Exhibit 10.1

 

AMENDMENT NO. 3 TO

SECOND AMENDED AND RESTATED CREDIT AGREEMENT

 

THIS AMENDMENT NO 3 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this
“Amendment”) is entered into at Columbus, Ohio, as of September 26, 2005, by and
among (a) Dominion Homes, Inc. (the “Company”), (b) the institutions from time
to time (individually a “Lender” and collectively the “Lenders”) party to the
Credit Agreement (as defined below) signatory hereto, and (c) The Huntington
National Bank (“Huntington”) in its separate capacity as administrative agent
for the Lenders and issuing banks under the Credit Agreement (with its
successors in such capacity, the “Administrative Agent”). This Amendment further
amends and modifies a certain Second Amended and Restated Credit Agreement dated
as of December 3, 2003 (as amended, supplemented, restated or otherwise modified
from time to time, the “Credit Agreement”) by and among (a) the Company, as
borrower, (b) the Lenders, as lenders, (c) KeyBank National Association, as
Syndication Agent, (d) U. S. Bank National Association, as Documentation Agent,
and (e) Huntington, as issuing bank for any Letters of Credit issued pursuant to
the Credit Agreement and Administrative Agent. All capitalized terms not
otherwise defined herein shall have the meanings ascribed to such terms in the
Credit Agreement.

 

RECITALS:

 

A. As of December 3, 2003, the Company, the Lenders, the Administrative Agent
and the other agents referred to in the Credit Agreement executed and delivered
the Credit Agreement setting forth the terms of certain extensions of credit and
other financial accommodations to the Company; and

 

B. As of December 3, 2003, and, subsequently, as of June 30, 2004, in connection
with the Credit Agreement, the Company executed and delivered, inter alia, the
Notes, in the aggregate original principal sum of Three Hundred Million Dollars
($300,000,000) and a swing note in favor of Huntington in the principal sum of
Fifteen Million Dollars ($15,000,000); and

 

C. In connection with the Credit Agreement and the Notes, the Company and
certain of its Subsidiaries executed and delivered to the Administrative Agent
certain other Loan Documents; and

 

D. The Company has requested that the Lenders and the Administrative Agent amend
and modify certain terms and financial covenants in the Credit Agreement, and
the Lenders signatory hereto and the Administrative Agent are willing to do so
upon the terms and conditions contained herein.

 

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NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:

 

1. Section 8.16, “ Ratio of Uncommitted Land Holdings to Consolidated Tangible
Net Worth,” of the Credit Agreement is hereby amended to recite in its entirety
as follows:

 

8.16 Ratio of Uncommitted Land Holdings to Consolidated Tangible Net Worth.

 

The Company and its consolidated Subsidiaries shall maintain at all times a
ratio of Uncommitted Land Holdings to Consolidated Tangible Net Worth of not
greater than (i) 1.90 to 1.00 continuing through March 30, 2006, and (ii) 1.75
to 1.00 as of March 31, 2006, and continuing at all times thereafter.

 

2. Section 8.17, “ Interest Coverage Ratio,” of the Credit Agreement is hereby
amended to recite in its entirety as follows:

 

8.17 Interest Coverage Ratio.

 

The Interest Coverage Ratio of the Company and its Subsidiaries on a
consolidated basis, as determined as of the last day of each fiscal quarter for
the twelve month period ending on such date, shall not be less than (i) 1.80 to
1.00 as of the fiscal quarter ending September 30, 2005, (ii) 1.90 to 1.00 as of
the fiscal quarter ending December 31, 2005, and (iii) 2.00 to 1.00 as of the
fiscal quarter ending March 31, 2006, and continuing as of the end of each
fiscal quarter thereafter.

 

3. Section 8.18, “ Land Not Zoned for Residential Development,” of the Credit
Agreement is hereby amended to recite in its entirety as follows:

 

8.18 Land Not Zoned for Residential Development.

 

Without the consent of the Administrative Agent and the Required Lenders, the
Company will not, and will not permit any Subsidiaries to, purchase or hold any
raw acreage or undeveloped land or other land not having a zoning classification
appropriate for a subdivision development of the type developed by the Company
or a Restricted Subsidiary, whether now owned or acquired hereafter, in excess
of the aggregate sum of $20,000,000 outstanding at any time, valued at the
lesser of cost or market.

