way relating to or arising out of this Credit Agreement or the other
Credit Documents or any documents contemplated herein or the transactions
contemplated hereby or thereby or any action taken or omitted by the
Administrative Agent under or in connection with any of the foregoing; provided
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the gross negligence or willful
misconduct of the Administrative Agent. If any indemnity furnished to the
Administrative Agent for any purpose shall, in the opinion of the Administrative
Agent, be insufficient or become impaired, the Administrative Agent may call for
additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity is furnished. The agreements in this
Section shall survive the repayment of the Loans and other obligations under the
Credit Documents and the termination of the Commitments hereunder.
10.8 Administrative Agent in its Individual Capacity.
The Administrative Agent and its affiliates may make loans to, accept
deposits from and generally engage in any kind of business with any Credit Party
as though the Administrative Agent were not Administrative Agent hereunder. With
respect to the Loans made and all Borrowers' Obligations owing to it, the
Administrative Agent shall have the same rights and powers under this Credit
Agreement as any Lender and may exercise the same as though they were not
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.
10.9 Successor Agent.
The Administrative Agent may, at any time, resign upon 20 days' written
notice to the Lenders, and be removed with or without cause by the Required
Lenders upon 30 days' written notice to the Administrative Agent; provided that
prior to the occurrence of an Event of Default, such successor Administrative
Agent shall not be appointed without the consent of the Borrowers, which consent
shall not be unreasonably withheld. Upon any such resignation or removal, the
Required Lenders shall have the right to appoint a successor Administrative
Agent; provided that prior to the occurrence of an Event of Default, such
successor Administrative Agent shall not be appointed without the consent of the
Borrowers which consent shall not be unreasonably withheld. If no successor
Administrative Agent shall have been so appointed by the Required Lenders, and
shall have accepted such appointment, within 30 days after the notice of
resignation or notice of removal, as appropriate, then the retiring
Administrative Agent shall select a successor Administrative Agent provided such
successor is a Lender hereunder or a commercial bank organized under
the laws of the United States of America or of any State thereof and has a
combined capital and surplus of at least $400,000,000. Upon the acceptance of
any appointment as Administrative Agent hereunder by a successor, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations as Administrative Agent, as appropriate, under this Credit Agreement
and the other Credit Documents and the provisions of this Section 10.9 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Credit Agreement.
SECTION 11
MISCELLANEOUS
-------------
11.1 Notices.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (i) when
delivered, (ii) when transmitted via telecopy (or other facsimile device) to the
number set out below, (iii) the day following the day on which the same has been
delivered prepaid to a reputable national overnight air courier service, or (iv)
the third Business Day following the day on which the same is sent by certified
or registered mail, postage prepaid, in each case to the respective parties at
the address, in the case of the Borrowers and Guarantors and the Administrative
Agent, set forth below, and in the case of the Lenders, set forth on Schedule
2.1(a), or at such other address as such party may specify by written notice to
the other parties hereto:
if to the Borrowers or the Guarantors:
Speedway Motorsports, Inc.
P.O. Box 18747
Charlotte, North Carolina 28218
Attn: Chief Financial Officer
Telephone: (704) 532-3306
Telecopy: (704) 532-3312
with copies to:
Speedway Motorsports, Inc.
P.O. Box 600
Concord, North Carolina 28026-0600
Attn: Chief Financial Officer
Speedway Funding Corp.
900 N. Market Street
Suite 200
Wilmington, Delaware 19801
Attn: Victoria L. Garrett, Vice President
if to the Administrative Agent:
NationsBank, N.A.
Independence Center, 15th Floor
NC1-001-15-04
101 N. Tryon Street
Charlotte, North Carolina 28255
Attn: Michael W. Stearns
Telephone: (704) 386-9046
Telecopy: (704) 409-0026
with a copy to:
NationsBank, N.A.
