DEBT.
CREATE, INCUR, ASSUME OR HAVE
OUTSTANDING ANY INDEBTEDNESS, EXCEPT FOR: (I) INDEBTEDNESS OWING TO LENDER;
(II) INDEBTEDNESS INCURRED BY BORROWER IN THE ORDINARY COURSE OF BUSINESS
(INCLUDING PURSUANT TO APPLICABLE SBA RULES AND REGULATIONS), OTHER THAN
INDEBTEDNESS FOR BORROWED MONEY; (III) INDEBTEDNESS TO ASBA UNDER THE ASBA NOTE,
(IV) INDEBTEDNESS TO FIRSTCITY FINANCIAL WITH RESPECT TO THE FIRSTCITY DEBT, AND
(V) SUBORDINATED DEBT ACCEPTABLE TO LENDER.
6.2
LOANS AND DISTRIBUTIONS.
MAKE ANY LOANS,
DIVIDENDS OR OTHER DISTRIBUTIONS, PAYMENTS, OR ADVANCES OF MONEY AND/OR
EXTENSIONS OF CREDIT TO ANY PERSONS, INCLUDING OFFICERS, DIRECTORS, EMPLOYEES,
STOCKHOLDERS, OR AFFILIATES AND SUBSIDIARIES OF BORROWER, OTHER THAN (A)
REASONABLE ADVANCES MADE IN THE ORDINARY COURSE OF BUSINESS ON ACCOUNT OF
SALARY, COMMISSIONS, AND ROUTINE TRAVEL AND BUSINESS EXPENSES, (B) LOANS MADE IN
THE ORDINARY COURSE OF BUSINESS TO TERM LOAN DEBTORS, (C) PAYMENTS TO ASBA
REQUIRED TO BE MADE UNDER THE ASBA NOTE OR THE ASBA SECURITY AGREEMENT, SO LONG
AS SUCH PAYMENTS ARE MADE SOLELY FROM THE PROCEEDS OF THE SERVICED ASBA ASSETS,
(D) PAYMENTS TO FIRSTCITY FINANCIAL OF REGULARLY SCHEDULED MONTHLY PAYMENTS OF
INTEREST WITH RESPECT TO THE FIRSTCITY DEBT, (E) PAYMENTS TO FIRSTCITY FINANCIAL
FOR CORPORATE OVERHEAD EXPENSES CHARGED TO BORROWER IN AMOUNTS NOT EXCEEDING
THOSE PERMITTED UNDER SECTION 4.16 OF THE ASSET PURCHASE AGREEMENT OR TO
FIRSTCITY SERVICING CORPORATION FOR SERVICES PROVIDED UNDER THE SERVICING
AGREEMENT, EACH AS IN EFFECT ON THE CLOSING DATE, AND (F) OUT OF FUNDS LEGALLY
AVAILABLE THEREFOR, THE REGULARLY SCHEDULED DIVIDENDS TO WHICH THE HOLDERS OF
BORROWER'S PREFERRED STOCK ARE ENTITLED PURSUANT TO BORROWER'S CERTIFICATE OF
FORMATION AS IN EFFECT ON THE CLOSING DATE, SO LONG AS IN THE CASE OF ANY
PAYMENT DESCRIBED IN CLAUSES (D), (E), OR (F) ABOVE (I) NO DEFAULT OR EVENT OF
DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING OR WOULD
46
OCCUR AS A RESULT THEREOF, AND (II)
SUCH PAYMENT IS PERMITTED UNDER APPLICABLE
SBA RULES AND REGULATIONS.
6.3
LIENS.
EXCEPT AS OTHERWISE EXPRESSLY
PERMITTED HEREIN OR IN THE OTHER LOAN DOCUMENTS, ENCUMBER, PLEDGE, MORTGAGE, OR
GRANT A SECURITY INTEREST IN (EXCEPT FOR PERMITTED LIENS), OR ASSIGN, SELL
(EXCEPT FOR THE SALE OF SBA GUARANTEED NOTES RECEIVABLE, THE SALE OF
NON-GUARANTEED PARTICIPATIONS IN PARTICIPATED NOTES RECEIVABLE, THE SALE TO SBA
OF THE NON-GUARANTEED NOTE RECEIVABLE PORTION OF ANY NOTE RECEIVABLE WITH
RESPECT TO WHICH SBA ALSO HOLDS THE SBA GUARANTEED NOTE RECEIVABLE PORTION
THEREOF, AND PURSUANT TO ANY SECURITIZATION TRANSACTION, EACH TO THE EXTENT
PERMITTED BY SECTION 6.13, AND THE SALE OF OTHER PROPERTY IN THE ORDINARY COURSE
OF BUSINESS), LEASE OR OTHERWISE DISPOSE OF OR TRANSFER, WHETHER BY SALE,
MERGER, CONSOLIDATION, LIQUIDATION, DISSOLUTION, OR OTHERWISE, ANY OF THE
COLLATERAL; PROVIDED, THAT THE FOREGOING SHALL NOT PROHIBIT BORROWER FROM
DEALING WITH THE COLLATERAL CONSISTING OF THE UNDERLYING COLLATERAL FOR THE
SBA 7(A) LOANS GRANTED TO BORROWER TO SECURE THE OBLIGATIONS OF THE TERM LOAN
DEBTORS IN THE ORDINARY COURSE OF ITS BUSINESS AND IN ACCORDANCE WITH SBA RULES
AND REGULATIONS.
6.4
CAPITAL EXPENDITURES.
MAKE CAPITAL
EXPENDITURES (INCLUDING CAPITALIZED