exv10w2






EXHIBIT 10.2




FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




     THIS FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”),
dated as of May 27, 2009, is by and among PENSON WORLDWIDE, INC. a Delaware corporation (the
“Borrower”), each lender from time to time party hereto (collectively, the
“Lenders” and individually, a “Lender”), REGIONS BANK, as Administrative Agent (in
such capacity, the “Administrative Agent”), Swing Line Lender, and Letter of Credit Issuer,
GUARANTY BANK and REGIONS CAPITAL MARKETS, a division of Regions Bank, as Joint Lead Arrangers, and
GUARANTY BANK, as Syndication Agent (the “Syndication Agent”).



RECITALS:




     A. The Borrower, the Lenders and the Administrative Agent have entered into that certain
Amended and Restated Credit Agreement dated as of May 1, 2009 (as the same may be amended,
modified, supplemented or restated from time to time, the “Credit Agreement”).



     B. The Borrower, the Lenders, and the Administrative Agent now desire to amend the Credit
Agreement as provided herein.



     NOW, THEREFORE, in consideration of the premises herein contained and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:



ARTICLE I




Definitions




     Section 1.1 Definitions. Capitalized terms used in this Amendment, to the extent not
otherwise defined herein, shall have the same meanings as in the Credit Agreement, as amended
hereby.



ARTICLE II




Amendments




     Section 2.1 Amendments to Section 1.01 of the Credit Agreement.



     (a) Effective as of the date hereof, the following definitions shall be added to Section
1.01 of the Credit Agreement in alphabetical order to read in their entirety as follows:




     “Convertible Notes” means those certain convertible senior notes due 2014
issued pursuant to the Notes Offering in an aggregate principal amount of up to $75,000,000.




     “Indenture” means that certain Indenture by and between the Borrower and US
Bank, National Association, as Trustee, with respect to the Convertible Notes.



 









 






     “Notes Offering” means the issuance by the Borrower of the Convertible Notes
pursuant to the Indenture and the Offering Memorandum.




     “Notes Offering Documents” means the Convertible Notes and the Indenture.




     “Offering Memorandum” means that certain Offering Memorandum issued by the
Borrower with respect to the sale of the Convertible Notes.



     (b) Effective as of the date hereof, the paragraph containing the definition of “Consolidated
Fixed Charge Coverage Ratio” in Section 1.01 of the Credit Agreement shall be amended to
read in its entirety as follows:




     “Consolidated Fixed Charge Coverage Ratio” means, at any date of determination,
the ratio of (a) Consolidated EBITDA, to (b) the sum of (i) Interest Charges, (ii) the
aggregate principal amount of all regularly scheduled principal payments or redemptions or
similar acquisitions for value of outstanding debt for borrowed money, it being understood
the Total Outstandings hereunder shall be assumed to be amortized over a five year period
solely in order to calculate scheduled payments of the Loans and (iii) the aggregate amount
of Federal, state, local and foreign income taxes paid in cash, in each case, of or by the
Borrower and its Subsidiaries for the most recently completed period of determination;
provided, however, that for purposes of calculating the Consolidated Fixed
Charge Coverage Ratio, Interest Charges with respect to the Convertible Notes shall be
limited to interest paid in cash for such period.



     (c) Effective as of the date hereof, the paragraph containing the definition of “Disposition”
or “Dispose” in Section 1.01 of the Credit Agreement shall be amended to read in its
entirety as follows:




     “Disposition” or “Dispose” means the sale, transfer, license, lease or
other disposition (including any sale and leaseback transaction) of any property by any
Person, including any sale, assignment, transfer or other disposal, with or without
recourse, of any notes or accounts receivable or any rights and claims associated therewith;
provided, however, that the Notes Offering and the conversion of Convertible
Notes shall not be considered a Disposition.



     (d) Effective as of the date hereof, the paragraph containing the definition of “Investment”
in Section 1.01 of the Credit Agreement shall be amended to read in its entirety as
follows:




     “Investment” means, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other acquisition of
capital stock or other securities of another Person, (b) a loan, advance or capital
contribution to, Guarantee or assumption of debt of, or purchase or other acquisition of any
other debt or equity participation or interest in, another Person, including any partnership
or joint venture interest in such other Person and any arrangement pursuant to which the
investor Guarantees Indebtedness of such other Person, or (c) the purchase or other
acquisition (in one transaction or a series of transactions) of assets of another Person
that constitute a business unit; provided, however, that the Notes Offering
and the



 









 







conversion of Convertible Notes shall not be considered an Investment. For purposes of
covenant compliance, the amount of any Investment shall be the amount actually invested,
without adjustment for subsequent increases or decreases in the value of such Investment.



