EXHIBIT 10.1


 


FIRST AMENDMENT TO CREDIT AGREEMENT


 


FIRST
AMENDMENT dated as of September 24, 2004 (this  “Amendment”), to the CREDIT AGREEMENT
dated as of March 15, 2004 (the “Credit  Agreement’’), among TRUE
TEMPER CORPORATION, a Delaware corporation (“Holdings”), TRUE TEMPER
SPORTS, INC., a Delaware corporation (the “Borrower”), the LENDERS from
time to time parties thereto, CREDIT SUISSE FIRST BOSTON, acting through its
Cayman Islands Branch, as Administrative Agent and as Collateral Agent (such
terms having the meanings provided in the Credit Agreement), CREDIT SUISSE
FIRST BOSTON, acting through its Cayman Islands Branch, as sole bookrunner and
sole lead arranger, ANTARES CAPITAL CORPORATION, as syndication agent, and
GOLDMAN SACHS CREDIT PARTNERS L.P. and MERRILL LYNCH CAPITAL, a division of
Merrill Lynch Business Financial Services Inc., as co-documentation agents.


 


A.    Holdings, the Borrower and the
Administrative Agent, among others, are parties to the Credit Agreement.


 


B.    Holdings and the Borrower have requested
that the Lenders agree to amend certain provisions of the Credit Agreement as
set forth in this Amendment.


 


C.    The Lenders whose signatures appear below,
constituting at least the Required Lenders, are willing to amend the Credit
Agreement on the terms and subject to the conditions set forth herein.


 


D.    Capitalized terms used but not defined
herein shall have the meanings assigned to such terms in the Credit Agreement,
as amended hereby.


 


Accordingly,
in consideration of the mutual agreements herein contained and other good and
valuable consideration, the sufficiency and receipt of which are hereby
acknowledged, the parties hereto agree as follows:


 


SECTION
1. Amendment of the Credit Agreement. 
The Credit Agreement is hereby amended, effective as of the First
Amendment Effective Date (as defined below), as follows:


 


(a)   Amendment of Section 1.01.  (i) Section 1.01 is revised by inserting the
following definitions in the appropriate alphabetical order therein:


 


“First
Amendment” shall mean the First Amendment to this Agreement dated as of
September 24, 2004, among Holdings, the Borrower and the Lenders parties
thereto.


 


“First
Amendment Effective Date” shall mean the date on which the First Amendment
becomes effective.


 

















 


“Funded
Senior Debt” shall mean, as of the last day of any fiscal quarter, Funded
Debt at such date, excluding the Indebtedness represented by the Subordinated
Notes.


 


“Senior
Leverage Ratio” shall mean, on the last day of any fiscal quarter, the
ratio of (a) Funded Senior Debt on such date to (b) Consolidated EBITDA for the
period of four consecutive fiscal quarters most recently ended on and prior to
such date, taken as one accounting period.


 


(ii)
The definition of “Applicable Margin” is revised by inserting the following
proviso immediately after the table set forth in such definition:


 


“;
provided that, notwithstanding the foregoing, each Applicable Margin set
forth above shall be increased by an additional 0.50% per annum at all times
during the period from and including the First Amendment Effective Date through
and including March 30, 2005 and at any time thereafter until the date on which
the Borrower shall have delivered for any fiscal quarter financial statements
and certificates required by Section 5.04(a) or (b), as applicable, and Section
5.04(c) demonstrating (i) (A) at any time during the period from March 31, 2005
through September 30,2005, that the Leverage Ratio on the last day of such
fiscal quarter is equal to or less than 6.75 to 1.00, or (B) at any time during
the period from October 1, 2005 through December 31, 2005, that the Leverage
Ratio on the last day of such fiscal quarter is equal to or less than 6.50 to
1.00, in which case described in this clause (i) the increase in the Applicable
Margin described above shall be reduced by 0.25% per annum or (ii) at any time
after December 31,2005, that the Borrower is in compliance with the covenant
set forth in Section 6.12, in which case described in this clause (ii) the
increase in the Applicable Margin described above shall no longer be
applicable”