NationsBank Corporate Center
NC1-007-17-09
100 N. Tryon Street
Charlotte, North Carolina 28255
Attn: Sports Finance Group
Telephone: (704) 386-5474
Telecopy: (704) 386-1270
11.2 Right of Set-Off.
In addition to any rights now or hereafter granted under applicable law
or otherwise, and not by way of limitation of any such rights, upon the
occurrence of an Event of Default, each Lender is authorized at any time and
from time to time, without presentment, demand, protest or other notice of any
kind (all of which rights being hereby expressly waived), to set-off and to
appropriate and apply any and all deposits (general or special) and any other
indebtedness at any time held or owing by such Lender (including, without
limitation branches, agencies or Affiliates of such Lender wherever located) to
or for the credit or the account of any Credit Party against obligations and
liabilities of such Credit Party to such Lender hereunder, under the Notes, the
other Credit Documents or otherwise, irrespective of whether such Lender shall
have made any demand hereunder and although such obligations, liabilities or
claims, or any of them, may be contingent or unmatured, and any such set-off
shall be deemed to have been made immediately upon the occurrence of an Event of
Default even though such charge is made or entered on the books of such Lender
subsequent thereto. Each of the Credit Parties hereby agrees that any Person
purchasing a participation in the Loans and Commitments hereunder pursuant to
Section 11.3(c) may exercise all rights of set-off with respect to its
participation interest as fully as if such Person were a Lender hereunder.
11.3 Benefit of Agreement.
(a) Generally. This Credit Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided that none of the Credit
Parties may assign and transfer any of its interests without prior
written consent of all the Lenders; provided further that the rights of
each Lender to transfer, assign or grant participations in its rights
and/or obligations hereunder shall be limited as set forth in this
Section 11.3, provided however that nothing herein shall prevent or
prohibit any Lender from (i) pledging its Loans hereunder to a Federal
Reserve Bank in support of borrowings made by such Lender from such
Federal Reserve Bank, or (ii) granting assignments or participation in
such Lender's Loans and/or Commitments hereunder to its parent company
and/or to any affiliate of such Lender which is at least 50% owned by
such Lender or its parent company.
(b) Assignments. Each Lender may assign all or a portion of
its rights and obligations hereunder pursuant to an assignment
agreement substantially in the form of Schedule 11.3(b) to one or more
Eligible Assignees, provided that any assignment of a portion of its
rights and obligations hereunder shall be in a minimum aggregate amount
of $10,000,000 of the Commitments and in integral multiples of
$1,000,000 above such amount, that such assignment shall be of a
constant, not varying, percentage of all of the assigning Lender's
rights and obligations under this Credit Agreement. Any assignment
hereunder shall be effective upon delivery to the Administrative Agent
of written notice of the assignment together with a transfer fee of
$3,500 (paid by the assignee) payable to the Administrative Agent for
its own account; provided, however, that no transfer fee will be
required in connection with assignments to an Affiliate or Subsidiary
of a Lender so long as such assignments do not exceed two in any one
year. The assigning Lender will give prompt notice to the
Administrative Agent and the Borrowers of any such assignment. Upon the
effectiveness of any such assignment (and after notice to the Borrowers
as provided herein), the assignee shall become a "Lender" for all
purposes of this Credit Agreement and the other Credit Documents and,
to the extent of such assignment, the assigning Lender shall be
relieved of its obligations hereunder to the extent of the Loans and
Commitment components being assigned. Along such lines, the Borrowers
agree that, upon notice of any such assignment and surrender of the
appropriate Note or Notes, they will promptly provide to the assigning
Lender and to the assignee separate promissory notes in the amount of
their respective interests substantially in the form of the original
Note or Notes (but with notation thereon that it is given in
substitution for and replacement of the original Note or Notes or any
replacement notes thereof).
(c) Participations. Each Lender may sell, transfer, grant or
assign participations in all or any part of such Lender's interests and
obligations hereunder; provided that (i) such selling Lender shall
remain a "Lender" for all purposes under
this Credit Agreement (such selling Lender's obligations under the
Credit Documents remaining unchanged) and the participant shall not
constitute a Lender hereunder, (ii) no such participant shall have, or
be granted, rights to approve any amendment or waiver relating to this
Credit Agreement or the other Credit Documents except to the extent any
such amendment or waiver would (A) reduce the principal of or rate of
interest on or Fees in respect of any Loans in which the participant is
participating, (B) postpone the date fixed for any payment of principal
(including extension of the Termination Date or the date of any
mandatory prepayment), interest or Fees in which the participant is
participating, or (C) release all or any substantial part of any
collateral or guaranties (except as expressly provided in the Credit
Documents) supporting any of the Loans or Commitments in which the
participant is participating, (iii) sub-participations by the
participant (except to an affiliate, parent company or affiliate of a
parent company of the participant) shall be prohibited and (iv) any
participations of a portion of a Lender's rights and obligations
hereunder shall be in a minimum aggregate amount of $5,000,000 of the
Commitments and in integral multiples of $1,000,000 in excess thereof.
In the case of any such participation, the participant shall not have
any rights under this Credit Agreement or the other Credit Documents
(the participant's rights against the selling Lender in respect of such
participation to be those set forth in the participation agreement with
such Lender creating such participation) and all amounts payable by the
Borrower hereunder shall be determined as if such Lender had not sold
such participation, provided, however, that such participant shall be
entitled to receive additional amounts under Sections 3.6, 3.9, 3.10
and 3.11 on the same basis as if it were a Lender.
11.4 No Waiver; Remedies Cumulative.
No failure or delay on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege hereunder or under any other
Credit Document and no course of dealing between any of the Credit Parties shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, power or privilege hereunder or under any other Credit Document preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege hereunder or thereunder. The rights and remedies provided herein
are cumulative and not exclusive of any rights or remedies which the
Administrative Agent or any Lender would otherwise have. No notice to or demand
on any Credit Party in any case shall entitle the Borrowers or any other Credit
Party to any other or further notice or demand in similar or other circumstances
or constitute a waiver of the rights of the Administrative Agent or the Lenders
to any other or further action in any circumstances without notice or demand.
11.5 Payment of Expenses, etc.
The Borrowers jointly and severally agree to: (i) pay all reasonable
out-of-pocket costs and expenses of the Administrative Agent in connection with
the negotiation, preparation, execution and delivery and administration of this
Credit Agreement and the
other Credit Documents and the documents and instruments referred to therein
(including, without limitation, the reasonable fees and expenses of Moore & Van
Allen, special counsel to the Administrative Agent) and any amendment, waiver or
consent relating hereto and thereto including, but not limited to, any such
amendments, waivers or consents resulting from or related to any work-out,
renegotiation or restructure relating to the performance by the Credit Parties
under this Credit Agreement and of the Administrative Agent and the Lenders in
connection with enforcement of the Credit Documents and the documents and
instruments referred to therein (including, without limitation, in connection
with any such enforcement, the reasonable fees and disbursements of counsel for
the Administrative Agent and each of the Lenders); (ii) pay and hold each of the
Lenders harmless from and against any and all present and future stamp and other
similar taxes with respect to the foregoing matters and save each of the Lenders
harmless from and against any and all liabilities with respect to or resulting
from any delay or omission (other than to the extent attributable to such
Lender) to pay such taxes; and (iii) indemnify each Lender, its officers,
directors, employees, representatives and agents from and hold each of them
harmless against any and all losses, liabilities, claims, damages or expenses
incurred by any of them as a result of, or arising out of, or in any way related
to, or by reason of any investigation, litigation or other proceeding (whether
or not any Lender is a party thereto) related to the entering into and/or
performance of any Credit Document or the use of proceeds of any Loans
(including other extensions of credit) hereunder or the consummation of any
other transactions contemplated in any Credit Document or any Environmental
Claim (except to the extent such claim arises from the gross negligence or
willful misconduct of any indemnified party), including, without limitation, the
reasonable fees and disbursements of counsel incurred in connection with any
such investigation, litigation or other proceeding (but excluding, any such
losses, liabilities, claims, damages or expenses to the extent incurred by
reason of gross negligence or willful misconduct on the part of the Person to be
indemnified).
11.6 Amendments, Waivers and Consents.
Neither this Credit Agreement nor any other Credit Document nor any of
the terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing signed by the Required Lenders, provided that no such amendment, change,
waiver, discharge or termination shall, without the consent of each Lender
affected thereby, (i) extend the scheduled maturities (including the final
maturity and any mandatory scheduled prepayments) of any Loan, or any portion
thereof, or reduce the rate or extend the time of payment of interest (other
than as a result of waiving the applicability of any post-default increase in
interest rates) thereon or fees hereunder or reduce the principal amount
thereof, or increase the Commitments of the Lenders over the amount thereof in
effect (it being understood and agreed that a waiver of any Default or Event of
Default shall not constitute a change in the terms of any Commitment of any
Lender), (ii) release any Guarantor from its guaranty obligations hereunder,
(iii) amend, modify or waive any provision of this Section or Section 3.5, 3.11,
3.12, 3.13, 3.14, 5.1, 5,2, 9.1(a), 11.2, 11.3, or 11.9, (iv) reduce any
percentage specified in, or otherwise modify, the definition of Required
Lenders, (v) consent to the assignment or transfer by any Borrower (or
Guarantor) of any of its rights and obligations under (or in
respect of) this Credit Agreement or (vi) release all or any substantial part of
any collateral. No provision of Section 10 may be amended without the consent of
the Administrative Agent.
