Exhibit 10.35
FOURTH AMENDMENT AND LIMITED WAIVER
TO
AMENDED AND RESTATED CREDIT AGREEMENT
THIS FOURTH AMENDMENT AND LIMITED WAIVER TO AMENDED AND RESTATED CREDIT
AGREEMENT, dated as of December 31, 2001 (this "Fourth Amendment") relates to
that certain Amended and Restated Credit Agreement dated as of February 10, 1999
(as amended by the First Amendment to Amended and Restated Credit Agreement,
dated April 28, 2000 (the "First Amendment"), the Second Amendment to Amended
and Restated Credit Agreement, dated as of December 29, 2000 (the "Second
Amendment") and the Third Amendment to Amended and Restated Credit Agreement,
dated as of March 19, 2001 (the "Third Amendment"), and as may be further
amended, supplemented, restated or otherwise modified from time to time, the
"Credit Agreement") and is entered into among Callaway Golf Company, a Delaware
corporation (the "Borrower"), the other credit parties signatory to the Credit
Agreement, the lenders signatory hereto (the "Requisite Lenders") and General
Electric Capital Corporation, a New York corporation, as agent for the Lenders
(in such capacity, the "Agent"). Capitalized terms used and not otherwise
defined herein shall have the meanings assigned to them in the Credit Agreement.
W I T N E S S E T H
WHEREAS, the Borrower, the other Credit Parties, Agent and the Lenders
have entered into the Credit Agreement, the First Amendment, the Second
Amendment and the Third Amendment;
WHEREAS, Callaway Golf South Pacific Pty Ltd ("CGSP") is a wholly owned
subsidiary of Borrower and Borrower has advanced certain sums to CGSP (the
"Intercompany Debt");
WHEREAS, CGSP and Borrower have agreed to convert into equity a portion of
the Intercompany Debt, whereby Borrower will receive 500,000 of the ordinary
shares of CGSP in exchange for a A$500,000 reduction of the Intercompany Debt
(as more fully described in Schedule A attached hereto, the "Recapitalization");
WHEREAS, Borrower has requested that Agent and the Requisite Lenders grant
a limited waiver (the "Limited Waiver") to Section 6.5 of the Credit Agreement
(Capital Structure and Business), solely with respect to the Recapitalization;
WHEREAS, Borrower has requested that the Credit Agreement be amended to
exclude the issuance of shares of Stock in payment of advances made by Borrower
to its Subsidiaries from the limitations provided in Section 6.5 of the Credit
Agreement (the "Amendment");
WHEREAS, Section 11.2 of the Credit Agreement requires that the Requisite
Lenders consent to the Limited Waiver and the Amendment; and
FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
WHEREAS, Agent, Borrower and Requisite Lenders are willing to provide the
Limited Waiver and Amendment on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the above premises, Borrower, Agent,
and the Requisite Lenders agree as follows:
1. Definitions and Usage. Capitalized terms used, but not defined, herein
have the meanings ascribed to such terms in the Credit Agreement. Any reference
herein to Section, Exhibit or Schedule shall, unless otherwise specified, refer
to such Section, Exhibit or Schedule hereof, in its entirety.
2. Amendment to the Credit Agreement. Upon the Effective Date (as defined
in Section 5 below), Section 6.5(b) of the Credit Agreement is hereby amended by
deleting the text thereof in its entirety and substituting the following in lieu
thereof:
"make any change in its capital structure as described on Disclosure
Schedule (3.8), including the issuance of any shares of Stock, warrants or
other securities convertible into Stock or any revision of the terms of
its outstanding Stock, except (i) to the extent permitted by Section
6.13(ii) or Section 6.14, (ii) as a result of a Reincorporation Merger,
(iii) that Special Purpose Corporation may issue Stock in connection with
the Receivables Facility and (iv) that Borrower may make a Public Offering
of its common Stock so long as (A) the proceeds thereof are applied in
prepayment of the Obligations as required by Section 1.3(b)(iii), and (B)
no Change of Control occurs after giving effect thereto"
3. Limited Waiver. Upon the Effective Date, and as limited herein, the
Requisite Lenders hereby waive Section 6.5 of the Credit Agreement (Capital
Structure and Business), solely with respect to the Recapitalization.