     Section 2.2 Amendment to Section 2.05(f) of the Credit Agreement. Effective as of the
date hereof, Section 2.05(f) of the Credit Agreement is amended to read in its entirety as
follows:




     (f) Upon the issuance and sale of any Equity Interests by the Borrower or any
Subsidiary as permitted in Section 7.06(d) (other than (i) the issuance and sale of
JBO Stock consistent with historical practice of the Borrower and (ii) the issuance and sale
of Equity Interests in connection with the Notes Offering and the conversion of Convertible
Notes), 100% of the Net Cash Proceeds shall be immediately paid to the Administrative Agent
to be applied to the Loans, and the Total Commitments shall be permanently reduced by the
amount of the Net Cash Proceeds of such issuance. The provisions of this Section do not
constitute a consent to the issuance and sale of any Equity Interests not otherwise
permitted in Section 7.06.



     Section 2.3 Amendment to Section 6.03(f) of the Credit Agreement. Effective as of the
date hereof, Section 6.03(f) of the Credit Agreement is amended to read in its entirety as
follows:




     (f) of the sale by the Borrower of any of its capital stock or other Equity Interest
(other than (a) as contemplated under the 2000 Stock Incentive Plan or securities issued
upon exercise of stock options issued to employees, directors or contractors of the Borrower
or its Subsidiaries, or (b) any conversion of Convertible Notes representing less than 50%
in the aggregate of the aggregate principal amount of all Convertible Notes issued pursuant
to the Notes Offering; provided, however, at the request of the
Administrative Agent, the Borrower shall provide any information regarding such sales to the
Administrative Agent);



     Section 2.4 Amendment to Section 7.03(f) of the Credit Agreement. Effective as of the
date hereof, Section 7.03(f) of the Credit Agreement is amended by removing the “and” at
the end thereof.



     Section 2.5 Amendment to Section 7.03(g) of the Credit Agreement. Effective as of the
date hereof, Section 7.03(g) of the Credit Agreement is amended to delete the “.” at the
end thereof and substituting “; and” in lieu thereof.



     Section 2.6 Amendment to Section 7.03 of the Credit Agreement. Effective as of the
date hereof, Section 7.03 of the Credit Agreement is amended to add a new Section
7.03(h) to read in its entirety as follows:




     (h) Indebtedness associated with the Notes Offering Documents.



 









 





     Section 2.7 Amendment to Section 7.06(e) of the Credit Agreement. Effective as of the
date hereof, Section 7.06(e) of the Credit Agreement is amended by removing the “and” at
the end thereof.



     Section 2.8 Amendment to Section 7.06(f) of the Credit Agreement. Effective as of the
date hereof, Section 7.06(f) of the Credit Agreement is amended to delete the “.” at the
end thereof and substituting “;” in lieu thereof.



     Section 2.9 Amendment to Section 7.06 of the Credit Agreement. Effective as of the
date hereof, Section 7.06 of the Credit Agreement is amended to add a new Section
7.06(g) to read in its entirety as follows:




     (g) the Borrower may issue Equity Interests in connection with the Notes Offering and
the conversion of Convertible Notes; and



     Section 2.10 Amendment to Section 7.06 of the Credit Agreement. Effective as of the
date hereof, Section 7.06 of the Credit Agreement is amended to add a new Section
7.06(h) and a new Section 7.06(i) to read in their entirety as follows:




     (h) the Borrower may make Restricted Payments in connection with the Convertible Notes
pursuant to the terms of the Notes Offering Documents; and




     (i) the Borrower and its Subsidiaries may make cash payments in lieu of fractional
entitlements to securities or may round fractional entitlements to a whole security.



     Section 2.11 Amendment to Section 7.13 of the Credit Agreement. Effective as of the
date hereof, Section 7.13 of the Credit Agreement is amended to read in its entirety as
follows:



     7.13 Prepayment of Indebtedness. Prepay any Indebtedness other than (a) the
Obligations, (b) Indebtedness under the Notes Offering Documents, or (c) other Indebtedness
not to exceed $20,000,000 in the aggregate during any fiscal year; provided,
however, that the conversion of Convertible Notes shall not be considered a
prepayment under this Section 7.13.



