Exhibit 10.14H
SIXTH AMENDMENT AND WAIVER
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SIXTH AMENDMENT AND WAIVER (this "Amendment"), dated as of August 25,
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1999, to the Amended and Restated Credit Agreement, dated as of March 10, 1998
(as previously amended, and as the same is being and may be further amended,
restated, supplemented or otherwise modified from time to time, the "Credit
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Agreement"), among PAMECO CORPORATION, a Georgia corporation (the "Company"),
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the lenders parties thereto (together with their respective successors and
permitted assigns, the "Lenders") and GENERAL ELECTRIC CAPITAL CORPORATION, a
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New York corporation, as agent for the Lenders (in such capacity, together with
its successors and permitted assigns, the "Agent").
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W I T N E S S E T H :
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WHEREAS, the Company has requested that the Agent and the Lenders
amend certain provisions of, and grant a certain waiver with respect to, the
Credit Agreement upon the terms and subject to the conditions set forth herein;
and
WHEREAS, the Agent and the Lenders have agreed to such amendments and
waiver only upon the terms and subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, the parties hereto hereby agree as follows:
1. Defined Terms. Terms defined in the Credit Agreement are used
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herein with the meanings set forth in the Credit Agreement unless otherwise
defined herein.
2. Amendment of Credit Agreement.
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(a) Amendment of Schedule 10.8. Schedule 10.8 to the Credit
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Agreement is hereby replaced with Annex A attached hereto.
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3. Waiver. The Agent and the Lenders hereby waive the Event of
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Default arising under Section 11(c) of the Credit Agreement caused solely by the
Company's failure to comply with subsections (a), (b), (d) and (e) of Schedule
10.8 to the Credit Agreement for the fiscal month ended June 30, 1999. The
foregoing waivers are limited to the specific purpose for which they are granted
and shall not be construed as a consent, waiver or other modification with
respect to any other term, condition or other provisions of any Loan Document or
any other Default or Event of Default now or hereafter existing.
4. Conditions to Effectiveness. This Amendment shall become
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effective (the actual date of such effectiveness, the "Sixth Amendment Effective
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Date") as of the date first above written when:
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(a) This Amendment shall have been duly executed and delivered by
each of the parties hereto.
(b) The Acknowledgment and Consent dated as of the date hereof by
the Company and Pameco Investment Company, Inc. shall have been duly
executed and delivered by each of the parties thereto.
(c) The Agent shall have received a certificate of the Secretary
or an Assistant Secretary of each Loan Party, dated as of the Sixth
Amendment Effective Date, and certifying (i) that attached thereto is a
true and complete copy of the resolutions (which resolutions are in form
and substance reasonably satisfactory to each Lender) of the board of
directors of such Loan Party authorizing, as applicable, the execution,
delivery and performance of this Amendment, the Acknowledgment and Consent
attached hereto and related matters, certified by the Secretary or an
Assistant Secretary of such Loan Party as of the Sixth Amendment Effective
Date and (ii) as to the incumbency and specimen signature of such Loan
Party's officers executing this Amendment and all other documents required
or necessary to be delivered hereunder or in connection herewith. Such
certificate shall state that the resolutions thereby certified have not
been amended, modified, revoked or rescinded as of the date of such
certificate.
(d) The Agent shall have received true and complete copies of the
certificate of incorporation and by-laws of each Loan Party, certified as
of the Sixth Amendment Effective Date as complete and correct copies
thereof by the Secretary or an Assistant Secretary of such Loan Party.
5. Company Representations and Warranties. The Company represents
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and warrants that:
(a) Each of this Amendment and the Credit Agreement as amended by
this Amendment constitutes the legal, valid and binding obligation of the
Company.
(b) Each of the representations and warranties set forth in
Section 7 of the Credit Agreement are true and correct as of the Sixth
Amendment Effective Date; provided that references in the Credit Agreement
to this "Agreement" shall be deemed references to the Credit Agreement as
amended to date and by this Amendment.
(c) After giving effect to this Amendment, there does not exist
any Default or Event of Default.
6. Continuing Effect. Except as expressly waived hereby, the Credit
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Agreement shall continue to be and shall remain in full force and effect in
accordance with its terms.
7. Expenses. The Company agrees to pay and reimburse the Agent for
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all of its out-of-pocket costs and expenses incurred in connection with the
negotiation, preparation,
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execution, and delivery of this Amendment, including the fees and expenses of
counsel to the Agent.
8. Counterparts. This Amendment may be executed on any number of
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separate counterparts and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. Delivery of an executed
counterpart of a signature page to this Amendment by telecopy shall be effective
as delivery of a manually executed counterpart of this Amendment.
9. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED
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AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Sixth Amendment and
Waiver to be duly executed and delivered in New York, New York by their proper
and duly authorized officers as of the day and year first above written.
PAMECO CORPORATION
By: _________________________________
Title: ______________________________
GENERAL ELECTRIC CAPITAL CORPORATION,
as Agent and as a Lender
By: _________________________________
Title: Duly Authorized Signatory
WACHOVIA BANK, N.A.
By: _________________________________
Title: ______________________________
NATIONSBANK, N.A.
By: _________________________________
Title: ______________________________
SUNTRUST BANK, ATLANTA
By: _________________________________
Title: ______________________________
By: _________________________________
Title: ______________________________
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ANNEX A
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SCHEDULE 10.8
to
Credit Agreement
FINANCIAL COVENANTS
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The Company shall not breach or fail to comply with any of the
following financial covenants, each of which shall be calculated in accordance
with GAAP, consistently applied:
(a) Company EBITDA. As of the last day of each fiscal period of the
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Company, the Consolidated EBITDA for the preceding twelve consecutive fiscal
months shall not be less than the amount set forth below opposite such period:
Fiscal Quarter Ending Amount
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August 31, 1999 $18,343,000
November 30, 1999 $18,724,000
February 29, 2000 $17,246,000
For each fiscal quarter thereafter $20,000,000
Fiscal Month Ending Amount
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July 31, 1999 $18,196,000
September 30, 1999 $18,001,000
October 31, 1999 $17,925,000
December 31, 1999 $17,659,000
January 31, 2000 $17,936,000
(b) Fixed Charge Coverage Ratio. As of the last day of each fiscal
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quarter of the Company, the ratio of (i) Consolidated EBITDA to (ii)
Consolidated Fixed Charges for the preceding twelve consecutive fiscal months
(the "Fixed Charge Coverage Ratio") shall not be less than the ratio set forth
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below opposite such period:
Fiscal Quarter Ending Ratio
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August 31, 1999 1.09 to 1.00
November 30, 1999 1.02 to 1.00
February 29, 2000 0.85 to 1.00
For each fiscal quarter thereafter 1.25 to 1.00
(c) Maintenance of Net Worth. (i) The Company Net Worth on the last
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day of each fiscal quarter ending on the day set forth below shall not be less
than the amount set forth opposite such date:
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Fiscal Year Ending Amount
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May 31, 1998 $65,000,000
August 31, 1998 $65,000,000
November 30, 1998 $65,000,000
February 28, 1999 $65,000,000 plus 50% of
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Consolidated Net Income for the
fiscal year then ended
(ii) Commencing with the fiscal year of the Company ending on February
29, 2000, (A) the Company Net Worth on the last day of each of the first, second
and third fiscal quarters of each fiscal year of the Company shall not be less
than the minimum Company Net Worth of the Company required pursuant to this
paragraph (c) for the fourth quarter of the immediately preceding fiscal year of
the Company and (B) the Company Net Worth on the last day of each fiscal year of
the Company shall not be less than the minimum Company Net Worth required
pursuant to this paragraph (c) for the third quarter of such fiscal year plus
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50% of Consolidated Net Income for such fiscal year.
(d) Consolidated Senior Debt Leverage Ratio. As of the last day of
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any fiscal period of the Company, the Consolidated Senior Debt Leverage Ratio
shall not be greater than the ratio set forth below opposite such period:
Fiscal Quarter Ending Ratio
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August 31, 1999 9.87 to 1.00
November 30, 1999 9.78 to 1.00
February 29, 2000 11.58 to 1.00
For each fiscal quarter thereafter 5.00 to 1.00
Fiscal Month Ending Ratio
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July 31, 1999 9.34 to 1.00
September 30, 1999 10.08 to 1.00
October 31, 1999 10.17 to 1.00
December 31, 1999 10.85 to 1.00
January 31, 2000 10.70 to 1.00
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(e) Consolidated Total Debt Leverage Ratio. As of the last day of any
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fiscal quarter of the Company, the Consolidated Total Debt Leverage Ratio shall
not be greater than the ratio set forth below opposite such period:
Fiscal Quarter Ending Ratio
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August 31, 1999 9.89 to 1.00
November 30, 1999 9.83 to 1.00
February 29, 2000 11.59 to 1.00 For each fiscal quarter
thereafter 6.00 to 1.00
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ACKNOWLEDGMENT AND CONSENT
ACKNOWLEDGMENT AND CONSENT (this "Acknowledgment and Consent"), dated
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as of August ___, 1999, to the documents listed on Schedule 1 hereto (the
"Documents") made by each of the signatories hereto (each a "Grantor"), in favor
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of GENERAL ELECTRIC CAPITAL CORPORATION, a New York corporation, as agent (in
such capacity, the "Agent") for the lenders (the "Lenders") from time to time
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parties to the Amended and Restated Credit Agreement referred to below.
