Exhibit 10.8*
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EXECUTION VERSION
AMENDMENT NO. 3 AND CONSENT
TO REVOLVING CREDIT AND SECURITY AGREEMENT
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THIS AMENDMENT NO. 3 AND CONSENT TO REVOLVING CREDIT AND SECURITY
AGREEMENT (this "Amendment") is made and entered into as of November 1,
2002, between MasTec, Inc., a Florida corporation ("MasTec"), certain of
the Subsidiaries of MasTec identified on the signature pages hereto
(together with MasTec, hereinafter collectively referred to as the
"Borrowers"), the financial institutions party from time to time to the Loan
Agreement (as hereinafter defined) (the "Lenders") and Fleet Capital
Corporation, a Rhode Island corporation, as administrative agent (the
"Administrative Agent") for the Lenders.
Recitals:
The Borrowers, the Lenders and the Administrative Agent are parties to
a Revolving Credit and Security Agreement dated as of January 22, 2002, as
amended by an Assumption and Amendment Agreement dated as of February 7,
2002 and an Amendment No. 2 dated as of October 25, 2002 (as amended and in
effect, the "Loan Agreement"), pursuant to which Lenders have made certain
revolving credit loans and letter of credit accommodations to the Borrowers.
The Borrowers have requested that the Lenders permit the creation of
certain Liens on the Collateral, amend the Loan Agreement in certain other
respects and consent to the proposed sale by MasTec of its Miami, Florida
headquarters. To induce the Lenders to do so, the Borrowers have agreed
to execute and deliver and to perform its obligations under this Amendment.
Upon the terms and subject to the conditions hereinafter set forth,
the Lenders have agreed so to amend the Loan Agreement and to grant such
consent.
NOW, THEREFORE, for TEN DOLLARS ($10.00) in hand paid and other good
and valuable consideration, the receipt and sufficiency of which are hereby
severally acknowledged, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. Definitions. All capitalized terms used in this Amendment, unless
otherwise defined herein, shall have the meaning ascribed to such terms in
the Loan Agreement.
2. Amendments to Loan Agreement (Phase I). Subject to the provisions
of Section 5(a) of this Amendment, the Loan Agreement is hereby amended by:
(a) amending the definition "Fixed Charge Coverage Ratio" appearing in
Section 1.1 of the Loan Agreement by adding the following proviso immediately
prior to the period at the end thereof:
and, provided, further, that Capital Expenditures made by the
Borrowers during such period in connection with the implementation of
the Borrowers' Oracle management information systems (the "Oracle
Capex") shall be excluded from the calculation of Capital Expenditures
for such period in determining the Fixed Charge Coverage Ratio, to the
extent that (a) the aggregate amount of Oracle Capex so excluded during
any period ending on or prior to December 31, 2002 does not exceed the
lesser of (i) the actual amount of Oracle Capex made by the Borrowers
during such period and (ii) $5,000,000, and (b) the amount of Oracle
Capex so excluded during any period ending after December 31, 2002 and
on or prior to December 31, 2003 does not exceed the lesser of (i) the
actual amount of Oracle Capex made by the Borrowers during such period
and (ii) $10,000,000. For the avoidance of doubt, there will be no
Oracle Capex exclusions for periods ending after December 31, 2003.
(b) amending Section 10.5 by redesignating clauses (d) and (e) thereof
as new clauses (e) and (f), respectively, and inserting a new clause (d)
thereof to read as follows:
(d) with respect to any surety that has issued a payment or
performance bond for the benefit of one or more Borrowers, (i) such
surety's decision to cease considering requests by any Borrower for the
issuance of bonds generally, to the extent MasTec has knowledge thereof,
(ii) such surety's decision to take possession or control of the work
under any bonded contract in order to complete such bonded contract,
(iii) the making of any payment by such surety pursuant to a bond, and
(iv) any amendment to the indemnity agreement or any other agreement in
effect at any time between such surety and one or more Borrowers
relating to the issuance of bonds, together with a copy of such
amendment,
3. Amendments to Loan Agreement (Phase II). Subject to the provisions
of Section 5(b) of this Amendment, the Loan Agreement is hereby further
amended by:
(a) amending Section 1.1 of the Loan Agreement by adding thereto the
following new definitions in appropriate alphabetical order:
"Crum & Forster Intercreditor Agreement" means the Intercreditor
Agreement dated on or about the Phase II Effective Date between the
Crum & Forster Sureties and the Administrative Agent and acknowledged
by the Borrowers.