 

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4. The definitions of “Applicable Eurodollar Margin” and “Interest Expense,”
respectively, set forth Section 14.3, “Defined Terms,” of the Credit Agreement
are hereby amended to recite as follows:

 

“Applicable Eurodollar Margin” means the applicable rate per annum set forth
below based on the Interest Coverage Ratio of the Company and its consolidated
Subsidiaries as of the end of any applicable period of determination:

 

Interest Coverage Ratio

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   Applicable Eurodollar
Margin

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greater than 3.75 to 1.00

   1.75 %

greater than or equal to 3.25 to 1.00, but less than or equal to 3.75 to 1.00

   2.00 %

greater than 2.75 to 1.00, but less than 3.25 to 1.00

   2.25 %

greater than 2.25 to 1.00, but less than or equal to 2.75 to 1.00

   2.50 %

less than or equal to 2.25 to 1.00

   2.75 %

 

“Interest Expense” means, for any period (without duplication), all interest
incurred, accrued, or paid on a consolidated basis for the Company and its
Subsidiaries, regardless of (i) whether the same constitutes interest expense
under GAAP, and (ii) whether such interest is accrued, expensed, capitalized,
paid in cash or other property, or scheduled to be paid or accrued, and,
includes, without limitation, the interest component of capital lease
obligations for such period, all bank fees, commissions, discounts and other
fees and charges owed with respect to the Letters of Credit and net costs under
interest rate contracts.

 

5. Conditions of Effectiveness. All provisions of this Amendment shall become
effective as of September 26, 2005, upon satisfaction of all of the following
conditions precedent:

 

(a) The Administrative Agent shall have received:

 

(i) duly executed counterparts (with sufficient copies for the Administrative
Agent, each Lender and the Company) of this Amendment executed by the
Administrative Agent, Lenders constituting at least the Required Lenders and the
Company;

 

(ii) duly executed fee letter satisfactory to the Administrative Agent; and

 

(iii) such other certificates, instruments, documents as may be required by the
Administrative Agent, each of which shall be in form and substance satisfactory
to the Administrative Agent and its counsel.

 

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(b) The representations contained in the immediately following paragraph shall
be true and accurate.

 

6. Representations and Warranties. The Company represents and warrants to the
Administrative Agent and each Lender as follows: (a) that after giving effect to
this Amendment, each representation and warranty made by or on behalf of the
Company in the Credit Agreement and in the other Loan Documents is true and
correct in all respects on and as of the date hereof as though made on and as of
such date, except to the extent that any such representation or warranty
expressly relates solely to a date prior hereto; (b) the execution, delivery and
performance by the Company and each Restricted Subsidiary, if applicable, of
this Amendment and the Loan Documents, as the case may be, have been duly
authorized by all requisite corporate or organizational action on the part of
each such Person and will not violate any Constituent Document of such Person;
(c) each of this Amendment and the Loan Documents has been duly executed and
delivered by the Company and each Restricted Subsidiary, as applicable, and each
of this Amendment, the Credit Agreement as amended hereby and Loan Document
constitutes the legal, valid and binding obligation of such Person, enforceable
against each such Person in accordance with the terms thereof; and (d) no event
has occurred and is continuing, and no condition exists which would constitute
an Event of Default or a Potential Default.

 

7. Reference to and Effect on the Loan Documents. (a) Upon the effectiveness of
this Amendment, each reference in the Credit Agreement to “Second Amended and
Restated Credit Agreement,” “Credit Agreement,” “Agreement,” the prefix
“herein,” “hereof,” or words of similar import, and each reference in the Loan
Documents to the Credit Agreement, shall mean and be a reference to the Credit
Agreement as amended hereby. (b) Except to the extent amended or modified
hereby, all of the representations, warranties, terms, covenants and conditions
of the Credit Agreement and the Loan Documents shall remain as written
originally and in full force and effect in accordance with their respective
terms and are hereby ratified and confirmed, and nothing herein shall affect,
modify, limit or impair any of the rights and powers which the Lenders or the
Administrative Agent may have hereunder or thereunder. The amendment set forth
herein shall be limited precisely as provided for herein, and shall not be
deemed to be a waiver of, amendment of, consent to or modification of any of the
rights of the Lenders or the Administrative Agent under or of any other term or
provisions of the Credit Agreement or any Loan Document, or of any term or
provision of any other instrument referred to therein or herein or of any
transaction or future action on the part of the Company which would require the
consent of the Lenders or the Administrative Agent.

 

8. Waiver of Jury Trial. THE PARTIES ACKNOWLEDGE THAT, AS TO ANY AND ALL
DISPUTES THAT MAY ARISE BETWEEN THE PARTIES, THE COMMERCIAL NATURE OF THE
TRANSACTION OUT OF WHICH THIS AMENDMENT ARISES WOULD MAKE ANY SUCH DISPUTE
UNSUITABLE FOR TRIAL BY JURY. ACCORDINGLY, EACH OF THE PARTIES TO THIS AMENDMENT
HEREBY WAIVES ANY RIGHT TO TRIAL BY JURY AS TO ANY AND ALL DISPUTES THAT MAY
ARISE RELATING TO THIS AMENDMENT OR TO ANY OF THE OTHER INSTRUMENTS OR DOCUMENTS
EXECUTED IN CONNECTION HEREWITH.

 

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9. Counterparts. This Amendment may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed and delivered, shall be an original, and all of which together will
constitute one and the same instrument. Receipt by the Administrative Agent of a
facsimile copy of an executed signature page hereof will constitute receipt by
the Administrative Agent of an executed counterpart of this Amendment.

 

10. Costs and Expenses. The Company agrees to pay on demand in accordance with
the terms of the Credit Agreement all reasonable costs and expenses of the
Administrative Agent in connection with the preparation, reproduction, execution
and delivery of this Amendment and all other Loan Documents entered into in
connection herewith, including the reasonable fees and out-of-pocket expenses of
the Administrative Agent’s counsel with respect thereto.

 

11. Governing Law. This Amendment and the rights and obligations of the parties
hereto shall be governed by, and construed and interpreted in accordance with,
the law of the State of Ohio.

 

12. Headings. Section headings in this Amendment are included herein for
convenience of reference only and will not constitute a part of this Amendment
for any other purpose.

 

13. Patriot Act Notice. The Lenders and the Administrative Agent hereby notify
the Company that pursuant to the requirements of the USA Patriot Act (Title III
of Pub.L.10756 (signed into law October 26, 2001)) (the “Act”), they are
required to obtain, verify and record information that identifies the Company,
which information includes the name and address of the Company and other
information that will allow the Lenders and the Administrative Agent to identify
the Company in accordance with the Act.

 

[Signature pages follow.]

 

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IN WITNESS WHEREOF, the Company, the Administrative Agent and the following
Lenders have hereunto set their hands as of the date first set forth above.

 

COMPANY: DOMINION HOMES, INC. By:  

/s/ Terrence R. Thomas

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Its:   SVP – Finance and CFO ADMINISTRATIVE AGENT: THE HUNTINGTON NATIONAL BANK
By:  

/s/ Steven P. Clemens

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Its:   Vice President THE LENDERS:

THE HUNTINGTON NATIONAL BANK,

as Lender and Issuing Bank

By:  

/s/ Frederick G. Hadley

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Its:   Senior Vice President

JPMORGAN CHASE BANK, N.A.

(successor by merger to Bank One, NA (Main Office Columbus))

By:  

/s/ John C. Hart

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Its:   Senior Vice President

 

 

Signature Page to Amendment No. 3 to Second Amendment and Restated Credit
Agreement

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KEYBANK NATIONAL ASSOCIATION By:  

 

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Its:  

 

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NATIONAL CITY BANK By:  

/s/ Steven A. Smith

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Its:   Senior Vice President COMERICA BANK By:  

/s/ Adam Sheets

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Its:   Account Officer U.S. BANK NATIONAL ASSOCIATION By:  

/s/ Michael C. Dodge

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Its:   Banking Officer FIFTH THIRD BANK (CENTRAL OHIO) By:  

/s/ Christopher D. Jones

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Its:   Vice President

 

 

Signature Page to Amendment No. 3 to Second Amendment and Restated Credit
Agreement

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BANK OF AMERICA, N.A.,

successor by merger to Fleet National Bank

By:  

/s/ Mark W. LaRiviere

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Its:   Senior Vice President

WASHINGTON MUTUAL BANK, FA,

a federal association

By:  

 

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Its:  

 

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Signature Page to Amendment No. 3 to Second Amendment and Restated Credit
Agreement

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CONSENT OF GUARANTORS

 

The undersigned, each being a guarantor of the Company’s indebtedness to the
Lenders pursuant to certain guaranty agreements executed and delivered to the
Administrative Agent, hereby consents and agrees to be bound by the terms,
conditions and execution of the foregoing Amendment and hereby further agrees
that (i) each of their obligations shall be continuing as provided in said
guaranty agreements, and (ii) said guaranty agreements shall remain as written
originally and continue in full force and effect in all respects.

 

DOMINION HOMES OF KENTUCKY GP, LLC       DOMINION HOMES REALTY, LLC By:  

/s/ Terrence R. Thomas

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      By:  

/s/ Terrence R. Thomas

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Its:   Vice President       Its:   Vice President and Treasurer ALLIANCE TITLE
AGENCY OF KENTUCKY, LLC       RESOLUTION PROPERTY COMPANY, LLC By:  

/s/ Terrence R. Thomas

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      By:  

/s/ Terrence R. Thomas

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Its:   Vice President and Treasurer       Its:   President            

DOMINION HOMES OF KENTUCKY, LTD.,

a Kentucky limited partnership

            By:   Dominion Homes of Kentucky GP, LLC, a Kentucky limited
liability company, its general partner                 By:  

/s/ Terrence R. Thomas

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                Its:   Vice President

 

 

Signature Page to Amendment No. 3 to Second Amendment and Restated Credit
Agreement