W I T N E S S E T H
WHEREAS, Pameco Corporation (the "Company"), the Lenders and the Agent
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entered into the Amended and Restated Credit Agreement dated as of March 10,
1998 (as previously amended, and as the same may be further amended, restated,
supplemented or otherwise modified from time to time, the "Amended and Restated
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Credit Agreement"); and
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WHEREAS, to secure and guarantee the obligations of the Company under
the Amended and Restated Credit Agreement, each Grantor entered into Documents
to which it is a party; and
WHEREAS, the Amended and Restated Credit Agreement was amended on the
date hereof pursuant to the Sixth Amendment and Waiver, dated as of this date,
among the Company, the Lenders and the Agent (the "Amendment"; the Amended and
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Restated Credit Agreement as amended by the Amendment, the "Amended Agreement");
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and
WHEREAS, it is a condition precedent to the effectiveness of the
Amendment that each Grantor execute and deliver this Acknowledgment and Consent
to confirm that the security interests granted under the Documents secure the
Obligations of the Company under the Amended Agreement;
NOW, THEREFORE, in consideration of the premises and mutual agreements
contained herein, and for other valuable consideration, the receipt of which is
hereby acknowledged, each Grantor and the Agent hereby agree as follows:
1. Defined Terms. Unless otherwise defined herein, terms which are
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defined in the Amended and Restated Credit Agreement and used herein are so used
as so defined.
2. Representations and Warranties. Each Grantor represents and
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warrants that upon the execution and delivery of this Acknowledgment and
Consent, the Documents, as acknowledged and consented to hereby, shall
constitute a valid and continuing lien on and, to the extent provided therein,
perfected security interest in, the collateral referred to in the Documents, as
acknowledged and consented to hereby, in favor of the Agent for the ratable
benefit of the Lenders.
3. Acknowledgment and Consent. Each Grantor hereby:
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(a) acknowledges and consents to the execution, delivery and
performance of (i) the Amendment and (ii) all of the documents and
transactions contemplated thereby;
(b) agrees that such execution, delivery and performance shall
not in any way affect such Grantor's obligations under any Loan Document
(as defined in the Amended Agreement) to which such Grantor is a party,
which obligations on the date hereof remain absolute and unconditional and
are not subject to any defense, set-off or counterclaim; and
(c) grants to the Agent, for the ratable benefit of the Lenders,
and pursuant to the terms and conditions of the Documents a continuing lien
on and security interest in all collateral described in the Documents as
security for the Obligations (as defined in the Amended Agreement).
4. Miscellaneous.
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(a) This Acknowledgment and Consent may be executed in any number
of separate counterparts, and all of said counterparts taken together shall
constitute one and the same instrument. Delivery of an executed
counterpart of a signature page to this Acknowledgment and Consent by
telecopy shall be effective as delivery of a manually executed counterpart
of this Acknowledgment and Consent.
(b) This Acknowledgment and Consent shall become effective when
executed by each Grantor and the Agent.
(c) THIS ACKNOWLEDGMENT AND CONSENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE
STATE OF NEW YORK.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Acknowledgment and
Consent to be executed and delivered by their respective duly authorized
officers as of the date first written above.
PAMECO CORPORATION
By: _____________________________
Name: __________________________
Title: ___________________________
PAMECO INVESTMENT COMPANY, INC.
By: _____________________________
Name: __________________________
Title: ___________________________
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Schedule 1 to
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Acknowledgment and Consent
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DOCUMENTS
The Company Security Agreement dated as of March 19, 1992 by Pameco
Corporation in favor of General Electric Capital Corporation, as Agent
The Pledge Agreement dated as of April 29, 1996 by Pameco Corporation in
favor of General Electric Capital Corporation, as Agent
The Intercreditor Agreement dated as of April 29, 1996 among Pameco
Corporation, Pameco Securitization Corporation, Redwood Receivables Corporation
and General Electric Capital Corporation
The Pledge Agreement dated as of December 1, 1997 by Pameco Corporation in
favor of General Electric Capital Corporation, as Agent
The Subsidiary Guarantee dated as of December 1, 1997 by Pameco Investment
Company, Inc. in favor of General Electric Capital Corporation, as Agent
The Subsidiary Security Agreement dated as of December 1, 1997 by Pameco
Investment Company, Inc. in favor of General Electric Capital Corporation, as
Agent
The Trademark Security Agreement dated as of December 1, 1997 by Pameco
Investment Company, Inc. in favor of General Electric Capital Corporation, as
Agent
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