"Crum & Forster Sureties" means, collectively, United States
Fire Insurance Company, The North River Insurance Company, TIG
Insurance Company and Lombard General Insurance Company of Canada.
"Phase II Effective Date" means the date on which Section 3 of
Amendment No. 3 to this Agreement dated as of November 1, 2002, between
the Borrowers, the Lenders and the Administrative Agent shall have
become effective in accordance with its terms.
(b) amending Section 11.11 of the Loan Agreement by redesignating
clause (iii) thereof as clause (iv) and inserting a new clause (iii) thereof
to read as follows:
(iii) the Crum & Forster Intercreditor Agreement or, in any manner
that could reasonably be expected to be adverse to the interests of the
Lenders, the General Agreement of Indemnity dated on or about the Phase
II Effective Date between one or more Borrowers and the Crum & Forster
Sureties,
(c) further amending the Loan Agreement by deleting the first page of
Schedule 1.1B -Permitted Liens in its entirety and substituting therefor a
new first page in the form of Exhibit A hereto.
4. Consent to Sale and Leaseback of Miami, Florida Headquarters. Subject
to the provisions of Section 5 of the Amendment, the Lenders hereby consent
to (i) the sale by MasTec of its Real Estate located at 3155 N.W. 77th Avenue,
Miami, Florida 33122, consisting of MasTec's chief executive office (the
"Headquarters"), and certain office furniture and equipment currently used
by MasTec and located on such Real Estate, to the extent the consummation of
such sale would otherwise violate the provisions of Sections 8.7 and 8.9 of
the Loan Agreement, and (ii) the subsequent leasing by MasTec of the
Headquarters from the purchaser thereof to the extent the same would
otherwise violate the provisions of Section 11.10 of the Loan Agreement;
provided, that (i) such sale and leaseback is consummated by the Borrowers
on or prior to December 16, 2002, (ii) MasTec receives gross cash proceeds
from such sale in an aggregate amount not less than $3,900,000 (from which
shall be deducted commissions, estimated taxes arising out of the sale and
expenses of sale), (iii) the net cash proceeds of such sale (the amount of
which shall be certified to the Administrative Agent, for the benefit of
the Lenders, in writing, by the chief financial officer of MasTec promptly
following completion of such sale) are paid by the purchaser by wire
transfer to a Controlled Account to be applied to the outstanding Loans
of the Borrowers, and (iv) MasTec furnishes to the Administrative Agent, for
the benefit of the Lenders, such additional information with respect to such
sale and leaseback as any Lender through the Administrative Agent may
reasonably request. The Lenders hereby agree with the Borrowers that the
value of the Real Estate so sold by MasTec shall not be counted against the
aggregate amount of Collateral that may be disposed of pursuant to Section
8.7 of the Loan Agreement during Fiscal Year 2002. By its signature below,
each Lender authorizes the Administrative Agent, and the Administrative
Agent agrees, at the Borrowers' expense, to execute and deliver appropriate
release documents as reasonably requested by the Borrowers to evidence the
release of the Liens of the Administrative Agent that affect such Real Estate.
5. Conditions to Effectiveness.
(a) The provisions of Sections 2 and 4 of this Amendment shall become
effective on the date (the "Phase I Effective Date") on which the
Administrative Agent shall have received (i) an amendment fee in the amount
of $125,000 for the Ratable account of the Lenders, which fee is earned on
such date and is not subject to refund or rebate of any kind whatsoever,
and (ii) the following documents, each of which shall be satisfactory in
form and substance to the Administrative Agent and in sufficient copies for
each Lender:
(A) this Amendment duly executed and delivered by the Borrowers,
the Lenders and the Administrative Agent;
(B) a certificate of the secretary or assistant secretary of each
Borrower having attached thereto the articles or certificate of
incorporation and bylaws of such Borrower (or containing the
certification of such secretary or assistant secretary that no
amendment or modification of such articles or certificate of
incorporation or bylaws has become effective since the last date on
which such documents were last delivered to the Lenders), all corporate
action, including shareholders' approval, if necessary, has been taken
by such Borrower and/or its shareholders to authorize the execution,
delivery and performance of this Amendment and to the further effect
that the incumbency certificate most recently delivered to the Lenders
remains in effect, unchanged;
(C) a certificate of the president or chief financial officer of
MasTec stating that, to the best of his or her knowledge and based on an
examination sufficient to enable him or her to make an informed statement,
both before and after giving effect to the Amendment,
(1) all of the representations and warranties made or deemed to be
made under the Loan Agreement are true and correct on and as of the Phase I
Effective Date, and
(2) no Default or Event of Default exists; and the
Administrative Agent shall be satisfied as to the truth and accuracy thereof;
and
(D) such other documents and instruments as any Lender through the
Administrative Agent may reasonably request.
