THIRD AMENDMENT AND CONSENT
THIRD AMENDMENT AND CONSENT dated as of September 30, 1996
(this "Amendment"), among TWS FUNDING, INC., a Delaware corporation (the
"Borrower"), FLAGSTAR CORPORATION, a Delaware corporation ("Flagstar"), and each
financial institution executing this Amendment as a "Lender" (each, a "Lender").
PRELIMINARY STATEMENTS:
1. The Borrower, Flagstar and the Lender Parties, the
Co-Administrative Agents and the Funding Agent referred to therein have entered
into a Second Amended and Restated Credit Agreement dated as of April 10, 1996
(as amended to date, the "Credit Agreement"; the terms defined therein being
used herein as therein defined unless otherwise defined herein).
2. The Borrower and Flagstar have requested that the Lenders
agree (a) to amend certain provisions of the Credit Agreement as herein provided
and (b) to consent to a variance from Section 5.02(m) of the Credit Agreement to
the extent required to permit a change to Flagstar's fiscal year end as
described on Schedule I hereto.
3. The Lenders have expressed their willingness to grant the
Borrower's and Flagstar's requests on the terms and conditions set forth below.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements contained herein, the parties hereto hereby
agree as follows:
SECTION 1. Amendments to the Credit Agreement. The Credit
Agreement is, effective as of the date hereof and subject to the satisfaction of
the conditions precedent set forth in Section 3 hereof, hereby amended as
follows:
(a) Section 5.04(a) is amended by deleting therefrom the ratio
set opposite each of the Rolling Periods set forth below and
substituting therefor the ratio set forth below opposite each such
Rolling Period:
Rolling Periods Ending Ratio
---------------------- -----
September 30, 1996 8.40 : 1.00
December 31, 1996 8.40 : 1.00
March 31, 1997 8.70 : 1.00
June 30, 1997 8.60 : 1.00
September 30, 1997 8.20 : 1.00
December 31, 1997 8.20 : 1.00
March 31, 1998 8.10 : 1.00
(b) Section 5.04(b) is amended by deleting therefrom the ratio
set opposite each of the Rolling Periods set forth below and
substituting therefor the ratio set forth below opposite each such
Rolling Period:
Rolling Periods Ending Ratio
---------------------- -----
September 30, 1996 4.00 : 1.00
December 31, 1996 4.05 : 1.00
March 31, 1997 4.25 : 1.00
June 30, 1997 4.25 : 1.00
September 30, 1997 4.05 : 1.00
December 31, 1997 4.00 : 1.00
March 31, 1998 3.90 : 1.00
(c) Section 5.04(c) is amended by deleting therefrom the ratio
set opposite each of the Rolling Periods set forth below and
substituting therefor the ratio set forth below opposite each such
Rolling Period:
Rolling Periods Ending Ratio
---------------------- -----
September 30, 1996 1.00 : 1.00
December 31, 1996 1.05 : 1.00
March 31, 1997 1.00 : 1.00
June 30, 1997 1.03 : 1.00
September 30, 1997 1.05 : 1.00
December 31, 1997 1.05 : 1.00
March 31, 1998 1.10 : 1.00
(d) Section 5.04(d) is amended by deleting the amount
"$115,000,000" set opposite "Fiscal Year Ending in December 1997" and
substituting therefor the amount "$100,000,000."
SECTION 2 Consent. Effective as of the date hereof and subject
to the satisfaction of the conditions precedent set forth in Section 3, hereof,
the Required Lenders hereby consent to a variance from Section 5.02(m) of the
Credit Agreement to the extent required to permit a change to Flagstar's fiscal
year as described on Schedule I hereto.
SECTION 3. Conditions of Effectiveness. This Amendment shall
become effective when, and only when (a) the Funding Agent shall have received
counterparts of this Amendment executed by the Borrower, Flagstar and the
Required Lenders or, as to any of the Lenders, advice satisfactory to the
Funding Agent that such Lenders have executed this Amendment, (b) the Funding
Agent shall have received the Consent attached hereto, signed by each Guarantor
and Grantor (as such term is defined in the Security Agreement) and (c) the
Funding Agent shall have received a certificate, dated the date of receipt
thereof by the Funding Agent, in form and substance satisfactory to the Funding
Agent, signed by a duly authorized officer of Flagstar, to the effect that (i)
the representations and warranties set forth in Section 4 hereof are correct on
and as of the date of such certificate as though made on and as of such date and
(ii) no event has occurred and is continuing that constitutes a Default.
SECTION 4. Representations and Warranties. Flagstar represents
and warrants as follows:
(a) The execution, delivery and performance by each Loan Party
of this Amendment and the Credit Agreement, as amended hereby, and the
consummation of the transactions contemplated hereby and thereby, are
within such Loan Party's corporate powers, have been duly authorized by
all necessary corporate action on the part of such Loan Party, and do
not (i) contravene such Loan Party's charter or by-laws, (ii) violate
any law (including, without limitation, the Securities Exchange Act of
1934, as amended), rule, regulation (including, without limitation,
Regulation X of the Board of Governors of the Federal Reserve System,
as in effect from time to time), order, writ, judgment, injunction,
decree, determination or award applicable to any Loan Party, (iii)
conflict with or result in the breach of, or constitute a default
under, any contract, loan agreement, indenture, mortgage, deed of
trust, lease or other instrument binding on or affecting any Loan
Party, any of its Subsidiaries or any of their properties or (iv)
result in or require the creation or imposition of any Lien (other than
Liens created by or permitted under the Loan Documents) upon or with
respect to any of the properties of any Loan Party or any
of its Subsidiaries except, as to (ii) and (iii) above, as would not,
and would not be reasonably likely to, have a Material Adverse Effect.
(b) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for the due execution, delivery,
recordation, filing or performance by any Loan Party of this Amendment
or the Credit Agreement, as amended hereby, except those
authorizations, approvals, actions, notices and filings which have been
duly obtained, take, given, or made and are in full force and effect.
(c) This Amendment and the Consent have been duly executed and
delivered by each Loan Party party thereto. The Credit Agreement, as
amended hereby, is the legal, valid and binding obligation of each Loan
Party party thereto, enforceable against such Loan Party in accordance
with its terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, moratorium, reorganization or other similar
laws affecting creditors' rights generally and subject to general
principles of equity (regardless of whether considered in a proceeding
in equity or at law).
SECTION 5. Reference to and Effect on the Loan Documents. (a)
Upon the effectiveness hereof, on and after the date hereof each reference in
the Credit Agreement to "this Agreement", "hereunder", "hereof" or words of like
import referring to the Credit Agreement and each reference in the other Loan
Documents to the Credit Agreement, "thereunder", "thereof" or words of like
import referring to the Credit Agreement, shall mean and be a reference to the
Credit Agreement, as amended hereby.
(b) Except as specifically provided, the Credit Agreement is
and shall continue to be in full force and effect and is hereby in all respects
ratified and confirmed.
(c) The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate as a waiver of
any right, power or remedy of any Lender or Co-Administrative Agent or the
Funding Agent under any of the Loan Documents, nor constitute a waiver of any
provision of any of the Loan Documents.
SECTION 6. Governing Law. This Amendment shall be governed by,
and construed in accordance with, the laws of the State of New York.
SECTION 7. Execution in Counterparts. This Amendment may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed to be an original and all of which taken together shall constitute but
one and the same agreement. Delivery of an executed counterpart of a signature
page to this Amendment by telecopier shall be effective as delivery of a
manually executed counterpart of this Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment and Consent to be executed by their respective officers thereunto duly
authorized, as of the date first above written.
Borrowers
TWS FUNDING, INC.
By:
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Title: Vice President and Treasurer
FLAGSTAR CORPORATION
By:
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Title: Vice President and Treasurer
Lenders
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[Print or type name of institution]
By:
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Title: