Exhibit 10.78(a)








Exhibit 10.78(a)




EXECUTION VERSION




AMENDMENT NO. 1 TO AMENDED AND RESTATED CREDIT AGREEMENT 




This Amendment No. 1 to Amended and Restated Credit Agreement dated as of October 28, 2011
(this “Amendment”), is by and among SMITH & WESSON HOLDING CORPORATION, a Nevada
corporation, SMITH & WESSON CORP., a Delaware corporation, THOMPSON/CENTER ARMS COMPANY, INC., a
New Hampshire corporation, THOMPSON CENTER HOLDING CORPORATION, a Delaware corporation, SMITH &
WESSON SECURITY SOLUTIONS, INC., a Delaware corporation, FOX RIDGE OUTFITTERS, INC., a New
Hampshire corporation, K.W. THOMPSON TOOL COMPANY, INC., a New Hampshire corporation, O.L.
DEVELOPMENT, INC., a New Hampshire corporation, BEAR LAKE HOLDINGS, INC., a Delaware corporation,
and SMITH & WESSON DISTRIBUTING, INC., a Delaware corporation (collectively, the
“Borrowers”, and each a “Borrower”), TD BANK N.A., a national banking association,
in its capacity as administrative agent (in said capacity, the “Administrative Agent”) for
the lenders from time to time party to the Credit Agreement referenced below (collectively, the
“Lenders”).



R E C I T A L S:




WHEREAS, the Borrowers, the Administrative Agent and the Lenders have entered into that
certain Amended and Restated Credit Agreement dated as of December 7, 2010 (as amended, restated,
supplemented or modified from time to time, the “Credit Agreement”); and



WHEREAS, the Borrowers have requested that the Administrative Agent and the Lenders enter into
this Amendment to, among other things, revise the definition of the Capital Expenditures to exclude
certain restructuring related expenses therefrom and to provide the Borrowers with the ability to
reduce the Revolving Commitment from time to time, all as more particularly set forth herein, and
the Administrative Agent and the Required Lenders have agreed to do so, subject to the terms and
conditions set forth herein;



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




1. Recitals. The foregoing recitals are hereby incorporated by reference herein.



2. Definitions. Terms defined in the Credit Agreement and not otherwise defined
herein shall have the meanings given to such terms in the Credit Agreement.



3. Amendments to Credit Agreement. The parties hereto hereby agree that, effective on
the Amendment Effective Date, the Credit Agreement is hereby amended as follows:



3.1. Amendment to Definition of “Capital Expenditures”. The definition of “Capital
Expenditures” set forth in Section 1.01 of the Credit Agreement is hereby deleted in its entirety
and the following is substituted therefor:



““Capital Expenditures” of any Person means, without duplication, any expenditure or
commitment to expend money for any purchase or other acquisition of any asset which would be
classified as a fixed or capital asset on a balance sheet of such Person prepared in accordance
with GAAP;
provided however, solely for purposes of calculating the Consolidated Fixed Charge
Coverage Ratio for the Test Periods ending on October 31, 2011, January 31, 2012, April 30, 2012
and July 31, 2012 respectively, Capital Expenditures shall not include any expenditures resulting
from the Borrowers’ consolidation of their Rochester, New Hampshire operations into their
Springfield, Massachusetts facility in an amount not to exceed $4,254,000 in aggregate.”


 


 









 





3.2. Amendment to Section 2.10. Section 2.10 of the Credit Agreement is hereby amended
by deleting clauses (c) and (d) thereof in their entirety and substituting the following new
clauses (c) and (d) therefor:




“SECTION 2.10. Termination and Reduction of Commitments.



(c) The Borrower Representative may from time to time reduce the Revolving Commitment,
provided that (x) each reduction of the Revolving Commitment shall be in an amount of $10,000,000
or any whole multiple of $1,000,000 in excess thereof, and (y) the Borrower Representative shall
not reduce the Revolving Commitment if, after giving effect to any concurrent prepayment of the
Revolving Loans hereunder, the Revolving Exposure would exceed the Revolving Commitment.



(d) The Borrower Representative shall notify the Administrative Agent of any election to
terminate or reduce the Revolving Commitment under paragraph (b) or (c) of this Section at least
five (5) Business Days prior to the effective date of such termination or reduction, specifying
such election and the effective date thereof. Each notice delivered by the Borrower Representative
pursuant to this Section shall be irrevocable; provided that a notice of termination of the
Revolving Commitments delivered by the Borrower Representative may state that such notice is
conditioned upon the effectiveness of other credit facilities, in which case such notice may be
revoked by the Borrower Representative (by notice to the Administrative Agent on or prior to the
specified effective date) if such condition is not satisfied. Any termination or reduction of the
Revolving Commitment shall be permanent.”



4. Representations and Warranties. The Borrowers, by their execution hereof, jointly
and severally represent and warrant as follows:



4.1. Legal Existence; Organization. Each Borrower is duly organized and validly
existing and in good standing under the laws of the jurisdiction of its organization and under the
laws of each other jurisdiction in which it is qualified to do business, with all power and
authority (corporate or otherwise) necessary (a) to enter into this Amendment and the documents
executed in connection herewith and to perform all of its obligations hereunder and thereunder, and
(b) to own its properties and carry on the business now conducted or proposed to be conducted by
it.



4.2. Enforceability. Each Borrower has taken all action (corporate or otherwise)
required to make the provisions of this Amendment and the documents executed in connection herewith
valid and enforceable obligations of such Borrower, as they purport to be. Each Borrower has duly
authorized, executed and delivered this Amendment and the documents executed in connection
herewith. This Amendment and each document executed in connection herewith is the legal, valid and
binding obligations of such Borrower and each is enforceable against such Borrower in accordance
with its terms.



4.3. No Legal Obstacle to Agreements. Neither the execution, delivery or performance
by any Borrower of this Amendment or any document executed in connection herewith nor the
execution, delivery or performance by any Borrower, nor the consummation of any other transaction
referred to or contemplated by this Amendment, any document executed in connection herewith, nor
the fulfillment of the terms hereof or thereof, has constituted or resulted in or will constitute
or result in:




4.3.1 any breach or termination of any agreement, instrument, deed or lease to which
such Borrower is a party or by which such Borrower is bound, or of the charter, by-laws or
other organizational documents, as applicable, of such Borrower;


 


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4.3.2 the violation of any law, judgment, decree or governmental order, rule or
regulation applicable to such Borrower;




4.3.3 the creation under any agreement, instrument, deed or lease of any Lien (other
than Liens on the Collateral which secure the Obligations) upon any of the assets of such
Borrower; or




4.3.4 any redemption, retirement or other repurchase obligation of such Borrower under
any charter, by-law, organizational document, agreement, instrument, deed or lease to which
such Borrower is a party.



Except such as have been obtained and are in full force and effect, no approval, authorization
or other action by, or declaration to or filing with, any governmental or administrative authority
or any other Person is required to be obtained or made by any Borrower in connection with the
execution, delivery and performance by such Borrower of this Amendment or any document executed in
connection herewith or the consummation of the transactions contemplated hereby or thereby or the
execution, delivery and performance by such Borrower.



4.4. Defaults. No Default exists or, immediately after giving effect to this
Amendment, will exist.



4.5. Incorporation of Representations and Warranties. The representations and
warranties set forth in Article V of the Credit Agreement and in the other Loan Documents are each
true and correct in all material respects on the date hereof as if originally made on and as of the
date hereof, except to the extent that such representations and warranties expressly relate to an
earlier date, in which case, such representations and warranties shall be true and correct as of
such earlier date, provided that all representations and warranties set forth in Article V
with respect to the Schedules shall be true and correct as of the date hereof with reference to the
updated Schedules delivered herewith.



5. Conditions. This Amendment shall become effective upon the date when each of the
following conditions precedent have been satisfied (the “Amendment Effective Date”):



5.1. Consummation of this Amendment. The Administrative Agent shall have received
this Amendment fully executed by the parties hereto.



5.2. Fees and Expenses. The Borrowers shall have paid or provided for payment of all
fees and expenses of the Administrative Agent (including the reasonable fees and expenses of its
legal counsel) in connection with this Amendment and the documents executed in connection herewith
and the transactions contemplated herein.



6. Further Assurances. Each Borrower will, promptly upon the request of the
Administrative Agent from time to time, execute, acknowledge, deliver, file and record all such
instruments and notices, and take all such other action, as the Administrative Agent deems
necessary or advisable to carry out the intent and purposes of this Amendment (and the attached
acknowledgements and consents) and the documents executed in connection therewith.


 


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7. No Defenses; Release. Each Borrower warrants and represents to the Administrative
Agent and the Lenders that, as of the Amendment Effective Date, such Borrower has no claims,
counterclaims, offsets or defenses to the Loan Documents or the Obligations, or if any such Person
does have any claims, counterclaims, offsets or defenses to the Loan Documents or the Obligations
as of the Amendment Effective Date, the same are hereby waived, relinquished and released in
consideration of the execution and delivery of this Amendment by the Administrative Agent and the
Lenders party hereto.



8. General. Except as specifically amended hereby, all of the terms and provisions of
the Credit Agreement and each of the other Loan Documents (including without limitation any
Collateral Documents) and all related documents, shall remain in full force and effect and are
hereby ratified and confirmed. This Amendment may be executed in any number of counterparts, which
together shall constitute one instrument, and shall bind and inure to the benefit of the parties
thereto and their respective successors and assigns, including as such successors and assigns, all
holders of any Obligation. Delivery of an executed counterpart of a signature page of this
Amendment by telecopy or in PDF format by electronic mail shall be effective as delivery of a
manually executed counterpart of this Amendment. This Amendment shall be governed by and construed
in accordance with the laws of the State of New York, including, but not limited to, Section 5-1401
of the New York General Obligations Law.



9. Reduction of Revolving Commitment. The Borrower Representative hereby notifies the
Administrative Agent of its election to reduce the Revolving Commitment from $115,000,000 to
$55,000,000, effective on the Amendment Effective Date, and requests that the Administrative Agent
and the Lenders waive the required notice period under Section 2.10(c) of the Credit Agreement, as
amended hereby. The Borrower Representative confirms and represents that, after giving effect to
such reduction in the Revolving Commitment and any concurrent prepayment of the Revolving Loans
under the Credit Agreement, the Revolving Exposure will not exceed the Revolving Commitment.
Subject to the terms and conditions set forth herein, the Required Lenders and the Administrative
Agent hereby agree to waive the required notice period under Section 2.10(c) of the Credit
Agreement, as amended hereby, and agree that the reduction in the Revolving Commitment as requested
by the Borrower Representative herein shall become effective on the Amendment Effective Date.



[Signature pages follow]



 


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Each of the undersigned has caused this Amendment to be executed and delivered by its duly
authorized officer as of the date first above written.



	 	 	 	 	 
	 	Borrowers:



SMITH & WESSON HOLDING CORPORATION

 	 
	 	By:  	/s/ Jeffrey D. Buchanan
 	 
	 	 	Name:  	Jeffrey D. Buchanan 	 
	 	 	Title:  	EVP, CFO, Secretary and Treasurer 	 
	 
	 	SMITH & WESSON CORP.

 	 
	 	By:  	/s/ Jeffrey D. Buchanan
 	 
	 	 	Name:  	Jeffrey D. Buchanan 	 
	 	 	Title:  	EVP, CFO, Secretary and Treasurer 	 
	 
	 	THOMPSON/CENTER ARMS COMPANY, INC.

 	 
	 	By:  	/s/ Jeffrey D. Buchanan
 	 
	 	 	Name:  	Jeffrey D. Buchanan 	 
	 	 	Title:  	EVP, CFO, Secretary and Treasurer 	 
	 
	 	SMITH & WESSON SECURITY SOLUTIONS, INC.

 	 
	 	By:  	/s/ Jeffrey D. Buchanan
 	 
	 	 	Name:  	Jeffrey D. Buchanan 	 
	 	 	Title:  	EVP, CFO, Secretary and Treasurer 	 
	 
	 	FOX RIDGE OUTFITTERS, INC.

 	 
	 	By:  	/s/ Jeffrey D. Buchanan
 	 
	 	 	Name:  	Jeffrey D. Buchanan 	 
	 	 	Title:  	EVP, CFO, Secretary and Treasurer 	 
	 



 


 









 





	 	 	 	 	 
	 	BEAR LAKE HOLDINGS, INC.

 	 
	 	By:  	/s/ Jeffrey D. Buchanan
 	 
	 	 	Name:  	Jeffrey D. Buchanan 	 
	 	 	Title:  	EVP, CFO, Secretary and Treasurer 	 
	 
	 	K.W. THOMPSON TOOL COMPANY, INC.

 	 
	 	By:  	/s/ Jeffrey D. Buchanan
 	 
	 	 	Name:  	Jeffrey D. Buchanan 	 
	 	 	Title:  	EVP, CFO, Secretary and Treasurer 	 
	 
	 	O.L. DEVELOPMENT, INC.

 	 
	 	By:  	/s/ Jeffrey D. Buchanan
 	 
	 	 	Name:  	Jeffrey D. Buchanan 	 
	 	 	Title:  	EVP, CFO, Secretary and Treasurer 	 
	 
	 	THOMPSON CENTER HOLDING COMPANY

 	 
	 	By:  	/s/ Jeffrey D. Buchanan
 	 
	 	 	Name:  	Jeffrey D. Buchanan 	 
	 	 	Title:  	EVP, CFO, Secretary and Treasurer 	 
	 
	 	SMITH & WESSON DISTRIBUTING, INC.

 	 
	 	By:  	/s/ Jeffrey D. Buchanan
 	 
	 	 	Name:  	Jeffrey D. Buchanan 	 
	 	 	Title:  	EVP, CFO, Secretary and Treasurer 	 
	 



 


 









 





	 	 	 	 	 
	 	Required Lenders:



TD BANK, N.A.

 	 
	 	By:  	/s/ Maria P. Goncalves
 	 
	 	 	Name:  	Maria P. Goncalves 	 
	 	 	Title:  	Regional Vice President 	 
	 
	 	SOVEREIGN BANK

 	 
	 	By:  	/s/ John Faber
 	 
	 	 	Name:  	John Faber 	 
	 	 	Title:  	Senior Vice President 	 
	 
	 	BERKSHIRE BANK

 	 
	 	By:  	/s/ Michael T. Mancuso
 	 
	 	 	Name:  	Michael T. Mancuso 	 
	 	 	Title:  	Vice President 	 
	 
	 	CHICOPEE SAVINGS BANK

 	 
	 	By:  	/s/ Kathi L. Donahue
 	 
	 	 	Name:  	Kathi L. Donahue 	 
	 	 	Title:  	Senior Vice President 	 
	 
	 	DEUTSCHE BANK TRUST COMPANY AMERICAS

 	 
	 	By:  	/s/ Dusan Lazarov
 	 
	 	 	Name:  	Dusan Lazarov 	 
	 	 	Title:  	Director 	 
	 
	 	By:  	                                                  /s/ Michael Getz
 	 
	 	 	Name:  	Michael Getz 	 
	 	 	Title:  	Vice President 	 
	 



 


 









 





	 	 	 	 	 
	 	Administrative Agent:



TD BANK, NA.,

as Administrative Agent

 	 
	 	By:  	/s/ Maria P. Goncalves
 	 
	 	 	Name:  	Maria P. Goncalves 	 
	 	 	Title:  	Regional Vice President