Exhibit 10.3
FIRST AMENDMENT
TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT
AGREEMENT (this “ Amendment ”), dated as of
September 28, 2007, is by and among INFRASTRUX GROUP, INC., a
Washington corporation (herein, together with its successors and
assigns, the “ Borrower ”), INFRASTRUX HOLDINGS,
LLC, a Delaware limited liability company (herein, together with
its successor and assigns, (the “ Parent ”),
each Subsidiary Guarantor signatory hereto, the Lenders signatories
hereto, and CREDIT SUISSE, CAYMAN ISLANDS BRANCH, as the
administrative agent for the Lenders (the “ Administrative
Agent ”), the Swing Line Lender and an Issuing
Bank.
W I T N E S S E T H:
WHEREAS, pursuant to that certain
Credit Agreement dated as of November 3, 2006 (the “
Existing Credit Agreement ”) by and among the
Borrower, the Parent, the Subsidiary Guarantors, the Lenders and
the Administrative Agent, the Lenders provided a term loan facility
and a revolving credit facility to the Borrower;
WHEREAS, the Borrower has requested
that the Lenders agree to amend certain provisions of the Existing
Credit Agreement; and
WHEREAS, the Administrative Agent
and the Required Lenders are willing to make such amendments upon
the terms and conditions contained in this Amendment;
NOW, THEREFORE, for good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and in consideration of the agreements herein
contained, the parties hereby agree as follows:
PART I
DEFINITIONS
SUBPART 1.1. Certain
Definitions . Unless otherwise defined herein or the
context otherwise requires, the following terms used in this
Amendment, including its preamble and recitals, have the following
meanings:
“ Additional Equity
” means $50,000,000 in good and immediately available Dollars
received from the Parent as additional cash equity.
“ Amended Credit
Agreement ” means the Existing Credit Agreement as
amended hereby.
“ First Amendment Effective
Date ” is defined in Subpart 3.1.
SUBPART 1.2. Other
Definitions . Unless otherwise defined herein or the context
otherwise requires, terms used in this Amendment, including its
preamble and recitals, have the meanings provided in the Amended
Credit Agreement.
PART II
AMENDMENTS TO EXISTING CREDIT
AGREEMENT
Effective on the First Amendment
Effective Date (and subject to the occurrence of the conditions set
forth in Part III ), the Existing Credit Agreement is hereby
amended in accordance with this Part II . Except as so
amended, the Existing Credit Agreement shall continue in full force
and effect.
SUBPART 2.1. Amendment to
Article I . Article I of the Existing Credit Agreement
is hereby amended by
(a) adding the following definitions
in the appropriate alphabetical order:
“ Additional Prepayment
Date ” has the meaning provided in
Section 2.13(b)(xiv) .
“ First Amendment
” means that certain First Amendment to the Credit Agreement
dated as of September 28, 2007 by and among the parties to
this Agreement.
“ First Amendment Effective
Date ” means September 28, 2007.
“ First Amendment Fees and
Expenses ” means the sum of the amount required to be
paid by the Borrower pursuant to (i) Subpart 3.3 of the First
Amendment and (ii) Subpart 3.4 of the First
Amendment.
“ Supplemental Cash
Interest Amounts ” means all Supplemental Revolver Cash
Amounts and all Supplemental Term Loan Cash Amounts.
“ Supplemental Revolver
Cash Amount ” has the meaning provided in
Section 2.09(h)(i) .
“ Supplemental Term Loan
Cash Amount ” has the meaning provided in
Section 2.09(h)(ii) .
“ Supplemental Term Loan
Deferred Fee Amount ” has the meaning provided in
Section 2.09(h)(ii) .
