Exhibit 10.10
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AMENDMENT NO. 3 TO CREDIT AGREEMENT
THIS AMENDMENT NO. 3 TO CREDIT AGREEMENT (this "AMENDMENT"), dated as
of December 31, 2001, by and among:
(i) XXXXXXX & SYLVAN POOLS CORPORATION, an Ohio corporation
(herein, together with its successors and assigns, the "BORROWER");
(ii) the financial institutions listed on the signature pages
hereof (collectively, the "LENDERS"); and
(iii) NATIONAL CITY BANK, a national banking association, as a
Lender, the Letter of Credit Issuer, the Collateral Agent and the
Administrative Agent.
PRELIMINARY STATEMENTS:
(1) The Borrower, the Lenders, the Letter of Credit Issuer, the
Collateral Agent and the Administrative Agent entered into the Credit Agreement,
dated as of July 8, 1999, as amended (the "CREDIT AGREEMENT"; the terms defined
therein used herein as so defined).
(2) The parties hereto desire to modify certain provisions of the
Credit Agreement, all as more fully set forth below.
NOW, THEREFORE, the parties hereby agree as follows:
SECTION 1. AMENDMENTS.
1.1. AMENDMENT TO MATURITY DATE. Section 1.1 of the Credit Agreement is
hereby amended to delete the definition of "MATURITY DATE" therefrom and to
insert in place thereof the following:
"MATURITY DATE" shall mean August 10, 2004, unless extended in
accordance with Section 4.4, or such earlier date on which the Total
Commitment is terminated.
1.2. AMENDMENT TO DATE OF PROJECTIONS. Section 8.1 of the Credit
Agreement is hereby amended to delete subsections (c) and (e) therefrom and to
insert in place thereof the following:
(c) OFFICER'S COMPLIANCE CERTIFICATES. (i) At the time of the
delivery of the financial statements provided for in sections 8.1(a)
and (b), a certificate on behalf of the Borrower of the Chief Financial
Officer or other Authorized Officer of the Borrower to the effect that,
to the best knowledge of the Borrower, no Default or Event of Default
exists or, if any Default or Event of Default does exist, specifying
the nature and extent thereof and the actions the Borrower proposes to
take with respect thereto, which certificate shall set forth the
calculations required to establish compliance with the provisions of
sections 9.4(c), 9.7, 9.8, 9.9, 9.10, 9.11 and 9.13 of this Agreement;
(ii) on January 31(st), February 28(th) (or 29(th), as the case may
be), and March 31(st) of each fiscal year of the Borrower, a
certificate on behalf of the Borrower of the Chief Financial Officer
or other Authorized Officer of the Borrower to the effect that, to
the best knowledge of the Borrower, no Default or
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Event of Default exists or, if any Default or Event of Default does
exist, specifying the nature and extent thereof and the actions the
Borrower proposes to take with respect thereto, which certificate shall
set forth the calculations required to establish compliance with the
provisions of section 9.8 of this Agreement; and (iii) if after the
Borrower delivers a certificate pursuant to this section 8.1(c) for any
fiscal period, the Borrower completes an Acquisition, the Borrower may
deliver another certificate pursuant to this section 8.1(c) for the
same fiscal period which gives pro forma effect to such Acquisition for
the period prior to the date of the Acquisition which is covered by
such fiscal period or prior periods, in the manner contemplated by the
definition of Consolidated EBITDA and other applicable defined terms,
in the computations establishing compliance with such sections.
(e) BUDGETS AND FORECASTS. On or before March 31st of any
fiscal year of the Borrower and its Subsidiaries, a consolidated budget
in reasonable detail for each of the four fiscal quarters of such
fiscal year, and (if and to the extent prepared by management of the
Borrower) for any subsequent fiscal year, as customarily prepared by
management for its internal use, setting forth, with appropriate
discussion, the forecasted balance sheet, income statement, operating
cash flows and capital expenditures of the Borrower and its
Subsidiaries for the period covered thereby, and the principal
assumptions upon which such forecast and budget are based.
1.3. AMENDMENT TO LEVERAGE RATIO COVENANT. Section 9.8 of the Credit
Agreement is hereby amended to add the following new sentence thereto:
Notwithstanding the foregoing, commencing January 1, 2002, for the time
period from January 1 through March 30 of each fiscal year of the
Borrower, the Borrower will not suffer or permit at any time during any
such calendar month the ratio of (a) the amount of its Consolidated
Total Debt for such calendar month to (b) its Consolidated EBITDA for
the most recently completed 12 calendar months, to exceed 4.00 to 1.00.
1.4. AMENDMENT TO CAPITAL EXPENDITURE LIMITATION. The Credit Agreement
is hereby amended to delete Section 9.11 therefrom and to insert in place
thereof the following:
9.11. CONSOLIDATED CAPITAL EXPENDITURES. The Borrower will
not, and will not permit any of its Subsidiaries to, make or incur
Consolidated Capital Expenditures during any fiscal period of the
Borrower in excess of the amount specified below, except that in the
event actual Consolidated Capital Expenditures for any fiscal period
indicated below are less than such amount, 50% of the difference may be
carried over to the next fiscal period indicated below, but not any
subsequent fiscal period:
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Fiscal Year Amount
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Borrower's fiscal year ended December 31, 1999 $1,500,000
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Borrower's fiscal year ended December 31, 2000 $3,500,000
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Borrower's fiscal year ended December 31, 2001 and $5,000,000
thereafter
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SECTION 2. REPRESENTATIONS AND WARRANTIES. The Borrower represents and
warrants to the Lenders and the Administrative Agent as follows:
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2.1 AUTHORIZATION, VALIDITY AND BINDING EFFECT. This Amendment has been
duly authorized by all necessary corporate action on the part of the Borrower,
has been duly executed and delivered by a duly authorized officer or officers of
the Borrower, and constitutes the valid and binding agreement of the Borrower,
enforceable against the Borrower in accordance with its terms.
2.2. REPRESENTATIONS AND WARRANTIES TRUE AND CORRECT. The
representations and warranties of the Borrower contained in the Credit
Agreement, as amended hereby, are true and correct on and as of the date hereof
as though made on and as of the date hereof, except to the extent that such
representations and warranties expressly relate to a specified date, in which
case such representations and warranties are hereby reaffirmed as true and
correct when made.
2.3. NO EVENT OF DEFAULT. No condition or event has occurred or exists
that constitutes or that, after notice or lapse of time or both, would
constitute a Default or an Event of Default.
2.4. NO CLAIMS. The Borrower is not aware of any claim or offset
against, or defense or counterclaim to, any of its obligations or liabilities
under the Credit Agreement or any other Credit Document.
SECTION 3. RATIFICATIONS. Except as expressly modified and superseded
by this Amendment, the terms and provisions of the Credit Agreement are ratified
and confirmed and shall continue in full force and effect.
SECTION 4. BINDING EFFECT. Concurrently herewith:
(a) the Borrower shall have paid all legal fees and expenses of the
Administrative Agent in connection with this Amendment and the documents
executed in connection herewith; and
(b) the Borrower shall have provided such other items and shall have
satisfied such other conditions as may be reasonably required by the
Administrative Agent and the Lenders.
SECTION 5. MISCELLANEOUS.
5.1. SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon and
inure to the benefit of the Borrower, each Lender and the Administrative Agent
and their respective permitted successors and assigns.
5.2. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made in this Amendment shall survive the execution and delivery
of this Amendment, and no investigation by the Administrative Agent or any
Lender or any subsequent Loan or issuance of a Letter of Credit shall affect the
representations and warranties or the right of the Administrative Agent or any
Lender to rely upon them.
5.3. REFERENCE TO CREDIT AGREEMENT. The Credit Agreement and any and
all other agreements, instruments or documentation now or hereafter executed and
delivered pursuant to the terms of the Credit Agreement as amended hereby, are
hereby amended so that any reference therein to the Credit Agreement shall mean
a reference to the Credit Agreement as amended hereby.
5.4. SEVERABILITY. Any term or provision of this Amendment held by a
court of competent jurisdiction to be invalid or unenforceable shall not impair
or invalidate the remainder of this Amendment and the effect thereof shall be
confined to the term or provision so held to be invalid or unenforceable.
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5.5. APPLICABLE LAW. This Amendment shall be governed by and construed
in accordance with the laws of the State of Ohio, without regard to principles
of conflicts of laws.
5.6. HEADINGS. The headings, captions and arrangements used in this
Amendment are for convenience only and shall not affect the interpretation of
this Amendment.
5.7. ENTIRE AGREEMENT. This Amendment is specifically limited to the
matters expressly set forth herein. This Amendment and all other instruments,
agreements and documentation executed and delivered in connection with this
Amendment embody the final, entire agreement among the parties hereto with
respect to the subject matter hereof and supersede any and all prior
commitments, agreements, representations and understandings, whether written or
oral, relating to the matters covered by this Amendment, and may not be
contradicted or varied by evidence of prior, contemporaneous or subsequent oral
agreements or discussions of the parties hereto. There are no oral agreements
among the parties hereto relating to the subject matter hereof or any other
subject matter relating to the Credit Agreement.
5.8. WAIVER OF CLAIMS. The Borrower, by signing below, hereby waives
and releases the Administrative Agent, the Collateral Agent, the Letter of
Credit Issuer and each of the Lenders and their respective directors, officers,
employees, attorneys, affiliates and subsidiaries from any and all claims,
offsets, defenses and counterclaims of which Borrower is aware, such waiver and
release being with full knowledge and understanding of the circumstances and
effect thereof and after having consulted legal counsel with respect thereto.
5.9. COUNTERPARTS. This Amendment may be executed by the parties hereto
separately in one or more counterparts, each of which when so executed shall be
deemed to be an original, but all of which when taken together shall constitute
one and the same agreement. Transmission by a party to another party (or its
counsel) via facsimile of a copy of this Amendment (or a signature page of this
Amendment) shall be as fully effective as delivery by such transmitting party to
the other parties hereto of a counterpart of this Amendment that had been
manually signed by such transmitting party.
[Remainder of page intentionally left blank.]
5.10. JURY TRIAL WAIVER. EACH OF THE PARTIES TO THIS AMENDMENT HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AMENDMENT, THE OTHER CREDIT
DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH PARTY HERETO
HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AMENDMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS PARAGRAPH.
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IN WITNESS WHEREOF, this Amendment has been duly executed and delivered
as of the date first above written.
XXXXXXX & SYLVAN POOLS NATIONAL CITY BANK,
CORPORATION as the Administrative Agent, the Collateral Agent, the
Letter of Credit Issuer and as a Lender
By:_________________________________ By:_______________________________
Name:_______________________________ Name:_____________________________
Title:______________________________ Title:____________________________
THE HUNTINGTON NATIONAL BANK FIRSTAR BANK, N.A.
By:________________________________ By:_______________________________
Name:______________________________ Name:_____________________________
Title:_____________________________ Title:____________________________
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