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EXHIBIT 10.12
TENTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
ESCALADE, INCORPORATED, an Indiana corporation (the "Company"), and
BANK ONE, INDIANA, National Association, a national banking association (the
"Bank") being parties to that certain Amended and Restated Credit Agreement
dated as of May 31, 1996 as amended from time to time through the date hereof
(collectively the "Agreement"), hereby agree to amend the Agreement by this
Tenth Amendment to Amended and Restated Credit Agreement (the "Tenth
Amendment"), on the terms and subject to the conditions set forth as follows:
1. DEFINITIONS.
a. Terms used in this Tenth Amendment with their initial letter
capitalized which are not defined herein shall have the
meanings ascribed to them in the Agreement.
b. The following definitions set forth in Section 1 of the
Agreement are hereby amended and restated in their entirety to
read as follows:
o "Applicable Rate" means that number of percentage points to be taken
into account in determining the Applicable Spread which is used in
computing the rate at which interest accrues on the Loan and, the
Applicable Unused Fee Rate which is used in calculating the Unused Fee.
Initially, from the date of the Tenth Amendment and until receipt by
the Bank of the Company's first fiscal quarter end financial statements
furnished after such date to the Bank pursuant to the requirements of
Section 5.b(ii), the Applicable Rate shall be determined assuming a
Leverage Ratio of less than 1.50:1.0 in accordance with the following
table:
Applicable Rate
Applicable Spread* Applicable
Prime-based LIBOR-based Unused Fee
Leverage Ratio Rate Rate Rate
----------------------------------------- ------------------------ ------------------------ -----------------------
greater than or equal to
2.50:1.00 0.00% RL 2.00% RL .375%
----------------------------------------- ------------------------ ------------------------ -----------------------
less than or equal to 2.49:1.00, but
greater than or equal to 2.00:1.00
0.00% RL 1.75% RL .25%
----------------------------------------- ------------------------ ------------------------ -----------------------
less than or equal to1.99:1.00, but
greater than or equal to
1.50:1.00 0.00% RL 1.50% RL .25%
----------------------------------------- ------------------------ ------------------------ -----------------------
less than 1.50:1.00 0.00% RL 1.25% RL .25%
----------------------------------------- ------------------------ ------------------------ -----------------------
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* Where "RL" means Revolving Loan.
Such determination and resulting rate change will be effective as of the
first day of the month following the receipt of the financial statements.
Thereafter, the Applicable Rate shall be determined on the basis of the
financial statements of the Company for each fiscal quarter end furnished
to the Bank pursuant to the requirements of Section 5.b(ii), and shall be
effective as of the first day of the month following the receipt of the
financial statements. It is noted that the above table provides an
Applicable Rate for a Leverage Ratio greater than that which will be
permissible under the terms of Section 5.g(ii). For the avoidance of
doubt, it is agreed that it is the intent of the parties that the Bank
shall be free to exercise all remedies otherwise provided for in this
Agreement in the event of the violation by the Company of the covenant
stated in Section 5.g(ii), notwithstanding the accrual of interest upon
the Loan at a rate determined in accordance with this definition.
2. REVOLVING LOAN. Section 2.a. of the Agreement is hereby amended and restated
in its entirety, to read as follows and Sections 2.b and 2.c. are hereby
deleted:
a. The Revolving Loan. The Bank will make a revolving loan to the
Company on the following terms and subject to the following
conditions:
(i) The Commitment -- Use of Proceeds. From this date and until
March 31, 2005, the Bank agrees to make Advances
(collectively, the "Revolving Loan") under a revolving line of
credit from time to time to the Company of amounts not
exceeding in the aggregate at any time outstanding Twenty
Million Five Hundred Thousand and No/100 Dollars
($20,500,000.00) (the "Commitment"), as decreased from time to
time as hereinafter set forth, provided that all of the
conditions of lending stated in Section 7 of this Agreement as
being applicable to the Revolving Loan have been fulfilled at
the time of each Advance. Proceeds of the Revolving Loan shall
initially be used to restructure the principal balance
outstanding under the Term Loan and hereafter may be used by
the Company only to fund working capital requirements. The
initial Commitment shall be available to the Company until
March 31, 2001, on which date and on each March 31 thereafter
until March 31, 2005, the Commitment shall reduce by
$4,100,000. In the event Advances outstanding under the
Revolving Loan on such dates exceed the new Commitment amount,
after giving effect to the required reduction set forth above,
the Company shall, on such dates and without demand,
immediately repay such excess to the Bank.
