FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT
Exhibit 10.1
FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT
This FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT (this “Amendment”), dated as of January 23,
2010, is made between LINDSAY CORPORATION, a Delaware corporation (“Borrower”), and XXXXX FARGO
BANK, NATIONAL ASSOCIATION, a national banking association (“Bank”).
WHEREAS, Borrower and Bank have entered into that Revolving Credit Agreement dated as of
January 24, 2008 (the “Original Credit Agreement”). The Original Credit Agreement, as the same may
be amended from time to time, is sometimes referred to herein as the “Credit Agreement.”
Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to
them in the Credit Agreement. Borrower and Bank desire to amend the Credit Agreement as provided
herein.
NOW, THEREFORE, Borrower and Bank agree as follows:
SECTION 1. Amendments.
(A) Section 1.01 (Definitions). The following definitions set forth in
Section 1.01 of the Credit Agreement, as previously amended, are hereby amended and
restated in their entirety as follows:
“Daily LIBOR Rate” means for any day, the rate of interest equal to the
LIBOR Rate then in effect for delivery for a one (1) month period.
“Letter of Credit Margin” shall mean One Percent (1.00%).
“LIBOR Rate” means the rate per annum determined pursuant to the
following formula:
LIBOR Rate =
|
Base LIBOR |
where:
“Base LIBOR” means the rate per annum for United States dollar
deposits quoted by Bank for the purpose of calculating effective
rates of interest for loans making reference to the LIBOR Rate, as
the Inter-Bank Market Offered Rate in effect from time to time for
delivery of funds for one (1) month in amounts approximately equal
to the principal amount of such loans. Borrower understands and
agrees that Bank may base its quotation of the Inter-Bank Market
Offered Rate upon such offers or other market indicators of the
Inter-Bank Market as Bank in its discretion deems appropriate
including, but not limited to, the rate offered for U.S. dollar
deposits on the London Inter-Bank Market.
“LIBOR Reserve Percentage” means the reserve percentage
prescribed by the Board of Governors of the Federal Reserve System
(or any successor) for “Eurocurrency Liabilities” (as defined in
Regulation D of the Federal Reserve Board, as amended), adjusted by
Bank for expected changes in such reserve percentage during the term
of the Note.
“LIBOR Rate Margin” shall mean One and Two-Tenths Percent (1.20%)
plus the Increase in LIBOR Spread. From the date of this Amendment
through the end of the current fiscal quarter (the “Initial Adjustment
Date”), the “Increase in LIBOR Spread” shall be 0.00%; on the
Initial Adjustment Date, and on the last day of each fiscal quarter
thereafter, the Increase in LIBOR Spread shall be adjusted quarterly based
on the Consolidated Funded Debt to EBITDA of the Borrower, as of the
then-most-recently completed fiscal quarter for which financial statements
are to be delivered pursuant to Section 5.01(C) hereof, in
accordance with the following grid:
| Consolidated Funded | Increase in | |
| Debt to EBITDA* | LIBOR Spread | |
| ≤ 0.99x | 0.00% | |
| 1.00x ≤ 1.74x | 0.40% | |
| 1.75x ≤ 1.99x | 0.70% | |
| 2.00x ≤ 2.24x | 0.95% | |
| ≥ 2.25x | 1.20% |
| * | Calculated on a four-quarter rolling basis as provided in Section 5.01(I)(iii). |
“Termination Date” shall mean January 23, 2012.
“Unused Commitment Fee” shall mean an amount equal to one-quarter of
one percent (0.25%) per annum of the difference between the then-effective
Maximum Amount and the average daily balance of Outstanding Credit during
the preceding calendar quarter.