(b) The provisions of Section 3 of this Amendment shall become effective
on the date (the "Phase II Effective Date") on which the Administrative Agent
shall have received the following documents, each of which, unless otherwise
indicated below, shall be satisfactory in form and substance to the
Administrative Agent and in sufficient copies for each Lender:
(i) on or prior to December 16, 2002, the Crum & Forster Intercreditor
Agreement, duly executed and delivered by the Administrative Agent and the
Crum & Forster Sureties and acknowledged by the Borrowers, in form and
substance satisfactory to the Administrative Agent and the Lenders in their
sole discretion (capitalized terms are used herein as defined in the Loan
Agreement, after giving effect to this Amendment); and
(ii) a certificate of the president or chief financial officer of
MasTec stating that, to the best of his or her knowledge and based on an
examination sufficient to enable him or her to make an informed statement,
both before and after giving effect to the Amendment,
(A) all of the representations and warranties made or deemed to be
made under the Loan Agreement are true and correct on and as of the
Phase II Effective Date, and
(B) no Default or Event of Default exists; and the Administrative
Agent shall be satisfied as to the truth and accuracy thereof; and
(iii) such other documents and instruments as any Lender through the
Administrative Agent may reasonably request.
6. Representations and Warranties. To induce the Administrative Agent
and the Lenders to enter into this Amendment, each Borrower hereby makes
the following representations and warranties to the Administrative Agent
and the Lenders, which representations and warranties shall survive the
delivery of this Amendment and the making of additional Loans under the
Loan Agreement as amended hereby:
(a) Authorization of Agreements. Each Borrower has the right and
power, and has taken all necessary action to authorize it, to execute,
deliver and perform this Amendment and each other agreement
contemplated hereby to which it is a party in accordance with their
respective terms. This Amendment and each other such agreement
contemplated hereby to which it is a party has been duly executed and
delivered by the duly authorized officers of such Borrower and each
is, or each when executed and delivered in accordance with this
Amendment will be, a legal, valid and binding obligation of such
Borrower, enforceable in accordance with its terms.
(b) Compliance of Agreements with Laws. The execution, delivery and
performance of this Amendment in accordance with their respective terms
do not and will not, by the passage of time, the giving of notice or
otherwise,
(i) require any Governmental Approval that has not been
obtained or violate any Applicable Law relating to such Borrower
or any of its Subsidiaries,
(ii) conflict with, result in a breach of or constitute a
default under the articles or certificate of incorporation or
by-laws or other constituent documents or any shareholders' or
members' agreement of such Borrower or any of its Subsidiaries,
any material provisions of any indenture, agreement or other
instrument to which such Borrower, any of its Subsidiaries or any
of such Borrower's or such Subsidiaries' property may be bound or
any Governmental Approval relating to such Borrower or any
of its Subsidiaries, or
(iii) result in or require the creation or imposition of any
Lien upon or with respect to any property now owned or hereafter
acquired by such Borrower other than the Security Interest.
7. Effect of Amendment. From and after the Phase I Effective Date, all
references in the Loan Agreement and in any other Loan Document to "this
Agreement," "the Loan Agreement," "hereunder," "hereof" and words of like
import referring to the Loan Agreement, shall mean and at any time of
determination be references to the Loan Agreement as amended by the then
effective provisions of this Amendment. Except as expressly amended hereby,
the Loan Agreement and all terms, conditions and provisions thereof remain
in full force and effect and are hereby ratified and confirmed. The
execution, delivery and effectiveness of this Amendment shall not, except
as expressly provided herein, operate as a waiver of any right, power or
remedy of any Lender under any of the Loan Documents, nor constitute a
waiver of any provision of any of the Loan Documents.
8. Breach of Amendment. Any breach by the Borrowers of any
representation, warranty or covenant contained herein shall constitute an
Event of Default.
9. Counterpart Execution. 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 to be an
original and all of which taken together shall constitute but one and the
same agreement. Delivery of an executed signature page of any party hereto
by facsimile transmission shall be as effective as delivery of a manually
delivered counterpart thereof.
10. Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of Georgia without giving effect to
conflicts of law principles thereof.
11. Successors and Assigns. This Amendment shall be binding upon and
inure to the benefit of the parties hereto and their respective successors
and assigns.
12. Further Assurances. The Borrowers agree to take such further
actions as any Lender through the Administrative Agent shall reasonably
request from time to time in connection herewith to evidence or give effect
to the amendments set forth herein or any of the transactions contemplated
hereby.
13. Section Titles. Section titles and references used in this Amendment
shall be without substantive meaning or content of any kind whatsoever and are
not a part of the agreement among the parties hereto.
14. Waiver of Jury Trial. To the fullest extent permitted by applicable
law, each of the parties hereto hereby waives the right to trial by jury in
any action, suit, counterclaim or proceeding arising out of or related to
this Amendment.
IN WITNESS WHEREOF, the parties her eto have caused this Amendment to
be duly executed under seal and delivered by their respective duly authorized
officers as of the date first written above.
FLEET CAPITAL CORPORATION,
as Administrative Agent and as a Lender
By: /s/ Dennis S. Losin
Name: Dennis S. Losin
Title: Sr. V.P.
WACHOVIA BANK, NATIONAL
ASSOCIATION, as a Lender
By: /s/ Dan Denton
Name: Dan Denton
Title: Vice President
LASALLE BUSINESS CREDIT, INC.,
as a Lender
By: /s/ Douglas Colletti
Name: Douglas Colletti
Title: First Vice President
JPMORGAN CHASE BANK, as a Lender
By: /s/ Robert Morrow
Name: Robert Morrow
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION,
as a Lender
By: /s/ Alex M. Council IV
Name: Alex M. Council IV
Title: Vice President
BORROWERS:
MASTEC, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
CHURCH & TOWER, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
CHURCH & TOWER ENVIRONMENTAL, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
CRUZ-CELL, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
DRESSER/AREIA CONSTRUCTION, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
FLAIRE INCORPORATED
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
GMR TELCOM, L.L.C.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
MASTEC INTEGRATION SYSTEMS, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
MASTEC NETWORK SERVICES, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
MASTEC NORTH AMERICA, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
MASTEC NORTH CAROLINA, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
MASTEC TELCOM & ELECTRICAL
SERVICES, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
MASTEC VIRGINA, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
PHASECOM AMERICA, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
PROTEL IND., INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
RENEGADE OF IDAHO, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
S.S.S. CONSTRUCTION, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
UPPER VALLEY UTILITIES CORP.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
WILDE HOLDING CO., INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
WILDE ACQUISITION CO., INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
NORTHLAND CONTRACTING, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
WILDE OPTICAL SERVICE, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO_
MASTEC FC, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO_
MASTEC REAL ESTATE HOLDINGS, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO_
MASTEC OF TEXAS, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
MASTEC TC, INC.
By: /s/ Donald Weinstein
Name: Donald Weinstein
Title: EVP & CFO
Exhibit A to
Amendment No. 3
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SCHEDULE 1.1B
Permitted Liens
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1. Liens in favor of Fleet National Bank, N.A. as Agent under that certain
Revolving Credit Agreement dated June 9, 1997 by and among MasTec, Inc.
(the "Parent") and its Subsidiaries as amended (the "Existing Credit
Facility"), which will be satisfied as of the Effective Date.
2. Liens in favor of the Bank of Nova Scotia (the "Bank") under that
certain credit facility by and among the Bank and Phasecom Systems, Inc.
(the "Borrower") dated June 29, 2001 (the "1st Canadian Facility").
3. Liens in favor of the Bank of Nova Scotia (the "Bank") under that certain
credit facility by and among the Bank and Integral Power & Telecommunications
Corporation, Ltd. (the "Borrower") dated June 29, 2001 (the "2nd Canadian
Facility").
4. Liens in favor of Liberty Mutual Insurance Company (for itself and any of
its affiliated issuers of Bonds (as defined therein), collectively,
"Liberty") under that certain General Agreement of Indemnity dated April 27,
1999, securing up to $100,000,000 of surety bonds at any one time outstanding
issued by Liberty from time to time for the benefit of one or more Borrowers,
which Liens are subordinated to the Security Interest to the extent provided
in the Intercreditor Agreement dated as of January 22, 2002 between Liberty
Mutual Insurance Company (for itself and any of its affiliated issuers of
Bonds (as defined therein)) and the Administrative Agent.
5. Liens in favor of the Crum & Forster Sureties, securing up to
$125,000,000 of surety bonds at any one time outstanding issued by the Crum
& Forster Sureties from time to time for the benefit of one or more
Borrowers, which Liens are subordinated to the Security Interest to the
extent provided in the Crum & Forster Intercreditor Agreement.
6. Attached summary - U.C.C. search results.