SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
February 12, 1999
Date of report
CALLAWAY GOLF COMPANY
(Exact name of Registrant as Specified in Charter)
California 1-10962 95-3797580
(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification Number)
2285 Rutherford Road
Carlsbad, CA 92008-8815
(Address of Principal Executive Offices)
(760) 931-1771
(Registrant's telephone number, including area code)
ITEM 2. Acquisition or Disposition of Assets.
Effective as of February 12, 1999, Callaway Golf Company, a California
corporation (the "Company"), amended its original Credit Agreement dated as of
December 30, 1998, pursuant to an Amended and Restated Credit Agreement (the
"Amended Credit Agreement") among the Company, as Borrower, certain of the
Company's subsidiaries as additional credit parties, the lenders signatory
thereto from time to time (the "Lenders") and General Electric Capital
Corporation, a New York corporation, as Agent for the Lenders. The original
Credit Agreement provided revolving credit facilities to the Company of up to
$75 million (including a $10 million letter of credit subfacility). Under the
Amended Credit Agreement, the revolving credit facilities were increased to up
to $120 million. The Company's obligations under the Amended Credit Agreement
are secured by substantially all of the tangible and intangible assets of the
Company and certain of its subsidiaries, including real property and a pledge of
certain of the capital stock of the Company's foreign and domestic subsidiaries.
The Amended Credit Agreement includes customary conditions, representations,
warranties, affirmative and negative covenants (including certain financial
covenants) and events of default.
Also effective as of February 12, 1999, Odyssey Golf, Inc. and Callaway
Golf Sales Company, both wholly owned subsidiaries of the Company, Golf Funding
Corporation, a newly formed wholly owned subsidiary of Callaway Golf Sales
Company, and the Company obtained an $80 million accounts receivable
securitization facility (the "Accounts Receivable Facility"). Under the
Accounts Receivable Facility, substantially all of Odyssey Golf, Inc.'s domestic
accounts receivable were sold to Callaway Golf Sales Company. In turn, Callaway
Golf Sales Company has sold, and from time to time will sell, substantially all
of its domestic accounts receivable (the "Receivables") to Golf Funding
Corporation. The Accounts Receivable Facility provides for the sale from time
to time of the Receivables by Golf Funding Corporation to Redwood Receivables
Corporation in exchange for a combination of immediately available funds and a
deferred purchase price amount. The Accounts Receivable Facility includes a
corporate guarantee by the Company of the obligations of Callaway Golf Sales
Company thereunder and includes customary conditions, representations,
warranties, affirmative and negative covenants (including the same financial
covenants set forth in the Amended Credit Agreement with respect to the Company)
and termination events.
The foregoing summary of the Amended Credit Agreement and the Accounts
Receivable Facility is qualified in its entirety by reference to the full text
of the Amended Credit Agreement and the key documents relating to the Accounts
Receivable Facility, copies of which are attached hereto and incorporated herein
by reference.
ITEM 7. Financial Statements and Exhibits
(c) Exhibits
10.1 Amended and Restated Credit Agreement dated as of February 10,
1999 among Callaway Golf Company, as Borrower, the other credit
parties signatory thereto, as Credit Parties, the Lenders
signatory thereto from time
2
to time, as Lenders, and General Electric Capital Corporation, as
Agent and Lender
10.2 Receivables Transfer Agreement dated as of February 10, 1999, by
and among Callaway Golf Sales Company and Odyssey Golf, Inc.
10.3 Receivables Transfer Agreement dated as of February 10, 1999, by
and among Callaway Golf Company, as Parent Guarantor, Callaway
Golf Sales Company, as the CGS Originator and as Servicer, and
Golf Funding Corporation
10.4 Receivables Purchase and Servicing Agreement dated as of February
10, 1999, by and among Golf Funding Corporation, as Seller,
Redwood Receivables Corporation, as Purchaser, Callaway Golf Sales
Company, as Servicer, and General Electric Capital Corporation, as
Operating Agent and Collateral Agent
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: FEBRUARY 25, 1999
CALLAWAY GOLF COMPANY
By: /s/ David A. Rane
-------------------------------------------
David A. Rane
Executive Vice President, Administration and
Planning, and Chief Financial Officer
4
EXHIBIT INDEX
Exhibit Number Description
- -------------- -----------
10.1 Amended and Restated Credit Agreement dated as of February 10,
1999 among Callaway Golf Company, as Borrower, the other credit
parties signatory thereto, as Credit Parties, the Lenders
signatory thereto from time to time, as Lenders, and General
Electric Capital Corporation, as Agent and Lender
10.2 Receivables Transfer Agreement dated as of February 10, 1999, by
and among Callaway Golf Sales Company and Odyssey Golf, Inc.
10.3 Receivables Transfer Agreement dated as of February 10, 1999, by
and among Callaway Golf Company, as Parent Guarantor, Callaway
Golf Sales Company, as the CGS Originator and as Servicer, and
Golf Funding Corporation
10.4 Receivables Purchase and Servicing Agreement dated as of
February 10, 1999, by and among Golf Funding Corporation, as
Seller, Redwood Receivables Corporation, as Purchaser, Callaway
Golf Sales Company, as Servicer, and General Electric Capital
Corporation, as Operating Agent and Collateral Agent
5