     Section 2.12 Amendment to Section 7.16(c) of the Credit Agreement. Effective as of
the date hereof, Section 7.16(c) of the Credit Agreement is amended to read in its entirety
as follows:




     (c) Consolidated Leverage Ratio. Permit the Consolidated Leverage Ratio as of
the end of any fiscal quarter measured quarterly in arrears on a rolling four quarter basis
to be greater than *** to ***.



     Section 2.13 Addition of Section 7.18 to the Credit Agreement. Effective as of the
date hereof, a new Section 7.18 is added to the Credit Agreement after Section 7.17
to read in its entirety as follows:



 









 






     7.18 Amendments to Notes Offering Documents. Amend, supplement or otherwise modify the
material terms of the Notes Offering Documents if such amendment, supplement, or
modification would materially and adversely impact the Lenders.



     Section 2.14 Amendment to Section 8.01(k) of the Credit Agreement. Effective as of
the date hereof, Section 8.01(k) of the Credit Agreement is amended to delete the “.” at
the end thereof and substituting “; or” in lieu thereof.



     Section 2.15 Amendment to Section 8.01 of the Credit Agreement. Effective as of the
date hereof, Section 8.01 of the Credit Agreement is amended to add a new Section
8.01(j) to read in its entirety as follows:




     (j) There occurs any Fundamental Change as defined in the Indenture.



     Section 2.16 Amendment to Schedule 5.05 to the Credit Agreement. Effective as of the
date hereof, Schedule 5.05 to the Credit Agreement is amended to add “The Convertible
Notes” thereto.



ARTICLE III




Conditions Precedent to Effectiveness




     Section 3.1 Conditions. The effectiveness of this Amendment is subject to the full
satisfaction of each of the following conditions precedent:



     (a) Documents. The Administrative Agent shall have received all of the following, in
form and substance satisfactory to the Administrative Agent:




     (i) Amendment. Executed counterparts of this Amendment, sufficient in number
for distribution to the Administrative Agent, each Lender and the Borrower.




     (ii) Notes Offering Documents. A copy of each Notes Offering Document, such
documents to be satisfactory to the Administrative Agent and the Required Lenders.




     (iii) Closing of Notes Offering. Evidence that all conditions precedent to the
closing of the Notes Offering shall have been completed.




     (iv) Amendment Fee. Payment of an amendment fee in the amount of $175,000.00.




     (v) Other Fees. Any fees required to be paid on or before the date hereof
shall have been paid, including those fees required to be paid in that certain Fee Letter
dated as of May 22, 2009 between the Borrower and the Administrative Agent.




     (vi) Additional Information. Such additional documents, instruments and
information as the Administrative Agent, the Letter of Credit Issuer, the Swing Line Lender
or the Required Lenders reasonably may require.



 









 





     (b) No Default or Event of Default. No Default shall exist or would result from the
execution of this Amendment.



     (c) No Material Adverse Effect. Since the date of the most recent financial
statements delivered by the Borrower to the Administrative Agent, no event or circumstance has
occurred that has had or would be reasonably expected to have, either individually or in the
aggregate, a Material Adverse Effect.



     (d) Representations and Warranties. All of the representations and warranties
contained in Article V of the Credit Agreement as amended hereby and in the other Loan
Documents shall be true and correct on and as of the date hereof, with the same force and effect as
if such representations and warranties had been made on and as of the date hereof, except to the
extent that such representations and warranties specifically refer to an earlier date, in which
case they shall be true and correct as of such earlier date.



ARTICLE IV




No Waiver




     Section 4.1 No Waiver. Nothing contained herein shall be construed as a waiver by the
Administrative Agent or any Lender of any covenant or provision of the Credit Agreement, this
Amendment, or any other Loan Document, or of any other contract or instrument between the Borrower
and the Administrative Agent and/or the Lenders, and the failure of the Administrative Agent and/or
any Lender at any time or times hereafter to require strict compliance by the Borrower of any
provision thereof shall not waive, affect or diminish any right of the Administrative Agent or any
Lender to thereafter demand strict compliance therewith. The Administrative Agent and the Lenders
hereby reserve all rights granted under the Credit Agreement, this Amendment, the other Loan
Documents and any other contract or instrument between the Borrowers and the Administrative Agent
and/or the Lenders.



ARTICLE V




Ratifications, Representations and Warranties




     Section 5.1 Ratifications. The terms and provisions set forth in this Amendment shall
modify and supersede all inconsistent terms and provisions set forth in the Credit Agreement and
except as expressly modified and superseded by this Amendment, the terms and provisions of the
Credit Agreement are ratified and confirmed and shall continue in full force and effect. The
Borrower, the Administrative Agent and the Lenders agree that the Credit Agreement as amended
hereby shall continue to be legal, valid, binding and enforceable in accordance with its terms.