2
“ Supplemental Interest
Termination Date ” means the third Business Day after the
date when the Borrower has both (a) paid in full in good and
immediately available Dollars (i) all Supplemental Term Loan
Deferred Fee Amounts (including without limitation all Supplemental
Term Loan Deferred Fee Amounts that have accrued but are not yet
due and all interest on the Supplemental Term Loan Deferred Fee
Amounts, in each case, regardless of whether the Supplemental Term
Loan Deferred Fee Amounts have been capitalized as Term Loans) and
(ii) all Supplemental Cash Interest Amounts that have accrued
and are unpaid, regardless of whether such Supplemental Cash
Interest Amounts are due and (b) delivered written notice to
the Administrative Agent (in form an substance reasonably
satisfactory to the Administrative Agent) that it elects to cease
payment of supplemental interest on the Loans as provided in
Section 2.09(h) ; provided that it shall be a
further condition of the occurrence of the Supplemental Interest
Termination Date that (x) no Default or Event of Default shall
have occurred and be continuing as of such date, (y) the
Borrower shall have been in compliance with the financial covenants
set forth in Section 7.07 (after giving effect to the
occurrence of the Supplemental Interest Termination Date) as
established by the Required Financial Information as of the end of
the fiscal quarter ending immediately preceding such date and
(z) the Borrower shall have provided the Administrative Agent
any other supporting information regarding its compliance with such
financial covenants as of the end of such fiscal quarter as the
Administrative Agent shall reasonably request.
(b) adding the following new text
after the close parenthesis and before the period at the end of the
definition of “Consolidated Interest
Expense”:
; provided, however, that in no
event shall any Supplemental Term Loan Deferred Fee Amount be
included in any determination of Consolidated Interest
Expense
SUBPART 2.2. Supplemental
Interest . Section 2.09(d) of the Existing Credit
Agreement is amended by replacing “Notwithstanding the above
provisions,” with “Notwithstanding the above provisions
and Section 2.09(h) ,” and the following is
hereby added to the Existing Credit Agreement as
Section 2.09(h) :
(h) Supplemental Interest
.
(i) Revolving Loans and Swing
Loans . In addition to the interest required pursuant to
Section 2.09(a) , Section 2.09(c) ,
Section 2.09(d) and/or any other provision of this
Agreement or the other Loan Documents, the Borrower shall from and
including the First Amendment Effective Date until and through the
Supplemental Interest Termination Date make an additional cash
payment on the outstanding principal amount of each Revolving Loan
and each Swing Loan made by each Lender in an amount equal to
either (A) 1.25% per annum or (B) so long
3
as the Total Leverage Ratio of the
Borrower and its Subsidiaries as of the end of the immediately
preceding fiscal quarter, as established by the Required Financial
Information (delivered in accordance with the terms and conditions
herein), is less than 4.75 to 1.00, 1.00% per annum of the
principal amount of each such outstanding Revolving Loan or Swing
Loan, as applicable (the “ Supplemental Revolver Cash
Amount ”). The rate for calculating the Supplemental
Revolver Cash Amount shall be deemed to be 1.25% per annum as
of and including the First Amendment Effective Date; after delivery
of the Required Financial Information for the Borrower’s
fiscal quarter ending September 30, 2007, such rate shall be
determined pursuant to the provisions above. The Supplemental
Revolver Cash Amount shall be paid on the date of the interest
payments for the applicable Revolving Loan or Swing Loan as
provided in Section 2.09(e) . In addition to the
payment dates specified in Section 2.09(e) , on the
Supplemental Interest Termination Date, the Borrower shall pay all
outstanding Supplemental Revolver Cash Amounts on all Revolving
Loans and Swing Loans as specified in the definition of
Supplemental Interest Termination Date.
(ii) Term Loan . In addition
to the interest required pursuant to Section 2.09(b) ,
Section 2.09(d) and/or or any other provision of this
Agreement or the other Loan Documents, the Borrower shall from and
including the First Amendment Effective Date until and through the
Supplemental Interest Termination Date (A) make an additional
cash payment on the outstanding principal amount of each Term Loan
made by each Lender in an amount equal to either
(I) 0.75% per annum or (II) so long as the Total Leverage
Ratio of the Borrower and its Subsidiaries as of the end of the
immediately preceding fiscal quarter, as established by the
Required Financial Information (delivered in accordance with the
terms and conditions herein), is less than 4.75 to 1.00,
0.50% per annum of the principal amount of each such
outstanding Loan (the “ Supplemental Term Loan Cash
Amount ”) and (B) increase the then outstanding
principal of each Term Loan by an amount equal to 0.50% per
annum of the principal amount of each such outstanding Loan (the
“ Supplemental Term Loan Deferred Fee Amount ”).
The rate for calculating the Supplemental Term Loan Cash Amount
shall be deemed to be 0.75% per annum as of and including the
First Amendment Effective Date; after delivery of the Required
Financial Information for the Borrower’s fiscal quarter
ending September 30, 2007, such rate shall be determined
pursuant to the provisions above. The Supplemental Term Loan Cash
Amount shall be paid, and the Supplemental Term Loan Deferred Fee
Amount shall be capitalized as additional principal of the Term
Loan upon which such Supplemental Term Loan Deferred Fee Amount is
owed, in each case on the date of the interest payments for the
applicable Term Loan as provided in Section 2.09(e) .
In addition to the payment dates specified in Section
2.09(e) ,
4
on the Supplemental Interest
Termination Date, the Borrower shall pay all outstanding
Supplemental Term Loan Cash Amounts and all Supplemental Term Loan
Deferred Fee Amounts on all Term Loans as specified in the
definition of Supplemental Interest Termination Date.
SUBPART 2.3. Excess Cash
Flow . Section 2.13(b)(iv) of the Existing Credit
Agreement is hereby amended by deleting Section 2.13(b)(iv)
and replacing such section in its entirety with the
following:
(iv) Excess Cash Flow .
Within 120 days after the end of each fiscal year, the Borrower
shall prepay the Loans and/or cash collateralize the reimbursement
obligations of the Borrower hereunder in respect of Letters of
Credit in an amount equal to 100% (if the Total Leverage Ratio as
of the end of such fiscal year is equal to or greater than 4.00 to
1.00), 75% (if the Total Leverage Ratio as of the end of such
fiscal year is less than 4.00 to 1.00 but equal to or greater than
2.50 to 1.00) or 50% (if the Total Leverage Ratio as of the end of
such fiscal year is less than 2.50 to 1.00) of the Excess Cash Flow
earned during such prior fiscal year (such prepayment to be applied
as set forth in clause (xii) below).
SUBPART 2.4. Additional
Prepayment . The following is hereby added to the Existing
Credit Agreement as Section 2.13(b)(xiv):
(xiv) Additional Prepayment .
Notwithstanding the provisions of Section 2.13(b)(vii)
(which provisions shall not be applicable to the Additional
Equity), not later than the Business Day immediately following the
date when the Additional Equity is received by the Borrower, but in
no event later than October 16, 2007 (such date, the “
Additional Prepayment Date ”), the Borrower shall make
a prepayment in respect of the Term Loan (which prepayment shall be
accompanied by interest on the applicable principal amount to be
prepaid through the date of prepayment) in an amount such that the
principal amount of the Term Loan prepaid on the Additional
Prepayment Date is equal to the Additional Equity less the
First Amendment Fees and Expenses. Such prepayment of the Term Loan
pursuant to this clause (xiv) shall be applied pro rata to the
remaining amortization payments thereof set forth in
Section 2.13(d) .
5
SUBPART 2.5. Financial
Covenants . Section 7.07 of the Existing Credit
Agreement is hereby amended by deleting Section 7.07 and
replacing such section in its entirety with the
following:
Section 7.07 Financial
Covenants .
(a) Total Leverage Ratio .
