Exhibit 10.1
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is made and
entered into as of this 20th day of October, 2003 by and among COMPX
INTERNATIONAL INC., a Delaware corporation (the "Borrower"), the banks and
lending institutions party to the Credit Agreement referred to below (the
"Lenders"), and WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking
association, in its capacity as administrative agent for the Lenders (the
"Administrative Agent").
The Lenders have extended certain credit facilities to the Borrower
pursuant to the Credit Agreement dated as of January 22, 2003, by and among the
Borrower, the Lenders and the Administrative Agent (as amended, restated,
supplemented or otherwise modified from time to time, the "Credit Agreement").
The parties now desire to amend the Credit Agreement (with such amendment
to be effective in accordance with Section 3 below) to exclude certain severance
charges incurred during the third quarter of 2003 from the calculation of EBIT
for purposes of Section 9.3 (Interest Coverage Ratio) subject to the terms and
conditions set forth below.
NOW THEREFORE, for good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties hereto agree as follows:
1. Capitalized Terms. All capitalized undefined terms used in this
Amendment shall have the meanings assigned thereto in the Credit Agreement.
2. Amendment to Credit Agreement. The Credit Agreement is hereby
amended by deleting Section 9.3 (Interest Coverage Ratio) in its entirety and
replacing it with the following:
SECTION 9.3 Interest Coverage Ratio. As of any fiscal quarter end
during the periods set forth below, permit the ratio of
(a) (i) EBIT for the period of four (4) consecutive fiscal
quarters ending on or immediately prior to such date, less (ii) with
respect to the periods of four (4) consecutive fiscal quarters ending
on September 30, 2003, December 31, 2003, March 31, 2004 and June 30,
2004, severance charges, in an aggregate amount not to exceed
$4,000,000, incurred during the fiscal quarter ending September 30,
2003 and related to the Borrower's and its Subsidiaries' operations in
the Netherlands, to
(b) Interest Expense for the period of four (4) consecutive
fiscal quarters ending on or immediately prior to such date,
to be less than the corresponding ratio set forth below:
Period Ratio
Closing Date through and including December 31, 2003 2.25 to 1.00
January 1, 2004 and thereafter 2.50 to 1.00
3. Effectiveness. This Amendment shall become effective as of
September 30, 2003, subject to the satisfaction of each of the following
conditions (whether satisfied before or after September 30, 2003):
(a) Amendment Documents. The Administrative Agent shall have received
this Amendment executed by the Borrower, each of the Subsidiary Guarantors and
each of the Required Lenders.
(b) Amendment Fee. The Administrative Agent shall have received, for
the account of each Lender which shall have executed this Amendment concurrently
with or prior to the effectiveness hereof, an amendment fee in an aggregate
amount equal to 0.05% of the aggregate amount of each such Lender's Commitment.
(c) Other Fees and Expenses. The Administrative Agent shall have been
reimbursed for all fees and out of pocket charges and other expenses incurred in
connection with this Amendment (including, without limitation, the costs and
expenses referred to in Section 8 hereof, and the Credit Agreement) and the
transactions contemplated thereby.
(d) Other Documents. The Administrative Agent shall have received any
other documents, certificates or instruments reasonably requested thereby in
connection with the execution of this Amendment.
5. Effect of the Amendment. Except as expressly modified hereby, the
Credit Agreement and the other Loan Documents shall be and remain in full force
and effect. This Amendment shall not be deemed (a) to be a waiver of, or consent
to, a modification or amendment of, any other term or condition of the Credit
Agreement or any other Loan Document or (b) to prejudice any other right or
rights which the Administrative Agent or the Lenders may now have or may have in
the future under or in connection with the Credit Agreement or the other Loan
Documents or any of the instruments or agreements referred to therein, as the
same may be amended or modified from time to time.
6. Representations and Warranties/No Default.
(a) By its execution hereof, the Borrower hereby certifies that (i)
each of the representations and warranties set forth in the Credit Agreement and
the other Loan Documents is true and correct as of the date hereof as if fully
set forth herein unless such representations and warranties relate to a specific
date, in which case such representations and warranties shall be true and
correct as of such specific date and (ii) no Default or Event of Default has
occurred and is continuing as of the date hereof.
(b) By its execution hereof, the Borrower represents and warrants that
as of the date hereof there are no claims or offsets against or defenses or
counterclaims to any of the obligations of the Borrower or any Subsidiary
Guarantor under the Credit Agreement or any other Loan Document.
(c) By its execution hereof, the Borrower hereby represents and
warrants that the Borrower and each Subsidiary Guarantor has the right, power
and authority and has taken all necessary corporate and other action to
authorize the execution, delivery and performance of this Amendment and each
other document executed in connection herewith to which it is a party in
accordance with their respective terms. This Amendment and each other document
executed in connection herewith has been duly executed and delivered by the duly
authorized officers of the Borrower and each Subsidiary Guarantor, and each such
document constitutes the legal, valid and binding obligation of the Borrower and
each Subsidiary Guarantor, enforceable in accordance with its terms.
7. Acknowledgement by Subsidiary Guarantors. By their execution
hereof, each of the Subsidiary Guarantors hereby expressly (a) consents to the
modifications and amendments set forth in this Amendment, (b) reaffirms all of
its respective covenants, representations, warranties and other obligations set
forth in the Subsidiary Guaranty Agreement and the other Loan Documents to which
it is a party and (c) acknowledges, represents and agrees that its respective
covenants, representations, warranties and other obligations set forth in the
Subsidiary Guaranty Agreement and the other Loan Documents to which it is a
party remain in full force and effect.
8. Costs and Expenses. The Borrower shall pay all reasonable
out-of-pocket costs and expenses of the Administrative Agent in connection with
the preparation, execution and delivery of this Amendment, including, without
limitation, the reasonable fees and disbursements of counsel for the
Administrative Agent.
9. Governing Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NORTH CAROLINA, WITHOUT REFERENCE TO THE CONFLICTS
OR CHOICE OF LAW PRINCIPLES THEREOF.
10. Counterparts. This Amendment may be executed in separate
counterparts, each of which when executed and delivered is an original but all
of which taken together constitute one and the same instrument.
11. Fax Transmission. A facsimile, telecopy or other reproduction of
this Amendment may be executed by one or more parties hereto, and an executed
copy of this Amendment may be delivered by one or more parties hereto by
facsimile or similar instantaneous electronic transmission device pursuant to
which the signature of or on behalf of such party can be seen, and such
execution and delivery shall be considered valid, binding and effective for all
purposes. At the request of any party hereto, all parties hereto agree to
execute an original of this Amendment as well as any facsimile, telecopy or
other reproduction hereof.
[Signatures Pages Follow]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the date and year first above written.
BORROWER:
COMPX INTERNATIONAL INC., as Borrower
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Financial Officer
[Signature Pages Continue]
SUBSIDIARY GUARANTORS:
COMPX SECURITY PRODUCTS, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President - Finance
▇▇▇▇▇▇ ▇▇▇▇▇▇ USA, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Treasurer
[Signature Pages Continue]
AGENTS AND LENDERS:
WACHOVIA BANK, NATIONAL ASSOCIATION, as Administrative Agent and Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
COMPASS BANK, as Lender
By: /s/ Key ▇▇▇▇▇
Name: Key ▇▇▇▇▇
Title: Executive Vice President
COMERICA BANK, as Lender
By:/s/▇▇▇▇▇ ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:Corporate Banking Officer