(B) Section 5.01 (Certain Affirmative Covenants). Sections 5.01(I) (Funded
Debt to EBITDA), (J) (Fixed Charge Coverage Ratio) and (K) (Current Ratio) of the
Credit Agreement are deleted and replaced with the following new Section 5.01(I):
(I) Financial Condition. Maintain its financial condition as follows, for
Borrower on a consolidated basis with its consolidated subsidiaries, using generally
accepted accounting principles consistently applied and used consistently with prior
practices (except to the extent specified as follows or modified by the definitions herein):
(i) Current Ratio not less than 1.50 to 1.0 as of each fiscal quarter end, with
“Current Ratio” defined as total current assets divided by total current
liabilities.
(ii) Tangible Net Worth not less than $115,000,000.00 (the “TNW Requirement”)
as of each fiscal quarter end, beginning with the quarter ended February 28, 2010;
the TNW Requirement shall be increased at the end of each fiscal quarter, beginning
with the quarter ended May 30, 2010, by an amount equal to 25% of net income after
taxes for such fiscal quarter (but shall not be reduced as a result of any losses
incurred during any such fiscal quarter); with “Tangible Net Worth” defined as the
aggregate of consolidated total stockholders’ equity plus subordinated debt less any
intangible assets.
(iii) Consolidated Funded Debt to EBITDA not greater than 2.5 to 1.0 as of each
fiscal quarter end, with “Funded Debt” defined as the sum of all obligations for
borrowed money (including subordinated debt) plus that portion of all capital lease
obligations reported on the balance sheet of Borrower and its consolidated
subsidiaries, as a liability as of such quarter end, and with “EBITDA” defined, for
the four fiscal quarters ending as of such quarter end, as net profit before tax
plus interest expense, depreciation expense and amortization expense for the
Borrower and its consolidated subsidiaries; provided however that, in the event that
an acquisition or disposition permitted by this Agreement shall have been
consummated during such four fiscal quarter period, in computing EBITDA, net profit
(and all other amounts specified in this definition of EBITDA ) shall be computed on
a pro forma basis giving effect to such acquisition or disposition, as the case may
be, as of the first day of such period.
(iv) Consolidated Fixed Charge Coverage Ratio not less than 2.25 to 1.0 as of
each fiscal quarter end, with “Fixed Charge Coverage Ratio” defined as the quotient
obtained by dividing (x) for the four fiscal quarters ending as of such quarter end,
the aggregate of net profit of the Borrower and its consolidated subsidiaries after
taxes plus depreciation expense, amortization expense, cash capital equity
contributions and increases in subordinated debt minus dividends, distributions and
decreases in subordinated debt, divided by (y) the aggregate of the current portion
of long term debt (excluding balloon
payments) and capitalized lease payments for the Borrower and its consolidated
subsidiaries as of such quarter end.
SECTION 2. Effectiveness. This Amendment shall become effective when and only when
the Bank shall have received all of the following, in each case in form and substance acceptable to
the Bank: (a) counterparts of this Amendment duly executed by Borrower; and (b) such other
documents or actions as the Bank may reasonably request.
SECTION 3. Representations and Warranties of Borrower. Borrower represents and
warrants as follows:
(a) Borrower is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation shown above.
(b) The execution, delivery and performance by Borrower of this Amendment, the Credit
Agreement, and the other Loan Documents, as amended hereby, are within Borrower’s powers,
have been duly authorized by all necessary action on the part of Borrower and its
shareholders and/or directors, as applicable, and do not: (i) contravene Borrower’s articles
of incorporation or bylaws, or (ii) contravene any law or any contractual restriction
binding on or affecting Borrower or its consolidated subsidiaries, or (iii) result in, or
require, the creation of any lien, security interest or other charge or encumbrance upon or
with respect to any of the properties of the Borrower or any of its consolidated
subsidiaries (other than liens, security interests, charges or encumbrances in favor of the
Bank under the Credit Agreement and other Loan Documents).
(c) No authorization, approval or other action by, and no notice to or filing with,
any governmental authority or regulatory body is required for the due execution, delivery
and performance by Borrower of this Amendment or the Original Credit Agreement, as amended
hereby, or other Loan Documents.
(d) This Amendment and the Original Credit Agreement, as amended hereby, and the other
Loan Documents, constitute, legal, valid and binding obligations of Borrower enforceable
against Borrower in accordance with their respective terms.
(e) There is no pending or threatened action or proceeding affecting Borrower before
any court, governmental agency or arbitrator, which may materially adversely affect the
financial condition or operations of Borrower or its ability to perform its obligations
under the Original Credit Agreement, as amended hereby, and the other Loan Documents.
(f) Except to the extent otherwise provided in the Borrower’s Form 10-K for
the period ended August 31, 2009, and Form 10-Q for the period ended November
30, 2009 (the “Most Recent Filing”), Borrower restates and affirms each and all of the
representations of Borrower set forth in Article IV of the Original Credit Agreement. The
information in the Most Recent Filing is, as of its date and as of the date of this
Agreement, true and correct in all material respects and does not omit to state a material
fact necessary in order to make the statements made, in light of the circumstances under
which they were made, not misleading.
(g) No event of default as described in Section 6.01 of the Original Credit
Agreement has occurred and is continuing (without regard to notice or any applicable grace
period, if any).
SECTION 4. Reference to and Effect on the Credit Agreement. Upon the effectiveness
of this Amendment pursuant to Section 2 hereof, each reference in the Original Credit
Agreement to “this Agreement”, “hereunder” “hereof”, “herein” or words of like import shall mean
and be a reference to the Credit Agreement, as amended hereby. Except as specifically amended
above, the Credit Agreement shall remain in full force and effect and is hereby ratified and
confirmed. The execution, delivery and effectiveness of this Amendment shall not, except as
expressly provided herein, operate as a waiver of any right, power or remedy of Bank under the
Credit Agreement, nor constitute a waiver of any provision of the Credit Agreement.
SECTION 5. Execution in Counterparts. This Agreement may be executed in several
counterparts, and all counterparts so executed shall constitute one agreement, binding on all of
the parties hereto, notwithstanding that all the parties are not signatory to the original or the same
counterpart.
SECTION 6. Governing Law. This Amendment shall be governed by, and construed in
accordance with, the laws of the State of Nebraska (without giving effect to conflicts of law
principles).
SECTION 7. Final Agreement. This Amendment and the Credit Agreement and other Loan
Documents represents the final agreement between Bank and Borrower as to the subject matter thereof
and may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of
the parties. There are no unwritten oral agreements between the parties.
A CREDIT AGREEMENT MUST BE IN WRITING TO BE ENFORCEABLE UNDER NEBRASKA LAW. TO PROTECT
THE PARTIES FROM ANY MISUNDERSTANDINGS OR DISAPPOINTMENTS, ANY CONTRACT, PROMISE, UNDERTAKING OR
OFFER TO FOREBEAR REPAYMENT OF MONEY OR TO MAKE ANY OTHER FINANCIAL ACCOMMODATION IN CONNECTION
WITH THIS LOAN OF MONEY OR GRANT OR EXTENSION OF CREDIT, OR ANY AMENDMENT OF, CANCELLATION OF,
WAIVER OF, OR SUBSTITUTION FOR ANY OR ALL OF THE TERMS OR PROVISIONS OF ANY INSTRUMENT OR DOCUMENT
EXECUTED IN CONNECTION WITH THIS LOAN OF MONEY OR GRANT OR EXTENSION OF CREDIT, MUST BE IN WRITING
TO BE EFFECTIVE.
IN WITNESS WHEREOF, the parties have signed this Amendment as of the date and year first
above written.
| XXXXX FARGO BANK, NATIONAL ASSOCIATION |
||||
| By: | /s/ Xxxxxxx X. Xxxxxxx | |||
| Xxxxxxx X. Xxxxxxx, Vice President | ||||
| LINDSAY CORPORATION |
||||
| By: | /s/ Xxxxx X. Xxxxxxx | |||
| Name: | Xxxxx X. Xxxxxxx | |||
| Title: | Chief Financial Officer | |||