The Borrower will not permit the Total Leverage Ratio as of the end
of any fiscal quarter of the Borrower and its Subsidiaries to be
greater than (i) if the Supplemental Interest Termination Date
has not occurred, the ratio set forth below opposite such period in
Column A and (ii) if the Supplemental Interest Termination
Date has occurred, the ratio set forth below opposite such period
in Column B:
|
|
|
|
|
Four fiscal quarters ending
|
|
Column A
Maximum Total
Leverage Ratio
|
|
Column B
Maximum Total
Leverage Ratio
|
|
September 30, 2007
|
|
7.00:1.00
|
|
5.10:1.00
|
|
December 31, 2007
|
|
8.30:1.00
|
|
4.25:1.00
|
|
March 31, 2008
|
|
8.75:1.00
|
|
4.20:1.00
|
|
June 30, 2008
|
|
8.15:1.00
|
|
4.20:1.00
|
|
September 30, 2008
|
|
5.75:1.00
|
|
4.20:1.00
|
|
December 31, 2008
|
|
4.75:1.00
|
|
3.65:1.00
|
|
March 31, 2009
|
|
4.60:1.00
|
|
3.35:1.00
|
|
June 30, 2009
|
|
4.60:1.00
|
|
3.35:1.00
|
|
September 30, 2009
|
|
4.30:1.00
|
|
3.35:1.00
|
|
December 31, 2009
|
|
3.80:1.00
|
|
3.10:1.00
|
|
March 31, 2010
|
|
2.85:1.00
|
|
2.85:1.00
|
|
June 30, 2010
|
|
2.85:1.00
|
|
2.85:1.00
|
|
September 30, 2010
|
|
2.85:1.00
|
|
2.85:1.00
|
|
December 31, 2010
|
|
2.70:1.00
|
|
2.70:1.00
|
|
March 31, 2011
|
|
2.60:1.00
|
|
2.60:1.00
|
|
June 30, 2011
|
|
2.60:1.00
|
|
2.60:1.00
|
|
September 30, 2011
|
|
2.60:1.00
|
|
2.60:1.00
|
|
December 31, 2011
|
|
2.60:1.00
|
|
2.60:1.00
|
|
March 31, 2012
|
|
2.60:1.00
|
|
2.60:1.00
|
|
June 30, 2012
|
|
2.60:1.00
|
|
2.60:1.00
|
|
September 30, 2012
|
|
2.60:1.00
|
|
2.60:1.00
|
|
December 31, 2012
|
|
2.60:1.00
|
|
2.60:1.00
|
6
(b) Interest Coverage Ratio .
The Borrower will not permit the Interest Coverage Ratio as of the
end of any fiscal quarter of the Borrower and its Subsidiaries to
be less than (i) if the Supplemental Interest Termination Date
has not occurred, the ratio set forth below opposite such period in
Column A and (ii) if the Supplemental Interest Termination
Date has occurred, the ratio set forth below opposite such period
in Column B:
|
|
|
|
|
Four fiscal quarters ending
|
|
Column A
Minimum Interest
Coverage Ratio
|
|
Column B
Minimum Interest
Coverage Ratio
|
|
September 30, 2007
|
|
1.08:1.00
|
|
2.40:1.00
|
|
December 31, 2007
|
|
1.08:1.00
|
|
2.40:1.00
|
|
March 31, 2008
|
|
1.08:1.00
|
|
2.40:1.00
|
|
June 30, 2008
|
|
1.28:1.00
|
|
2.40:1.00
|
|
September 30, 2008
|
|
1.90:1.00
|
|
2.40:1.00
|
|
December 31, 2008
|
|
2.25:1.00
|
|
2.40:1.00
|
|
March 31, 2009
|
|
2.25:1.00
|
|
2.65:1.00
|
|
June 30, 2009
|
|
2.50:1.00
|
|
2.65:1.00
|
|
September 30, 2009
|
|
2.70:1.00
|
|
2.65:1.00
|
|
December 31, 2009
|
|
2.85:1.00
|
|
2.90:1.00
|
|
March 31, 2010
|
|
3.40:1.00
|
|
2.90:1.00
|
|
June 30, 2010
|
|
3.40:1.00
|
|
2.90:1.00
|
|
September 30, 2010
|
|
3.40:1.00
|
|
2.90:1.00
|
|
December 31, 2010
|
|
3.40:1.00
|
|
3.40:1.00
|
|
March 31, 2011
|
|
3.90:1.00
|
|
3.40:1.00
|
|
June 30, 2011
|
|
3.90:1.00
|
|
3.40:1.00
|
|
September 30, 2011
|
|
3.90:1.00
|
|
3.40:1.00
|
|
December 31, 2011
|
|
3.90:1.00
|
|
3.90:1.00
|
|
March 31, 2012
|
|
3.90:1.00
|
|
3.90:1.00
|
|
June 30, 2012
|
|
3.90:1.00
|
|
3.90:1.00
|
|
September 30, 2012
|
|
3.90:1.00
|
|
3.90:1.00
|
|
December 31, 2012
|
|
3.90:1.00
|
|
3.90:1.00
|
SUBPART 2.6. Management
Fees . Section 7.09(e) of the Existing Credit
Agreement is hereby amended by deleting Section 7.09(e) and
replacing such section in its entirety with the
following:
(e) subject to the conditions below,
payments by the Borrower to Tenaska Capital Management, LLC under
the Management Agreement in an aggregate amount not to exceed in
any fiscal year (in each case