(ii) Method of Borrowing. The obligation of the Company to repay
the Revolving Loan shall be evidenced by a promissory note
(the "Revolving Note") of the Company in the form of Exhibit
"A" to the Tenth
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Amendment. So long as no Event of Default or Unmatured Event
of Default shall have occurred and be continuing and until
March 31, 2005, the Company may borrow, repay and reborrow
(subject to Section 2.a.(i) above) under the Revolving Note on
any Banking Day, provided that no borrowing may cause the
principal balance of the Loan to exceed the Commitment or may
result in an Event of Default or an Unmatured Event of
Default. Each Advance under the Revolving Loan shall be
conditioned upon receipt by the Bank from the Company of an
Application for Revolving Loan Advance and an Officer's
Certificate, provided that the Bank may, at its discretion,
make a disbursement upon the oral request of the Company made
by an Authorized Officer, or upon a request transmitted to the
Bank by telephone facsimile ("fax") machine, or by any other
form of written electronic communication (all such requests
for Advances being hereafter referred to as "informal
requests"). In so doing, the Bank may rely on any informal
request which shall have been received by it in good faith
from a person reasonably believed to be an Authorized Officer.
Each informal request shall be promptly confirmed by a duly
executed Application and Officer's Certificate if the Bank so
requires and shall in and of itself constitute the
representation of the Company that no Event of Default or
Unmatured Event of Default has occurred and is continuing or
would result from the making of the requested Advance and that
the making of the requested Advance shall not cause the
principal balance of the Revolving Loan to exceed the current
Commitment. All borrowings and reborrowings and all repayments
shall be in amounts of not less than Twenty Five Thousand
Dollars ($25,000), except for repayment of the entire
principal balance of the Revolving Loan and except for special
prepayments of principal required under the terms of Section
2.a.(i). Upon receipt of an Application, or at the Bank's
discretion upon receipt of an informal request for an Advance
and upon compliance with any other conditions of lending
stated in Section 7 of this Agreement applicable to the
Revolving Loan, the Bank shall disburse the amount of the
requested Advance to the Company. All Advances by the Bank and
payments by the Company shall be recorded by the Bank on its
books and records, and the principal amount outstanding from
time to time, plus interest payable thereon, shall be
determined by reference to the books and records of the Bank.
The Bank's books and records shall be presumed prima facie to
be correct as to such matters.
(iii) Interest on the Revolving Loan. The principal amount of the
Revolving Loan outstanding from time to time shall bear
interest until maturity of the Revolving Note at a rate per
annum equal to the Prime Rate plus the Applicable Spread
except that at the option of the Company, exercised from time
to time as provided in Section 2.d.(i), interest may accrue
prior to maturity on any Advance or on the entire outstanding
balance of the Revolving Loan as to which no Optional Rate
previously elected remains
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in effect, at a LIBOR-based Rate for a period of one month,
three months or six months, provided that an election of an
Optional Rate for a period extending beyond March 31, 2005
shall be permitted only at the discretion of the Bank. After
maturity, whether on March 31, 2005 or on account of
acceleration of maturity upon the occurrence of an Event of
Default, and until paid in full, the Revolving Loan shall bear
interest at a rate equal to the Prime Rate plus three percent
(3%) plus the Applicable Spread, except as to any portion of
the Loan for which the Company may have elected an Optional
Rate for a period of time that has not expired at maturity,
such portion shall, during the remainder of such period, bear
interest at the greater of the Prime Rate plus the Applicable
Spread per annum or the Optional Rate then in effect plus
three percent (3%) per annum. Accrued interest shall be due
and payable monthly on the last Banking Day of each month
prior to maturity. After maturity, interest shall be payable
as accrued and without demand.
(iv) Unused Fee. In addition to interest on the Revolving loan, the
Company shall pay to the Bank a fee (the "Unused Fee") for
each partial or full calendar quarter during which the
Commitment is outstanding equal to the Applicable Unused Fee
Rate per annum of the amount of the average daily excess of
the Commitment over the average daily principal balance
outstanding under the Revolving Loan. Unused fees for each
calendar quarter shall be due and payable within ten (10) days
following the Bank's submission of a statement of the amount
due. Such fees may be debited by the Bank when due to any
demand deposit account of the Company carried with the Bank
without further authority.
3. EVENTS OF DEFAULT. Section 8, subsections d, e and f of the Agreement are
hereby amended and restated to read in their entirety as follows:
d. Nonpayment of Other Indebtedness for Borrowed Money. Default by the
Company or any Subsidiary in the payment when due, whether by
acceleration or otherwise, of any other material indebtedness for
borrowed money, or default in the performance or observance of any
obligation or condition with respect to any such other indebtedness
if the effect of such default is to accelerate the maturity of such
other indebtedness or to permit the holder or holders thereof, or
any trustee or agent for such holders, to cause such indebtedness to
become due and payable prior to its scheduled maturity, unless the
Company or any Subsidiary is contesting the existence of such
default in good faith and by appropriate proceedings and that
appropriate reserves have been established with respect thereto.
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e. Other Material Obligations. Subject to the expiration of any
applicable grace period, default by the Company or any Subsidiary in
the payment when due, or in the performance or observance of any
material obligation of, or condition agreed to by the Company or any
Subsidiary with respect to any material purchase or lease of goods,
securities or services except only to the extent that the existence
of any such default is being contested in good faith and by
appropriate proceedings and that appropriate reserves have been
established with respect thereto.
f. Bankruptcy, Insolvency, etc. The Company or any Subsidiary admitting
in writing its inability to pay its debts as they mature or an
administrative or judicial order of dissolution or determination of
insolvency being entered against the Company or any Subsidiary; or
the Company or any Subsidiary applying for, consenting to, or
acquiescing in the appointment of a trustee or receiver for the
Company or any Subsidiary or any property thereof, or the Company or
any Subsidiary making a general assignment for the benefit of
creditors; or, in the absence of such application, consent or
acquiescence, a trustee or receiver being appointed for the Company
or any Subsidiary or for a substantial part of its property and not
being discharged within sixty (60) days; or any bankruptcy,
reorganization, debt arrangement, or other proceeding under any
bankruptcy or insolvency law, or any dissolution or liquidation
proceeding being instituted by or against the Company or any
Subsidiary, and, if involuntary, being consented to or acquiesced in
by the Company or any Subsidiary or remaining for sixty (60) days
undismissed.
4. REPRESENTATIONS AND WARRANTIES. In order to induce the Bank to enter
into this Tenth Amendment, the Company represents and warrants to the Bank that:
a. The execution and delivery of this Tenth Amendment, the execution
and delivery of all of the other documents executed in connection
herewith, and the performance by the Company of its obligations under
this Tenth Amendment and all of the documents executed in connection
herewith are within the corporate power of the Company, have been duly
authorized by all necessary corporate action, have received any
required governmental or regulatory agency approvals and do not and
will not contravene or conflict with any provision of law or of the
Articles of Incorporation or Bylaws of the Company or of any agreement
binding upon the Company or any of its property.
b. This Tenth Amendment and all of the documents executed by the
Company in connection herewith are the legal, valid and binding
obligations of the Company, enforceable against the Company in
accordance with their respective terms, except to the extent that
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws enacted for the relief of
debtors generally and other similar laws affecting the enforcement of
creditors' rights generally or by equitable principles which may affect
the availability of specific performance and other equitable remedies.
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c. The representations and warranties contained in Section 3 of the
Agreement are true and correct as of the date hereof except that the
representations contained in Section 3.d. of the Agreement shall be
deemed to refer to the latest financial statements furnished by the
Company to the Bank.
d. No Event of Default or Unmatured Event of Default has occurred and
is continuing as of the date of this Tenth Amendment.
5. CONDITIONS PRECEDENT. This Tenth Amendment shall become effective upon the
Bank's receipt of the following, contemporaneously with the execution of this
Tenth Amendment, each duly executed, dated and in form and substance
satisfactory to the Bank:
a. This Tenth Amendment;
b. The replacement Revolving Loan Note;
c. Certified copies of Resolutions of the Board of Directors of the
Company, authorizing the execution, delivery and performance,
respectively of this Tenth Amendment and the Revolving Loan Note, and
the other Loan Documents to which such entity is a party;
d. Certificate of the Secretary of the Company certifying the name of
the officer or officers authorized to sign each document to which the
Company is a party, together with a sample of the true signature of
each such officer;
e. Copies of the Articles of Incorporation and Bylaws of the Company
certified by the Secretary of such entity or a Certificate of No Change
to such documents if previously delivered to the Bank;
f. An opinion of counsel for the Company in form and substance
acceptable to the Bank and its counsel;
g. Receipt of payment of the reasonable legal fees and expenses of
Bank's counsel at closing or immediately upon receipt by Borrower of an
invoice therefor.
h. Such other documents as the Bank may reasonably request, including
but not limited to all documents filed with the Securities and Exchange
Commission regarding the tender offer.
6. PRIOR AGREEMENTS. The Agreement, as amended by this Tenth Amendment,
supersedes all previous agreements and commitments made or issued by the Bank,
related to all of the subjects of the Agreement, as amended by this Tenth
Amendment, and any oral or written proposals or commitments made or issued by
the Bank.
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7. AFFIRMATION. Except as expressly amended by this Tenth Amendment, all of the
terms and conditions of the Agreement and each of the Loan Documents remains in
full force and effect.
Executed on May 16, 2000 but effective as of May 15, 2000.
ESCALADE, INCORPORATED
By /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx, Secretary
BANK ONE, INDIANA, NATIONAL ASSOCIATION
By /s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx, Vice President and
Senior Relationship Manager
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Reaffirmation of Guaranties
The undersigned, each a duly appointed officer of the Guarantors
identified below, hereby ratify and affirm that their Unconditional Limited
Guarantors previously executed and delivered in favor of the Bank continue
unchanged and in full force and effect as to the indebtedness of the Company to
the Bank as it now exists and as it may be increased, extended, renewed or
amended from time to time hereinafter.
Executed and delivered by each of the Guarantors as of the date written
opposite their respective names below.
XXXXXX YALE INDUSTRIES, INC.
Date: May 16, 2000 By /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx, Secretary
(Printed Name and Title)
INDIAN INDUSTRIES, INC.
Date: May 16, 2000 By /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx, Secretary
(Printed Name and Title)
HARVARD SPORTS, INC.
Date: May 16, 2000 By /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx, Secretary
(Printed Name and Title)
MASTER PRODUCTS MANUFACTURING, INC.
Date: May 16, 2000 By /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx, Secretary
(Printed Name and Title)
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