Exhibit 10.1

 

LOAN AGREEMENT

 

THIS AGREEMENT is made as of the 18th day of March, 2004, by and between FIRST
ADVANTAGE CORPORATION, doing business in Florida as FIRST ADVANTAGE HOLDING,
INC. (the “Borrower”), a Delaware corporation, and BANK OF AMERICA, N.A. (the
“Bank”).

 

Recitals

 

The Borrower wishes to obtain credit from the Bank on the terms and conditions
set forth herein.

 

NOW, THEREFORE, for good and valuable consideration, the parties agree as
follows:

 

ARTICLE I

BORROWING AND PAYMENT

 

1.01 Revolving Line of Credit.

 

(a) The Bank hereby establishes in favor of the Borrower a revolving line of
credit (the “Line of Credit”). The Borrower shall be entitled to borrow, repay
and reborrow funds under the Line of Credit in accordance with the terms hereof
so long as the total principal amount owed to the Bank under the Line of Credit
does not exceed $25,000,000.00 (or such lesser amount as is set forth herein)
during the Revolving Period. The Bank’s obligation to make advances hereunder
shall terminate at the expiration of the Revolving Period.

 

(b) The Borrower’s indebtedness under the Line of Credit shall be evidenced by a
promissory note (as amended, extended or renewed from time to time, the “Line of
Credit Note”) of even date herewith executed by the Borrower in favor of the
Bank in the original principal amount of $25,000,000.00. The Line of Credit Note
shall bear interest at the rate set forth therein and shall be payable as set
forth therein.

 

(c) The Bank shall make each advance under the Line of Credit upon written or
telephonic notice from the Borrower to the Bank requesting an advance. The
notice shall specify the date for which the advance is requested (which must be
a Business Day) and the amount of the advance. The Bank must receive the notice
prior to 12:00 noon (Eastern time) on the Business Day of the advance.
Alternatively, the Borrower may request advances by drawing checks on a deposit
account that is linked to the credit facility hereunder in accordance with
disbursement arrangements that are mutually satisfactory to the parties. The
Bank will make each requested advance available to the Borrower not later than
the close of business on the Business Day of the request by crediting the
Borrower’s account maintained with the Bank in the amount of the advance if as
of such time: (i) the Bank’s obligation to make advances hereunder has not
terminated or expired; (ii) a Default or Event of Default has not occurred; and
(iii) all conditions to the advance set forth herein or in any other Loan

--------------------------------------------------------------------------------

Documents have been satisfied. The Bank may rely upon any written or telephonic
notice given by any person that the Bank in good faith believes is an authorized
representative of the Borrower without the necessity of any independent
investigation. If any telephonic notice conflicts with a written confirmation,
the telephonic notice shall govern if the Bank has acted in reliance thereon.

 

(d) For purposes hereof, the term “Revolving Period” shall mean a period
commencing on the date hereof and terminating on March 18, 2007.

 

1.02 Term Loans.

 

(a) Subject to the terms and conditions set forth herein, the Borrower may from
time to time, upon written notice to the Bank, convert all or a portion of the
outstanding principal balance of the Line of Credit Note to one or more term
loans (each, a “Term Loan”), upon satisfaction of the following conditions:

 

(i) The Borrower shall provide written notice to the Bank, not less than thirty
(30) business days prior to the requested effective date for such conversion of
outstanding principal to a Term Loan.

 

(ii) Each such Term Loan shall be for a principal amount of at least
$5,000,000.00 but not more than $10,000,000.00.

 

(iii) No Default or Event of Default shall have occurred hereunder and be
continuing at the time of such request.

 

(iv) The Borrower shall execute a promissory note (each, as amended, extended or
renewed from time to time, a “Term Note”, in the form set forth on Exhibit “D”
hereto. The Borrower, its Subsidiaries and the Guarantor shall execute such
other documentation as the Bank shall reasonably require in connection with such
Term Loan.

 

(v) The Borrower shall pay a fee upon the execution of each Term Note, in an
amount reasonably set by the Bank.

 

(vi) The Borrower shall pay all of the Bank’s fees, expenses and costs in
connection with the documentation, closing and administration of each Term Loan,
including, without limitation, all attorneys fees and costs, documentary stamp
taxes and intangible personal property taxes.

 

(b) Each Term Loan shall: (i) be for a term of 24 months; (ii) accrue interest
at the rate to be reasonably agreed upon between the Borrower and the Bank; and
(iii) be payable in monthly installments of principal plus interest in an amount
required to fully

 

2

--------------------------------------------------------------------------------

amortize the principal amount of such Term Loan over 24 months, commencing on
the date of such Term Loan.

 

(c) The Line of Credit shall be reduced by the original principal amount of each
Term Loan, so that, notwithstanding any contrary provision set forth herein, the
Outstanding Credit (as defined herein) shall not, at any time, exceed
$25,000,000. For the purposes hereof, “Outstanding Credit” shall mean the sum
of: (i) the outstanding principal amount under the Line of Credit Note; and (ii)
the aggregate face amount of all Term Notes.

 

1.03 Loan Documents. The Obligations (the “Obligations”) now or hereafter
evidenced by the Line of Credit Note and each Term Note (collectively, the
“Notes”) shall be guaranteed by The First American Corporation (the “Guarantor”)
pursuant to a Guaranty of Payment (as amended or restated from time to time, the
“Guaranty”) of even date herewith.

 

1.04 Facility Fees.

 

(a) The Borrower shall pay the Bank an annual commitment fee equal to 0.38% of
the face amount of the Line of Credit (after taking into account any Term Loans
deducted therefrom), on March 18 of each calendar year, commencing on the date
hereof, and continuing on each March 18th thereafter during the term hereof.

 

(b) The Borrower shall pay the Bank a fee equal to the 0.35% per annum
(calculated on the basis of a 365/366 day year) of the daily average unused
amount of the Line of Credit. The Borrower shall pay the fee: (i) quarterly in
arrears within 15 days after each fiscal quarter end (commencing on April 15,
2004), the amount of such fee to be on a pro rata basis for each such calendar
quarter; and (ii) on the termination or expiration of the Line of Credit for the
pro rata portion of such fee for the quarter in which the Line of Credit
terminates or expires.

 

1.05 Interpretation.

 

(a) Certain terms used herein shall have the meanings ascribed thereto in
Appendix I attached hereto.

 

(b) The definitions set forth in Appendix I attached hereto are equally
applicable to both the singular and plural forms of the terms defined. The words
“hereof”, “herein” and “hereunder” when used in this Agreement shall refer to
this Agreement as a whole and not to any particular provision of this Agreement.
Where the character or amount of any asset or liability or item of income or
expense is required to be determined or any consolidation or other accounting
computation is required to be made for the purposes of this Agreement, it shall
be done in accordance with GAAP except where such principles are inconsistent
with the specific provisions of this Agreement.

 

3

--------------------------------------------------------------------------------

(c) The Borrower shall cause its Subsidiaries to comply with all covenants and
agreements imposed upon the Subsidiaries herein. Each provision set forth herein
obligating (or purportedly obligating) any Subsidiary to take, or refrain from
taking, any action shall obligate the Borrower to cause such Subsidiary to take,
or refrain from taking, such action.

 

ARTICLE II

CONDITIONS

 

2.01 Conditions to Initial Advance. The obligation of the Bank to make an
initial extension of credit hereunder is subject, without limitation, to
satisfaction of the following conditions precedent:

 

(a) The Bank shall have received on or before the date hereof and the date of
such extension of credit in form reasonably satisfactory to it: (i) the duly
executed Loan Documents; (ii) such evidence of corporate authorization from the
Borrower and the Guarantor as the Bank may reasonably require; (iii) good
standing certificates indicating that the Borrower and the Guarantor are in good
standing in their respective states of incorporation and in any other states
where they are required to qualify to do business (except where the failure to
be so qualified would not have a Material Adverse Effect); and (iv) certified
articles of incorporation, bylaws or other applicable organizational documents
of the Borrower and the Guarantor.

 

(b) The Bank shall have received on or before the date hereof from attorneys for
the Borrower reasonably acceptable to the Bank, an opinion addressed to the Bank
in form attached hereto as Appendix II.

 

2.02 Conditions to Advances. The obligation of the Bank to make any advances
hereunder or under any Note is subject, without limitation, to satisfaction of
the following additional conditions precedent:

 

(a) The representations and warranties of the Borrower and the Guarantor set
forth in this Agreement and in the Loan Documents shall be true and correct in
all material respects on and as of the date of each such advance or extension of
credit.

 

(b) On the date of each such advance or extension of credit, the Borrower shall
be in compliance with all the material terms and provisions set forth in this
Agreement on its part to be observed or performed, and no Default or Event of
Default shall be continuing hereunder.

 

2.03 Other Documents. The Bank shall have received on or before the date hereof
or the date of any advance or credit extension hereunder such other documents or
items as the Bank may reasonably request.

 

4

--------------------------------------------------------------------------------

ARTICLE III

AFFIRMATIVE COVENANTS

 

3.01 Financial Statements. The Borrower will deliver to the Bank the following:

 

(a) Within forty-five (45) days after the end of each quarter of the Borrower’s
fiscal year (other than the last quarter of each fiscal year), a balance sheet,
income statement and statement of cash flows for the Borrower and its
Subsidiaries on a consolidated and consolidating basis (except for statements of
cash flows which will be on a consolidated basis only) as of the end of and for
such period in reasonable detail certified by the chief financial officer or
other senior financial officer of the Borrower. For the avoidance of doubt, a
copy of the Borrower’s quarterly report on Form 10-Q filed with the Securities
and Exchange Commission shall satisfy this requirement.

 

(b) Within forty-five (45) days after the end of each quarter of the Guarantor’s
fiscal year (other than the last quarter of each fiscal year), a balance sheet,
income statement and statement of cash flows for the Guarantor, on a
consolidated basis, as of the end of and for such period in reasonable detail
certified by the chief financial officer or other senior financial officer of
the Guarantor. For the avoidance of doubt, a copy of the Guarantor’s quarterly
report on Form 10-Q filed with the Securities and Exchange Commission shall
satisfy this requirement.

 

(c) Within one hundred twenty (120) days after the end of each fiscal year of
the Borrower, a balance sheet, income statement and statement of cash flows for
the Borrower and its Subsidiaries on a consolidated and consolidating basis
(except for statements of cash flows which shall be on a consolidated basis
only) as of the end of and for such period in reasonable detail and such
consolidated balance sheet, income statement and statement of cash flows for the
Borrower and its Subsidiaries shall be audited and certified by independent
certified public accounts acceptable to the Bank. For the avoidance of doubt, a
copy of the Borrower’s annual report on Form 10-K filed with the Securities and
Exchange Commission shall satisfy this requirement.

 

(d) Within one hundred twenty (120) days after the end of each fiscal year of
the Guarantor, a balance sheet, income statement and statement of cash flows for
the Guarantor on a consolidated basis, as of the end of and for such period in
reasonable detail, and such balance sheet, income statement and statement of
cash flows for the Guarantor shall be audited and certified by independent
certified public accountants acceptable to the Bank. For the avoidance of doubt,
a copy of the Guarantor’s annual report on Form 10-K filed with the Securities
and Exchange Commission shall satisfy this requirement

 

(e) Not later than fifteen days after completion, the combined annual
budget/projections for the Borrowers and its Subsidiaries, together with the
combined capital expenditures budget for the Borrower and its Subsidiaries (if
available), certified to the Bank by the chief financial officer or other senior
financial officer of the Borrower

 

5

--------------------------------------------------------------------------------

(f) Promptly upon receipt thereof, copies of all management letters, if any,
submitted to the Borrower by independent certified public accountants in
connection with each annual or interim audit of the books of the Borrower by
such accountants.

 

(g) Not later than three Business Days after the Borrower becomes aware of the
occurrence of any Default or Event of Default, a notice thereof, specifying the
nature thereof.

 

(h) Such other material information as the Bank may from time to time reasonably
request.

 

3.02 Financial Information. All financial information submitted by the Borrower,
the Guarantor or any Subsidiary hereunder shall be prepared in accordance with
GAAP as in effect from time to time. The Borrower will maintain books of account
in accordance with GAAP.

 

3.03 Taxes and Other Charges. The Borrower and its Subsidiaries, as applicable,
will pay and discharge or cause to be paid and discharged all taxes, charges,
liabilities or claims of any type at any time assessed against or incurred by
the Borrower or any Subsidiary, or that could become a lien against the Borrower
or such Subsidiary or any of their properties if not paid when due. Nothing in
this subsection shall require the payment of any such sum if the Borrower or
such Subsidiary, as applicable, by appropriate proceedings contests the same in
good faith and so long as the Borrower or such Subsidiary, as the case may be,
maintains adequate reserves therefor.

 

3.04 Insurance. The Borrower and its Subsidiaries will maintain adequate
insurance with responsible insurers with coverage normally obtained by
businesses similar to that of the Borrower or its Subsidiaries, but covering at
least: (i) damage to physical property from fire and other hazards for the full
insurable value of such property; (ii) liability on account of injury to
persons; and (iii) insurance against theft, forgery or embezzlement or other
illegal acts of officers or employees in reasonable amounts.

 

3.05 Maintenance of Corporate Existence. Except as otherwise permitted herein,
the Borrower and its Subsidiaries will do or cause to be done all things
necessary to preserve and keep in full force and effect their existence,
material franchises, material rights and material privileges as corporations
under the laws of their states of incorporation and any other jurisdiction where
the conduct of their business or the ownership of their properties would require
them to be qualified to do business (except where the failure to be so qualified
would not have a Material Adverse Effect). Notwithstanding the foregoing,
Subsidiaries may merge into other Subsidiaries or into the Borrower, provided
that: (i) the Borrower’s percentage interest (whether direct or indirect) in
such merging Subsidiary is not reduced by such merger; (ii) the Bank is provided
notice of such merger; (iii) such merger does not result in a Default or Event
of Default hereunder; and (iv) such merger does not result in a default or event
of default under any other agreements between the Borrower and the Bank.

 

6

--------------------------------------------------------------------------------

3.06 Use of Proceeds. The funds borrowed under the Note shall be used for
working capital purposes, for Permitted Acquisitions and for such other purposes
as the Bank may approve from time to time.

 

3.07 Notice of Litigation. Not later than five (5) Business Days after the
commencement thereof, the Borrower shall furnish the Bank notice of all material
actions, suits and proceedings before any court or governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign,
affecting the Borrower or any Subsidiary with respect to which an adverse
determination against the Borrower or such Subsidiary could have a Material
Adverse Effect.

 

3.08 Maintenance of Properties. The Borrower and each Subsidiary shall maintain,
preserve and keep its property, plant and equipment in good repair, working
order and condition (ordinary wear and tear excepted) and shall from time to
time make all needful and proper repairs, renewals, replacements, additions and
betterments thereto so that at all times the efficiency thereof shall be fully
preserved and maintained.

 

3.09 ERISA. The Borrower and each Subsidiary shall promptly pay and discharge
all obligations and liabilities arising under ERISA of a character that if
unpaid or unperformed could reasonably be expected to result in the imposition
of a Lien against any of its Property. The Borrower and each Subsidiary shall
notify the Bank within five Business Days of: (a) the occurrence of any
reportable event (as defined in ERISA) with respect to a Plan; (b) receipt of
any notice from the PBGC of its intention to seek termination of any Plan or
appointment of a trustee therefor; (c) its intention to terminate or withdraw
from any Plan; and (d) the occurrence of any event with respect to any Plan that
would result in the incurrence by the Borrower or any Subsidiary of any material
liability, fine or penalty, or any material increase in the contingent liability
of the Borrower or any Subsidiary with respect to any Plan or any
post-retirement Welfare Plan benefit.

 

3.10 Other Events. The Borrower shall promptly notify the Bank of any material
default under or violation of any material agreement, law or regulation to which
the Borrower or any Subsidiary is a party or by which it is bound, if such
default or violation could result in a Material Adverse Effect. The Borrower and
its Subsidiaries shall promptly perform all of their material obligations under
any material agreements to which any of them is a party, and each of them shall
use its best efforts to ensure compliance by other parties in all material
respects with such agreements.

 

3.11 Compliance with Laws. The Borrower and its Subsidiaries shall comply in all
material respects at all times with all statutes, regulations, orders and
judgments to which they, or any of them, are subject, the non-compliance with
which could result in a Material Adverse Effect.

 

3.12 Access. The Bank (by any of its officers, employees or agents) shall have
the right, exercisable as frequently as the Bank reasonably determines to be
appropriate, to inspect and make extracts from all of the records, files and
books of account of the Borrower or its Subsidiaries, provided that, in
exercising its rights under this Section, the Bank shall use reasonable efforts
to minimize the disruption to the business of the Borrower and its Subsidiaries.
All reasonable and

 

7

--------------------------------------------------------------------------------

documented costs, fees and expenses incurred by the Bank, or for which the Bank
has become obligated, in connection with any such inspection or verification
shall be payable by the Borrower to the Bank.

