EXHIBIT 4.1
TENTH AMENDMENT TO CREDIT AGREEMENT
AND
FORBEARANCE AGREEMENT
THIS TENTH AMENDMENT TO CREDIT AGREEMENT AND FORBEARANCE AGREEMENT (this
"AGREEMENT") is entered into as of January 31, 2002 by and among U.S.
AGGREGATES, INC., a Delaware corporation (the "COMPANY"), various financial
institutions (the "LENDERS") and BANK OF AMERICA, N.A., as agent for the Lenders
(the "AGENT").
RECITALS:
WHEREAS, the Company, the Lenders and the Agent have entered into a
Third Amended and Restated Credit Agreement dated as of June 5, 1998 (as
amended, the "CREDIT AGREEMENT"; capitalized terms used but not otherwise
defined herein have the meanings assigned thereto in the Credit Agreement)
pursuant to which, as of the date hereof, the Company is indebted and liable to
the Agent and the Lenders for various Loans, other financial accommodations and
obligations (the "INDEBTEDNESS");
WHEREAS, the parties hereto desire to amend the Credit Agreement in
certain respects;
WHEREAS, the Company and certain of the Lenders previously executed a
Tenth Amendment to the Credit Agreement dated as of November 15, 2001, but such
document never became effective; and
WHEREAS, the Company is in default of certain provisions of the Credit
Agreement and the Required Lenders have agreed to forbear to the extent, and on
the terms and subject to the conditions, set forth in this Agreement;
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the parties hereto agree as follows:
1 SECTION AMENDMENTS TO CREDIT AGREEMENT. Effective on (and subject to
the occurrence of) the Tenth Amendment Effective Date (as defined below):
1.1 Section 1.1 of the Credit Agreement shall be amended by adding the
following definitions thereto, each in its appropriate alphabetical position:
IDAHO SALE means the sale by Monroc of substantially all of
its assets and properties used in its operations in the State of Idaho
pursuant to the Agreement of Purchase and Sale of Asets dated as of
February 5, 2002 among Oldcastle MMG, Inc., Monroc, the Company and
Oldcastle Materials, Inc. for a purchase price of approximately
$21,750,000 (with expected Net Cash Proceeds to the Agent pursuant to
SECTION 6.2.1(A) of approximately $16,000,000), subject to adjustment
as provided in such Agreement, which shall close no later than February
8, 2002.
IDAHO SALE CASH COLLATERAL ACCOUNT - see SECTION 6.2.1(A).
OPERATING BUDGET means a weekly budget for the Company and its
Subsidiaries setting forth cash receipts and anticipated disbursements
on a weekly basis for the period from February 1, 2002 through March
16, 2002 and delivered to the Lenders in connection with the
effectiveness of the Tenth Amendment.
TENTH AMENDMENT means the Tenth Amendment to this Agreement
and Forbearance Agreement dated as of January 31, 2002.
1.2 Section 4.1 of the Credit Agreement shall be amended and restated
to read in its entirety as follows:
4.1 INTEREST RATES. The Company promises to pay interest on
the unpaid principal amount of each Loan for the period commencing on
and including the date of such Loan to but excluding the date such Loan
is paid in full, as follows:
(a) at all times while such Loan is an ABR Loan, at a rate per
annum equal to the sum of the Alternate Base Rate from time to time in
effect plus the Applicable ABR Margin; and
(b) at all times while such Loan is a Eurodollar Loan, at a
rate per annum equal to the sum of the Eurodollar Rate (Reserve
Adjusted) applicable to each Interest Period for such Loan plus the
Applicable Eurodollar Margin;
PROVIDED, HOWEVER, that upon notice to the Company from the Agent
(acting upon the request of the Required Lenders) at any time an Event
of Default exists, and for so long as such Event of Default continues,
the interest rate applicable to all Loans shall be increased by 2%.
Notwithstanding anything to the contrary herein, (i) each Term C Loan
shall bear interest from and including the date of such Loan to but
excluding the date such Loan is paid in full at a rate per annum equal
to the Alternate Base Rate plus 7% (subject to the PROVISO to the
immediately preceding sentence) and (ii) at all times after the Idaho
Sale, a portion of the Loans in each Facility (other than the Term C
Loans) equal to the principal amount of Loans in such Facility that
would have been prepaid with the Net Cash Proceeds of the Idaho Sale
but for CLAUSE (2) of the last PROVISO to SECTION 6.2.1 (with respect
to each Facility, such Facility's "DEFERRED PREPAYMENT PORTION") shall
bear interest at a rate per annum equal to the sum of the Alternate
Base Rate plus 7% (subject to the PROVISO to the immediately preceding
sentence), and the principal amount of Loans in each Facility in excess
of such Facility's Deferred Prepayment Portion shall bear interest as
set forth in the first sentence of this SECTION 4.1. For purposes of
calculating interest on the Loans, all payments of principal on each
Facility shall be
applied first to the Deferred Prepayment Portion of such Facility and
second to the remainder of such Facility.
1.3 Section 6.2.1 of the Credit Agreement shall be amended by adding
the following immediately after the existing text of CLAUSE (A):
; PROVIDED, FURTHER, that notwithstanding anything to the contrary set
forth in this Agreement, the Net Cash Proceeds from the Idaho Sale
shall be applied or distributed as follows: (1) FIRST to the Term C
Loans, together with any Capitalized Interest and accrued interest on
the principal amount prepaid and to fees attributable to the Term C
Loans (with application first to fees thereon then due and owing,
second to interest thereon then due and owing, and third to unpaid
principal); (2) SECOND to a cash collateral account under the Agent's
control and as to which the Company shall have the ability to make
withdrawals therefrom only in the circumstances specified below (the
"IDAHO SALE CASH COLLATERAL Account") in an amount not to exceed
$5,000,000; (3) THIRD to pay the fees of the Lenders that are due and
owing under Section 3 of the Seventh Amendment hereto dated as of May
29, 2001 and other fees and expenses of the Agent (including fees and
expenses, or reserves to add to appropriate retainers in respect of
such fees and expenses, of professional advisors to the Agent) and (4)
FOURTH to the Loans as set forth above in this SECTION 6.2.1(A), IT
BEING UNDERSTOOD that the Company shall be entitled to withdraw funds
from the Idaho Sale Cash Collateral Account solely for (x) paying
amounts specified in the Operating Budget or (y) prepayment of the
Loans in accordance with this SECTION 6.2.1(A), and only if the
following conditions precedent are satisfied (A) the Company shall have
submitted to the Agent a written certification (executed by the Chief
Executive Officer or Chief Financial Officer of the Company) describing
the requested withdrawal specifying that the proceeds thereof will be
applied to one of such permitted uses and certifying as to the
following CLAUSES (B) and (C), which certification shall be in form and
substance satisfactory to the Agent (PROVIDED that for purposes of
paying amounts specified in the Operating Budget, the Company may only
make one withdrawal per week in an amount not to exceed 115% of the
aggregate expenses set forth in the Operating Budget for the
then-current week plus the amount set forth in the Operating Budget for
any prior week that was not spent in that week), (B) the
representations and warranties of the Company set forth in Section 9 of
this Agreement (excluding SECTION 9.6 and 9.8) shall be true and
correct on such date of withdrawal (except to the extent relating
solely to an earlier date, in which case they were true and correct as
of such earlier date) and (C) other than the Specified Defaults (as
defined in the Tenth Amendment), no Event of Default or Unmatured Event
of Default shall exist.
SECTION 2 FORBEARANCE. Subject to the satisfaction of the conditions
precedent set forth in SECTION 4.2 below, the Agent and the Required Lenders
agree that during the Forbearance Period (defined below) they will not (i)
declare the Commitments to be terminated or declare all Notes and all other
Indebtedness to be due and payable or (ii) commence any legal action or
otherwise sue, foreclose or take any action under any of the Loan Documents to
(a) seek to enforce payment of the Indebtedness or (b) foreclose upon or
otherwise enforce the security interests, liens or mortgages in, to or against
any of the collateral granted to the Agent
under the Collateral Documents (the "COLLATERAL"). When used herein,
"FORBEARANCE PERIOD" means the period of time commencing on the Forbearance
Effective Date and terminating on the earliest to occur of (i) 11:59 p.m. on
March 16, 2002, (ii) the date on which the forbearance period under any Other
Forbearance Agreement (defined below) shall have terminated and (iii) the
occurrence of a Forbearance Default. The Agent may (and at the direction of the
Required Lenders shall), if any Specified Default (defined below) exists upon
the expiration or termination of the Forbearance Period, or upon the occurrence
of any Forbearance Default, declare the Commitments to be terminated and/or
declare all Notes and all other Indebtedness to be due and payable and otherwise
exercise all rights and remedies under the Loan Documents. The Company agrees
that, upon the expiration or termination of the Forbearance Period and without
any further action on the part of the Agent or any Lender, any obligation of the
Agent or any Lender to forbear from exercising rights under any of the Loan
Documents, this Agreement or applicable law shall terminate and, thereafter, the
Agent and the Lenders shall be entitled, in their sole discretion, to exercise
any or all of such rights as they may deem appropriate.
