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EXHIBIT 10.32
May , 1999
Jeffrey Miller, President and CEO
AQUA-CHEM, INC.
7800 North 113th Street (zip 53224)
P.O. Box 421 (zip 53201)
Milwaukee, WI 53201
Re: Second Amendment ("Second Amendment") under the Second Amended
and Restated Aqua-Chem, Inc. Revolving Credit Agreement dated
as of June 23, 1998 (as previously amended, "Credit
Agreement") by and among Aqua-Chem, Inc. ("Company"), Comerica
Bank, as Agent (in such capacity, "Agent") and the Banks
(including Comerica Bank) from time to time signatories
thereto.
Gentlemen:
Reference is made to the Credit Agreement. Except as specifically
defined to the contrary herein, capitalized terms used in this First Amendment
shall have the meanings given them in the Credit Agreement.
The Company has requested that the Agent and the Banks amend the
definition of "Consolidated EBITDA" contained in the Credit Agreement, amend
Section 8.10 (Fixed Charge Coverage Ratio) and to make such other changes as are
necessary so as to permit any Bank to act as Issuing Bank under the Credit
Agreement.
Based on the Agent's receipt of the approval of the requisite Banks and
subject to the terms and conditions of this letter, this letter agreement will
confirm the that the Credit Agreement is hereby amended as follows:
1. Section 1 of the Credit Agreement is amended as follows:
(a) the definition of "Consolidated EBITDA" is hereby amended
by amending and restating clause (v) thereof in its entirety as
follows:
"(v) losses (or less gains) from Asset Dispositions or other
non-cash items included in the determination of net income (excluding
sales, expenses or losses related to current assets) and all
restructuring charges related to the closing of the Company's
Greenville, Mississippi manufacturing facility (as permitted
hereunder), and the restructuring charges taken in January, 1999 in an
amount up to $1,200,000, and the restructuring charges taken in April,
1999 in an amount up to $900,000";
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Jeffrey Miller, President and CEO
Aqua-Chem, Inc.
May , 1999
Page 2
2. Section 8.10 of the Credit Agreement (Fixed Charge Coverage Ratio)
is hereby amended and restated in its entirety as follows:
"Fixed Charge Coverage Ratio. Maintain, as of the end of each
fiscal quarter, for the four fiscal quarters then ended, beginning with
the fiscal quarter ending June 30, 1999, a Fixed Charge Coverage Ratio
of not less than the following amounts during the periods set forth
below:
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Quarter Ending Ratio
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June 30, 1999 1.0 to 1.0
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September 30, 1999 1.0 to 1.0
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December 31, 1999 1.10 to 1.0
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March 31, 2000 1.15 to 1.0
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June 30, 2000 and thereafter 1.25 to 1.0
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3. This Second Amendment shall become effective according to the terms
hereof and on such date (the Second Amendment Effective Date") as the Agent
shall have received:
(a) an Authorization of Second Amendment (in the form attached to this
Letter Amendment), in each case duly executed and delivered by each of the
Company, the Guarantors, and the requisite Banks, in form satisfactory to Agent
and the requisite Banks; and
(b) all fees and expenses due and owing on the Second Amendment
Effective Date or as agreed to among the parties, including an amendment fee for
the account of each Bank in the amount of 20 basis points on each such Bank's
Percentage of the Revolving Credit Aggregate Commitment; provided however, that
the parties agree that each Bank shall receive one half of its amendment fee on
the Second Amendment Effective Date and one half on July 15, 1999 (and the
Company acknowledges that the failure to deliver such remaining portion of the
amendment fee on July 15, 1999 shall constitute an Event of Default under the
Credit Agreement).
On the Second Amendment Effective Date, Replacement Schedule 1.1
(setting forth the alternate Pricing Matrix) attached hereto as Attachment I
shall replace existing Schedule 1.1 in its entirety.
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Jeffrey Miller, President and CEO
Aqua-Chem, Inc.
May , 1999
Page 3
This Second Amendment is limited to the specific matters described
above and shall not be deemed to be a waiver or consent to any other failure to
comply with any provision of the Credit Agreement or any other Loan Document, or
to amend or alter in any respect the term and conditions of the Credit Agreement
(including without limitation all conditions and requirements for Advances and
any financial covenants), the Notes or any of the other Loan Documents, or to
constitute a waiver or release by any of the Banks or the Agent of any right,
remedy, Default or Event of Default under the Credit Agreement or any other Loan
Documents, except as specifically set forth above. Furthermore, this Second
Amendment shall not affect in any manner whatsoever any rights or remedies of
the Banks with respect to any other non-compliance by the Company with the
Credit Agreement or the other Loan Documents whether in the nature of a Default
or an Event of Default, and whether now in existence or subsequently arising.
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