 

3.13 Deposits. The Borrower shall maintain substantially all of its deposit
accounts with the Bank.

 

ARTICLE IV

NEGATIVE COVENANTS

 

4.01 Liens. Neither the Borrower nor any Subsidiary will create, incur, assume
or suffer to exist any Lien of any nature whatsoever on any of the assets of the
Borrower or any Subsidiary now or hereafter owned, or enter into or suffer to
exist any conditional sales contracts or other title retention agreements except
for Permitted Liens. For purposes hereof, “Permitted Liens” shall mean:

 

(a) Liens in favor of the Bank;

 

(b) Liens on equipment to secure indebtedness permitted hereunder to finance the
acquisition thereof;

 

(c) the Lien of ad valorem and other taxes and assessments not yet due and
payable;

 

(d) Liens (other than Liens under ERISA) arising out of pledges, deposits, or
other amounts owed under worker’s compensation laws, unemployment insurance, old
age pensions or other social security or retirement benefits, or similar
legislation, or to secure payment of premiums for insurance purchased in the
usual course of operations or in connection with self-insurance or to secure the
performance of bids, tenders or trade contracts incurred in the ordinary course
of operations and not in connection with the borrowing of money;

 

(e) deposits for indemnity bonds and other bonds required in the ordinary course
of the Borrower’s or any Subsidiary’s business, and not in connection with
borrowed money;

 

(f) inchoate materialmen’s, suppliers’, operators’, mechanics’, workmen’s,
repairmen’s, employees’, carriers’, warehousemen’s or attorneys’ Liens or other
like statutory Liens arising in the ordinary course of business and securing
obligations (i) that are not delinquent or (ii) the amounts or validity of which
are being contested in good faith as to which the Borrower has established
appropriate funded reserves to the extent required by GAAP;

 

(g) deposits made by the Borrower or any Subsidiary in the ordinary course of
business;

 

8

--------------------------------------------------------------------------------

(h) Liens of financial institutions arising in the ordinary process of
collection of instruments;

 

(i) statutory landlord’s Liens, and contractual landlord’s Liens created prior
to this date (or in the case of any Subsidiary acquired pursuant to a Permitted
Acquisition, prior to the date of such acquisition) provided that amounts
secured thereby are not past due by more than 30 days.

 

(j) Liens filed by owners of leased equipment whose lien shall be limited to
such leased equipment and no other assets of the Borrower;

 

(k) Liens in existence at the time any Subsidiary is acquired; and

 

(l) Pledge of stock in acquired companies to the seller of such Company.

 

4.02 Obligations.

 

(a) Neither the Borrower nor any Subsidiary is or will become directly or
indirectly obligated in any way for any Debt or other obligations for borrowed
money except for Permitted Obligations without the prior written consent of the
Bank. For purposes hereof, “Permitted Obligations” shall mean:

 

(i) any and all obligations now or hereafter owed by the Borrower or any
Subsidiary to the Bank;

 

(ii) customer deposits in the ordinary course of business;

 

(iii) obligations listed on Exhibit “A” hereto (provided; however, that all Debt
of the Borrower to the Guarantor shall at all times be subordinated to the
Obligations pursuant to the Guaranty;

 

(iv) obligations under Letters of Credit necessary to support the Borrower’s
worker’s compensation, employment insurance, and social security obligations;

 

(v) indebtedness subordinated to the Bank’s rights pursuant to subordination
agreements reasonably satisfactory to the Bank;

 

(vi) inter-company indebtedness;

 

(vii) leases of real property;

 

9

--------------------------------------------------------------------------------

(viii) debt of acquired companies or incurred in connection with acquiring such
companies not to exceed an aggregate total indebtedness of $3,000,000 for each
such acquired company; and

 

(ix) operating leases and equipment leases.

 

(b) Notwithstanding the foregoing subparagraph (a), the Borrower and its
Subsidiaries shall be entitled to enter into and maintain Capital Leases and
purchase money indebtedness, in addition to existing amounts permitted under the
foregoing subparagraph (a), for so long as the aggregate rentals and other
amounts payable by the Borrower or such Subsidiaries, on an aggregate
outstanding basis, under all such obligations will not exceed $3,750,000.00 or
such greater amount as the Bank may approve in writing.

 

(c) Neither the Borrower nor the Subsidiaries shall: (i) purchase any Debt or
other obligations for borrowed money (other than Debt or other obligations which
are Permitted Obligations) or guarantee any obligations of any other Person
(except that each of the Borrower and the Subsidiaries shall be entitled to
guaranty any Permitted Obligations, together with other obligations permitted in
subparagraph (b) above, of the Borrower or any other Subsidiary); (ii) enter
into any credit support, financial maintenance, credit enhancement or similar
arrangement in favor of any Person; (iii) enter into any other transaction that
is intended to assure performance of the obligations of any other Person; or
(iv) subordinate any claim or demand that it may have to any claim or demand of
any other Person (other than the Bank).

 

(d) The Borrower shall not enter into any agreement, other than the Loan
Documents, prohibiting the creation or assumption of any Lien upon its Property.

 

(e) Neither the Borrower nor any Subsidiary will enter into any Hedge Agreement
without the Bank’s prior written consent. For purposes hereof, the term “Hedge
Agreement” means each agreement between the Borrower or any Subsidiary and any
other party that provides for an interest rate or commodity swap, cap, floor,
collar, forward foreign exchange transaction, currency swap, cross-currency rate
swap, currency option, or any combination of, or option with respect to, these
or similar transactions, for the purpose of hedging the Borrower’s or any
Subsidiary’s exposure to fluctuations in interest rates, currency valuations or
commodity prices.

 

4.03 Merger; Consolidation; Sale of Substantial Assets. Neither the Borrower nor
any Subsidiary will, except as permitted by Section 3.05 hereof, without the
Bank’s prior written consent, which will not be withheld unreasonably: (a) merge
into, consolidate with, or sell or transfer all or a substantial part of its
assets to, any other Person; (b) take any action that would reduce the ownership
or voting interest of the Borrower and its Subsidiaries in any Subsidiary; or
(c) pledge or encumber any stock of any Subsidiary (except for pledges in favor
of the Bank).

 

10

--------------------------------------------------------------------------------

4.04 Loans, Investments and Acquisitions.

 

(a) Neither the Borrower nor any Subsidiary will purchase any stock, securities
or evidence of indebtedness, or make or permit to exist any loans or advances
to, or make any investment or acquire any interest in, any other Person (except,
however, that the Borrower shall be entitled to make Permitted Acquisitions in
accordance with the terms hereof). Neither the Borrower nor any Subsidiary
shall, without the Bank’s prior written consent, enter into partnership or joint
venture agreements with any other Person. Notwithstanding the foregoing: (i) the
Borrower shall be entitled to extend credit and make advances to majority owned
Subsidiaries; (ii) the Borrower may extend credit and make advances in the
ordinary course of business, in addition to credit and advances permitted under
the foregoing subparagraph; and (iii) the Borrower and its Subsidiaries may
invest in Eligible Securities. For purposes hereof, “Eligible Securities” shall
mean: (i) direct obligations of the United States of America or any agency or
instrumentality thereof whose obligations constitute the full faith and credit
of the United States of America so long as all such obligations mature within
one year of the date of issuance thereof; (ii) commercial paper rated P-1 or
better by Moody’s and maturing within one year of the date of issuance thereof;
(iii) certificates of deposit issued by the Bank; and (iv) repurchase
obligations with a term of not more than seven days for underlying securities of
the types described in the foregoing clause (i) entered into with a United
States commercial bank having capital and surplus of not less than $100,000,000.
Notwithstanding anything to the contrary in this Section 4.04(a), the
limitations of this Section 4.04(a) shall not be applicable in connection with
the Borrower’s formation and funding of a newly created Subsidiary for the
purposes of consummating a Permitted Acquisition in accordance with the terms of
this Agreement.

 

(b) The Borrower shall be entitled to acquire businesses through stock
acquisitions, asset purchases or mergers upon satisfaction of the following
conditions:

 

(i) Each such acquisition shall be made on arms length terms. The Borrower,
after consummation of the acquisition, own and control a majority of the
outstanding equity and voting rights in any Person acquired by the Borrower or
any such Subsidiary in connection with the acquisition.

 

(ii) The Person acquired, or the business acquired, must be in the same or a
related line of business as the Borrower and its Subsidiaries.

 

(iii) The Borrower shall have given the Bank notice of such acquisition within
three (3) business days from the date of public notice of such acquisition. Such
notice may include a copy of the press release, but shall, at a minimum, include
the name of the business to be acquired and the date of the press release.

 

(iv) The acquisition will not result in a Default or an Event of Default
hereunder. In addition, the acquisition will not result in a default under the
financial or other covenants contained in any other agreement between the
Borrower and the

 

11

--------------------------------------------------------------------------------

Bank: (aa) at the time such acquisition is consummated after giving effect to
such acquisition; and (bb) on a projected basis based upon reasonable
projections after giving effect to such acquisition.

 

(c) Neither the Borrower nor any Subsidiary shall form or create any new
Subsidiary on or after the date hereof except for the sole purpose of
consummating a Permitted Acquisition in accordance with the terms of this
Agreement.

 

4.05 Nature of Business. Neither the Borrower nor any Subsidiary will engage in
any business if, as a result, the general nature of the business in which it
would then be engaged would be substantially changed from the general nature of
the business engaged in by it on the date of this Agreement.

 

4.06 Sale or Pledge of Property. Neither the Borrower nor any Subsidiary will
sell, lease or otherwise dispose of or transfer any of its interests in any
accounts receivable.

 

4.07 Pension Plan Funding Deficiency. Neither the Borrower nor any Subsidiary
shall incur or suffer to exist any material accumulated funding deficiency
within the meaning of the ERISA or incur any material liability to the PBGC (or
any successor) established thereunder in connection with any Plan.

 

4.08 Transactions with Affiliates. Except as set forth on Exhibit “B” hereto,
the Borrower and its Subsidiaries shall not directly or indirectly enter into
any transaction with any Affiliate other than in the ordinary course and
pursuant to the reasonable business requirements of the Borrower or such
Subsidiaries. Any such transaction shall be upon fair and reasonable terms and
provisions no less favorable to the Borrower or any such Subsidiary than it
could have obtained in a comparable arm’s-length transaction with a Person who
is not an Affiliate of the Borrower or such Subsidiary.

 

4.09 Sale and Leaseback. Neither the Borrower nor any Subsidiary will enter into
any arrangement with any Person providing for the leasing by the Borrower or any
Subsidiary of Property that has been sold or is to be sold or transferred by the
Borrower or any of the Subsidiaries to such Person.

 

4.10 Fiscal Year. Neither the Borrower nor any Subsidiary shall change its
fiscal year from the fiscal year currently used by such entity.

 

ARTICLE V

REPRESENTATIONS AND WARRANTIES

 

The Borrower represents and warrants, and so long as this Agreement is in effect
or any part of the Obligations remains unpaid, shall continue to represent and
warrant at all times, that:

 

 

12

--------------------------------------------------------------------------------

5.01 The Borrower and Subsidiaries. The Borrower and the Subsidiaries are duly
organized or incorporated and validly existing under and by virtue of their
respective states of existence. Each is duly licensed and qualified in all other
states and jurisdictions wherein the nature of the business transacted by it or
the ownership of its properties makes such licensing or qualification as a
foreign corporation necessary, if any, except where the failure to be so
qualified would not have a Material Adverse Effect. Each of the Borrower and its
Subsidiaries: (a) holds in full force and effect all material permits, licenses
and franchises necessary for it to carry out its operations in conformity with
all applicable laws and regulations; and (b) has full and adequate power to own
its Property and conduct its business as now conducted.

 

5.02 Authorization, Conflicts and Validity. The execution and delivery of this
Agreement and each of the other Loan Documents to which the Borrower is or will
be a party and the performance by the Borrower of all of its obligations
thereunder: (a) have been duly authorized by all requisite corporate action; (b)
will not violate or be in conflict with (i) any material provision of applicable
law (including, without limitation, any applicable usury or similar law); (ii)
any material order, rule or regulation of any court or other governmental
authority; (iii) any material provision of its certificate of incorporation or
bylaws, including any amendments thereto, or any resolution with continuing
effect adopted by its Board of Directors or shareholders; or (iv) any material
provision of any shareholders’ agreement or trust respecting securities of its
issue or related rights; (c) will not violate, be in conflict with, result in a
breach of or constitute a default (with or without the giving of notice or the
passage of time or both) under any material instrument, indenture, agreement or
other obligation to which it is a party or by which it or any of its assets and
properties is or may be bound or subject; and (d) except as specifically
contemplated by this Agreement or any other Loan Documents, will not result in
the creation or imposition of any Lien, charge or encumbrance of any nature upon
any of its assets and properties. The Loan Documents to which the Borrower is or
will be a party when executed and delivered will be legal, valid and binding
obligations of the Borrower, enforceable in accordance with their respective
terms and provisions.

 

5.03 Consents. No consent, approval or authorization of, or registration,
declaration or filing with, any governmental authority or other person
(including, without limitation, the shareholders of the Borrower) is required as
a condition precedent, concurrent or subsequent to or in connection with the due
and valid execution, delivery and performance by the Borrower of this Agreement
or any other Loan Document to which it is or will be a party, or the legality,
validity, binding effect or enforceability of any of the respective
representations, warranties, covenants and other terms and provisions thereof,
which has not been obtained prior to the date hereof. Each franchise, license,
certificate, authorization, approval or consent from any governmental authority
material to the present conduct of the business and operations of the Borrower
or its Subsidiaries, or required for the acquisition, ownership, improvement,
operation or maintenance by it of any material portion of the assets and
properties it now owns, operates or maintains, has been obtained and validly
granted, is in full force and effect and constitutes valid and sufficient
authorization therefor.

 

5.04 Legal or Administrative Proceedings. There are no material actions, suits,
investigations or proceedings by any Person pending or to the best knowledge of
the Borrower threatened against the Borrower or any Subsidiary or to which they
are a party involving the

 

13

--------------------------------------------------------------------------------

possibility of any judgment or liability not fully covered by insurance or by
adequate reserves set up on the books of the Borrower or the Subsidiaries.

 

5.05 Trademarks, Franchises and Licenses. The Borrower and its Subsidiaries own,
possess or have the right to use all necessary patents, licenses, software,
franchises, trademarks, trade names, trade styles, copyrights, trade secrets,
know how and confidential commercial and proprietary information to conduct
their businesses as now conducted, without known conflict with any patent,
license, franchise, trademark, trade name, trade style, copyright or other
proprietary right of any other Person.

 

5.06 Corporate Restrictions. Neither the Borrower nor any Subsidiary is a party
to any contract or subject to any charter or other corporate restriction that
would materially and adversely affect its property or business, or its ability
to perform its obligations under the Loan Documents.

 

5.07 Taxes. The Borrower and the Subsidiaries have filed all federal and state
tax returns that are required to be filed, and have paid all taxes as shown on
the returns and on all assessments received by them to the extent that the taxes
have become due. Proper and accurate amounts have been withheld by the Borrower
and its Subsidiaries from their respective employees for all periods in full and
complete compliance with the tax, social security and unemployment withholding
provisions of applicable federal, state, local and foreign law and such
withholdings have been timely paid to the respective governmental agencies.

 

5.08 Default. There exists as of the date hereof no Default or Event of Default.

 

5.09 Other Representations. All warranties and representations of the Borrower
or any of the Subsidiaries contained in any of the Loan Documents are true and
accurate in all material respects.

 

5.10 Subsidiaries. As of the date hereof, the Borrower owns no Subsidiaries
other than those Subsidiaries listed on Exhibit “C” attached hereto. Except as
disclosed on Exhibit “C” attached hereto, the Borrower owns, directly or
indirectly, 100% of the outstanding capital stock of its Subsidiaries. The only
persons or entities in which the Borrower owns an equity interest are the
Subsidiaries. No Person holds or is entitled to obtain any other equity interest
in the Subsidiaries.

 

5.11 ERISA. The Borrower and its Subsidiaries have fulfilled their obligations
under the minimum funding standards of and are in compliance in all material
respects with ERISA and the Code to the extent applicable to them. None of them
has incurred any liability to the PBGC or a Plan under Title IV of ERISA other
than a liability to the PBGC for premiums under Section 4007 of ERISA. Neither
the Borrower nor any Subsidiary has any contingent liabilities with respect to
any post-retirement benefits under any Plan or Welfare Plan, other than
liability for continuation coverage described in article 6 of Title I of ERISA.

 

5.12 Compliance with Laws. The Borrower and its Subsidiaries are in compliance
with the requirements of all federal, state and local laws, rules and
regulations applicable to or pertaining to

 

14

--------------------------------------------------------------------------------

their Property or business operations (including, without limitation, the
Occupational Safety and Health Act of 1970, the Americans with Disabilities Act
of 1990, and laws and regulations establishing quality criteria and standards
for air, water, land and toxic or hazardous wastes and substances),
non-compliance with which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect. Neither the Borrower nor any
Subsidiary has received notice to the effect that its operations are not in
compliance with any of the requirements of applicable federal, state or local
environmental, health and safety statutes and regulations or are the subject of
any governmental investigation evaluating whether any remedial action is needed
to respond to a release of any toxic or hazardous waste or substance into the
environment, which non-compliance or remedial action, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.

 

5.13 Purpose of the Borrower. The Borrower does not own any “margin security”
within the meaning of Regulation U (12 CFR Part 221) of the Board of Governors
of the Federal Reserve System. None of the proceeds of the loan by the Bank to
the Borrower will be used for the purpose of purchasing or carrying any margin
security or for the purpose of reducing or retiring any indebtedness that was
originally incurred to purchase or carry a margin security or for any other
purpose that might constitute this transaction a “purpose credit” within the
meaning of Regulation U, as now in effect or as it may hereafter be amended.
Neither the Borrower nor any agent acting on its behalf has taken or will take
any action that might cause this Agreement or any Loan Document to violate
Regulation U or any other regulation of the Board of Governors of the Federal
Reserve System or to violate the Securities Exchange Act of 1934, in each case
as in effect now or as the same may hereafter be amended.

 

5.14 Solvency. After giving effect to the full funding of the loans contemplated
herein, the Borrower and each Subsidiary will be solvent. “Solvent” shall mean,
when used with respect to any Person, that: (a) such Person does not intend to
incur, and does not believe and has no reason to believe that it will incur,
debts beyond its ability to pay as they become due; (b) the sum of such Person’s
assets is greater than all of such Person’s liabilities at a fair valuation; (c)
such Person has sufficient cash flow to enable it to pay its debts as they
become due; and (d) such Person does not have unreasonably small capital to
carry on such Person’s business as theretofore operated and all businesses in
which such Person is about to engage. “Fair valuation” is intended to mean that
value that can be obtained if the assets are sold within a reasonable time in
arm’s-length transactions in an existing and not theoretical market.

 

5.15 Federal Acts. Neither the Borrower nor any of its Subsidiaries is an
“investment company” or a company “controlled” by an “investment company” within
the meaning of the Investment Company Act of 1940, as amended, or a “public
utility holding company” within the meaning of the Public Utility Holding
Company Act.

 

5.16 Affiliate Transactions. Except as set forth on Exhibit “B” hereto, neither
the Borrower nor any Subsidiary is a party to any contracts or agreements with
any of its Affiliates on terms and conditions that are less favorable to the
Borrower or such Subsidiary than would be usual and customary in similar
contracts or agreements between Persons not affiliated with one other.

 

15

--------------------------------------------------------------------------------

5.17 Full Disclosure. The statements and information furnished to the Bank in
connection with the negotiation of this Agreement and the other Loan Documents
and the commitment by the Bank to provide all or part of the financing
contemplated hereby do not contain any untrue statements of a material fact or
omit a material fact necessary to make the material statements contained herein
or therein not misleading. The Bank acknowledges that, as to any projections
furnished to the Bank, the Borrower only represents that the same were prepared
on the basis of information and estimates that the Borrower believed to be
reasonable.

 

ARTICLE VI

EVENTS OF DEFAULT

 

6.01 Events of Default. Each of the following events shall constitute an “Event
of Default” hereunder:

 

(a) if the Borrower defaults in the payment of any principal, interest or other
amount under the Note, either by the terms thereof or otherwise as provided
herein and such default continues for a period of ten days thereafter; or

 

(b) if the Borrower, the Guarantor or any Subsidiary defaults in any payment of
principal of or interest on any other obligation for borrowed money beyond any
period of grace provided with respect thereto if the effect of such default is
to cause, or permit the holder or holders of such obligation (or trustee on
behalf of such holder or holders) to cause, such obligation to become due prior
to its stated maturity, except for obligations disputed in good faith if the
Bank is promptly notified thereof and, if required by GAAP, funded reserves are
established; or

 

(c) if any statement, representation or warranty made by the Borrower, any
Subsidiary or the Guarantor herein or in any writing now or hereafter furnished
in connection with or pursuant to the Loan Documents or in connection with any
audit shall be false in any material respect as of the date made; or

 

(d) (i) if any Event of Default occurs under any Loan Document; or (ii) if the
Borrower, any Subsidiary or the Guarantor defaults in the performance or
observance of any other agreement, covenant, term or condition contained herein
or in any other Loan Document and such default shall not have been remedied
within 30 days after written notice thereof is sent by the Bank to the Borrower
except, however, that an Event of Default shall not be deemed to have occurred
if the Borrower, the Subsidiary or the Guarantor, as the case may be, commences
to cure such default within such 30-day period and the Borrower, such Subsidiary
or the Guarantor, as the case may be, completes such cure within 60 days after
such notice; or

 

(e) If the Guarantor disputes, attempts to avoid or indicates its intent to seek
to avoid its obligations under the Guaranty; or

 

16

--------------------------------------------------------------------------------

(f) if the Borrower, the Guarantor or any Subsidiary makes an assignment for the
benefit of creditors or is generally not paying its debts as they become due; or

 

(g) if any order, judgment or decree is entered under the bankruptcy,
reorganization, compromise, arrangement, insolvency, readjustment of debt,
dissolution or liquidation or similar law of any jurisdiction adjudicating the
Borrower, the Guarantor or any Subsidiary, bankrupt or insolvent; or

 

(h) if the Borrower, the Guarantor, or any Subsidiary petitions or applies to
any tribunal for, or consents to, the appointment of a trustee, receiver,
custodian, liquidator, or similar official, of the Borrower, the Guarantor or
any Subsidiary or of any substantial part of the assets of the Borrower, the
Guarantor or any Subsidiary, or commences a voluntary case under the Bankruptcy
Code of the United States or any proceedings relating to the Borrower, the
Guarantor or any Subsidiary, under the bankruptcy, insolvency, or moratorium law
of any other jurisdiction, whether now or hereafter in effect; or

 

(i) if any such petition or application is filed, or any such proceedings are
commenced, against the Borrower, the Guarantor or any Subsidiary and if the
Borrower, the Guarantor or the Subsidiary by any act indicates its approval
thereof, consent thereto, or acquiescence therein, or an order is entered in an
involuntary case under the Bankruptcy Code of the United States, or an order,
judgment or decree is entered appointing any such trustee, receiver, custodian,
liquidator, or similar official, or approving the petition in any proceedings,
and such order remains unstayed and in effect for more than 60 days; or

 

(j) if any order is entered in any proceedings against the Borrower or the
Guarantor decreeing the dissolution or split-up of the Borrower or the Guarantor
or if the Borrower or the Guarantor dissolves (or is dissolved) or its existence
is terminated; or

 

(k) if any judgment or judgments are entered against the Borrower or the
Guarantor, or against the Property of any such Person, in an aggregate amount in
excess of: (i) $500,000.00 with respect to the Borrower; or (ii) $1,000,000.00
with respect to the Guarantor, that remains unvacated, unbonded, unstayed and
unsatisfied for a period of 45 days; or

 

(l) if any Event of Default resulting from the Borrower’s failure to make any
payment when due occurs under that certain Loan Agreement dated July 31, 2003,
between the Borrower and the Bank; or

 

(m) if any event of default occurs under any credit arrangements now existing or
hereafter entered into between the Guarantor and the Bank; or

 

(n) if the Guarantor’s Debt Rating, as determined by S&P, is lower, at any time,
then BBB-. Notwithstanding the foregoing, if, at any time, an S&P Debt Rating
for the

 

17

--------------------------------------------------------------------------------

Borrower is unavailable, then the Bank may use the Debt Rating of the Borrower
issued by Moody’s, if available, and it shall be an Event of Default is such
Debt rating issued by Moody’s is less than Baa3.

 

6.02 Default. A “Default” shall be deemed to have occurred hereunder if any
event or condition occurs that would constitute an Event of Default hereunder
upon the satisfaction of any requirement for notice or passage of time in
connection with such event or condition.

 

6.03 Remedies.

 

(a) During the continuation of any Default, the Bank shall have no obligation to
make advances hereunder or under any other Loan Document. If any Event of
Default shall occur, any obligation of the Bank to make advances hereunder or
under any Loan Document shall be terminated without notice to the Borrower. If
the Bank elects not to extend any further credit hereunder after the occurrence
of any Event of Default, the Bank shall notify the Borrower of such election as
promptly as practical after the date of such election. However, the Bank’s
failure to give any such notice shall not impair its rights hereunder, and the
Bank’s failure to give any such notice on one occasion shall not impair its
rights upon the occurrence of any subsequent Event of Default.

 

(b) Except as otherwise provided in section 6.04 below, upon the occurrence of
an Event of Default, the Bank shall provide written notice thereof to the
Guarantor. The Guarantor shall have five (5) business days (the “Guarantor Cure
Period”) from receipt of notice of such Event of Default to either (i) cure such
Event of Default, if such Event of Default is capable of being cured by the
Guarantor; or (ii) pay all amounts then outstanding under the Loan, including,
without limitation, all amounts due under the Line of Credit Note and each Term
Loan, together with all other Obligations of the Borrower to the Bank under this
Agreement or any of the other Loan Documents.

 

(c) Upon the expiration of the Guarantor Cure Period, if the Event of Default is
still continuing, the Bank may, by notice to the Borrower, effective upon
dispatch, declare the entire unpaid principal amount then outstanding under the
Loan Documents, all interest accrued and unpaid under the Loan Documents and all
other Obligations of the Borrower to the Bank under this Agreement or any of the
other Loan Documents to be forthwith due and payable. Thereupon, the then
outstanding principal amount under the Loan Documents, all accrued interest and
all such other Obligations shall become and be forthwith due and payable,
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived by the Borrower, and the Bank may immediately
enforce payment of all such amounts and exercise any or all of the rights and
remedies of the Bank under this Agreement and other Loan Documents, including
without limitation the right to resort to any or all collateral (if any)
securing any obligations under the Loan Documents and exercise any or all of the
rights of a secured party pursuant to the Uniform Commercial Code of Florida and
other applicable similar statutes in other jurisdictions.

 

18

--------------------------------------------------------------------------------

6.04 Termination of Rights to Advances; Automatic Acceleration. Notwithstanding
anything herein to the contrary, (a) the Borrower’s right, if any, to obtain any
additional advances or credit under the Loan Documents shall automatically
terminate upon the initiation against the Borrower or any Subsidiary of any
proceeding under the Federal Bankruptcy Code, or upon the occurrence of any
Event of Default described in subparagraphs (g), (h), (i), (j), or (k) of
Section 6.01, and (b) all Obligations shall automatically be and become
immediately due and payable, without any Guarantor Cure Period, upon the
occurrence of any Event of Default described in subparagraphs (h), (i), or (j)
of Section 6.01.

 

6.05 Additional Rights of Bank.

 

(a) The Borrower acknowledges that its timely and complete compliance with all
of the terms and conditions contained in the Loan Documents is a material
consideration for the Bank’s extension of the credit facilities evidenced by the
Loan Documents. In addition to all other rights and remedies that the Bank has
upon the occurrence of an Event of Default, the Bank, in its sole discretion,
may: (i) waive its rights resulting from such Event of Default; and (ii) charge
the Borrower a fee for such waiver, provided that such fee shall not exceed
0.10% of the face amount of the Line of Credit Note.

 

(b) The Borrower acknowledges that the Bank’s ability to monitor the loans
evidenced by the Loan Documents is dependent upon the Borrower’s providing all
financial statements and other information required in Section 3.01 hereof
within the time periods set forth in such section. In addition to all other
rights and remedies that the Bank has upon the occurrence of an Event of
Default, the Bank may by notice to the Borrower assess the Borrower a late fee
upon each failure by the Borrower to deliver financial statements or information
within the time periods set forth in Section 3.01 hereof (whether or not such
failure constitutes a Default or an Event of Default hereunder). The amount of
such late fee shall not exceed $1000.00. The Borrower shall pay such fee no
later than ten days after the Bank has notified the Borrower of such assessment.
The Bank may assess the late fee on successive occasions based upon any
successive failures to deliver financial statements or financial information
within the periods required herein. The Bank’s assessment of any such fee, and
the Borrower’s payment of the same, shall not be deemed to be a waiver of the
Borrower’s continuing obligation to provide financial statements and other
information required hereunder.

 

ARTICLE VII

MISCELLANEOUS

 

7.01 Expenses. The Borrower agrees to pay, and save the Bank harmless against
liability for the payment of, all reasonable out-of-pocket expenses arising in
connection with this transaction (including any renewals or modifications
relating hereto), including any state documentary stamp taxes or other taxes
(including interest and penalties, if any) that may be determined to be payable
in connection with the execution and delivery of any Loan Document or any
renewal or modification of

 

19

--------------------------------------------------------------------------------

any Loan Document, and the reasonable fees and expenses of the Bank’s counsel.
The Borrower acknowledges that it has participated with the Bank in establishing
the structure of this transaction and that it has independently determined the
amount of documentary stamp and other taxes due in connection herewith. The
Borrower has not relied upon representations of the Bank or its counsel in
calculating the amount of such taxes, and the Borrower shall be liable for any
additional taxes (including interest and penalties) that may be due in
connection with this transaction or any renewals hereof. If an Event of Default
shall occur, the Borrower shall also pay all of the Bank’s costs of collection
including reasonable Bank employee travel expenses, court costs and reasonable
fees of attorneys and legal assistants (whether incurred in connection with
trial or appellate proceedings). If the Borrower fails to pay any such expenses
within five (5) Business Days after the Bank makes demand therefore, the
Borrower authorizes the Bank to make advances under the Note and to debit its
deposit accounts (other than accounts maintained by the Borrower with the Bank
solely for payroll purposes and identified to the Bank as such) to pay all
expenses.

 

7.02 Survival of Representations and Warranties. All representations and
warranties contained herein or made in writing by the Borrower in connection
herewith shall survive the execution and delivery of the Loan Documents.

 

7.03 Successors and Assigns. All covenants and agreements in this Agreement
contained by or on behalf of any of the parties hereto shall bind and inure to
the benefit of the respective successors and assigns of the parties hereto
whether so expressed or not. The Borrower shall not be entitled to assign its
rights hereunder. The Bank may, without the Borrower’s consent, assign all or
part of its rights hereunder or grant participations herein; provided, however,
that no participant shall have any rights against the Borrower unless the Bank
has failed to exercise its rights hereunder upon the occurrence of a Default or
Event of Default. The Bank may disclose to any such assignee or participant (or
any prospective assignee or participant) such information concerning the
Borrower and its Affiliates as the Bank deems appropriate.

 

7.04 No Third Party Beneficiaries. The Guarantor is not a third party
beneficiary to this Loan Agreement and, in addition to the rights of the Bank
set forth in the Guaranty, the Bank, with the concurrence of the Borrower, shall
have the right without impairing the liability of the Guarantor, to alter and
amend this Loan Agreement without notice to or consent by the Guarantor.

 

7.05 Notices. All communications, notices or demands provided for hereunder or
under any other Loan Document to which the Borrower is a party shall be sent by
first class mail, by courier, by hand or by certified mail as follows or to such
other address with respect to any party as such party shall notify the others in
writing:

 

To the Bank:

  

Bank of America, N.A.

9000 Southside Blvd., Bldg. 100

Jacksonville, Florida 32256

Attn: Commercial Client & Credit Services

 

20

--------------------------------------------------------------------------------

To the Borrower:    First Advantage Holding, Inc.

 

One Progress Plaza, Suite 2400

 

St. Petersburg, Florida 33701

 

Attn: Chief Financial Officer and General Counsel

 

with copy to: The First American Corporation

 

1 First American Way

 

Santa Ana, California 92707

 

Attn: Controller

 

If to the

Guarantor:              The First American Corporation

 

1 First American Way

 

Santa Ana, California 92707

 

Attn: Kenneth DeGiorgio, General Counsel

 

with copy to: Neil W. Rust, Esquire

 

White & Case LLP

 

633 West Fifth Street

 

Los Angeles, California 90071

 

Except as otherwise specifically set forth herein, each such communication,
notice or demand shall be deemed given: (i) three days after deposited in the
U.S. mail with proper postage affixed if sent by mail; or (ii) when actually
delivered to the appropriate address if sent by courier or by hand.
Notwithstanding the foregoing, failure to provide “copy to” notices set forth
above shall not affect the validity of the notices or prevent the Bank’s
enforcement of its rights and remedies hereunder.

 

7.06 Applicable Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Florida.

 

7.07 Headings. The descriptive section headings herein have been inserted for
convenience only and shall not be deemed to limit or otherwise affect the
construction of any provisions hereof.

 

7.08 Counterparts. This Agreement may be executed simultaneously in several
counterparts. Each counterpart shall be deemed an original.

 

7.09 Remedies Cumulative. All rights and remedies of the Bank hereunder are
cumulative and in addition to any rights and remedies that the Bank may have
under the laws of Florida. The Bank’s exercise of any one right or remedy
against one party hereto will not deprive the Bank of any right or remedy
against that party or any other parties hereto. No right, power or remedy
conferred upon or reserved to the Bank under this Agreement or any other of the
Loan Documents is exclusive of any other right, power or remedy in any of the
Loan Documents, but each and every such right, power and remedy shall be
cumulative and concurrent and shall be in addition to any other right,

 

21

--------------------------------------------------------------------------------

power and remedy given hereunder or under any other Loan Documents, or now or
hereafter existing at law, in equity or by statute.

 

7.10 Delay or Omission. No delay or omission of the Bank to exercise any right,
power or remedy under any of the Loan Documents or accruing upon any Event of
Default shall exhaust or impair any such right, power or remedy or shall be
construed to waive any such Event of Default or to constitute acquiescence
therein. Every right, power and remedy given to the Bank under any of the Loan
Documents may be exercised from time to time and as often as may be deemed
expedient by the Bank.

 

7.11 No Waiver of One Default to Affect Another. No waiver of any Default or
Event of Default hereunder shall extend to or affect any subsequent Default or
Event of Default or any other Default or Event of Default then existing, or
impair any rights, powers or remedies consequent thereon.

 

7.12 Changes. No term of any Loan Document may be changed, waived, discharged or
terminated orally, or by any action or inaction, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.

 

7.13 Severability. If any portion of any Loan Document is declared void by any
court as illegal or against public policy, the remainder of the Loan Documents
in question shall continue in full effect.

 

7.14 Lost or Damaged Note. Upon receipt by the Borrower of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of the Line of
Credit Note or any Term Note (each, a “Lost Note”) and of an indemnity agreement
reasonably satisfactory to the Borrower, the Borrower will make and deliver to
the Bank a new note of like tenor, date and principal amount in lieu of the Lost
Note.

 

7.15 Merger. This Agreement supersedes and replaces any commitment letter
relating to the Obligations. Except as otherwise expressly provided for in the
Loan Documents, no termination or cancellation (regardless of cause or
procedure) of the financing under this Agreement shall in any way affect or
impair the obligations, duties, and liabilities of the Borrower or the rights of
the Bank relating to any transaction or event occurring prior to such
termination. All indemnifications, warranties and representations contained in
the Loan Documents shall survive such termination or cancellation.

 

7.16 Arbitration. The parties agree to the following arbitration provisions:

 

(a) These arbitration provisions govern the resolution of any controversies or
claims between the Borrower and the Bank, whether arising in contract, tort or
by statute, including but not limited to controversies or claims (collectively,
a “Claim”) that arise out of or relate to: (i) this Loan Agreement (including
any renewals, restatements, extensions or modifications hereof); or (ii) any
document related to this Loan Agreement.

 

 

22

--------------------------------------------------------------------------------

(b) At the request of the Borrower or the Bank, any Claim shall be resolved by
binding arbitration in accordance with the Federal Arbitration Act (Title 9, U.
S. Code) (the “Arbitration Act”). The Arbitration Act will apply even though
this Loan Agreement provides that it is governed by the law of a specified
state. Arbitration proceedings will be determined in accordance with the
Arbitration Act, the rules and procedures for the arbitration of financial
services disputes of JAMS or any successor thereof (“JAMS”), and the terms of
this Section. In the event of any inconsistency, the terms of this Section shall
control. The arbitration shall be administered by JAMS and conducted in
Hillsborough County, Florida. All Claims shall be determined by one arbitrator.
However, if Claims exceed $1,000,000, upon the request of any party, the Claims
shall be decided by three arbitrators. All arbitration hearings shall commence
within 90 days of the demand for arbitration and close within 90 days of
commencement and the award of the arbitrator or arbitrators, as the case may be,
shall be issued within 30 days of the close of the hearing. However, the
arbitrator or arbitrators, as the case may be, upon a showing of good cause, may
extend the commencement of the hearing for up to an additional 60 days. The
arbitrator or arbitrators, as the case may be, shall provide a concise written
statement of reasons for the award. The arbitration award may be submitted to
any court having jurisdiction to be confirmed and enforced.

 

(c) The arbitrator(s) will have the authority to decide whether any Claim is
barred by the statute of limitations and, if so, to dismiss the arbitration on
that basis. For purposes of the application of the statute of limitations, the
service on JAMS under applicable JAMS rules of a notice of Claim is the
equivalent of the filing of a lawsuit. Any dispute concerning this arbitration
provision or whether a Claim is arbitrable shall be determined by the
arbitrator(s). The arbitrator(s) shall have the power to award legal fees
pursuant to the terms of this Loan Agreement.

 

(d) These arbitration provisions do not limit the right of the Borrower or the
Bank to: (i) exercise self-help remedies, such as but not limited to, setoff;
(ii) initiate judicial or nonjudicial foreclosure against any real or personal
property collateral; (iii) exercise any judicial or power of sale rights, or
(iv) act in a court of law to obtain an interim remedy, such as but not limited
to, injunctive relief, writ of possession or appointment of a receiver, or
additional or supplementary remedies.

 

(e) By agreeing to binding arbitration, the Borrower and the Bank irrevocably
and voluntarily waive any right they may have to a trial by jury in respect of
any Claim. Furthermore, without intending in any way to limit this agreement to
arbitrate, to the extent any Claim is not arbitrated, the parties irrevocably
and voluntarily waive any right they may have to a trial by jury in respect of
such Claim. This provision is a material inducement for the Borrower’s
executing, and the Bank’s accepting, this Loan Agreement. No provision in this
Loan Agreement or in any document related hereto regarding submission to
jurisdiction or venue in any court is intended or shall be construed to be in
derogation of the provisions of this Loan Agreement or in any such other
document for arbitration of any controversy or claim.

 

23

--------------------------------------------------------------------------------

7.17. NOTICE OF FINAL AGREEMENT. THIS WRITTEN LOAN AGREEMENT REPRESENTS THE
FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OR UNDERSTANDINGS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

24

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties hereto have signed and sealed this Agreement on
the day and year first above written.

 

FIRST ADVANTAGE CORPORATION, a Delaware corporation doing business in Florida as

FIRST ADVANTAGE HOLDING, INC.

By:

 

/s/ JOHN LAMSON

   

--------------------------------------------------------------------------------

Print Name:

 

John Lamson

   

--------------------------------------------------------------------------------

Its:

 

Chief Financial Officer

   

--------------------------------------------------------------------------------

BANK OF AMERICA, N.A.

By:

 

/s/ DAVID I. SUELLAU II

   

--------------------------------------------------------------------------------

Print Name:

 

David I. Suellau II

   

--------------------------------------------------------------------------------

Its:

 

Senior Vice President

   

--------------------------------------------------------------------------------

 

25

--------------------------------------------------------------------------------

APPENDIX I

 

The following terms when used in the Loan Agreement shall have the following
meanings:

 

“Affiliate” means any Person directly or indirectly controlling or controlled
by, or under direct or indirect common control with, another Person. A Person
shall be deemed to control another Person for the purposes of this definition if
such Person possesses, directly or indirectly, the power to direct, or cause the
direction of, the management and policies of the other Person, whether through
the ownership of voting securities, common directors, trustees or officers, by
conduct or otherwise.

 

“Bank” is defined in the introductory paragraph of the Loan Agreement.

 

“Borrower” is defined in the introductory paragraph of the Loan Agreement.

 

“Business Day” means each day other than a Saturday, a Sunday or any holiday on
which commercial banks in Jacksonville, Florida are closed for business.

 

“Capital Lease” means any lease of Property which in accordance with GAAP is
required to be capitalized on the balance sheet of the lessee.

 

“Capital Lease Obligation” means the amount of the liability shown on the
balance sheet of any Person in respect of a Capital Lease determined in
accordance with GAAP.

 

“Code” means the Internal Revenue Code of 1986, as amended, and any successor
statute thereto.

 

“Debt” means for any Person (without duplication): (a) all indebtedness of such
Person for borrowed money, whether current or funded, or secured or unsecured,
(b) all indebtedness for the deferred purchase price of Property or services,
(c) all indebtedness created or arising under any conditional sale or other
title retention agreement with respect to Property acquired by such Person (even
though the rights and remedies of the seller or lender under such agreement in
the event of a default are limited to repossession or sale of such Property),
(d) all indebtedness secured by a purchase money mortgage or other Lien to
secure all or part of the purchase price of Property subject to such mortgage or
Lien, (e) all obligations under leases that shall have been or must be, in
accordance with GAAP, recorded as Capital Leases with respect to which such
Person is liable as lessee, (f) any liability in respect of banker’s acceptances
or letters of credit, (g) any indebtedness, whether or not assumed, secured by
Liens on Property acquired by such Person at the time of

 

26

--------------------------------------------------------------------------------

acquisition thereof, (h) all indebtedness, whether or not for borrowed money,
represented by notes, drafts, bonds, debentures and similar instruments, and (i)
all indebtedness referred to in clause (a), (b), (c), (d), (e), (f), (g) or (h)
above which is directly or indirectly guaranteed by such Person or which such
Person has agreed (contingently or otherwise) to purchase or otherwise acquire
or in respect of which any of them have otherwise assured a creditor against
loss. Debt shall not, however, include trade payables arising in the ordinary
course of business that are not more than 90 days past due.

 

“Debt Rating” means, as of any date of determination, the rating as determined
by either S&P or Moody’s of the Borrower’s non-credit-enhanced debt.

 

“Default” is defined in Section 6.02 of the Loan Agreement.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
or any successor statute thereto.

