Exhibit 10.10
THIRD AMENDMENT TO AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
THIS THIRD AMENDMENT TO AMENDED AND RESTATED REVOLVING CREDIT
AGREEMENT (this "Amendment") made as of May 12, 2000 by and among NUCO2 INC., a
Florida corporation (the "Company"), SUNTRUST BANK, a Georgia banking
corporation (formerly named SunTrust Bank, South Florida, National Association,
a national banking association) ("SunTrust"), BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC., a Delaware corporation (the "Documentation Agent"), THE
PROVIDENT BANK, an Ohio banking corporation, BANK LEUMI LE-ISRAEL B.M., Miami
Agency, IBJ WHITEHALL BUSINESS CREDIT CORPORATION, a New York corporation,
XXXXXXXX BANK, N.A., a national banking association, and any other banks or
other lending institutions that are or will become parties to the Credit
Agreement (as defined below) (collectively, the "Lenders" and each individually,
a "Lender"), and SUNTRUST BANK, a Georgia banking corporation (formerly named
SunTrust Bank, South Florida, National Association, a national banking
association), as agent for the Lenders.
PRELIMINARY STATEMENTS:
The Company, Agent and the Lenders are parties to that certain
Amended and Restated Revolving Credit Agreement dated as of May 4, 1999 as
amended by that certain First Amendment to Amended and Restated Revolving Credit
Agreement dated as of June 16, 1999 and as amended by that certain Second
Amendment and Waiver to Amended and Restated Revolving Credit Agreement dated as
of February 7, 2000 (the "Credit Agreement"; capitalized terms used herein and
not defined herein shall have the meanings assigned to them in the Credit
Agreement), pursuant to which the Lenders made and continue to make certain
financial accommodations to the Company;
The Company has requested, and the Lenders have agreed, to amend
certain financial covenants and to make certain other amendments on the terms
and subject to the conditions set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
1. Amendments to Credit Agreement.
a. Section 1.01 of the Credit Agreement is hereby amended by: (i)
replacing the definitions of "Applicable Margin", "Consolidated Net Worth",
"EBITDA Multiple" and "Senior Funded Debt" in their entirety with the following
definitions:
"Applicable Margin" shall mean the percentage designated below based
on the ratio of the Company's Total Funded Debt to Annualized EBITDA for each
fiscal quarter-end, as indicated below:
Total Funded Debt to Applicable Margin Applicable Margin
Annualized EBITDA (LIBOR Advance) (Base Rate Advance)
Level I < 4.00:1.00 2.75% 1.25%
Level II => 4.00:1.00 and 3.25% 1.75%
< 4.75:1.00
Level III => 4.75:1.00 3.75% 2.25%
From the Effective Date through and including December 31, 2000, the
Applicable Margin on LIBOR Advances and Base Rate Advances shall be
3.75% and 2.25% respectively.
"Consolidated Net Worth" shall mean, as of the date of
determination, the sum of, without duplication, (a) total
shareholders' equity of the Company and its Subsidiaries on a
consolidated basis determined in accordance with GAAP and (b) the 8%
Convertible Preferred Stock.
"EBITDA Multiple" shall mean (a) 3.35 from March 1, 2000
through and including June 30, 2000; (b) 3.30 from July 1, 2000
through and including July 31, 2000; (c) 3.25 from August 1, 2000
through and including September 30, 2000; (d) 3.20 from October 1,
2000 through and including October 31, 2000; (e) 3.10 from November
1, 2000 through and including November 30, 2000; (f) 3.05 from
December 1, 2000 through and including December 31, 2000; (g) 3.00
from January 1, 2001 through and including January 31, 2001; (h)
2.95 from February 1, 2001 through and including February 28, 2001;
(i) 2.90 from March 1, 2001 through and including March 31, 2001;
(j) 2.85 from April 1, 2001 through and including April 30, 2001;
(k) 2.80 from May 1, 2001 through and including May 31, 2001; (l)
2.75 from June 1, 2001 through and including June 30, 2001; (m) 2.70
from July 1, 2001 through and including July 31, 2001; (n) 2.65 from
August 1, 2001 through and including August 31, 2001; (o) 2.60 from
September 1, 2001 through and including September 30, 2001; and (p)
2.50 thereafter.
