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FIRST AMENDMENT
TO
AMENDED AND RESTATED CREDIT AGREEMENT
FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT, dated as of May
1, 1999 (this "Amendment"), by and among CANNONDALE CORPORATION, a corporation
organized under the laws of the State of Delaware ("Cannondale"); each of the
Subsidiaries of Cannondale that is a signatory to the Credit Agreement (as
defined below) (such Subsidiaries of Cannondale, together with Cannondale, the
"Borrowers"); NATIONSBANK, N.A., a national banking association organized under
the laws of the United States of America ("NationsBank"); FLEET NATIONAL BANK, a
national banking association organized under the laws of the United States of
America ("Fleet"); THE CHASE MANHATTAN BANK, a bank organized under the laws of
New York ("Chase"); STATE STREET BANK AND TRUST COMPANY, a trust company
organized under the laws of Massachusetts ("State Street"); and BANKBOSTON,
N.A., a national banking association organized under the laws of the United
States of America ("BankBoston") (each of NationsBank, Fleet, Chase, State
Street and BankBoston may be referred to individually as a "Bank" and
collectively as the "Banks"); and NATIONSBANK, as administrative agent for the
Banks (in such capacity, together with its successors in such capacity, the
"Administrative Agent").
BACKGROUND
A. Reference is made to that certain Amended and Restated Credit Agreement
dated as of January 22, 1999 (the "Credit Agreement"), among the Borrowers, the
Administrative Agent, the Banks and the other parties signatory thereto.
B. The parties hereto wish to amend the Credit Agreement as herein
provided.
C. Capitalized terms not otherwise defined shall have the meanings ascribed
to them in the Credit Agreement, as amended hereby.
AGREEMENT
In consideration of the Background, which is incorporated by reference, the
parties hereto, intending to be legally bound, hereby agree as follows:
1. Modification. All the terms and provisions of the Credit Agreement
and the other Facility Documents, as amended to date, shall remain in full
force and effect except as follows:
(a) The definition of "Margin" contained in Section 1.1 of the
Credit Agreement is deleted and the following is substituted therefor:
"Margin" means (a) for each type of Revolving Loan, the number
of basis points for such type of Revolving Loan set forth below
opposite the range of the Consolidated Average Funded Debt to EBITDA
Ratio of Cannondale in the schedule below as determined as of the
last day of the immediately preceding Fiscal Quarter, with
adjustments to become effective on the date of receipt by the
Administrative Agent of the most recent financial statements of the
Borrowers required to be furnished to the Banks under Section 7.8;
provided, however, that in the event that the Borrowers fail to
furnish such financial statements to the Banks on a timely basis
under Section 7.8, "Margin" means, for each type of Revolving Loan
during the continuance of such
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failure until such financial statements are delivered, the highest
number of basis points for such type of Revolving Loan set forth
below:
MARGIN
CONSOLIDATED AVERAGE FUNDED ----------------------------------------
DEBT TO EBITDA RATIO VARIABLE RATE LOANS EUROCURRENCY LOANS
--------------------------- ------------------- ------------------
Less than 2.50 0 basis points 75.0 basis points
Greater than or equal to 2.50, but 0 basis points 97.5 basis points
less than 3.00
Greater than or equal to 3.00, but 0 basis points 120.0 basis points
less than 3.30
Greater than or equal to 3.30, but 0 basis points 145.0 basis points
less than 3.60
Greater than or equal to 3.60 0 basis points 170.0 basis points
and (b) for each type of Term Loan, the number of basis points
for such type of Term Loan set forth below opposite the stated time
period in the schedule below, with adjustments to become effective
automatically without further action on the part of the Borrowers,
the Administrative Agent or the Banks:
MARGIN
----------------------------------------
TIME PERIOD VARIABLE RATE LOANS EUROCURRENCY LOANS
----------- ------------------- ------------------
January 22, 1999 to 0 basis points 175 basis points
April 30, 1999
May 1, 1999 to 0 basis points 225 basis points
December 31, 1999
January 1, 2000 to 0 basis points 250 basis points
March 31, 2000
April 1, 2000 to 0 basis points 275 basis points
June 30, 2000
from and after July 1, 2000 0 basis points 300 basis points
(b) The facility fee schedule contained in Section 2.14(a) of the
Credit Agreement is deleted and the following is substituted therefor:
CONSOLIDATED AVERAGE FUNDED
DEBT TO EBITDA RATIO FACILITY FEE
--------------------------- ------------
Less than 2.50 25 basis points
Greater than or equal to 2.50, 27.5 basis points
but less than 3.00
Greater than or equal to 3.00 30.0 basis points
(c) Section 9.4 to the Credit Agreement is deleted and the
following is substituted therefor:
Section 9.4. Debt Service Coverage Ratio. Cannondale shall
maintain at all times, as certified at the end of each Fiscal Quarter
of Cannondale, a Consolidated Average Funded Debt to EBITDA Ratio
(for the four Fiscal Quarters then ended) of not greater than (a) 3.9
to 1.0 during the fourth Fiscal Quarter of Cannondale's 1999 Fiscal
Year, (b) 3.8 to 1.0 and 3.6 to 1.0 during the first and second
Fiscal Quarters, respectively, of Cannondale's 2000 Fiscal Year, and
(c) 3.3 to 1.0 thereafter.
2. Amendment Fee. The Borrowers hereby agree to pay to the
Administrative Agent, on the effective date of this Amendment, for the
account of each Bank executing this Amendment prior to May 14, 1999, an
amendment fee in the amount of .125% of such Bank's Commitment (used and
unused) on such date.
3. Conditions to effectiveness. This Amendment shall not be effective
until such date as the Administrative Agent shall have received the
following, all in form, scope, and content acceptable to the
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Administrative Agent and Required Banks in their sole discretion, and then
shall be effective as of the date first above written:
(a) This Amendment, executed by the Borrowers and the Required
Banks; and
(b) Such other agreements and instruments as the Administrative
Agent shall reasonably require.
4. Reaffirmation by the Borrowers. Each of the Borrowers
acknowledges, agrees, and reaffirms, both prior to and after taking into
account this Amendment, that each is legally, validly, and enforceably
indebted to the Banks under the Notes without defense, counterclaim, or
offset, and that each is legally, validly, and enforceably liable to the
Banks for all costs and expenses of collection and reasonable attorneys'
fees as and to the extent provided in this Amendment, the Credit Agreement,
the Notes, and the other Facility Documents. Each of the Borrowers hereby
restates and agrees to be bound by all covenants contained in the Credit
Agreement and the other Facility Documents and hereby reaffirms that all of
the representations and warranties contained in the Credit Agreement and
the other Facility Documents remain true and correct in all material
respects with the exception that the representations and warranties
regarding the financial statements described therein are deemed true as of
the date made. Each of the Borrowers represents that, except as set forth
in the Credit Agreement and the other Facility Documents, there are neither
pending, nor to each Borrower's knowledge, threatened, legal proceedings to
which any of the Borrowers is a party that materially or adversely affect
the transactions contemplated by this Amendment or the ability of any of
the Borrowers to conduct its business on a consolidated basis. Cannondale
and Cannondale Europe B.V. each acknowledge and represent that the
resolutions of each dated January 6, 1999, in the case of Cannondale, and
January 19, 1999, and January 21, 1999, in the case of Cannondale Europe
B.V., remain in full force and effect and have not been amended, modified,
rescinded, or otherwise abrogated.
5. Reaffirmation re: Collateral. Cannondale reaffirms the mortgages,
liens, security interests, and pledges granted to NationsBank, N.A., as
Administrative Agent, for the benefit of the Banks pursuant to the Credit
Agreement and the other Facility Documents to secure the obligations of
each Borrower thereunder.
6. Other representations by the Borrowers. Each of the Borrowers
represents and confirms that: (a) no Default or Event of Default has
occurred and is continuing, and that neither the Agents nor the Banks has
given its consent to or waived any Default or Event of Default, and (b) the
Credit Agreement and the other Facility Documents are in full force and
effect and enforceable against the Borrowers in accordance with the terms
thereof. Each of the Borrowers represents and confirms that as of the date
hereof, each has no claim or defense (and each of the Borrowers hereby
waives every claim and defense as of the date hereof) against the Agents or
the Banks arising out of or relating to the Credit Agreement or the other
Facility Documents or arising out of or relating to the making,
administration or enforcement of the Loans or the remedies provided for
under the Facility Documents.
7. No waiver by the Banks. Each of the Borrowers acknowledges that:
(a) neither the Banks nor the Administrative Agent, by execution of this
Amendment, are waiving any Default or Event of Default, whether now
existing or hereafter occurring, disclosed or undisclosed, by the Borrowers
under the Facility Documents, and (b) the Banks and the Administrative
Agent reserve all rights and remedies available to them under the Facility
Documents and otherwise.
8. Miscellaneous.
(a) This Amendment may be executed by one or more of the parties to
this Amendment on any number of separate counterparts (including by
facsimile transmission), and all of said counterparts taken together
shall be deemed to constitute one and the same instrument.
(b) This Amendment and the rights and obligations of the parties
hereunder shall be governed by, and construed in accordance with, the
laws of the State of New York.
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(c) This Amendment shall be deemed a, and included in the
definition of, Facility Document under the Credit Agreement for all
purposes.
(d) The Credit Agreement, as amended hereby, and the other Facility
Documents remain in full force and effect in accordance with their
terms.
[The balance of this page left intentionally blank. The next page is the
signature page.]
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IN WITNESS WHEREOF, the parties have executed this Amendment on the date
first written above.
BORROWERS
CANNONDALE CORPORATION
By /s/ XXXXXXX X. LUCA
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Name: Xxxxxxx X. Luca
Title: Vice President, CFO,
Treasurer
CANNONDALE EUROPE B.V.
By /s/ XXXX XXXXXXXX
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Name: Xxxx Xxxxxxxx
Title: President
CANNONDALE JAPAN K.K.
By /s/ XXXXXXX XXXXXXX
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Name: Xxxxxxx Xxxxxxx
Title: President
ADMINISTRATIVE AGENT
NATIONSBANK, N.A.
By /s/ X.X. XXXX
------------------------------------
Name: X.X. Xxxx
Title: Managing Director
BANKS
NATIONSBANK, N.A.
By /s/ X.X. XXXX
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Name: X.X. Xxxx
Title: Managing Director
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FLEET NATIONAL BANK
By
------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK
By
------------------------------------
Name:
Title:
STATE STREET BANK AND TRUST COMPANY
By /s/ XXXXXX X. XXXXXXX
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Name: Xxxxxx X. Xxxxxxx
Title: Vice President
BANKBOSTON, N.A.
By /s/ XXXXX X. XXXXXXX
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Name: Xxxxx X. Xxxxxxx
Title: Vice President
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