     Section 5.2 Representations and Warranties. The Borrower hereby represents and
warrants to the Administrative Agent and each Lender that (a) the representations and warranties
contained in the Credit Agreement, as amended hereby, and any other Loan Document are true and
correct on and as of the date hereof as though made on and as of the date hereof, except to the
extent that such representations and warranties specifically refer to an earlier date, in which



 









 







case they shall be true and correct as of such earlier date, and (b) no Default has occurred
and is continuing.



ARTICLE VI




Miscellaneous




     Section 6.1 Survival of Representations and Warranties. All representations and
warranties made in this Amendment or any other Loan Document including any Loan Document furnished
in connection with this Amendment shall survive the execution and delivery of this Amendment and
the other Loan Documents, and no investigation by the Administrative Agent or any Lender or any
closing shall affect the representations and warranties or the right of the Administrative Agent or
any Lender to rely upon them.



     Section 6.2 Reference to Agreement. Each of the Loan Documents, including the Credit
Agreement and any and all other agreements, documents, or instruments now or hereafter executed and
delivered pursuant to the terms hereof or pursuant to the terms of the Credit Agreement as amended
hereby, are hereby amended so that any reference in such Loan Documents to the Credit Agreement
shall mean a reference to the Credit Agreement as amended hereby. This Amendment is a Loan
Document.



     Section 6.3 Severability. Any provision of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder
of this Amendment and the effect thereof shall be confined to the provision so held to be invalid
or unenforceable.



     Section 6.4 APPLICABLE LAW. THIS AMENDMENT AND ALL OTHER LOAN DOCUMENTS EXECUTED
PURSUANT HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE PERFORMABLE IN TEXAS AND SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.



     Section 6.5 Successors and Assigns. This Amendment is binding upon and shall inure to
the benefit of the parties hereto and their respective successors and assigns, except the Borrower
may not assign or transfer any of its rights or obligations hereunder without the prior written
consent of the Administrative Agent and each Lender.



     Section 6.6 Counterparts. This Amendment may be executed in one or more counterparts
and by different parties on separate counterparts, each of which when so executed shall be deemed
to be an original, but all of which when taken together shall constitute one and the same
instrument. Delivery of an executed counterpart of any signature pages hereto by telecopy, e-mail
or other electronic transmission shall be effective as delivery of originally executed signature
pages.



     Section 6.7 Effect of Waiver. No consent or waiver, express or implied, by the
Administrative Agent and the Lenders to or for any breach of or deviation from any covenant,
condition or duty by the Borrower shall be deemed a consent or waiver to or of any other breach of
the same or any other covenant, condition or duty.



 









 





     Section 6.8 Headings. The headings, captions, and arrangements used in this Amendment
are for convenience only and shall not affect the interpretation of this Amendment.



     Section 6.9 ENTIRE AGREEMENT. THIS AMENDMENT AND THE OTHER LOAN DOCUMENTS REPRESENT
THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS AMONG THE PARTIES.



[Remainder of the Page Intentionally Left Blank. Signature Pages to Follow.]




 









 





     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of
the date first above written.




	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	PENSON WORLDWIDE, INC.
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/  Philip A. Pendergraft
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Philip A. Pendergraft
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:
	 	Chief Executive Officer
	 

	 	 	 	 	 	 





SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT

















 





	 	 	 	 	 	 	 
	 	 	REGIONS BANK,
as Administrative Agent, a Lender, Letter of Credit
 Issuer and Swing Line Lender

	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Robin Ingari
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Robin Ingari
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:
	 	Senior Vice President
	 

	 	 	 	 	 	 





SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
















 





	 	 	 	 	 	 	 
	 	 	GUARANTY BANK, as a lender
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Amanda Cone
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Amanda Cone
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:
	 	Senior Vice President
	 

	 	 	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT















 





	 	 	 	 	 	 	 
	 	 	 CAPITAL ONE, N.A., as a Lender 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jacob Villere
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Jacob Villere
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:
	 	Vice President
	 

	 	 	 	 	 	 







SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




















 





	 	 	 	 	 	 	 
	 	 	TEXAS CAPITAL BANK, NATIONAL
ASSOCIATION, as a Lender
	 
	 	 	 	 	 	 
	 	 	
	 

	 	By:
	 	/s/ Steve Bryan
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Steve Bryan
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:
	 	Vice President
	 

	 	 	 	 	 	 






SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT