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Exhibit 10.47
FIRST AMENDMENT
THIS FIRST AMENDMENT (this "Amendment"), dated as of December __, 2000,
to the Credit Agreement referenced below, is by and among RailWorks Corporation,
a Delaware corporation (the "Borrower"), the Subsidiaries of the Borrower
identified on the signature pages hereto (the "Guarantors"), the Lenders
identified on the signature pages hereto and Bank of America, N.A., as
Administrative Agent. Terms used herein but not otherwise defined herein shall
have the meanings provided to such terms in the Credit Agreement.
WITNESSETH
WHEREAS, a $250 million credit facility has been extended to the
Borrower pursuant to the terms of that Amended and Restated Credit Agreement
dated as of April 28, 2000 (as amended, modified and supplemented from time to
time, the "Credit Agreement") among the Borrower, the Guarantors, the Lenders,
First Union National Bank, as Documentation Agent, and Bank of America, N.A., as
Administrative Agent;
WHEREAS, the Borrower has requested certain modifications to the Credit
Agreement;
WHEREAS, the requested modifications require the consent of the
Required Lenders; and
WHEREAS, the Required Lenders have agreed to the requested
modifications on the terms and conditions set forth herein.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Amendments. The Credit Agreement is amended in the following
respects:
1.1 The following definitions in Section 1.1 of the Credit
Agreement are amended or added to read as follows:
"Acquired Company EBITDA" means, for any period for
the Person or Property which is the subject of an Acquisition,
the sum of net income for such period plus interest expense
for such period plus all provisions for any federal, state or
other domestic and foreign income taxes for such period plus
depreciation and amortization for such period, in each case on
a consolidated basis determined in accordance with GAAP
applied on a consistent basis. Except as otherwise expressly
provided, the applicable period shall be for the four
consecutive fiscal quarters immediately preceding the date of
determination or, if four consecutive fiscal quarters are not
available, then by annualization of the two consecutive fiscal
quarters immediately preceding as of the date of
determination.
"Available Revolving Committed Amount" shall have the
meaning provided in Section 2.1(a).
"Backlog/Contract Monitoring Report" shall have the
meaning provided in Section 7.2(f).
"Blocked Account" means a depository bank account of
the Borrower that is
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governed by an assignment of collateral account or similar
agreement, in form acceptable to the Administrative Agent,
whereby the Borrower shall grant a security interest in such
account in favor of the Administrative Agent for the benefit
of the Lenders and shall acknowledge and agree that there
shall be no disbursements from such account except in payment
of the Borrower's obligations to the Lenders under this
Agreement.
"Borrowing Base" means, as of any day, an amount
equal to the sum of:
(a) eighty-five percent (85%) of Eligible
Receivables;
(b) eighty-five percent (85%) of Eligible
Receivables Retainage;
(c) sixty percent (60%) of Eligible Inventory;
(d) the aggregate amount of cash and Cash
Equivalents held in a Blocked Account with the
Administrative Agent; and
(e) the Borrowing Base Overadvance;
in each case as set forth in the most recent Borrowing Base
Certificate, with adjustments to give effect to Acquisitions
and Divestitures since the date of such Borrowing Base
Certificate on a Pro Forma Basis.
"Borrowing Base Certificate" means a statement of the
Borrowing Base and its components delivered pursuant to
Section 7.1(c), in form and content satisfactory to the
Administrative Agent and certified by the chief financial
officer, chief accounting officer, treasurer or assistant
treasurer of the Borrower to be true and correct as of the
date thereof.
"Borrowing Base Overadvance" means prior to and
including September 30, 2001, $15 million, and thereafter,
zero ($0).
"Consolidated EBITDA" means, for any period for the
Consolidated Group, the sum of Consolidated Net Income for
such period plus Consolidated Interest Expense for such period
plus all provisions for any federal, state or other domestic
and foreign income taxes for such period plus depreciation and
amortization for such period, in each case on a consolidated
basis determined in accordance with GAAP applied on a
consistent basis, but excluding for purposes hereof (i)
extraordinary gains and losses and related tax effects
thereon, and (ii) those special charges taken or to be taken
in the third fiscal quarter and fourth fiscal quarter of 2000
identified on Schedule 7.9 attached to the First Amendment.
"Consolidated Excess Cash Flow" means, for any fiscal
year of the Consolidated Group on a consolidated basis, an
amount equal to the sum of, without duplication, (a)
Consolidated EBITDA for such fiscal year minus (b) Contingent
Payments actually paid in cash during such fiscal year minus
(c) Consolidated Interest Expense actually paid during such
fiscal year minus (d) federal, state and other income taxes
actually paid by the Consolidated Group on a consolidated
basis during such fiscal year minus (e) Consolidated Capital
Expenditures made during such fiscal year minus (or plus) (f)
changes in working capital accounts [plus decreases (minus
increases) in accounts receivable, accounts receivable
retention, costs in excess of ▇▇▇▇▇▇▇▇, inventory and items
set forth as "other current assets" on the consolidated and
consolidating balance sheet of the Consolidated Group and
minus decreases (plus increases) in accounts payable, ▇▇▇▇▇▇▇▇
in excess of cost,
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accrued payroll and items set forth as "other current
liabilities" on the consolidated and consolidating balance
sheet of the Consolidated Group] of the members of the
Consolidated Group, minus (g) the sum of all scheduled
payments of principal of Consolidated Funded Debt (including,
without limitation, the implied principal component of
payments due on Capital Leases and synthetic leases) during
such period minus (h) the sum of all scheduled reductions of
commitments of Consolidated Funded Debt (including, without
limitation, reductions in the Aggregate Revolving Committed
Amount required pursuant to Section 3.4(b)) during such period
minus (i) the amount of any voluntary prepayments of the
Tranche B Term Loan or (to the extent accompanied by a
reduction in the Aggregate Revolving Committed Amount) the
Revolving Loans plus (j) net proceeds from any recoveries of
any claims described on Schedule 3.3(c) attached to the First
Amendment.
"Consolidated Fixed Charges" means, for any period
for the Consolidated Group, the sum of (a) Consolidated
Interest Expense for such period (with adjustment to exclude
amortization of original issue discount on the Senior
Subordinated Notes) plus (b) Restricted Payments paid during
such period plus (c) the sum of all scheduled payments of
principal of Consolidated Funded Debt (including, without
limitation, the implied principal component of payments due on
Capital Leases and synthetic leases) for the period of four
consecutive fiscal quarters immediately following such period,
in each case on a consolidated basis determined in accordance
with GAAP applied on an consistent basis. Except as otherwise
expressly provided, the applicable period shall be for the
four consecutive fiscal quarters ending as of the date of
determination.
"Contingent Payments" means any payments payable (or
that may become payable) in settlement of any contingent
obligations incurred in connection with any Acquisition (other
than Support Obligations permitted by Section 8.1), including,
without limitation, any "earn-out payment" obligations.
"First Amendment" means the First Amendment to this
Credit Agreement dated as of December __, 2000.
"Overadvance Utilization Fee" shall have the meaning
assigned to such term in Section 3.5(d).
"Unadjusted Borrowing Base" means, as of any day, the
Borrowing Base less the Borrowing Base Overadvance.
1.2 The pricing grid in the definition of "Applicable Percentage"
is deleted in its entirety and replaced with the pricing grid below:
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Applicable Percentages Applicable Percentages
for Revolving Loans for Tranche B Term Loan
------------------------------------- ------------------------
Eurodollar
Loans
Consolidated and Base
Pricing Total Leverage Letter of Rate Commitment Eurodollar Base Rate
Level Ratio Credit Fee Loans Fee Loans Loans
------- --------------- ---------- ----- ---------- ---------- ---------
I > 5.5 4.00% 2.50% 0.750% 5.00% 3.50%
-
II > 5.0 but < 5.5 3.50% 2.00% 0.750% 4.50% 3.00%
-
III > 4.5 but < 5.0 3.25% 1.75% 0.625% 4.25% 2.75%
-
IV > 4.0 but < 4.5 3.00% 1.50% 0.625% 4.00% 2.50%
-
V > 3.5 but < 4.0 2.50% 1.00% 0.500% 3.50% 2.00%
-
VI > 3.0 but < 3.5 2.25% 0.75% 0.500% 3.50% 1.75%
-
VII > 2.5 but < 3.0 2.00% 0.50% 0.375% 3.50% 1.75%
-
VIII > 2.0 but < 2.5 1.75% 0.00% 0.300% 3.50% 1.75%
-
IX > 1.5 but < 2.0 1.50% 0.00% 0.300% 3.50% 1.75%
-
X < 1.5 1.25% 0.00% 0.250% 3.50% 1.75%
1.3 The definition of "Permitted Investments" in Section 1.1 is
amended to include the following sentence at the end thereof:
It is acknowledged and agreed that the loans,
advances and investments permitted under the foregoing clause
(xii) shall not include additional loans, advances and
investments in or to Foreign Subsidiaries.
1.4 Clause (i) of the proviso in Section 2.1(a) is amended to read
as follows:
(i) with regard to the Revolving Lenders
collectively, the aggregate principal amount of Revolving
Obligations outstanding at any time shall not exceed ONE
HUNDRED TWENTY-FIVE MILLION DOLLARS ($125,000,000) (as such
amount may be reduced from time to time in accordance with the
provisions hereof, the "Aggregate Revolving Committed
Amount"), provided that of such amount only ONE HUNDRED
MILLION DOLLARS ($100,000,000) shall be available hereunder
(the "Available Revolving Committed Amount") until such time
as
(A) for two consecutive fiscal quarters both
(i) the Consolidated Total Leverage Ratio shall be
less than 4.0:1.0 and (ii) the Consolidated Senior
Leverage Ratio shall be less than 2.5:1.0, in each
case as shown on the officer's certificate delivered
to the Administrative Agent pursuant to Section
7.2(a) as of the end of such quarters, or
(B) all (100%) of the Revolving Lenders and
Tranche B Term Lenders holding at least sixty-six and
two thirds percent (66-2/3%) of the outstanding
principal amount of the Tranche B Term Loan shall
otherwise agree;
1.5 Section 2.2(e) of the Credit Agreement is hereby deleted in
its entirety.
1.6 Section 2.2(f) of the Credit Agreement is hereby deleted in
its entirety.
1.7 Clause (c) of Section 2.4 of the Credit Agreement is amended
to read as follows:
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(c) Tranche B Term Loan. The principal amount of
the Tranche B Term Loan shall be due and payable in twenty-six
(26) consecutive quarterly installments, as follows:
Principal Principal
Amortization Amortization
Date Payment Date Payment
------------------ ------------ ------------------ ------------
June 30, 2000 $250,000 September 30, 2003 $1,875,000
September 30, 2000 $250,000 December 31, 2003 $1,875,000
December 31, 2000 $250,000 March 31, 2004 $2,500,000
March 31, 2001 $250,000 June 30, 2004 $2,500,000
June 30, 2001 $250,000 September 30, 2004 $2,500,000
September 30, 2001 $250,000 December 31, 2004 $9,781,250
December 31, 2001 $250,000 March 31, 2005 $9,781,250
March 31, 2002 $1,250,000 June 30, 2005 $9,781,250
June 30, 2002 $1,250,000 September 30, 2005 $9,781,250
September 30, 2002 $1,250,000 December 31, 2005 $9,781,250
December 31, 2002 $1,250,000 March 31, 2006 $9,781,250
March 31, 2003 $1,875,000 June 30, 2006 $9,781,250
June 30, 2003 $1,875,000 September 30, 2006 $9,781,250
------------
Total $100,000,000
1.8 Section 3.3(b)(ii) (Mandatory Prepayments in respect of
Divestitures) is amended to read as follows:
The Loans shall be prepaid as hereafter provided in
an amount equal to one hundred percent (100%) of the Net Cash
Proceeds received from Divestitures (other than in the
ordinary course of business) to the extent that the aggregate
amount of Net Cash Proceeds therefrom shall exceed $1 million
in any fiscal year.
1.9 A new subclause (v) is added to clause (b) of Section 3.3 of
the Credit Agreement to read as follows:
(v) Consolidated Excess Cash Flow. Until such
time as the Consolidated Total Leverage Ratio shall be less
than 3.0:1.0 as of the end of two consecutive fiscal quarters
as shown on the officer's certificate delivered to the
Administrative Agent pursuant to Section 7.2(a), the Borrower
will, within ninety (90) days after the end of each fiscal
year (commencing with the fiscal year ending December 31,
2001), prepay the Loans as hereafter provided in an amount
equal to seventy-five percent (75%) of the Consolidated Excess
Cash Flow for the prior fiscal year.
1.10 A new subclause (C) is added to clause (c)(ii) of Section 3.3
of the Credit Agreement to read as follows:
(C) Prepayments of Consolidated Excess Cash
Flow. Mandatory prepayments made under this Section 3.3 in
respect of Consolidated Excess Cash Flow shall be applied
fifty percent (50%) to the Tranche B Term Loan (to the
principal amortization installments thereof in inverse order
of maturity) and fifty percent (50%) to the Revolving
Obligations (with a corresponding permanent reduction in the
Revolving Committed Amount in an amount equal to all amounts
applied to the Revolving Obligations pursuant to this Section
3.3(c)(ii)(C)). Such mandatory prepayments shall be applied
first to Base Rate Loans, then to Eurodollar Loans in direct
order of Interest Period maturities, then to
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Quoted Rate Swingline Loans in direct order of Interest Period
maturities and then to a cash collateral account to secure LOC
Obligations.
1.11 Clause (b) of Section 3.4 of the Credit Agreement is
renumbered as clause (c) thereof and a new clause (b) is added thereto
to read as follows:
(b) Mandatory Reductions. The Aggregate
Revolving Committed Amount and the Available Revolving
Committed Amount each shall be automatically and permanently
reduced on the date set forth below by the amount set forth
opposite such date:
Date Amount
---- ------
June 30, 2002 $2,500,000
December 31, 2002 $2,500,000
June 30, 2003 $3,750,000
December 31, 2003 $3,750,000
June 30, 2004 $7,500,000
1.12 The first sentence of Section 3.5(a)(i) of the Credit
Agreement is amended to read as follows:
In consideration of the Revolving Commitments, the
Borrower agrees to pay to the Administrative Agent for the
ratable benefit of the Lenders a commitment fee (the
"Commitment Fee") equal to the sum of (i) the Applicable
Percentage per annum on the average daily unused amount of the
Available Revolving Committed Amount for the applicable period
plus (ii) one-half of the Applicable Percentage per annum on
the average daily amount by which the Aggregate Revolving
Committed Amount exceeds the Available Revolving Committed
Amount for the applicable period.
1.13 A new clause (d) is added to Section 3.5 of the Credit
Agreement to read as follows:
(d) Borrowing Base Overadvance Fee. In
consideration of the Borrowing Base Overadvance, the Borrower
agrees to pay to the Administrative Agent, for the ratable
benefit of the Lenders, an overadvance utilization fee (the
"Overadvance Utilization Fee") equal to one and one-fourth
percent (1.25%) per annum on the amount by which the aggregate
principal amount of outstanding Obligations exceeds the
Unadjusted Borrowing Base on any day during the applicable
period. The Overadvance Utilization Fee shall be payable
quarterly in arrears on the last Business Day of each March,
June, September and December and on the Termination Date,
beginning with the payment due December 31, 2000, for the
quarter (or a portion thereof) then ending.
1.14 Section 6.15 (Purpose of Extensions of Credit) is amended to
read as follows:
The Extensions of Credit shall be used (i) to
refinance existing Funded Debt and (ii) to finance working
capital, capital expenditures and other lawful corporate
purposes, including Permitted Acquisitions; provided that
notwithstanding the foregoing, proceeds of Extensions of
Credit may not be used to make earn-out payments owing under
seller financing obligations unless after giving effect to all
such payments there would be at least $15 million of
availability remaining hereunder.
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1.15 Subclause (ii) of clause (b) of Section 7.1 is renumbered as
clause (iii) and a new clause (ii) is added thereto to read as follows:
(ii) within sixty (60) days after the end of the
month of December and thirty (30) days after the end of each
other calendar month, a company-prepared consolidated and
consolidating balance sheet of the Consolidated Group as of
the end of such calendar month and related company-prepared
consolidated and consolidating statements of operations,
shareholders' equity and cash flows for such calendar month
and for the fiscal year to date, in form and substance
satisfactory to the Administrative Agent and the Required
Lenders, together with the monthly information package
prepared for the Board of Directors and the weekly cash flow
projections and reconciliation provided under Section 7.2(h);
1.16 Clause (c) of Section 7.1 of the Credit Agreement is amended
to read as follows:
(c)(i) by no later than the 15th day of each calendar
month, a Borrowing Base Certificate as of the last day of the
immediately preceding calendar month, and (ii) by no later
than the last day of each calendar month, an updated Borrowing
Base Certificate reflecting the Borrowing Base as of the last
day of the immediately preceding calendar month, indicating in
each case the outstanding Obligations owing as of the date of
determination;
1.17 Clause (f) of Section 7.2 of the Credit Agreement is
renumbered as clause (i) thereof and new clauses (f), (g) and (h) are
added thereto to read as follows:
(f) Contract Monitoring Report. Concurrently
with the delivery of the financial statements referred to in
Sections 7.1(a) and 7.1(b) above, a contract monitoring report
for all contracts with estimated revenues of $10 million or
more (the "Backlog/Contract Monitoring Report"), in the form
attached as Schedule 7.1(f) to the First Amendment;
(g) Quarterly Reconciliation Report.
Concurrently with the delivery of the financial statements
referred to in Sections 7.1(a) and 7.1(b) above commencing
with financial statements for the fiscal quarter ending March
31, 2001, a report in a form acceptable to the Administrative
Agent reflecting a comparison between the actual consolidated
and consolidating income statements, balance sheets and cash
flow forecasts for such quarter and the projections contained
in the Business Plan prepared in connection with (and as
defined in) the First Amendment;
(h) Cash Flow Reports. As soon as available, and
in any event within five (5) Business Days following the first
day of each two week period (commencing with the two week
period beginning December 4, 2000), a report, in a form
acceptable to the Administrative Agent, that includes (i) a
detailed cash flow projection of the Borrower for the then
upcoming six weeks, on a consolidated and consolidating basis,
and (ii) a variance analysis reflecting a detailed comparison
between the actual cash flow computations of the Borrower
through the end of the previous two week period on a
consolidated and consolidating basis and those projected for
such two week period in the most recent cash flow projection
previously provided to the Administrative Agent in accordance
with this Section; provided, however, that the first of such
reports shall be delivered on or before December __, 2000 and
shall not include a variance analysis.
1.18 Clause (a) of Section 7.9 of the Credit Agreement is amended
to read as follows:
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(a) Consolidated Total Leverage Ratio. As of the
end of each fiscal quarter of the members of the Consolidated
Group, the Consolidated Total Leverage Ratio shall not be
greater than the ratio set forth below:
Fiscal Quarter End Ratio
------------------ -----
December 31, 2000 5.75:1.0
March 31, 2001 5.75:1.0
June 30, 2001 5.75:1.0
September 30, 2001 5.10:1.0
December 31, 2001 4.50:1.0
March 31, 2002 4.25:1.0
June 30, 2002 4.25:1.0
September 30, 2002 4.25:1.0
December 31, 2002 and thereafter 4.00:1.0
1.19 Clause (b) of Section 7.9 of the Credit Agreement is amended
to read as follows:
(b) Consolidated Senior Leverage Ratio. As of
the end of each fiscal quarter of the members of the
Consolidated Group, the Consolidated Senior Leverage Ratio
shall not be greater than the ratio set forth below:
Fiscal Quarter End Ratio
------------------ -----
December 31, 2000 3.00:1.0
March 31, 2001 3.00:1.0
June 30, 2001 3.00:1.0
September 30, 2001 2.75:1.0
December 31, 2001 and thereafter 2.50:1.0
1.20 Clause (c) of Section 7.9 of the Credit Agreement is amended
to read as follows:
(c) As of the end of each fiscal quarter of the
members of the Consolidated Group, Consolidated Net Worth
shall be not less than the sum of (i) the greater of (A) an
amount equal to ninety percent (90%) of Consolidated Net Worth
as of December 31, 2000 or (B) $90 million plus (ii) on the
last day of each fiscal quarter to end after September 30,
2000, seventy-five percent (75%) of Consolidated Net Income
for the fiscal quarter (but not less than zero), such
increases to be cumulative, plus (iii) one hundred percent
(100%) of any increases in Consolidated Net Worth resulting
from Equity Transactions occurring after the date of the First
Amendment.
1.21 Clause (d) of Section 7.9 of the Credit Agreement is amended
to read as follows:
(d) Consolidated Fixed Charge Coverage Ratio. As
of the end of each fiscal quarter of the members of the
Consolidated Group, the Consolidated Fixed Charge Coverage
Ratio shall not be less than the ratio set forth below:
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Fiscal Quarter End Ratio
------------------ -----
December 31, 2000 1.20:1.0
March 31, 2001 1:10:1.0
June 30, 2001 1:00:1.0
September 30, 2001 1.20:1.0
December 31, 2001 1.35:1.0
March 31, 2002 1.35:1.0
June 30, 2002 1.40:1.0
September 30, 2002 1.40:1.0
December 31, 2002 1.40:1.0
March 31, 2003 1.50:1.0
June 30, 2003 1.50:1.0
September 30, 2003 1.50:1.0
December 31, 2003 1.50:1.0
March 31, 2004 1.35:1.0
June 30, 2004 and thereafter 1.20:1.0
1.22 A new clause (f) is added to Section 7.9 of the Credit
Agreement to read as follows:
(f) Consolidated EBITDA. As of the end of each fiscal
quarter of the members of the Consolidated Group, Consolidated
EBITDA for the fiscal quarter then ended shall not be less
than the amount set forth below:
Minimum Quarterly
Fiscal Quarter End Consolidated EBITDA
------------------ -------------------
December 31, 2000 $10,000,000
March 31, 2001 $10,000,000
June 30, 2001 $17,500,000
September 30, 2001 $20,000,000
December 31, 2001 $17,500,000
1.23 A new Section 7.15 is added to read as follows:
7.15 Deposit Accounts. No later than January 31,
2001, cause each of the members of the Consolidated Group
(other than Foreign Subsidiaries) to maintain any and all
deposit accounts either with the Administrative Agent or with
Lenders that have, with the Administrative Agent and the
applicable Credit Party, executed tri-party agency agreements
in substantially the form attached as Exhibit 7.15 or
otherwise in form reasonably acceptable to the Borrower and
the Administrative Agent; provided, however, that any of such
members of the Consolidated Group may maintain deposit
accounts with banking institutions other than the
Administrative Agent or the Lenders so long as the aggregate
amount of funds contained in all such deposit accounts does
not exceed $2,000,000. In the case of Foreign Subsidiaries, if
on May 31 of any year the aggregate amount of cash and Cash
Equivalents held by Foreign Subsidiaries on such date exceeds
the Funded Debt of the Foreign Subsidiaries (other than
intracompany loans) on such date, the Borrower shall cause the
Foreign Subsidiaries to promptly transfer to the Borrower or
its Domestic Subsidiaries in the United States.
1.24 Section 8.4 of the Credit Agreement is amended to read as
follows:
8.4 Acquisitions. Make any Acquisition, unless
(a) the Consolidated Total Leverage
Ratio shall have been less than 3.0:1.0 as of the end
of two consecutive fiscal quarters occurring after
the date of the First Amendment as shown on the
officer's
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certificate delivered to the Administrative Agent
pursuant to Section 7.2(a);
(b) the total consideration (cash and
non-cash consideration, including, without
limitation, Indebtedness assumed, capital stock of
the Borrower issued in connection with the
Acquisition and the maximum aggregate amount of
Contingent Payments payable in connection with the
Acquisition) for any single Acquisition (or series of
related Acquisitions) shall not exceed $15,000,000 in
any instance;
(c) the total consideration (cash and
non-cash consideration, including, without
limitation, Indebtedness assumed, capital stock of
the Borrower issued in connection with the
Acquisition and the maximum aggregate amount of
Contingent Payments payable in connection with the
Acquisition) for all Acquisitions shall not exceed
$30,000,000 in any fiscal year;
(d) the Person or Property that is the
subject of the Acquisition shall have generated
positive Acquired Company EBITDA;
(e) in the case of an Acquisition of
Property (other than capital stock or other equity
interest of any Person), such Property which is the
subject of the Acquisition shall be located in the
United States of America;
(f) in the case of an Acquisition of
the capital stock or other equity interest of any
Person, such Person shall be organized under the laws
of, and located in, any of the States of the United
States of America or the District of Columbia and all
of the Property of such Person shall be located in
the United States of America;
(g) the Property acquired (or the
Property of the Person acquired) in the Acquisition
is used or useful in the same or a similar line of
business as the Borrower and its Subsidiaries were
engaged in on the date of the First Amendment;
(h) the board of directors of the
Person which is, or whose Property is, the subject of
the Acquisition shall have approved the Acquisition
without material condition or contingency;
(i) no Default or Event of Default
would exist after giving effect to the Acquisition,
determined in the case of financial covenant
compliance on a Pro Forma Basis for the period of
four consecutive fiscal quarters immediately
preceding the date of the Acquisition and as
otherwise set forth in Section 1.3(b).
Any consent of the Required Lenders requested by the Borrower
under this Section 8.4 shall not be arbitrarily withheld or
unreasonably delayed.
1.25 A new Section 8.14 is added to read as follows:
8.14 Limitation of Payment of Intracompany Loans.
Make any principal payments on any Indebtedness owing to
Foreign Subsidiaries, except for
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principal payments of up to $4,000,000 in the aggregate on
Indebtedness owing to Foreign Subsidiaries on the date of the
First Amendment so long as no Default or Event of Default
exists immediately prior thereto or would exist immediately
after giving effect thereto.
1.26 The Attachment for Computation of Financial Covenants attached to
the Form of Officer's Certificate in Schedule 7.2(b) is amended to read
as attached hereto.
2. Waiver.
(a) The Lenders hereby waive any Default or Event of
Default that exists solely as a result of the Borrower's failure to
comply with Section 7.9(a) (Consolidated Total Leverage Ratio), Section
7.9(b) (Consolidated Senior Leverage Ratio), Section 7.9(c)
(Consolidated Net Worth) and Section 7.9(d) (Consolidated Fixed Charge
Coverage Ratio) for any period ended on or before September 30, 2000.
The foregoing waiver shall not modify or affect the Borrower's
obligation to comply with Section 7.9(a), Section 7.9(b), Section
7.9(c) and Section 7.9(d) at all times after September 30, 2000.
(b) The Lenders hereby waive any Default or Event of
Default that exists solely as a result of the Borrower's failure to
comply with Section 5.2(b) of the Security Agreement in connection with
(i) the change in corporate name of (A) Annex Railroad Builders Inc.
(now known as RailWorks Track Services, Inc.), (B) RWKS Transit, Inc.
(now known as RailWorks Transit, Inc.), (C) Railroad Service, Inc. (now
known as RailWorks Track Systems, Inc.), (D) RailWorks Rail Services,
Inc. (now known as RailWorks Rail Products & Services, Inc.) and (E)
▇▇▇▇▇ Corporation (now known as RWKS Construction, Inc.), and (ii) the
change in corporate structure of Impulse Electric Enterprises of New
York, Inc. and ▇▇▇▇▇▇▇ Electric, Inc., both of which merged into ▇.▇.
▇▇▇▇▇▇▇▇ & Company, Inc. The foregoing waiver shall not modify or
affect the Borrower's obligation to comply with Section 5.2(b) of the
Security Agreement in all other cases.
3. Covenants. The Borrower hereby agrees to provide the
following:
(a) Report Concerning Strategic Divestitures. On or
before March 31, 2001, the Borrower will provide a report to the
Administrative Agent on the advisability and feasibility of a sale or
other divestiture of non-strategic businesses.
(b) Delivery of Detailed 2001 Business Plan. On or before
December 31, 2000, a detailed "bottoms-up" cash flow budget for fiscal
year 2001 for the Borrower, including consolidated and consolidating
income statements, balance sheets and cash flow forecasts by month,
which shall be based upon and supported by income statements, balance
sheets and cash flow forecasts from each operating group within the
Borrower (including the Transit Group).
(c) Delivery of Backlog/Contract Monitoring Report. On or
before December 31, 2000, a detailed Backlog/Contract Monitoring Report
for the fiscal quarter ended September 30, 2000, as provided in Section
7.2(f), as amended.
4. Conditions Precedent. This Amendment shall be effective upon
satisfaction of the following conditions precedent:
(a) receipt by the Administrative Agent of multiple
counterparts of this Amendment executed by the Credit Parties and the
Required Lenders;
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(b) receipt by the Administrative Agent of an opinion of
counsel to the Credit Parties relating to this Amendment, which opinion
shall be in form and substance satisfactory to the Required Lenders;
(c) receipt by the Administrative Agent and the Lenders
of a detailed "bottoms-up" cash flow budget for fiscal year 2001 for
the Transit Group of the Borrower, including consolidated and
consolidating income statements, balance sheets and cash flow forecasts
by month;
(d) receipt by the Administrative Agent of a Blocked
Account agreement executed by the Borrower, which agreement shall be in
form and substance satisfactory to the Administrative Agent;
(e) receipt by the Administrative Agent, for the ratable
benefit of the Lenders which consent to this Amendment on the date
hereof (the "Consenting Lenders"), of an amendment fee equal to 10
basis points (0.10%) on the aggregate Commitments (after giving effect
to this Amendment) of the Consenting Lenders; and
(f) receipt by the Administrative Agent of all other fees
and expenses due in connection with this Amendment;
5. Representations.
(a) The Borrower hereby affirms that the representations
and warranties set forth in the Credit Agreement and the other Credit
Documents are true and correct as of the date hereof (except those
which expressly relate to an earlier period).
(b) Each of the Credit Parties hereby affirms that it has
the corporate or other power and authority, and the legal right, to
make, deliver and perform this Amendment and has taken all necessary
action to authorize the execution, delivery and performance of this
Amendment, and that this Amendment constitutes a legal, valid and
binding obligation enforceable in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles
(whether enforcement is sought by proceedings in equity or at law).
6. Release. Each Credit Party hereby represents and warrants that
it has no claims, counterclaims, offsets, or defenses to the Credit Documents or
to the performance of its obligations thereunder. In consideration of the
Lenders' willingness to enter into this Amendment, each Credit Party hereby
releases the Administrative Agent, the Lenders, and the Administrative Agent's
and the Lenders' respective officers, employees, representatives, agents,
counsel, trustees and directors from any and all actions, causes of action,
claims, demands, damages and liabilities or whatever kind or nature, in law or
in equity, now known or unknown, suspected or unsuspected, that may exist in
connection with any of the Credit Documents or the Obligations, to the extent
that any of the foregoing arises from any action or failure to act on or prior
to the date hereof.
7. Reaffirmation of Guaranty. Each Guarantor (i) acknowledges and
consents to all of the terms and conditions of this Amendment, (ii) affirms all
of its obligations under the Credit Documents and (iii) agrees that this
Amendment and all documents executed in connection herewith do not operate to
reduce or discharge such Guarantor's obligations under the Credit Agreement or
the other Credit Documents.
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8. No Other Changes. Except as modified hereby, all of the terms
and provisions of the Credit Agreement and the other Credit Documents (including
schedules and exhibits thereto) shall remain in full force and effect.
9. Costs and Expenses. The Borrower agrees to pay all reasonable
costs and expenses of the Administrative Agent in connection with the
preparation, execution and delivery of this Amendment, including, without
limitation, the reasonable fees and expenses of ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC.
10. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original and it shall not be necessary in making proof of this Amendment to
produce or account for more than one such counterpart.
11. Governing Law. This Amendment shall be deemed to be a contract
made under, and for all purposes shall be construed in accordance with, the laws
of the State of New York.
[Remainder of Page Intentionally Left Blank]
46
14
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Amendment to be duly executed and delivered as of the date first above
written.
BORROWER: RAILWORKS CORPORATION,
a Delaware corporation
By:
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
GUARANTORS: ALPHA-KEYSTONE ENGINEERING, INC., a Pennsylvania corporation
BIRMINGHAM WOOD, INC., an Alabama corporation
BREAKING TECHNOLOGY CORP., a New York corporation
BREAKING TECHNOLOGY & EQUIPMENT, INC., a New York corporation
▇▇▇▇▇▇▇▇ HOLDINGS, INC., a Delaware corporation
COMTRAK CONSTRUCTION, INC., a Georgia corporation
▇▇▇▇▇▇ BROTHERS, INC., a Washington corporation
CPI CONCRETE PRODUCTS, INCORPORATED, a Tennessee corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ CONSTRUCTION COMPANY, INC., a Texas corporation
FCM RAIL, LTD., a Michigan corporation
GANTREX CORPORATION, a Pennsylvania corporation
H.P. ▇▇▇▇▇▇▇▇, INC., a Pennsylvania corporation
HSQ TECHNOLOGY, a California corporation
▇▇▇▇▇▇▇ RAILROAD BUILDERS, INC., a Pennsylvania corporation
▇.▇. ▇▇▇▇▇▇▇▇ & COMPANY, INC., a New York corporation
M-TRACK ENTERPRISES, INC., a New York corporation
▇▇▇▇▇▇ TREATED WOOD, INC., an Alabama corporation
MERIT RAILROAD CONTRACTORS, INC., a Missouri corporation
MIDWEST CONSTRUCTION SERVICES, INC., an Indiana corporation
MIDWEST RAILROAD CONSTRUCTION AND MAINTENANCE CORPORATION
OF WYOMING, a Wyoming corporation
MINNESOTA RAILROAD SERVICE, INC., a Tennessee corporation
NEOSHO ASIA, INC., a Kansas corporation
NEOSHO CENTRAL AMERICA, INC., a Kansas corporation
NEOSHO CONSTRUCTION COMPANY, INCORPORATED, a Kansas corporation
NEOSHO CONTRACTORS, INC., a Wyoming corporation
NEOSHO INCORPORATED, INC., a Kansas corporation
NEOSHO INTERNATIONAL, INC., a Kansas corporation
NEW ENGLAND RAILROAD CONSTRUCTION CO., a Connecticut corporation
NORTHERN RAIL SERVICE AND SUPPLY COMPANY, INC.,
a Michigan corporation
By:
-----------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President of each of the foregoing
[SIGNATURE PAGES CONTINUE]
47
15
RAILCORP, INC., an Ohio corporation
RAILWORKS RAIL PRODUCTS & SERVICES, INC., a Kansas corporation
RAILWORKS TRACK SERVICES, INC., an Indiana corporation
RAILWORKS TRACK SYSTEMS, INC., a Nevada corporation
RAILWORKS TRANSIT, INC., a New York corporation
RAILWORKS WOOD PRODUCTS, INC., a Delaware corporation
RWKS CONSTRUCTION, INC., a Maryland corporation
SOUTHERN INDIANA WOOD PRESERVING CO., INC., an Indiana corporation
U.S. RAILWAY SUPPLY, INC., an Indiana corporation
U.S. TRACKWORKS, INC., a Michigan corporation
V&R ELECTRICAL CONTRACTORS, INC., a New York corporation
WM. ▇. ▇▇▇▇▇ CONSTRUCTION CO., INC., a Texas corporation
WOOD WASTE ENERGY, INC., a Virginia corporation
▇.▇. ▇▇▇▇▇ CO., INC., a Texas corporation
By:
-----------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President of each of the foregoing
RAILWORKS TRANSIT SYSTEMS, INC., a Delaware corporation
RAILWORKS CANADA, INC., a Delaware corporation
By:
-----------------------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Assistant Secretary of each of the foregoing
By:
-----------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President of each of the foregoing
DURA-WOOD LLC, a Delaware limited liability company
By: ▇▇▇▇▇▇ TREATED WOOD, INC.,
an Alabama corporation, its managing member
By:
--------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President
[SIGNATURE PAGES CONTINUE]
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16
LENDERS: BANK OF AMERICA, N.A.,
individually in its capacity as a
Lender and in its capacity as Administrative Agent
By:
--------------------------
Name:
Title:
FIRST UNION NATIONAL BANK
By:
--------------------------
Name:
Title:
SUMMIT BANK
By:
--------------------------
Name:
Title:
M&T BANK
By:
--------------------------
Name:
Title:
KEY BANK NATIONAL ASSOCIATION
By:
--------------------------
Name:
Title:
BANK ONE, MICHIGAN
By:
--------------------------
Name:
Title:
COMERICA BANK
By:
--------------------------
Name:
Title:
[SIGNATURE PAGES CONTINUE]
49
17
STATE STREET BANK AND TRUST COMPANY,
as Trustee for GENERAL MOTORS WELFARE BENEFITS TRUST
By:
-------------------------------------------------
Name:
Title:
STATE STREET BANK AND TRUST COMPANY, as Trustee for
GENERAL MOTORS EMPLOYEES GLOBAL GROUP PENSION TRUST
By:
-------------------------------------------------
Name:
Title:
ALLFIRST BANK
By:
-------------------------------------------------
Name:
Title:
▇▇▇▇▇▇ FINANCIAL, INC.
By:
-------------------------------------------------
Name:
Title:
THE PROVIDENT BANK
By:
-------------------------------------------------
Name:
Title:
FOOTHILL INCOME TRUST II, L.P.
By:
-------------------------------------------------
Name:
Title:
METROPOLITAN PROPERTY AND CASUALTY INSURANCE COMPANY
By:
-------------------------------------------------
Name:
Title:
[SIGNATURE PAGES CONTINUE]
50
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FLOATING RATE PORTFOLIO
By: INVESCO Senior Secured Management, Inc.,
as attorney in fact
By:
----------------------------------------------
Name:
Title:
AVALON CAPITAL LTD.
By: INVESCO Senior Secured Management, Inc.
By:
----------------------------------------------
Name:
Title:
CERES II FINANCE LTD
By: INVESCO Senior Secured Management, Inc.,
as Sub-Management Agent (Financial)
By:
----------------------------------------------
Name:
Title:
▇▇▇ ▇▇▇▇▇▇ PRIME RATE INCOME TRUST
By:
----------------------------------------------
Name:
Title:
▇▇▇ ▇▇▇▇▇▇ CLO I, LIMITED
By:
----------------------------------------------
Name:
Title:
▇▇▇ ▇▇▇▇▇▇ SENIOR INCOME TRUST
By:
----------------------------------------------
Name:
Title:
▇.▇. ▇▇▇▇▇▇▇ MARKET VALUE FUND, L.P.
By:
----------------------------------------------
Name:
Title:
51
19
Schedule 3.3(c)
Schedule of Claims Recoveries
52
20
Schedule 7.1(f)
Form of Contract/Backlog Monitoring Report
53
21
Exhibit 7.2(b)
Form of Attachment to Officer's Certificate
For Computation of Financial Covenants
54
22
Schedule 7.9
Special Charges taken in Third and Fourth Quarters of 2000
55
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Schedule 7.15
Form of Tri-Party Agency Agreement
56
