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Exhibit 10.13
SECOND AMENDMENT TO CREDIT AGREEMENT
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THIS SECOND AMENDMENT TO CREDIT AGREEMENT (the "Second Amendment") is
entered into by and among ESSEF CORPORATION, an Ohio corporation ("Essef"),
PAC-FAB, INC., a Delaware corporation ("Pac-Fab"), ENPAC CORPORATION, a Delaware
corporation ("Enpac"), XXXXXXX TECHNOLOGY CORPORATION (f/k/a FAME Plastics,
Inc.), a North Carolina corporation ("Xxxxxxx"), PUREX POOL SYSTEMS, INC., a
Delaware corporation ("Purex"), XXXXXX BROTHERS ALUMINUM FOUNDRY AND MOULD
WORKS, INC., an Ohio corporation ("Xxxxxx"; sometimes Xxxxxx, Essef, Pac-Fab,
Enpac, Xxxxxxx, and Purex collectively may be called "Borrowers" or individually
"Borrower"), SOCIETY NATIONAL BANK ("Society"), BRANCH BANKING AND TRUST COMPANY
("BBT"), and NBD BANK, N.A. ("NBD"; sometimes Society, BBT, and NBD collectively
may be called "Banks" and individually "Bank"), and SOCIETY NATIONAL BANK as
agent for Banks ("Agent").
RECITALS
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A. On March 1, 1994, Borrowers, Banks and Agent
entered into a certain Credit Agreement (the "Credit Agreement"; all terms
defined therein being used in this Second Amendment with the same meaning unless
otherwise stated), under the provisions of which Banks agreed to provide to
Borrowers a revolving credit facility in the maximum aggregate amount of
$33,000,000, an acquisition-related line of credit in the maximum aggregate
amount of $10,000,000 and an additional term loan facility in the maximum
aggregate amount of $10,000,000.
B. Effective January 3, 1995, Borrowers, Banks and
Agent entered into the First Amendment to Credit Agreement (the "First
Amendment") to (1) reduce the Applicable Base Rate Margin applicable to the
Revolving Loans, the Acquisition Term Loans and the Purex Division Term Loan,
and (2) reduce the Applicable LIBOR Loan Margin applicable to the Revolving
Loans, the Acquisition Term Loans and the Purex Division Term Loan.
C. Borrowers and Banks now desire to amend the Credit
Agreement to (1) extend the Commitment Period for the Revolving Loans, the
Acquisition Term Loans and the Purex Division Term Loan, (2) reduce the
Applicable LIBOR Loan Margin applicable to the Revolving Loans, the Acquisition
Term Loans and the Purex Division Term Loan.
PROVISIONS
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NOW, THEREFORE, in consideration of the foregoing and the following
provisions, the parties agree as follows:
Section I. AMENDMENTS TO CREDIT AGREEMENT.
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The Credit Agreement is amended as follows:
1. On and after the effective date of this Second
Amendment, each reference in the Credit Agreement and this Second Amendment to
"this Agreement," "hereunder," and "hereof," or words of like import
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referring to the Credit Agreement, shall mean and refer to the Credit Agreement
as amended by the First Amendment and the Second Amendment. The Credit
Agreement, as amended, is, and shall continue to be, in full force and effect
and hereby is ratified and confirmed in all respects.
2. The definition of "Applicable LIBOR Loan
Margin" set forth in Section 1.8 of the Credit Agreement, as amended, is
amended and restated in its entirety as follows:
1.8. APPLICABLE LIBOR LOAN MARGIN. The Applicable LIBOR Loan Margin
applicable to (a) the Revolving Loans, (b) the Acquisition Term Loans and
(c) the Purex Division Term Loan shall be 100 basis points above Adjusted
LIBOR.
3. The definition of "Commitment Period" set forth
in Section 1.20 of the Credit Agreement, as amended, is amended and restated
in its entirety as follows:
1.20. COMMITMENT PERIOD. The Commitment Period applicable to
(a) the Revolving Loans shall be the period from th e
Effective Date of this Agreement to and including January 31, 1998;
provided, however, that, upon delivery by Borrowers to Agent of each of
Essef's Form 10-K and audited financial statements for the fisc al year
ending immediately prior to the year for which such extension is being
requested, Borrowers may by written notice to each Bank request a one (1)
year extension of this Agreement, in which case such extension will be
permitted in the event each Bank agrees to such extension; and
(b) the Acquisition Line of Credit shall be the period
from the Effective Date of this Agreement to and including January 31,
1998; provided, however, that, upon delivery by Borrowers to Agent of
each of Essef's Form 10-K and audited financial statements for the fiscal
ye ar ending immediately prior to the year for which such extension is
being requested, Borrowers may by written notice to each Bank request a
one (1) year extension of this Agreement, in which case such extension
will be permitted in the event each Bank agrees to such extension.
4. The definition of "Letters of Credit" in
Section 1.33 of the Credit Agreement, as amended, is amended and restated in
its entirety as follows:
1.33. LETTERS OF CREDIT. Standby Letters of Credit provided
to one or more Borrowers by a Letter of Credit Bank in such form as
Borrowers and the Letter of Credit Bank may agree, b ut in no case having
a final expiration date later than January 31, 1998. Each Letter of
Credit issued by a Letter of Credit Bank shall identify (a) the
respective dates of issuance and expiration of such Letter of Credit, (b)
the amount of such Letter of Credit (which shall be a sum certain), (c)
the beneficiary and account party of such Letter of Credit, and (d) the
drafts and other documents necessary to be presented to the Letter of
Credit Bank upon a drawing under such Letter of Credit.
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5. Section 2.1(a)(i) of the Credit Agreement, as
amended, is amended and restated in its entirety as follows:
(i) BASE LENDING RATE REVOLVING LOANS OR LIBOR REVOLVING LOANS. The
Borrowers shall have the option, subject to the provisions set forth in
this Agreement, to borrow under this Agreement, repay the same in w hole
or in part, and re-borrow again at any time and from time to time, an
amount up to the amount of the Commitment less the outstanding amounts of
standby Letters of Credit issued by the Letter of Credit Bank (with such
Letters of Credit not to exceed a maximum of $1,000,000) for the benefit
of Borrowers (the "Revolving Loans"). Subject to the provisions of this
Agreement, the Revolving Loans shall become due and payab le in full on
January 31, 1998. The outstanding principal balance of the Revolving
Loans shall bear interest at a rate per annum which shall be the Base
Lending Rate from time to time in effect plus the Applicable Base Rate
Margin, or at a rate per annum which shall be equal to Adjusted LIBOR
plus the Applicable LIBOR Loan Margin.
6. Section 2.1(a)(v) of the Credit Agreement, as
amended, is amended and restated in its entirety as follows:
(v) ISSUANCE OF NOTES. The obligation of Borrowers to repay the
Revolving Loans made by each Bank to Borrowers and to pay interest on
such Revolving Loans shall be evidenced by the Revolving Loan Note s of
Borrowers dated March 1, 1994, as amended and restated by the Amen ded
and Restated Revolving Loan Notes substantially the form of EXHIBITS
(A)(1)-(3) attached to the Second Amendment to Credit Agreement dated
March 26, 1996, with appro- priate insertions, and payable to the order
of such Bank on January 31, 1998 in the principal amount of its Revolving
Loan Commi tment or, if less, the aggregate unpaid principal amount of
the Revolving Loans made to Borrowers by each Bank.
7. Section 2.1(b)(iv) of the Credit Agreement, as
amended, is amended and restated in its entirety as follows:
(iv) ISSUANCE OF ACQUISITION TERM LOAN NOTES. The obligation of
Borrowers to repay each Acquisition Term Loan made by each Bank to
Borrowers, and to pay interest on such Acquisition Term Loan, shall be
evidenced by an Acquisition Term Loan Note of Borrowers in substantially
the form of EXHIBITS (B)(1)-(3) attached to the Second Amendment to
Credit Agreement dated March 26, 1996, with appro- priate insertions,
dated the date such Acquisition Term Loan is made and payable to the
order of such Bank in the principal amount of such Bank's pro rata share
of such acquisition Term Loan (determined in accordance with SCHEDULE A).
The principal amount of such Acquisition Term Loan Note shall be repaid
in equal consecutive quarterly installments, commencing on the last day
of the third month following the month in which such Acqu isition Term
Loan is made to Borrowers, the amount of such quarterly p rincipal
payment to be determined by utilizing a four (4) year amortization
schedule; PROVIDED, however, that, subject to the provisions of this
Agreement, the unpaid principal balance outstanding on such Acquisition
Term Loan Note shall be due and payable on January 31, 1998.
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8. Section 2.1(c)(iv) of the Credit Agreement, as
amended, is amended and restated in its entirety as follows:
(iv) ISSUANCE OF THE PUREX DIVISION TERM LOAN NOTE. The obligation of
Borrowers to repay the Purex Division Term Loan made by each Ban k to
Borrowers, and to pay interest on such loan, shall be evidence d by the
Purex Division Term Loan Notes of Borrowers dated March 1, 1994, a s
amended and restated by the Amended and Restated Purex Division Term Loan
Notes in substantially the form of EXHIBITS (C)(1)-(3) attached to the
Second Amendment to Credit Agreement dated March 26, 1996, with
appropriate insertions and payable to the order of such Bank in the
principal amount of such Bank's pro rata share of such loan (determined
in accordance with SCHEDULE A). The principal amount of such note shall
be repaid in equal consecutive quarterly installments, commencing on the
last day of the third month following the month in which such loan is
made to Borrowers, the amount of such quarterly principal payment to be
determined by utilizing a seven (7) year amortization schedule; provided,
however, that, subject to the provisions of this Agreement, the unpaid
principal balance outstanding on such note shall be due and payable on
January 31, 1998.
9. Section 2.1(d) of the Credit Agreement, as
amended, is deleted in its entirety.
Section II. REPRESENTATIONS, WARRANTIES AND COVENANTS OF BORROWERS.
A. To the extent such representations, warranties and covenants pertain
to or are to be performed by Borrowers, all representations, warranties
and covenants in the Credit Agreement shall continue and be binding on
Borrower under this Second Amendment.
Section III. CONDITIONS PRECEDENT.
Borrowers acknowledge that the effectiveness of this Second Amendment is
subject to the receipt by Agent of the following documents on the date of this
Second Amendment, all in form and substance satisfactory to Agent and its
counsel:
A. The Second Amendment signed by a duly authorized officer of each
Borrower.
B. An executed copy of an Amended and Restated Revolving Loan Note
for each Revolving Loan of Borrowers in substantially the form of
EXHIBITS A(1)-(3) attached to this Second Amendment.
C. An executed copy of an Amended and Restated Purex Division Term
Loan Note for each Purex Division Term Loan of Borrowers in substantially
the form of EXHIBITS C(1)-(3) attached to this Second Amendment.
D. A certificate signed by a duly authorized officer of each
Borrower to the effect that:
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(a) As of the date hereof, no Possible Default exists.
(b) The representations and warranties of Borrowers set forth in the
Credit Agreement are true as of the date of this Second Amendment with
the same force and effect as i f made on the date of this Second
Amendment.
(C) Attached to such certificate is a certified copy of resolutions of
Members of the Board of Directors of each Borrower approving this Second
Amendment and all of the matters described in this Second Amendment, and
authorizing the execution, delivery and performance by each Borrower of
this Second Amendment and every other document required to be delivered
pursuant to this Second Amendment.
(d) Each Borrower's Articles (or Certificate) of Incorporation and Code
of Regulations (or Bylaws) have not been amended since the execution of
the Credit Agreement, and they continue to remain in full force and
effect as of the date of this Second Amendment.
(e) The officer signing certifies the incumbency and signatures of the
officers of each Borrower signing this Second Amendment and every other
document to be delivered pursuant to the Second Amendment.
E. Such other documents as Agent may reasonably request to implement
this Second Amendment and the transactions described in this Second
Amendment.
Section IV. APPLICABLE LAW.
This Second Amendment shall be deemed to be a contract under the laws of the
State of Ohio and, for all purposes, shall be construed in accordance with the
laws of such State.
Section V. COUNTERPARTS.
This Second Amendment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument, and any one
of the parties to this Second Amendment may execute this Second Amendment by
signing such counterpart.
IN WITNESS WHEREOF, the parties have caused this Second Amendment to be
executed by their duly authorized officers this 26th day of March, 1996.
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ESSEF CORPORATION PAC-FAB,INC.
By: By:
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Title: Title:
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XXXXXXX TECHNOLOGY CORPORATION XXXXXX BROTHERS ALUMINUM
(f/k/a FAME Plastics, Inc.) FOUNDRY AND MOULD WORKS, INC.
By: By:
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Title: Title:
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ENPAC CORPORATION PUREX POOL SYSTEMS, INC.
By: By:
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Title: Title:
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NBD BANK, N.A. BRANCH BANKING AND TRUST COMPANY
By: By:
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Title: Title:
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SOCIETY NATIONAL BANK
SOCIETY NATIONAL BANK, AGENT
By: By:
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Title: Title:
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