The Limited Waiver shall be limited to those Events of Default, if any,
arising solely from the Recapitalization as described herein and do not apply to
any past, present or future Events of Default caused by any other violation of
Sections 5 or 6 or other provisions of the Credit Agreement or any of the Loan
Documents.
4. Representations and Warranties. The Credit Parties hereby jointly and
severally represent and warrant to the Agent and the Requisite Lenders that, as
of the Effective Date and after giving effect to this Fourth Amendment:
a. All of the representations and warranties of the Credit Parties
contained in this Fourth Amendment, the Credit Agreement and the other
Loan Documents are true and correct in all material respects on and as of
the Effective Date, as if then made (other than representations and
warranties which expressly speak as of a different date, which shall be
true and correct in all material respects as of that date); and
b. No Default or Event of Default has occurred and is continuing or
will result after giving effect to this Fourth Amendment.
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FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
5. Effective Date. This Fourth Amendment shall become effective as of the
date first written above (the "Effective Date") upon the satisfaction of each of
the following conditions:
a. The Agent shall have received each of the following documents, in
each case in form and substance satisfactory to the Agent:
i. counterparts hereof executed by each of the Credit Parties,
the Agent and the Requisite Lenders;
ii. duly executed amendments to the Receivables Documents
effecting all modifications necessary to permit the
Recapitalization, together with a certificate of the Chief Financial
Officer of the Borrower certifying that all conditions to the
effectiveness of the amendments have been satisfied and that the
amendments are in full force and effect as of the Effective Date;
iii. the duly executed Pledge Agreement reflecting the
Recapitalization, accompanied by (y) the share certificate
representing sixty-five percent (65%) of the 500,000 ordinary shares
of CGSP being issued to Borrower pursuant to the Recapitalization,
which 325,000 ordinary shares of CGSP are being pledged in
accordance with the Credit Agreement, and (z) a stock power for such
share certificate executed in blank;
iv. a certificate of the Secretary or Assistant Secretary of
each of the Credit Parties dated the Effective Date certifying (A)
that the bylaws of such Credit Party have not been amended or
otherwise modified since the date of the most recent certification
thereof by the Secretary or Assistant Secretary of such Credit Party
delivered to the Agent and remain in full force and effect as of the
Effective Date, (B) that the charter of such Credit Party has not
been amended or otherwise modified since the date of the most recent
certification thereof by the Secretary of State of such Credit
Party's jurisdiction of incorporation delivered to the Agent and
remain in full force and effect as of the Effective Date and (C)
that the execution, delivery and performance of this Fourth
Amendment have been duly authorized by all necessary or proper
corporate and shareholder action; and
v. such additional documentation as the Agent may reasonably
request;
b. No law, regulation, order, judgment or decree of any Governmental
Authority shall, and the Agent shall not have received any notice that
litigation is pending or threatened which is likely to, enjoin, prohibit
or restrain the consummation of the transactions contemplated by this
Fourth Amendment, except for such laws, regulations, orders or decrees, or
pending or threatened litigation, that in the aggregate could not
reasonably be expected to have a Material Adverse Effect;
c. All corporate and other proceedings, and all documents,
instruments and other legal matters in connection with the transactions
contemplated by this Fourth Amendment shall be satisfactory in all
respects in form and substance to the Agent; and
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FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
d. No Default or Event of Default shall have occurred and be
continuing on the Effective Date or will result after giving effect to
this Fourth Amendment.