"Senior Funded Debt" shall mean all indebtedness for
money borrowed, purchase money mortgages, capitalized leases,
outstandings under asset securitization vehicles, conditional sales
contracts and similar title retention debt instruments, including
any current maturities of such indebtedness, which by its terms
matures more than one year from the date of any calculation thereof
and/or which is renewable or extendable at the option of the obligor
to a date beyond one year from such date; provided, that
Subordinated Debt shall not be included.
(ii) inserting a new sentence at the end of the definition of "Indebtedness" to
read as follows: "Notwithstanding the foregoing, Indebtedness shall exclude the
8% Convertible Preferred Stock."
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(iii) deleting the definitions of "Applicable Commitment Fee Percentage",
"Interest Coverage Ratio", "Maintenance Capital Expenditures", "Net Worth",
"Senior Debt Leverage Ratio" and "Total Capitalization" in their entirety; and
(iv) adding the following definitions in their proper alphabetical order:
"8% Convertible Preferred Stock" shall mean the
Company's 8% Cumulative Convertible Preferred Stock, no par value,
having an aggregate initial liquidation preference of $5,000,000.
"Fifth Amendment to Senior Subordinated Debt" shall mean
that certain Amendment No. 5 to Senior Subordinated Note Purchase
Agreement, dated as of the date hereof, among the Company, the
Guarantors and the Investors listed therein.
"Total Funded Debt" shall mean all indebtedness for
money borrowed, purchase money mortgages, capitalized leases,
outstandings under asset securitization vehicles, conditional sales
contracts and similar title retention debt instruments, including
any current maturities of such indebtedness, which by its terms
matures more than one year from the date of any calculation thereof
and/or which is renewable or extendable at the option of the obligor
to a date beyond one year from such date, minus cash and cash
equivalents.
"Total Funded Debt Coverage Ratio" shall mean, for any
fiscal period of the Company, the ratio of (a) Total Funded Debt as
of the last day of such fiscal period to (b) Annualized EBITDA.
b. Section 2.16 of the Credit Agreement is hereby amended by
replacing clause (c) of such Section 2.16 in its entirety with the following:
(c) The Company shall pay to the Agent, for the account
of and distribution of the respective Pro Rata Share to each Lender
(subject to the last sentence hereof), a commitment fee (the
"Commitment Fee") for the period commencing on April 1, 2000 to and
including the Commitment Termination Date computed at a rate equal
to .50% multiplied by the average daily unused portion of the
Commitments of the Lenders, such fee being payable quarterly in
arrears on the last day of each calendar quarter, commencing on June
30, 2000, and on the Commitment Termination Date. The Commitment Fee
will be calculated on the basis of a 360-day year for the actual
number of days elapsed.
c. Section 5.02(a) of the Credit Agreement is hereby amended (i) to
delete the word "and" at the end of clause (vi) thereof, (ii) to delete the
punctuation "." at the end of clause (vii) thereof and to substitute therefor
the new language "; and" and (iii) to add the following new clause (viii)
thereto:
(viii) as soon as available and in any event within 30
days after the end of each month, a completed report with respect to
accounts of the Company showing
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aging and such other matters related to accounts receivable in such
form as reasonably requested by the Agent.
d. Section 5.05 of the Credit Agreement is hereby amended by
replacing such Section 5.05 in its entirety with the following:
"Section 5.05 Maintenance of Books; Inspection of
Property and Records; Audits.
(a) The Company shall, and shall cause each of its
Subsidiaries to, keep proper books of record and account containing
complete and accurate entries in all material respects of all of
their respective financial and business transactions and prepare or
cause to be prepared its annual statements and reports in accordance
with GAAP. The Company shall, and shall cause each of its
Subsidiaries to, permit any person designated by any Lender to visit
and inspect any of its properties, corporate books and financial
records, to make copies and take extracts therefrom, and to discuss
its accounts, affairs, and finances with the principal officers of
the Company and such Subsidiary during reasonable business hours,
all at such times as the Lenders may reasonably request; provided,
however, that any time following the occurrence and continuance of
an Event of Default, no prior notice to the Company and such
Subsidiary shall be required. The Company shall, and shall cause
each of its Subsidiaries to, prepare or cause to be prepared its
interim statements and reports in accordance with GAAP, subject to
usual and customary year end audit and adjustments and footnote
disclosures.
(b) The Company shall, and shall cause each of its
Subsidiaries to, permit any person designated by the Agent to
conduct field audits of all accounts receivable of the Company and
each of its Subsidiaries as any Lender may reasonably request at any
time and from time to time, such field audits to be conducted at the
expense of the Company no more frequently than annually, unless an
Event of Default has occurred and is continuing, at which time such
field audits shall be conducted at the expense of the Company as
frequently as any Lender shall request."
e. Section 6.09 of the Credit Agreement is hereby amended by
replacing clause (a) of Section 6.09 in its entirety with the following:
"(a) In any fiscal year of the Company, the Company
shall not pay or declare any cash dividends on any of its capital
stock; provided, however, the Company may accrue and cumulate, but
not pay, cash dividends on the 8% Convertible Preferred Stock."
f. Section 7.01 of the Credit Agreement is hereby amended by
replacing such Section 7.01 in its entirety with the following:
"SECTION 7.01 Senior Debt Coverage Ratio. The Company
shall not permit the Senior Debt Coverage Ratio as of the last day
of any fiscal quarter of the Company to be greater than (i) 3.35 to
1.00 for the period beginning on April 1, 2000 through and
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including June 30, 2000; (ii) 3.25 to 1.00 for the period beginning
July 1, 2000 through and including September 30, 2000; (iii) 3.05 to
1.00 for the period beginning October 1, 2000 through and including
December 31, 2000; (iv) 2.90 to 1.00 for the period beginning
January 1, 2001 through and including March 31, 2001; (v) 2.75 to
1.00 for the period beginning April 1, 2001 through and including
June 30, 2001; (vi) 2.60 to 1.00 for the period beginning July 1,
2001 through and including September 30, 2001; and (vii) 2.50 to
1.00 thereafter."
g. Section 7.02 of the Credit Agreement is hereby amended by
replacing such Section 7.02 in its entirety with the following:
"SECTION 7.02 Interest Coverage Ratio. The Company shall
not permit the ratio of the last twelve months EBITDA to the last
twelve months Interest Expense as of the last day of any fiscal
quarter of the Company to be less than (i) 1.40 to 1.00 for the
period beginning on April 1, 2000 through and including June 30,
2000; (ii) 1.50 to 1.00 for the period beginning July 1, 2000
through and including September 30, 2000; (iii) 1.60 to 1.00 for the
period beginning October 1, 2000 through and including March 31,
2001; (iv) 1.75 to 1.00 for the period beginning April 1, 2001
through and including June 30, 2001; (v) 1.95 to 1.00 for the period
beginning July 1, 2001 through and including September 30, 2001;
(vi) 2.40 to 1.00 for the period beginning October 1, 2001 through
and including December 31, 2001; (vii) 2.50 to 1.00 for the period
beginning January 1, 2002 through and including March 31, 2002; and
(viii) 2.75 to 1.00 thereafter."
h. Section 7.03 of the Credit Agreement is hereby amended by
replacing such Section 7.03 in its entirety with the following:
"SECTION 7.03 Total Funded Debt Coverage Ratio. The
Company shall not permit the Total Funded Debt Coverage Ratio as of
the last day of any fiscal quarter of the Company to be greater than
(i) 5.75 to 1.00 for the period beginning on April 1, 2000 through
and including June 30, 2000; (ii) 5.35 to 1.00 for the period
beginning July 1, 2000 through and including September 30, 2000;
(iii) 5.00 to 1.00 for the period beginning October 1, 2000 through
and including December 31, 2000; (iv) 4.75 to 1.00 for the period
beginning January 1, 2001 through and including March 31, 2001; (v)
4.50 to 1.00 for the period beginning April 1, 2001 through and
including June 30, 2001; and (vi) 4.25 to 1.00 thereafter."
