Exhibit 10.1
AMENDMENT NO. 1 TO CREDIT AGREEMENT
This AMENDMENT NO. 1 TO CREDIT AGREEMENT (this "Amendment"), dated as
of March 25, 2005 is entered into by and among WEST MARINE PRODUCTS, INC., a
California corporation ("Borrower"), the Requisite Lenders (as defined in the
Credit Agreement referred to below), XXXXX FARGO BANK, NATIONAL ASSOCIATION, as
Administrative Agent, a Lender, the Issuing Lender and the Swing Line Lender,
with respect to the following:
A. Borrower, the Administrative Agent and the Lenders have previously
entered into that certain Credit Agreement dated as of October 14, 2004 (as it
existed prior to the date hereof, the "Existing Credit Agreement" and as the
same may be further amended, restated, supplemented or otherwise modified and in
effect from time to time, including, but not limited to, by this Amendment, the
"Credit Agreement"). Capitalized terms are used in this Amendment as defined in
the Credit Agreement, unless otherwise defined herein.
B. Borrower has requested certain amendments to Section 6.13 of the
Existing Credit Agreement.
C. The Administrative Agent and the Requisite Lenders are willing to
grant such requests on the terms and subject to the conditions of this
Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto hereby
agree as follows:
1. Effectiveness. The effectiveness of the provisions in
Sections 2 and 3 of this Amendment is subject to the satisfaction of the
conditions further described in Section 5 of this Amendment.
2. Leverage Ratio.
(a) Section 6.13 of the Existing Credit Agreement is hereby
amended and restated in its entirety as follows:
"6.13 Leverage Ratio. Permit the ratio of Funded Debt as
of the last day of any Fiscal Quarter plus six times Rental Expense for
Parent and its Subsidiaries, on a consolidated basis, for the 12-month period
then ended to EBITDAR for Parent and its Subsidiaries, on a consolidated
basis, for the 12-month period then ended to exceed (a) 3.75 to 1.00 on the
last day of such Fiscal Quarter (except for the Fiscal Quarter ending April
2, 2005) or (b) 4.00 to 1.00 on the last day of the Fiscal Quarter ending
April 2, 2005."
(b) The chart in clause H of Exhibit B (Compliance
Certificate) to the Existing Credit Agreement is hereby amended and restated in
its entirety as follows:
Maximum Permitted:
for all Fiscal Quarters except for the
Fiscal Quarter ending April 2, 2005 3.75 to 1.00
for the Fiscal Quarter ending April 2, 2005 4.00 to 1.00
3. Patriot Act. A new Section 11.25 is hereby added to the
Existing Credit Agreement as follows:
"11.25 Patriot Act. The Lenders hereby notify the Borrower
that pursuant to the requirements of the USA PATRIOT Act, Title III of Pub.
L. 107-56 (signed into law October 26, 2001) (the "Patriot Act"), each of the
Lenders is required to obtain, verify and record information that identifies
the Borrower, which information includes the Borrower's name and address and
other information that will allow the Lenders to identify the Borrower in
accordance with the Patriot Act."
4. Fees. In addition to all other amounts payable by Borrower
to the Administrative Agent and/or the Lenders, Borrower shall pay on the
Amendment Effective Date (as hereinafter defined) to each Lender a
non-refundable amendment fee in an amount equal to 0.070% of such Lender's
Commitment (the "Amendment Fees"). The Amendment Fees are fully earned, due and
payable as of the Amendment Effective Date.
5. Conditions Precedent to the Effectiveness of this Amendment.
The effectiveness of the provisions contained in Sections 2 and 3 above is
conditioned upon, and such provisions shall not be effective until, each of the
following conditions has been satisfied unless any such condition has been
waived in writing by the Requisite Lenders (the first date on which all of the
following conditions have been satisfied or waived in writing being referred to
herein as the "Amendment Effective Date"):
(a) The Administrative Agent shall have received, on behalf of
the Lenders, this Amendment (including the Guarantor reaffirmation attached
hereto), duly executed and delivered by Borrower, the Administrative Agent, the
Requisite Lenders and the Guarantors.
(b) The Administrative Agent shall have received, on behalf of
the Lenders, the Amendment Fees.
(c) The representations and warranties set forth in this
Amendment shall be true and correct in all material respects as of the Amendment
Effective Date.