 

“Event of Default” means any event or condition identified as such in Section
6.01 of the Loan Agreement.

 

“Funded Debt” is defined in Section 4.11(a) of the Loan Agreement.

 

“GAAP” means generally accepted accounting principles set forth from time to
time in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination.

 

“Guarantor” is defined in Section 1.03 of the Loan Agreement.

 

“Guaranty” is defined in Section 1.03 of the Loan Agreement.

 

“Lien” means any mortgage, lien, security interest, pledge, charge or
encumbrance of any kind in respect of any Property, including the interests of a
vendor or lessor under any conditional sale, Capital Lease or other title
retention arrangement.

 

“Line of Credit” is defined in Section 1.01(a) of the Loan Agreement.

 

“Line of Credit Note” is defined in Section 1.01(b) of the Loan Agreement

 

“Loan Agreement” or “this Agreement” shall mean the Loan Agreement to which this
Appendix is attached as such agreement may be amended or restated from time to
time.

 

27

--------------------------------------------------------------------------------

“Loan Documents” shall mean and include this Agreement (as amended from time to
time), the Line of Credit Note, each Term Note, any agreement pertaining to any
collateral, if any, securing the Loan, and all documents related to the
foregoing documents. Loan Documents shall also include all documents executed by
any Subsidiary in connection with the Loan on or after the date hereof.

 

“Lost Note” is defined in Section 7.14 of the Loan Agreement.

 

“Material Adverse Effect” means (a) a material adverse change in, or material
adverse effect upon, the operations, business, Property, or condition (financial
or otherwise) of the Borrower or of the Borrower and the Subsidiaries taken as a
whole, (b) a material impairment of the ability of the Borrower or any
Subsidiary to perform its obligations under any Loan Document, or (c) a material
adverse effect upon (i) the legality, validity, binding effect or enforceability
against the Borrower or any Subsidiary of any Loan Document or the rights and
remedies of the Bank thereunder or (ii) the perfection or priority of any Lien
on any collateral securing the Loan.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Notes” is defined in Section 1.03 of the Loan Agreement.

 

“Obligations” is defined in Section 1.04(a) of the Loan Agreement.

 

“PBGC” means the Pension Benefit Guaranty Corporation or any Person succeeding
to any or all of its functions under ERISA.

 

“Permitted Acquisition” shall mean any acquisition made in accordance with
Section 4.04(b) of the Loan Agreement.

 

“Permitted Liens” is defined in Section 4.01 of the Loan Agreement.

 

“Permitted Obligations” is defined in Section 4.02(a) of the Loan Agreement.

 

“Person” means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization or any other entity or
organization, including a government or agency or political subdivision thereof.

 

“Plan” means any employee pension benefit plan covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Code that
either (a) is maintained by the Borrower or any Subsidiary for employees of any
such Person or (b) is maintained pursuant to a collective bargaining agreement
or any other arrangement under which more than one employer makes contributions
and to which the Borrower or any Subsidiary is then making or accruing an
obligation to make contributions or has within the preceding five plan years
made contributions.

 

“Property” means any interest in any kind of property or asset, whether real,
personal or mixed, or tangible or intangible.

 

28

--------------------------------------------------------------------------------

“Revolving Period” is defined in Section 1.01(d) of the Loan Agreement.

 

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc. and any successor thereto.

 

“Solvent” is defined in Section 5.19 of the Loan Agreement.

 

“Subordinated Liabilities” means liabilities subordinated to Borrower’s
obligations to the Bank pursuant to: (a) a subordination agreement between the
Bank and the subordinate lender; or (ii) a subordination agreement between the
Borrower and the subordinate lender, under which the Bank is a third party
beneficiary with rights to enforce such subordination against the Borrower and
the subordinate lender and providing that: (i) upon the occurrence of an Event
of Default hereunder, the subordinate lender shall not accept any payments on
the subordinate indebtedness; and (ii) upon the occurrence of an Event of
Default hereunder, if the subordinated lender receives any payment on the
subordinated indebtedness, such payments shall be held in trust for the Bank and
shall be delivered to the Bank promptly after receipt of such payment.

 

“Subsidiary” means any corporation or other Person more than 50% of the
outstanding ordinary voting shares or other equity interests of which is at the
time directly or indirectly owned by the Borrower, by one or more of its
Subsidiaries, or by the Borrower and one or more of its Subsidiaries. All of the
Borrower’s Subsidiaries existing as of the date hereof are listed on Exhibit “C”
hereto.

 

“Term Note” is defined in Section 1.02 of the Loan Agreement

 

“Welfare Plan” means a “welfare plan” as defined in Section 3(1) of ERISA.

 

29

--------------------------------------------------------------------------------

EXHIBIT A

 

Obligor

--------------------------------------------------------------------------------

  

Lender

--------------------------------------------------------------------------------

  

Description

--------------------------------------------------------------------------------

First Advantage Corporation

   The First American Corporation    $10,000,000 Credit Line

First Advantage Corporation

   The First American Corporation    $20,000,000 Credit Line

US SEARCH. com, Inc.

   Comerica Bank    Line of Credit

First American Registry, Inc.

   IBM    Capital Lease

American Driving Records, Inc.

   California Bank and Trust    Standby Letter of Credit required by Louisiana
Dept. of Motor Vehicles

First Advantage Corporation

   David and Terry Karlman    Acquisition related indebtedness

First Advantage Corporation

   S.A.C. Capital Associates, LLC    Effective assumption of debt of acquisition
target

First Advantage Corporation

   Steven A. Cohen    Effective assumption of debt of acquisition target

First Advantage Corporation

   Gregory Pollack    Effective assumption of debt of acquisition target

First Advantage Corporation

   Dan and Joni Cates    Effective assumption of debt of acquisition target

First Advantage Corporation

   Aon Solutions    Effective assumption of debt of acquisition target

 

30

--------------------------------------------------------------------------------

First Advantage Corporation

   Lamar Stevens    Effective assumption of debt of acquisition target

First Advantage Corporation

   Patrick Ryan    Effective assumption of debt of acquisition target

 

31

--------------------------------------------------------------------------------

EXHIBIT B

 

Services Agreement between the Company and The First American Corporation

 

Amended and Restated Services Agreement, dated January 1, 2004, between the
Company and The First American Corporation

 

Service Agreement for End-User, effective December 31, 2003, by and between
First Advantage Enterprise Screening Corporation and The First American
Corporation

 

Agency/Company Agreement, effective January 1, 2003, between First American
Property & Casualty Insurance Company and Multifamily Community Insurance
Agency, Inc.

 

Profit Share Program letter, dated January 1, 2003, from First American Property
& Casualty Insurance Company to Multifamily Community Insurance Agency, Inc.

 

First Advantage Corporation $10,000,000 Line of Credit from The First American
Corporation

 

First Advantage Corporation $20,000,000 Line of Credit from The First American
Corporation

 

32

--------------------------------------------------------------------------------

EXHIBIT C

 

ARTICLE I. SUBSIDIARIES OF BORROWER

 

Agency Records, Inc. (“ARI”)

American Driving Records, Inc. (“ADR”)

ZapApp India Private Limited (co-owed by ADR & FAIH)

Background Information Systems, Inc. (“BIS”)

Credential Check & Personnel Services, Inc. (“CCPS”)

Employee Health Programs, Inc. (“EHP”)

Employee Health Programs (UK), Ltd. (wholly owned subsidiary of EHP)

Employee Information Services, Inc. (“EIS”)

First Advantage Enterprise Screening Corporation (“FAESC”)

First American Indian Holdings LLC (“FAIH”)

ZapApp India Private Limited (co-owed by ADR & FAIH)

First American Registry, Inc. (“Registry”)

Multifamily Community Insurance Agency, Inc. (wholly owned subsidiary of
Registry)

Greystone Health Sciences, Inc. (“GHS”)

HireCheck, Inc. (“HireCheck”) PartnerCheck, Inc. wholly owned subsidiary of
HireCheck)

Infocheck, Ltd. (“Infocheck”)

Liberatore Services, Inc. (“Liberatore”)

MVRS, Inc. (“MVRS”)

Med Tech Diagnostic Technologies, Inc. (“MDT”)

Omega Insurance Services, Inc. (“OIS”)

Pretiem, Inc. (“Pretiem”)

Proudfoot Reports Incorporated (“PRI”)

Quantitative Risk Solutions LLC (“QRS”)

SafeRent, Inc. (“SafeRent”)

Seconda LLC (Continental Compliance Services) (“CCS”)

Substance Abuse Management, Inc. (“SAMI”)

Total Information Source, Inc. (“TIS”)

US SEARCH.com, Inc. (“USS”)

Professional Resource Screening, Inc. (wholly owned subsidiary of USS)

 

33