i. Section 7.04 of the Credit Agreement is hereby amended by
replacing such Section 7.04 in its entirety with the following:
"SECTION 7.04 Minimum Net Worth. The Company shall at
all times maintain its Consolidated Net Worth greater than the
Minimum Net Worth, equal to (i) $40,000,000, plus (ii) fifty percent
(50%) of the cumulative Consolidated Net Income for each fiscal
quarter beginning after the fiscal quarter ending on March 31, 2000
(specifically not including any Consolidated Net Loss for any fiscal
quarter), plus (iii) the cumulative net proceeds of all equity
offerings, except for the 8% Convertible Preferred Stock."
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j. Section 8.01 of the Credit Agreement is hereby amended (i) to
delete the punctuation "." at the end of clause (o) thereof and to substitute
therefor the new language "; or" and (ii) to add the following new clause (p)
thereto:
"(p) The Company's aggregate outstanding Advances and
Letters of Credit under this Agreement exceed the Borrowing Base."
k. Annex A of the Credit Agreement is hereby amended by replacing
such Annex A in its entirety with the Annex A attached hereto as Exhibit A.
2. Conditions Precedent. This Amendment shall become effective upon
satisfaction of the following conditions:
a. The Agent shall have received one or more duly executed
counterparts of this Amendment signed by each of the parties hereto.
b. The Agent shall have received a copy of the Fifth Amendment to
Senior Subordinated Debt, in substantially the form attached hereto as Exhibit
A, as executed by the parties thereto. The terms and conditions of such Fifth
Amendment to Senior Subordinated Debt shall be satisfactory in all respects to
the Agent.
c. The Agent shall have received such other documents as any Lender
may reasonably request.
3. Other Agreements.
a. For purposes of clarity, the Company, the Agent and the Lenders
hereby acknowledge and agree that the Company may furnish to the Agent for
distribution to each of the Lenders a revised Borrowing Base Certificate for the
month ending March 31, 2000 in accordance with the terms and conditions of the
Credit Agreement as amended hereby.
b. The Company hereby affirms that each of the representations and
warranties of the Company contained in the Credit Agreement and in any other
Loan Documents (except to the extent that any such representation or warranty
expressly relates solely to an earlier date and for changes therein permitted or
contemplated by the Credit Agreement) is correct in all material respects on and
as of the date hereof and after giving effect to this Amendment. In addition,
with respect to this Amendment, Company warrants and represents that the
execution, delivery and performance by Company of this Amendment (i) are within
the Company's corporate power; (ii) have been duly authorized by all necessary
or proper corporate action; (iii) are not in contravention of any provision of
the Company's certificate of incorporation or bylaws; (iv) will not violate any
law or regulation, or any order or decree of any Governmental Authority; (v)
will not conflict with or result in the breach or termination of, constitute a
default under or accelerate any performance required by, any indenture,
mortgage, deed of trust, lease, agreement or other
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instrument to which the Company is a party or by which the Company or any of its
property is bound; (vi) will not result in the creation or imposition of any
Lien upon any of the property of the Company other than those in favor of the
Agent for the benefit of the Lenders, all pursuant to the Loan Documents; and
(vii) do not require the consent or approval of any Governmental Authority.
Company further represents and warrants that this Amendment has been duly
executed and delivered for the benefit of or on behalf of the Company and
constitutes a legal, valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms.
c. As amended hereby, all terms of the Credit Agreement and the
other Loan Documents shall be and remain in full force and effect and shall
constitute the legal, valid, binding and enforceable obligations of the Company
to the Agent and the Lenders. To the extent any terms and conditions in any
other Loan Documents shall contradict or be in conflict with any terms or
conditions of the Credit Agreement, after giving effect to this Amendment, such
terms and conditions are hereby deemed modified and amended accordingly to
reflect the terms and conditions of the Credit Agreement as modified and amended
hereby.
d. The Company hereby restates, ratifies and reaffirms each and
every term and condition set forth in the Credit Agreement and the other Loan
Documents, effective as of the date hereof, and represents that, after giving
effect to this Amendment, no Default or Event of Default has occurred and is
continuing as of the date hereof.
e. The Company agrees to pay on demand all costs and expenses of the
Agent in connection with the preparation, execution, delivery and enforcement of
this Amendment, the closing hereof, and any other transactions contemplated
hereby, including the fees and out-of-pocket expenses of the Company's counsel.
f. This Amendment may be executed in any number of counterparts,
each of which shall be deemed an original and all of which, taken together,
shall constitute one and the same instrument.
g. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS (AND NOT THE LAWS OF CONFLICTS), OF THE STATE OF FLORIDA
AND ALL APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
(Remainder of Page Intentionally Left Blank)
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed under seal by their respective officers thereunto duly
authorized, as of the date first above written.
NUCO2 INC.,
a Florida corporation
By: /s/ Xxxxx Xxxxxxxxx
-------------------------------------
Xxxxx Xxxxxxxxx
Chief Financial Officer and Treasurer
Attest: /s/ Xxxx X. Xxxxxxxx
---------------------------------
Xxxx X. Xxxxxxxx
General Counsel and Secretary
SUNTRUST BANK
individually and as Agent
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Xxxxxxx X. Xxxxxxxx
Vice President
BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.,
individually and as Documentation Agent
By: /s/ Xxxxx Xxxx
------------------------------------
Name: Xxxxx Xxxx
Title: Vice President
By: /s/ Xxxx X. Xxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Senior Associate
BANK-LEUMI LE-ISRAEL B.M.,
MIAMI AGENCY
By: /s/ Xxxxxxx Xxxxx
------------------------------------
Xxxxxxx Xxxxx
Vice President
THE PROVIDENT BANK
By: /s/ Xxxx Xxxxx
------------------------------------
Xxxx Xxxxx
Vice President
IBJ WHITEHALL BUSINESS CREDIT
CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Xxxxxx X. Xxxxxx
Xx. Vice President
XXXXXXXX BANK, N.A.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
By: /s/ Xxxxxx X. Xxxxxx Xx.
------------------------------------
Name: Xxxxxx X. Xxxxxx Xx.
Title: Assistant Vice President
ACKNOWLEDGMENT OF GUARANTORS
Each of the Guarantors acknowledges and agrees to the terms of the
foregoing Second Amendment to Amended and Restated Revolving Credit Agreement,
and further acknowledges and agrees that (i) all of the obligations of the
Company shall continue to constitute "Guaranteed Obligations" covered by the
Amended and Restated Guaranty Agreement dated as of May 4, 1999 executed by the
undersigned, and (ii) the Amended and Restated Guaranty Agreement is and shall
remain in full force and effect on and after the date hereof, and (iii) the
foregoing agreement shall in no way release, discharge, or otherwise limit the
obligations of such Guarantor under the Amended and Restated Guaranty Agreement.
This Acknowledgment of Guarantors is made and delivered as of May
12, 2000.
GUARANTORS:
NUCO2 ACQUISITION CORP.,
a Florida corporation
By: /s/ Xxxx X. Xxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Vice President
[CORPORATE SEAL]
XXXX COMPRESSED GASES, INC.,
a New Jersey corporation
By: /s/ Xxxx X. Xxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Vice President
[CORPORATE SEAL]
EXHIBIT A
ANNEX A
Date Projected Gross Margin
March 2000 49.90%
April 2000 50.20%
May 2000 50.50%
June 2000 50.80%
July 2000 50.80%
August 2000 51.20%
September 2000 51.60%
October 2000 51.70%
November 2000 52.30%
December 2000 52.70%
January 2001 53.30%
February 2001 53.70%
March 2001 54.20%
April 2001 54.60%
May 2001 55.10%
June 2001 55.50%
July 2001 55.80%
August 2001 56.10%
September 2001 56.40%
Date Projected Gross Margin
October 2001 56.70%
November 2001 57.00%
December 2001 57.20%
January 2002 57.60%
February 2002 57.80%
March 2002 58.10%