Notwithstanding the above, the right to deliver a Payment Blockage
Notice (as defined in the Indenture) shall reside solely with the Administrative
Agent and the Administrative Agent shall deliver such Payment Blockage Notice
only upon the direction of the Required Lenders.
11.7 Counterparts.
This Credit Agreement may be executed in any number of counterparts,
each of which where so executed and delivered shall be an original, but all of
which shall constitute one and the same instrument. It shall not be necessary in
making proof of this Credit Agreement to produce or account for more than one
such counterpart.
11.8 Headings.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
11.9 Survival of Indemnification.
All indemnities set forth herein, including, without limitation, in
Section 3.9, 3.11, 10.7 or 11.5 shall survive the execution and delivery of this
Credit Agreement, the making of the Loans, the repayment of the Loans and other
obligations under the Credit Documents and the termination of the Commitments
hereunder.
11.10 Governing Law; Submission to Jurisdiction; Venue.
(a) THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND
THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER
SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NORTH CAROLINA. Any legal action or proceeding
with respect to this Credit Agreement or any other Credit Document may
be brought in the courts of the State of North Carolina, in Mecklenburg
County, or of the United States for the Western District of North
Carolina, and, by execution and delivery of this Credit Agreement, each
of the Credit Parties hereby irrevocably accepts for itself and in
respect of its property, generally and unconditionally, the
jurisdiction of such courts. Each of the Credit Parties further
irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing
of copies thereof by registered or certified mail, postage prepaid, to
it at the address set out notices pursuant to Section 11.1, such
service to become effective 30 days
after such mailing. Nothing herein shall affect the right of the
Administrative Agent to serve process in any other manner permitted by
law or to commence legal proceedings or to otherwise proceed against
any Credit Party in any other jurisdiction.
(b) Each of the Credit Parties hereby irrevocably waives any
objection which it may now or hereafter have to the laying of venue of
any of the aforesaid actions or proceedings arising out of or in
connection with this Credit Agreement or any other Credit Document
brought in the courts referred to in subsection (a) hereof and hereby
further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has
been brought in an inconvenient forum.
11.11 Severability.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
11.12 Entirety.
This Credit Agreement together with the other Credit Documents
represent the entire agreement of the parties hereto and thereto, and supersede
all prior agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.
11.13 Survival of Representations and Warranties.
All representations and warranties made by the Credit Parties herein
shall survive delivery of the Notes and the making of the Loans hereunder.
11.14 Binding Effect; Termination.
(a) This Credit Agreement shall become effective at such time
on or after the Closing Date when it shall have been executed by the
Borrowers, the Guarantors and the Administrative Agent, and the
Administrative Agent shall have received copies hereof (telefaxed or
otherwise) which, when taken together, bear the signatures of each
Lender, and thereafter this Credit Agreement shall be binding upon and
inure to the benefit of the Borrowers, the Guarantors, the
Administrative Agent and each Lender and their respective successors
and assigns.
(b) The term of this Credit Agreement shall remain in effect
until no Loans or any other amounts payable hereunder or under any of
the other Credit Documents shall remain outstanding and until all of
the Commitments hereunder
shall have expired or been terminated.
11.15 Borrowers' Obligations Joint and Several.
(a) Each of the Borrowers is accepting joint and several liability
hereunder in consideration of the financial accommodation to be provided by the
Lenders under this Credit Agreement, for the mutual benefit, directly and
indirectly, of each of the Borrowers and in consideration of the undertakings of
each of the Borrowers to accept joint and several liability for the obligations
of each of them.
(b) Each of the Borrowers jointly and severally hereby irrevocably and
unconditionally accepts, not merely as a surety but also as a co-debtor, joint
and several liability with the other Borrower with respect to the payment and
performance of all of the obligations of the Borrowers under the Credit
Documents (the "Credit Obligations"), it being the intention of the parties
hereto that all such Credit Obligations shall be the joint and several
obligations of each of the Borrowers without preferences or distinction among
them.
(c) If and to the extent that either of the Borrowers shall fail to
make any payment with respect to any of the Credit Obligations as and when due
or to perform any of the Credit Obligations in accordance with the terms
thereof, then in each such event, the other Borrower will make such payment with
respect to, or perform, such Credit Obligation.
(d) The obligations of each Borrower under the provisions of this
Section 11.15 constitute full recourse obligations of the Borrowers, enforceable
against the Borrowers to the full extent of their properties and assets,
irrespective of the validity, regularity or enforceability of this Credit
Agreement or any other circumstances whatsoever.
(e) Except as otherwise expressly provided herein, each Borrower hereby
waives notice of acceptance of its joint and several liability, notice of any
Loan made under this Credit Agreement, notice of occurrence of any Event of
Default, or of any demand for any payment under this Credit Agreement, notice of
any action at any time taken or omitted by any Lender under or in respect of any
of the Credit Obligations, any requirement of diligence and, generally, all
demands, notices and other formalities of every kind in connection with this
Credit Agreement. Each Borrower hereby assents to, and waives notice of, any
extension or postponement of the time for the payment of any of the Credit
Obligations, the acceptance of any partial payment thereon, any waiver, consent
or other action or acquiescence by any Lender at any time or times in respect of
any default by either Borrower in the performance or satisfaction of any term,
covenant, condition or provision of this Credit Agreement, any and all other
indulgences whatsoever by any Lender in respect of any of the Credit
Obligations, and the taking, addition, substitution or release, in whole or in
part, at any time or times, of any security for any of the Credit Obligations or
the addition, substitution or release, in whole or in part, of any Borrower.
Without limiting the generality of the foregoing, each Borrower assents to any
other action or delay in acting or failure to act on the part of any Lender,
including, without limitation, any failure strictly or diligently to assert any
right or to pursue any remedy or to comply fully with the applicable laws or
regulations thereunder which might, but for the provisions of this Section
11.15, afford grounds for terminating, discharging or relieving such Borrower,
in whole or in part, from any of its obligations under this Section 11.15, it
being the intention of each Borrower that, so long as any of the Obligations
remain unsatisfied, the obligations of such Borrower under this Section 11.15
shall not be discharged except by performance and then only to the extent of
such performance. The Credit Obligations of each Borrower under this Section
11.15 shall not be diminished or rendered unenforceable by any winding up,
reorganization, arrangement, liquidation, reconstruction or similar proceeding
with respect to either Borrower or any Lender. The joint and several liability
of the Borrowers hereunder shall continue in full force and effect
notwithstanding any absorption, merger, amalgamation or any other change
whatsoever in the name, membership, constitution or place of formation of either
Borrower or any Lender.
(f) The provisions of this Section 11.15 are made for the benefit of
the Lenders and their respective successors and assigns, and may be enforced by
any such Person from time to time against either of the Borrowers as often as
occasion therefor may arise and without requirement on the part of any Lender
first to marshal any of its claims or to exercise any of its rights against
either of the other Borrowers or to exhaust any remedies available to it against
the other Borrower or to resort to any other source or means of obtaining
payment of any of the Obligations or to elect any other remedy. The provisions
of this Section 11.15 shall remain in effect until all the Obligations shall
have been paid in full or otherwise fully satisfied. If at any time, any
payment, or any part thereof, made in respect of any of the Credit Obligations,
is rescinded or must otherwise be restored or returned by any Lender upon the
insolvency, bankruptcy or reorganization of either of the Borrowers, or
otherwise, the provisions of this Section 11.15 will forthwith be reinstated in
effect, as though such payment had not been made.
(g) Notwithstanding any provision to the contrary contained herein or
in any other of the Credit Documents, to the extent the joint obligations of a
Borrower shall be adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers) then the obligations of each
Borrower hereunder shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including, without
limitation, the federal Bankruptcy Code).
Each of the parties hereto has caused a counterpart of this Credit
Agreement to be duly executed and delivered as of the date first above written.
BORROWERS:
SPEEDWAY MOTORSPORTS, INC., a Delaware
corporation
By: /s/ William R.Brooks
Title: Chief Financial Officer and Vice President
SPEEDWAY FUNDING CORP., a Delaware
corporation
By: /s/ Daniel F. Lindley
Title: Secretary
GUARANTORS:
600 RACING, INC., a North Carolina corporation
By: /s/ William R. Brooks
Title: Vice President
ATLANTA MOTOR SPEEDWAY, INC., a Georgia
corporation
By: /s/ William R. Brooks
Title: Vice President
[SIGNATURES CONTINUE]
BRISTOL MOTOR SPEEDWAY, INC., a Tennessee
corporation
By: /s/ William R. Brooks
Title: Vice President
CHARLOTTE MOTOR SPEEDWAY, INC., a North
Carolina corporation
By: /s/ William R. Brooks
Title: Vice President
INEX CORP., a North Carolina corporation
By: /s/ William R. Brooks
Title: Vice President
LAS VEGAS MOTOR SPEEDWAY, LLC, a
Nevada limited liability company
By: /s/ William R. Brooks
Title: Manager
SMI SYSTEMS, LLC, a Nevada
limited liability company
By: /s/ William R. Brooks
Title: Manager
SONOMA FUNDING CORPORATION, a
California corporation
By: /s/ William R. Brooks
Title: Vice President
[SIGNATURES CONTINUE]
SPEEDWAY CONSULTING & DESIGN, INC., a
North Carolina corporation
By: /s/ William R. Brooks
Title: Vice President
SPEEDWAY SYSTEMS LLC, a North Carolina
limited liability company
By: IMS Systems Limited Partnership,
its sole manager
By: Speedway Motorsports, Inc.,
its general partner
By: /s/ William R. Brooks
Title: Vice President
SPR ACQUISITION CORPORATION, a California
corporation
By: /s/ William R. Brooks
Title: Vice President
TEXAS MOTOR SPEEDWAY, INC., a Texas
corporation
By: /s/ William R. Brooks
Title: Vice President
THE SPEEDWAY CLUB, INC., a North Carolina
corporation
By: /s/ William R. Brooks
Title: Vice President
[SIGNATURES CONTINUE]
SPEEDWAY SCREEN PRINTING, LLC, a
North Carolina limited liability company
By: /s/ William R. Brooks
Title: Manager
IMS SYSTEMS LIMITED PARTNERSHIP, a
North Carolina limited partnership company
By: SPEEDWAY MOTORSPORTS, INC., its general
partner
By: /s/ William R. Brooks
Title: Vice President
LENDERS:
BANK ONE, TEXAS, N.A.
By: /s/ Randall Rapp
Title: Vice President
CREDIT LYONNAIS ATLANTA AGENCY
By: /s/ David M. Cawrse
Title: First Vice President and Manager
FIRST AMERICAN NATIONAL BANK
By: /s/ H. Hope Stewart
Title: Assistant Vice President
FIRST SECURITY BANK OF NEVADA
By: /s/ Cheryl Moss
Title: Senior Vice President
[SIGNATURES CONTINUE]
FIRST UNION NATIONAL BANK
By: /s/ illegible
Title: Senior Vice President
FLEET NATIONAL BANK
By: /s/ illegible
Title: Vice President
NATIONAL CITY BANK OF KENTUCKY
By: /s/ illegible
Title: Vice President
NATIONSBANK, N.A.
By: /s/ James E. Nash, Jr.
Title: Senior Vice President
SCOTIABANC, INC.
By: /s/ Wiliam E. Zarrett
Title: Senior Relationship Manager
SOUTHTRUST BANK, N.A.
By: /s/ illegible
Title: Group Vice President
[SIGNATURES CONTINUE]
SUNTRUST BANK, ATLANTA
By: /s/ Shelley M. Browne
Title: Vice President
ADMINISTRATIVE AGENT:
NATIONSBANK, N.A.
By: /s/ James E. Nash, Jr.
Title: Senior Vice President
SYNDICATION AGENT:
FIRST UNION NATIONAL BANK
By: /s/ illegible
Title: Senior Vice President
DOCUMENTATION AGENT:
CREDIT LYONNAIS ATLANTA AGENCY
By: /s/ David M. Cawrse
Title: First Vice President and Manager
LEAD ARRANGER
AND BOOK MANAGER:
BANC OF AMERICA SECURITIES LLC
By: /s/ illegible
Title: Managing Director
[SIGNATURES CONTINUE]
CO-AGENTS:
FIRST SECURITY BANK OF NEVADA
By: /s/ Cheryl Moss
Title: Senior Vice President
FLEET NATIONAL BANK
By: /s/ illegible
Title: Vice President
SOUTHTRUST BANK, N.A.
By: /s/ illegible
Title: Group Vice President
SUNTRUST BANK, ATLANTA
By: /s/ Shelley M. Browne
Title: Vice President