EXHIBIT 10.6
[BANK ONE LOGO] AMENDMENT TO CREDIT AGREEMENT
This agreement is dated as of December 16, 2003, to be effective as of 12/17/03
by and between Cavco Industries, Inc. (the "Borrower") and Bank One, NA, with
its main office in Chicago, II (the "Bank"), and its successors and assigns.
WHEREAS, the Borrower and the Bank entered into a credit agreement dated
September 17, 2003, as amended (if applicable) (the "Credit Agreement"); and
WHEREAS, the Borrower has requested and the Bank has agreed to amend the Credit
Agreement as set forth below;
NOW, THEREFORE, in mutual consideration of the agreements contained herein and
for other good and valuable consideration, the parties agree as follows:
1. DEFINED TERMS. Capitalized terms not defined herein shall have the meaning
ascribed in the Credit Agreement.
2. MODIFICATION OF CREDIT AGREEMENT. The Credit Agreement is hereby amended
as follows:
2.1 From and after the date of this agreement, the following provision
is hereby added to the Credit Agreement:
1.4 LETTER OF CREDIT SUBLIMIT. At any time the Borrower is
entitled to an advance under Facility A, the Bank agrees to
issue letters of credit for the account of the Borrower in an
amount not in excess of the maximum advance that the Borrower
would then be entitled to obtain under Facility A, provided
that (a) the aggregate maximum available amount which is drawn
and unreimbursed or may be drawn under all letters of credit
which are outstanding at any time, including without
limitation all letters of credit issued for the account of the
Borrower which are outstanding on the date of the Line of
Credit Note, shall not exceed $5,000,000.00, (b) the issuance
of any letter of credit with an expiration date beyond the
maturity date of the Line of Credit Note shall be entirely at
the discretion of the Bank, (c) any letter of credit shall be
a standby letter of credit and the form of the requested
letter of credit shall be satisfactory to the Bank, in the
Bank's sole discretion, and (d) the Borrower shall have
executed an application and reimbursement agreement for any
letter of credit in the Bank's standard form. While any letter
of credit is outstanding, the maximum amount of advances that
may be outstanding under the Line of Credit Note shall be
automatically reduced by the maximum amount available to be
drawn under any and all such letters of credit. The Borrower
shall pay the Bank a fee for each standby letter of credit
that is issued, calculated at the rate of 2% per annum of the
original maximum amount available of such standby letter of
credit, with such fee being calculated on the basis of a
360-day year and the actual number of days in the period
during which the standby letter of credit will be outstanding;
provided, however, that such fee shall not be less than
$200.00 for each letter of credit. No credit shall be given
for fees paid due to early termination of any letter of
credit. The Borrower shall also pay the Bank's standard
transaction fees with respect to any transactions occurring on
an account of any letter of credit. Each fee shall be payable
when the related letter of credit is issued, and transaction
fees shall be payable upon completion of the transaction as to
which they are charged. All fees may be debited by the Bank to
any deposit account of the Borrower carried with the Bank
without further authority and, in any event, shall be paid by
the Borrower within ten (10) days following billing. If on the
maturity date of the Line of Credit Note, any letter of credit
issued by Bank hereunder remains outstanding, Borrower shall
if requested by Bank, within five (5) business days after such
request, cause to be placed in a deposit account with Bank
which is assigned to Bank to secure Borrower's reimbursement
obligation(s) applicable to such outstanding letters of
credit, cash in an amount which is not less than the aggregate
of the unfunded amounts under all such outstanding letters of
credit. Failure to timely comply with such request shall be a
default and Event of Default under this agreement and the
other loan documents, and Bank may proceed to exercise and
enforce its rights and remedies against any collateral and
utilize the proceeds thereof to create such cash deposit.
2.2 From and after the date of this agreement, the provision in the
Credit Agreement captioned 4.5 FINANCIAL REPORTS.
A. is amended as follows; the portion of the provision now reading:
"Within thirty (30) days after and as of the end of each calendar
month" is replaced with the following:
Within thirty (30) days after the end of each calendar month in
which as of the last day of such month, there is an outstanding
advance under Facility A,
2.3 From and after the date of this agreement, the provision in the
Credit Agreement captioned 4.5 FINANCIAL REPORTS.
B. is amended as follows: the portion of the provision now reading:
"Within thirty (30) days after each monthly period," is replaced
with the following:
Within thirty (30) days after the end of each monthly period in
which as of the last day of such month, there is an outstanding
advance under Facility A,
3. RATIFICATION. The Borrower ratifies and reaffirms the Credit Agreement and
the Credit Agreement shall remain in full force and effect as modified
herein.
4. BORROWER REPRESENTATIONS AND WARRANTIES. The Borrower represents and
warrants that (a) the representations and warranties contained in the
Credit Agreement are true and correct in all material respects as of the
date of this agreement, (b) no condition, act or event which could
constitute an event of default under the Credit Agreement or any
promissory note or credit facility executed in reference to the Credit
Agreement exists, and (c) no condition, event, act or omission has
occurred, which, with the giving of notice or passage of time, would
constitute an event of default under the Credit Agreement or any
promissory note or credit facility executed in reference to the Credit
Agreement.
5. FEES AND EXPENSES. The Borrower agrees to pay all fees and out-of-pocket
disbursements incurred by the Bank in connection with this agreement,
including legal fees incurred by the Bank in the preparation,
consummation, administration and enforcement of this agreement.
6. EXECUTION AND DELIVERY. This agreement shall become effective only after
it is fully executed by the Borrower and the Bank.
7. ACKNOWLEDGEMENTS OF BORROWER. The Borrower acknowledges that as of the
date of this agreement it has no offsets with respect to all amounts owed
by the Borrower to the Bank arising under or related to the Credit
Agreement on or prior to the date of this agreement. The Borrower fully,
finally and forever releases and discharges the Bank and its successors,
assigns, directors, officers, employees, agents and representatives from
any and all claims, causes of action, debts and liabilities, of whatever
kind or nature, in law or in equity, of the Borrower, whether now known or
unknown to the Borrower, which may have arisen in connection with the
Credit Agreement or the actions or omissions of the Bank related to the
Credit Agreement on or prior to the date hereof. The Borrower acknowledges
and agrees that this agreement is limited to the terms outlined above, and
shall not be construed as an agreement to change any other terms or
provisions of the Credit Agreement. This agreement shall not establish a
course of dealing or be construed as evidence of any willingness on the
Bank's part to grant other or future agreements, should any be requested.
[THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK]
NOT A NOVATION. This agreement is a modification only and not a novation. Expect
for the above-quoted modification(s), the Credit Agreement, any loan agreements,
credit agreements, reimbursement agreements, security agreements, mortgages,
deeds of trust, pledge agreements, assignments, guaranties, instruments or
documents executed in connection with the Credit Agreement, and all the terms
and conditions thereof, shall be and remain in full force and effect with the
changes herein deemed to be incorporated therein. This agreement is to be
considered attached to the Credit Agreement and made a part thereof. This
agreement shall not release or affect the liability of any guarantor of any
promissory note or credit facility executed in reference to the Credit Agreement
or release any owner of collateral granted as security for the Credit Agreement.
The validity, priority and enforceability of the Credit Agreement shall not be
impaired hereby. To the extent that any provision of this agreement conflicts
with any term or condition set forth in the Credit Agreement, or any document
executed in conjunction therewith, the provisions of this agreement shall
supersede and control. The Bank expressly reserves all rights against all
parties to the Credit Agreement.
BORROWER:
Cavco Industries Inc.
BY: /s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx CFO, Treasurer and Vice President
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Printed Name Title
Date Signed: 12/17/03
BANK:
Bank One, NA, with its main office in Chicago, IL
By: /s/ Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx Vice President
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Printed Name Title
Data Signed: 12/17/03