 


(iii)
The definition of “Permitted Acquisition” is revised by deleting clause
(ii)(B)(x) thereof and replacing it with the following clause:


 


“(x)
$5,000,000 or more, then the Senior Leverage Ratio (at any time on or prior to
December 31, 2005) or the Leverage Ratio (at any time after December 31, 2005)
would be at least 0.25 to 1.0 less than the maximum Senior Leverage Ratio or
Leverage Ratio, as applicable, then permitted under Section 6.12 at such time”


 


(b)   Amendment of Section 2.12. Section
2.12(a) is revised by deleting the reference to “$2,000,000” in the eighth line
thereof and replacing it with a reference to “$500,000”.


 


(c)   Amendment of Section 6.11. Section
6.11 is revised by deleting the table set forth in such Section in its entirety
and replacing it with the Following table:


 


	
  Period

  	
   

  	
  Ratio

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  June 30, 2004
  through December 31, 2004

  	
   

  	
  1.70 to 1.00

  	
   

  
	
  January 1, 2005 through December 31, 2005

  	
   

  	
  1.70 to 1.00

  	
   

  
	
  January 1, 2006
  through December 31, 2006

  	
   

  	
  2.15 to 1.00

  	
   

  
	
  Thereafter

  	
   

  	
  2.25 to 1.00

  	
   

  



 


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(d)
Amendment of Section 6.12. Section 6.12 is revised by (i) inserting the
words “After December 31,2005” at the beginning of the first line thereof, (ii)
deleting the table set forth in such Section in its entirety and replacing it
with the following table:


 


	
  Period

  	
   

  	
  Ratio

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  January 1, 2006
  through December 31, 2006

  	
   

  	
  5.95 to 1.00

  	
   

  
	
  January 1, 2007
  through December 31, 2007

  	
   

  	
  5.50 to 1.00

  	
   

  
	
  January 1, 2008
  through December 31, 2008

  	
   

  	
  4.75 to 1.00

  	
   

  
	
  Thereafter

  	
   

  	
  4.50 to 1.00

  	
   

  



 


and
(iii) inserting the following paragraph at the end of such Section:


 


“Permit
the Senior Leverage Ratio on the last day of any fiscal quarter during any
period set forth below to be greater than the ratio set forth opposite such
period below:


 


	
  Period

  	
   

  	
  Ratio

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  September 26,
  2004 through March 31, 2005

  	
   

  	
  4.00 to 1.00

  	
   

  
	
  April 1, 2005
  through December 31, 2005

  	
   

  	
  3.75 to 1.00”

  	
   

  



 


(e)
Amendment or Section 6.13. Section 6.13 is revised by deleting the table
set forth in such Section in its entirety and replacing it with the following
table:


 


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  Period

  	
   

  	
  Ratio

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  June 30, 2004
  through December 31, 2005

  	
   

  	
  1.40 to 1.00

  	
   

  
	
  Thereafter

  	
   

  	
  1.50 to 1.00

  	
   

  



 


SECTION
2.  Representations and Warranties.  To induce the other parties hereto to enter
into this Amendment, Holdings and the Borrower represent and warrant to each of
the Lenders and the Administrative Agent that, as of the First Amendment Effective
Date:


 


(a)   This Amendment has been duly authorized,
executed and delivered by Holdings and the Borrower and this Amendment and the
Credit Agreement, as amended hereby, constitutes each of Holdings’ and the
Borrower’s legal, valid and binding obligation, enforceable against it in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered
in a proceeding in equity or at law.


 


(b)   The representations and warranties set forth
in the Credit Agreement and each other Loan Document are, after giving effect
to this Amendment, true and correct in all material respects on and as of the
First Amendment Effective Date, except to the extent such representations and
warranties expressly relate to an earlier date, in which case they were true
and correct in all material respects as of such earlier date.


 


(c)   No Default or Event of Default has occurred and
is continuing.


 


SECTION
3.  Conditions of Effectiveness of
this Amendment.  This Amendment
shall become effective on the date (the “First Amendment Effective Date”)
on which:


 


(a)   The Administrative Agent shall have received
duly executed and delivered counterparts of this Amendment that, when taken
together, bear the signatures of Holdings, the Borrower and the Required
Lenders.


 


(b)   The Borrower shall have paid to the
Administrative Agent for the prorata account of each Lender that has executed
and delivered a signature page (including, without limitation, by way of
facsimile to James Cooper at Latham & Watkins LLP, fax number 212-751-4864)
approving this Amendment on or before Friday, September 24, 2004 a fee in an
amount equal to 0.15% of the aggregate Commitments and outstanding Term Loans
of such Lender under the Credit Agreement.


 


(c)   The Borrower shall have paid to the
Administrative Agent all outstanding fees, costs and expenses owing to the
Administrative Agent as of such date.


 


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SECTION
4.  Effect of Amendment.  (a) Except as expressly set forth herein,
this Amendment shall not by implication or otherwise limit, impair, constitute
a waiver of or otherwise affect the rights and remedies of the Lenders, the
Administrative Agent or the Collateral Agent under the Credit Agreement or any
other Loan Document, and shall not alter, modify, amend or in any way affect
any of the terms, conditions, obligations, covenants or agreements contained in
the Credit Agreement or any other provision of the Credit Agreement or of any
other Loan Document, all of which are ratified and affirmed in all respects and
shall continue in full force and effect. Nothing herein shall be deemed to
entitle Holdings or the Borrower to a consent to, or a waiver, amendment,
modification or other change of, any of the terms, conditions, obligations,
covenants or agreements contained in the Credit Agreement or any other Loan
Document in similar or different circumstances.


 


(b)   On the First Amendment Effective Date, the
Credit Agreement shall be amended as provided herein. The parties hereto
acknowledge and agree that (i) this Amendment and any other Loan Documents
executed and delivered in connection herewith do not constitute a novation, or
termination of the “Obligations” (as defined in the Loan Documents) under the
Credit Agreement as in effect prior to the First Amendment Effective Date; (ii)
such “Obligations” are in all respects continuing (as amended hereby) with only
the terms thereof being modified to the extent provided in this Amendment; and
(iii) the Liens and security interests as granted under the Security Documents
securing payment of such “Obligations” are in all such respects continuing in
full force and effect and secure the payments of the “Obligations”.


 


(c)   This Amendment shall constitute a Loan
Document and shall be administered and construed pursuant to the terms of the
Credit Agreement (including, without limitation, Article IX thereof).


 


SECTION
5.  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 deemed an original, but all
such counterparts together shall constitute but one and the same instrument.
Delivery of any executed counterpart of a signature page of this Amendment by
facsimile transmission shall be as effective as delivery of a manually executed
counterpart hereof.


 


SECTION
6.  Applicable Law.  THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.


 


SECTION
7.  Headings.  The headings of this Amendment are for
purposes of reference only and shall not limit or otherwise affect the meaning
hereof.


 


[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


 


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IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed by their respective officers as of the day and year first above
written.


 


 


	
   

  	
  TRUE TEMPER CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Fred
  H. Geyer

  	
   

  
	
   

  	
  By:

  	
  Fred H. Geyer

  
	
   

  	
  Its: 

  	
  Senior Vice President,

    Chief Financial Officer and Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TRUE TEMPER SPORTS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Fred
  H. Geyer

  	
   

  
	
   

  	
  By:

  	
  Fred H. Geyer

  
	
   

  	
  Its:

  	
  Senior Vice President,

    Chief Financial Officer and Treasurer

  
						



 


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SIGNATURE PAGE TO


FIRST AMENDMENT


DATED AS OF SEPTEMBER 24, 2004,


TO THE TRUE TEMPER SPORTS, INC. CREDIT AGREEMENT


DATED AS OF MARCH 15, 2004


 


To approve First Amendment:


 


Name of Institution:


 


	
   

  
	
   

  	
   

  	
   

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
				



 


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