6. Representations and Warranties. In order to induce the
Administrative Agent and the Requisite Lenders to enter into this Amendment and
to amend the Existing Credit Agreement in the manner provided in this Amendment,
Borrower represents and warrants to the Administrative Agent and each Lender as
follows:
(a) Power and Authority. Borrower has all requisite corporate
power and authority to enter into this Amendment and to carry out the
transactions contemplated by, and perform its obligations under, the Existing
Credit Agreement as amended by this Amendment (hereafter referred to as the
"Amended Credit Agreement").
(b) Authority; Compliance With Other Agreements and
Instruments and Government Regulations. The execution, delivery and performance
by Borrower of this Amendment and the Amended Credit Agreement have been duly
authorized by all necessary corporate action and do not and will not:
(i) Require any consent or approval not heretofore
obtained of any partner, director, stockholder, member, security holder or
creditor of Borrower, Parent or any of their collective Subsidiaries;
(ii) Violate or conflict with any provision of any of
Borrower's, Parent's or any of their collective Subsidiaries' charter,
certificate of incorporation, bylaws, or other organizational documents, as
applicable;
(iii) Result in or require the creation or imposition of
any Lien (other than pursuant to the Loan Documents) or Right of Others upon or
with respect to any Property now owned or leased or hereafter acquired by
Borrower, Parent or any of their collective Subsidiaries, except where the Lien
or Right of Others could not reasonably be expected to have a Material Adverse
Effect;
(iv) Constitute a "transfer of an interest" or an
"obligation incurred" that is avoidable by a trustee under Section 548 of the
Bankruptcy Code of 1978, as amended, or constitute a "fraudulent conveyance,"
"fraudulent obligation" or "fraudulent transfer" within the meanings of the
Uniform Fraudulent Conveyances Act or Uniform Fraudulent Transfer Act, as
enacted in any applicable jurisdiction;
(v) Violate any Requirement of Law applicable to Borrower,
Parent or any of their collective Subsidiaries except where the violation could
not reasonably be expected to have a Material Adverse Effect; or
(vi) Result in a breach of or constitute a default under,
or cause or permit the acceleration of any obligation owed under, any indenture
or loan or credit agreement or any other Contractual Obligation to which any of
Borrower, Parent or any of their collective Subsidiaries is a party or by which
any of Borrower, Parent or any of their collective Subsidiaries or any of their
respective Property is bound or affected except where such breach, default or
acceleration under any Contractual Obligation, or any indenture, loan or credit
agreement could not reasonably be expected to have a Material Adverse Effect.
(c) Binding Obligations. This Amendment and the Amended Credit
Agreement each constitute the legal, valid and binding obligation of Borrower,
enforceable against Borrower in accordance with its terms, except as enforcement
may be limited by Debtor Relief Laws or equitable principles relating to the
granting of specific performance and other equitable remedies as a matter of
judicial discretion.
(d) Governmental Consents. No authorization, consent,
approval, order, license or permit from, or filing, registration or
qualification with, any Governmental Agency is or will be required to authorize
or permit under applicable Laws the execution, delivery and performance by
Borrower of this Amendment.
(e) Representations and Warranties in the Credit Agreement.
Borrower confirms that as of the Amendment Effective Date the representations
and warranties contained in Article 4 of the Credit Agreement are (before and
after giving effect to this Amendment) true and correct in all material respects
(except to the extent any such representation and warranty is expressly stated
to have been made as of a specific date, in which case it shall be true and
correct in all material respects as of such specific date) and that no Default
or Event of Default has occurred and is continuing.
7. Reference to and Effect on the Existing Credit Agreement and
the other Loan Documents.
(a) Except as specifically amended by this Amendment and the
documents executed and delivered in connection herewith, the Existing Credit
Agreement and the other Loan Documents shall remain in full force and effect and
are hereby ratified and confirmed by Borrower in all respects.
(b) The execution and delivery of this Amendment and
performance of the Amended Credit Agreement shall not, except as expressly
provided herein, constitute a waiver of any provision of, or operate as a waiver
of any right, power or remedy of the Administrative Agent or the Lenders under,
the Existing Credit Agreement or any of the other Loan Documents.
(c) Upon the conditions precedent set forth herein being
satisfied, this Amendment shall be construed as one with the Existing Credit
Agreement, and the Existing Credit Agreement shall, where the context requires,
be read and construed throughout so as to incorporate this Amendment.
8. If there is any conflict between the terms and provisions of
this Amendment and the terms and provisions of the Credit Agreement or any
other Loan Document, the terms and provisions of this Amendment shall govern.
9. Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument. Delivery of an executed
counterpart of a signature page of this Amendment by telecopy (or by e-mail of a
PDF or similar electronic image file) shall be effective as delivery of a
manually executed counterpart of this Amendment.
10. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF CALIFORNIA APPLICABLE TO
CONTRACTS MADE AND PERFORMED IN CALIFORNIA.
11. Waiver of Right to Trial by Jury. EACH PARTY TO THIS AMENDMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER THIS AMENDMENT OR IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTY HERETO OR ANY OF THEM WITH
RESPECT TO THIS AMENDMENT, OR THE TRANSACTIONS RELATED HERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AMENDMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
12. Attorneys' Fees and Other Costs. Borrower agrees to pay, on
demand, all reasonable attorneys' fees and costs (and allocated costs of
attorneys employed by the Administrative Agent ) incurred in connection with the
negotiation, documentation and execution of this Amendment.
13. Miscellaneous. This Amendment is a Loan Document as defined in
the Credit Agreement, and the provisions of the Credit Agreement generally
applicable to Loan Documents are applicable hereto and incorporated herein by
this reference.
[This Space Intentionally Left Blank]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the date first above written.
WEST MARINE PRODUCTS, INC.,
a California corporation
By /s/ Xxxx Xxxxxx
--------------------------------------
Name: Xxxx Xxxxxx
Title: Senior Vice President - Finance
and Chief Financial Officer
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Administrative Agent, a Lender, the Issuing
Lender and the Swing Line Lender
By /s/ Xxxxxxx Xxxxxx
--------------------------------------
Xxxxxxx Xxxxxx
Vice President
UNION BANK OF CALIFORNIA, N.A.,
as a Lender
By /s/ Xxxx Xxxxx
--------------------------------------
Name: Xxxx Xxxxx
Title: Vice President
BANK OF AMERICA, N.A.,
as a Lender
By /s/ Xxxxxx Xxxxxx
--------------------------------------
Name: Xxxxxx Xxxxxx
Title: Senior Vice President
U.S. BANK NATIONAL ASSOCIATION,
as a Lender
By /s/ Holland Xxxxxxxx
--------------------------------------
Name: Holland Xxxxxxxx
Title: Assistant Relationship Manager
BANK OF THE WEST,
as a Lender
By /s/ Xxxxx Xxxxxx
--------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
Each of the undersigned hereby acknowledges and consents to the
foregoing Amendment and confirms and agrees that each Guaranty, dated as of
October 14, 2004, executed by it in favor of the Administrative Agent and the
Lenders remains in full force and effect in accordance with its terms and is
hereby reaffirmed and ratified by each of the undersigned and each of the
undersigned hereby confirms that the representations and warranties contained in
each such Guaranty (including any incorporated by reference to the Credit
Agreement) are (before and after giving effect to this Amendment) true and
correct in all material respects.
WEST MARINE, INC.,
a Delaware corporation
By:/s/ Xxxx Xxxxxx
------------------------------
Name: Xxxx Xxxxxx
Title: Senior Vice President - Finance
and Chief Financial Officer
WEST MARINE PUERTO RICO, INC.,
a California corporation
By:/s/ Xxxx Xxxxxx
-----------------------------------
Name: Xxxx Xxxxxx
Title: Senior Vice President - Finance
and Chief Financial Officer
W MARINE MANAGEMENT COMPANY, INC.,
a California corporation
By:/s/ Xxxx Xxxxxx
-----------------------------------
Name: Xxxx Xxxxxx
Title: Senior Vice President - Finance
and Chief Financial Officer
WEST MARINE LBC, INC.,
a California corporation
By:/s/ Xxxx Xxxxxx
-----------------------------------
Name: Xxxx Xxxxxx
Title: Senior Vice President - Finance
and Chief Financial Officer
WEST MARINE IHC I, INC.,
a California corporation
By:/s/ Xxxx Xxxxxx
-----------------------------------
Name: Xxxx Xxxxxx
Title: Senior Vice President - Finance
and Chief Financial Officer
WEST MARINE CANADA CORP.,
a Nova Scotia unlimited liability company
By:/s/ Xxxx Xxxxxx
-----------------------------------
Name: Xxxx Xxxxxx
Title: Senior Vice President - Finance
and Chief Financial Officer