6. Reference to and Effect on the Loan Documents.
a. Upon the Effective Date, each reference in the Credit Agreement
to "this Agreement", "hereunder", "hereof" or words of like import, and
each reference in the other Loan Documents to the Credit Agreement, shall
mean and be a reference to the Credit Agreement as amended and
supplemented hereby.
b. Except to the extent specifically set forth herein, the
respective provisions of the Credit Agreement and the other Loan Documents
shall not be amended, modified, waived, impaired or otherwise affected
hereby, and such documents and the Obligations under each of them are
hereby confirmed as being in full force and effect.
c. This Fourth Amendment shall be limited solely to the matters
expressly set forth herein and shall not (i) constitute an amendment or
waiver of any other term or condition of the Credit Agreement or any other
Loan Document, (ii) prejudice any right or rights which the Agent or any
Lender may now have or may have in the future under or in connection with
the Credit Agreement or any other Loan Document, (iii) require the Agent
or any Lender to agree to a similar transaction on a future occasion or
(iv) create any right herein to another Person or other beneficiary or
otherwise, except to the extent specifically provided herein.
7. Miscellaneous. This Fourth Amendment is a Loan Document. The headings
herein are for convenience of reference only and shall not alter or otherwise
affect the meaning hereof.
8. Section Titles. The Section titles in this Fourth Amendment are and
shall be without substantive meaning or content of any kind whatsoever and are
not a part of the agreement between the parties hereto.
9. Counterparts. This Fourth Amendment may be executed in any number of
counterparts and by the different parties hereto in separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.
10. GOVERNING LAW. THIS FOURTH AMENDMENT, AND ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE HEREOF, SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
11. No Strict Construction. The parties hereto have participated jointly
in the negotiation and drafting of this Fourth Amendment. In the event an
ambiguity or question of intent or interpretation arises, this Fourth Amendment
shall be construed as if drafted jointly by the parties hereto and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Fourth Amendment.
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FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
IN WITNESS WHEREOF, the Credit Parties, the Agent and the Requisite
Lenders have caused this Fourth Amendment to be executed by their respective
officers thereunto duly authorized as of the date first above written.
CALLAWAY GOLF COMPANY,
as Borrower
By: ______________________________
Name:
Title:
Signature Page 1 of 9
FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
CALLAWAY GOLF SALES COMPANY,
as a Credit Party
By: ______________________________
Name:
Title:
Signature Page 2 of 9
FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
GENERAL ELECTRIC CAPITAL CORPORATION,
as Agent and Lender
By: /s/ Robert Yasuda
------------------------------
Name: Robert Yasuda
Title: Authorized Signatory
Pro Rata Share: 20.83%
Signature Page 3 of 9
FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
AMERICAN NATIONAL BANK AND TRUST
COMPANY OF CHICAGO,
as a Lender
By: ______________________________
Name:
Title:
Pro Rata Share: 17.71%
Signature Page 4 of 9
FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
BANK OF AMERICA, NATIONAL ASSOCIATION,
as a Lender
By: ______________________________
Name:
Title:
Pro Rata Share: 14.17%
Signature Page 5 of 9
FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
CONGRESS FINANCIAL CORPORATION
(WESTERN),
as a Lender
By: ______________________________
Name:
Title:
Pro Rata Share: 14.17%
Signature Page 6 of 9
FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
KEY CORPORATE CAPITAL INC.,
as a Lender
By: ___________________________
Name:
Title:
Pro Rata Share: 14.17%
Signature Page 7 of 9
FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
NATIONAL CITY COMMERCIAL FINANCE,
INC., as a Lender
By: ___________________________
Name:
Title:
Pro Rata Share: 8.33%
Signature Page 8 of 9
FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
NATIONAL WESTMINSTER BANK PLC,
as a Lender
By: ___________________________
Name:
Title:
Pro Rata Share: 10.63%
Signature Page 9 of 9
FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
EXHIBIT A
TO
LIMITED WAIVER TO AMENDED AND RESTATED CREDIT AGREEMENT
(see attached)
Exhibit A
FOURTH AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT