EXHIBIT 10.4C
THIRD AMENDMENT TO CREDIT AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is entered
into as of December 1, 1995, by and between SOUTHWEST WATER COMPANY,
a Delaware corprotion ("Borrower"), and WELLS FARGO BANK,
NATIONAL ASSOCIATION ("Bank").
RECITALS
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WHEREAS, Borrower is currently indebted to Bank pursuant to the terms and
conditions of that certain Credit Agreement between Borrower and Bank dated as
of December 2, 1992, as amended December 1, 1993 and December 1, 1994 ("Credit
Agreement").
WHEREAS, Bank and Borrower have agreed to certain changes in the terms and
conditions set forth in the Credit Agreement and have agreed to amend the Credit
Agreement to reflect said changes.
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree that the Credit
Agreement shall be amended as follows:
1. Section 1.1.(a) is hereby amended (a) by deleting "December 1, 1995" as
the last day on which Bank will make advances under the Line of Credit, and by
substituting for said date "December 1, 1996," and (b) by deleting "Five Million
Dollars ($5,000,000.00)" as the maximum principal amount available under the
Line of Credit, and by substituting for said amount "Six Million Dollars
($6,000,000.00)," with such changes to be effective upon the execution and
delivery to Bank of a promissory note substantially in the form of Exhibit A
attached hereto (which promissory note shall replace and be deemed the Line of
Credit Note defined in and made pursuant to the Credit Agreement) and all other
contracts, instruments and documents required by Bank to evidence such change.
2. Section 1.1.(b) second paragraph is hereby deleted in its entirety,
without substitution.
3. Section 1.2.(c) is hereby deleted in its entirety, and the following
substituted therefor:
"(c) Commitment Fee. Borrower shall pay to Bank a non-refundable fee
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for the Line of Credit equal to one percent (1%) per annum of the
daily unused balance of the Line of
Credit, calculated on a calendar quarter basis, which fee shall be due
and debited to Borrower's account not later than ten days after
billing is sent by Bank."
4. Section 2.5. is hereby deleted in its entirety, and the following
substituted therefor:
"SECTION 2.5. CORRECTNESS OF FINANCIAL STATEMENT. The financial
statement of Borrower dated September 30, 1995, a true copy of which
has been delivered by Borrower to Bank prior to the date hereof, (a)
is complete and correct and presents fairly the financial condition of
Borrower, (b) discloses all liabilities of Borrower that are required
to be reflected or reserved against under generally accepted
accounting principles, whether liquidated or unliquidated, fixed or
contingent, and (c) has been prepared in accordance with generally
accepted accounting principles consistently applied. Since the date
of such financial statement there has been no material adverse change
in the financial condition of Borrower, nor has Borrower mortgaged,
pledged, granted a security interest in or otherwise encumbered any of
its assets or properties except in favor of Bank or as otherwise
permitted by Bank in writing."
5. Section 4.9.(a) and (b) are hereby deleted in their entirety, and the
following substituted therefor:
"(a) Tangible Net Worth (defined as the aggregate of total
stockholders' equity less the aggregate of any treasury stock, any
intangible assets and any obligations due from stockholders, employees
and/or affiliates) not at any time less than $25,500,000.00.
(b) Ratio of Total Debt (defined as "Consolidated Liabilities": At any
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date of determination, the total liabilities of the Borrower and its
Subsidiaries on a consolidated basis determined in accordance with
GAAP (including, without limitation, (1) any balance sheet liability
with respect to a Pension Plan recognized pursuant to Financial
Accounting Standards Board Statements 87 or 88 and (2) any withdrawal
liability under Section 4201 of ERISA with respect to a withdrawal
from a Multiemployer Plan, as such liability may be set forth in a
notice of withdrawal liability under Section 4219 (and as adjusted
from time to time subsequent to the date of such notice), excluding,
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however, deferred taxes and contributions in aid of construction and
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Unamortized Investment Tax Credit) to Tangible Net Worth (as defined
above) not at any time less than 2.25 to 1.0."
6. Section 5.8. is hereby deleted in its entirety, and the following
substituted therefor:
"SECTION 5.8. OTHER INDEBTEDNESS FOR BORROWINGS. Create, incur,
assume or permit to exist, or permit any Subsidiary to create, incur,
assume or permit to
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exist, any indebtedness or liabilities resulting from borrowings,
loans or advances, whether matured or unmatured, liquidated or
unliquidated, joint or several, secured or unsecured, except for (a)
the liabilities of Borrower to Bank hereunder, (b) liabilities of
Borrower existing as of, and disclosed to Bank prior to the date of
this Agreement, (c) additional indebtedness for unsecured borrowings
which do not exceed $15,000,000.00 in the aggregate at any time for
Suburban Water Systems and New Mexico Utilities, Inc. (d) secured
indebtedness for purchase money financing of equipment which is
permitted under Section 5.5. and (e) Lines of Credit not to exceed an
aggregate of $16,000,000.00."
7. Except as specifically provided herein, all terms and conditions of
the Credit Agreement remain in full force and effect, without waiver or
modification. All terms defined in the Credit Agreement shall have the same
meaning when used in this Amendment. This Amendment and the Credit Agreement
shall be read together, as one document.
8. Borrower hereby remakes all representations and warranties contained
in the Credit Agreement and reaffirms all covenants set forth therein. Borrower
further certifies that as of the date of this Amendment there exists no Event of
Default as defined in the Credit Agreement, nor any condition, act or event
which with the giving of notice or the passage of time or both would constitute
any such Event of Default.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the day and year first written above.
WELLS FARGO BANK,
SOUTHWEST WATER COMPANY NATIONAL ASSOCIATION
By /s/ Anton C. Garnier By /s/ Catherine M. Wallace
Title: President Vice President
By /s/ Peter J. Moerbeek
Title: Vice President Finance
Chief Financial Officer
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