SECTION 3 ACKNOWLEDGMENTS; REPRESENTATIONS AND WARRANTIES.
3.1 The Company expressly acknowledges and agrees that the obligation
of the Company and the other Loan Parties to repay the Loans and the other
obligations under the Loan Documents is absolute and unconditional, and there
exists no right of setoff or recoupment, counterclaim or defense of any nature
whatsoever to payment of such obligations. The Company acknowledges and agrees
that each of the Loan Documents is the legal, valid and binding obligation of
each Loan Party thereto, enforceable against such Loan Party in accordance with
its terms. The Company agrees that it shall, and shall cause each of its
Subsidiaries to, not dispute the validity or enforceability of any of the Loan
Documents, or any of its obligations thereunder, or the validity, priority,
enforceability or extent of the Agent's security interest, mortgage or lien
against any item of Collateral described in the Loan Documents, in any judicial,
administrative or other proceeding, either during or following the expiration or
termination of the Forbearance Period.
3.2 The Company represents and warrants to the Agent and the Lenders
that (a) the representations and warranties made in Section 9 (excluding
Sections 9.6 and 9.8) of the Credit Agreement are true and correct on and as of
the Tenth Amendment Effective Date and the Forbearance Effective Date with the
same effect as if made on and as of the Tenth Amendment Effective Date and
Forbearance Effective Date, as the case may be (except to the extent relating
solely to an earlier date, in which case they were true and correct as of such
earlier date); (b) other than the Specified Defaults, no Event of Default or
Unmatured Event of Default exists or will result from the execution of this
Agreement; (c) no event or circumstance has occurred since the Effective Date
that has resulted, or would reasonably be expected to result, in a Material
Adverse Effect; (d) the execution and delivery by the Company of this Agreement
and the performance by the Company of its obligations under the Credit Agreement
as amended hereby (as so amended, the "AMENDED CREDIT AGREEMENT") (i) are within
the corporate powers of the Company, (ii) have been duly authorized by all
necessary corporate action, (iii) have received all necessary approval from any
Governmental Authority and (iv) do not and will not contravene or
conflict with any provision of any law, rule or regulation or any order, decree,
judgment or award which is binding on the Company or any Guarantor or any of
their respective Subsidiaries or of any provision of the certificate of
incorporation or bylaws or other organizational documents of the Company or of
any agreement, indenture, instrument or other document which is binding on the
Company or any Guarantor or any of their respective Subsidiaries; (e) the
Amended Credit Agreement is the legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency or similar
laws affecting the enforcement of creditors' rights generally or by equitable
principles relating to enforceability; (f) the obligation of the Company and the
other Loan Parties to repay the Loans and the other obligations under the Loan
Documents is absolute and unconditional, and there exists no right of setoff or
recoupment, counterclaim or defense of any nature whatsoever to payment of such
obligations; and (g) no Forbearance Default has occurred and is continuing.
SECTION 4 EFFECTIVENESS.
4.1 TENTH AMENDMENT EFFECTIVENESS. The amendments set forth in SECTION
1 above shall become effective as of the date hereof on such date (the "TENTH
AMENDMENT EFFECTIVE DATE") when the Agent shall have received (a) a counterpart
of this Agreement executed by the Company and the Required Revolving Lenders,
the Required Term A Lenders, and the Required Term B Lenders (or, in the case of
any party other than the Company from which the Agent has not received a
counterpart hereof, facsimile confirmation of the execution of a counterpart
hereof by such party) and (b) each of the following documents, each in form and
substance satisfactory to the Agent:
4.1.1. REAFFIRMATION. Counterparts of the Reaffirmation of Loan
Documents, substantially in the form of EXHIBIT A, executed by the Company, each
Guarantor and each Pledgor.
4.1.2. RESOLUTIONS. Certified copies of resolutions of the Board of
Directors of the Company authorizing or ratifying the execution, delivery and
performance by the Company of this Agreement, the Amended Credit Agreement and
each other Loan Document contemplated by this Agreement to which the Company is
a party.
4.1.3. INCUMBENCY AND SIGNATURE CERTIFICATES. A certificate of the
Secretary or an Assistant Secretary of the Company, certifying the names of the
officer or officers of the Company authorized to sign this Agreement and the
other Loan Documents contemplated hereby to which the Company is a party,
together with a sample of the true signature of each such officer.
4.1.4. OPERATING BUDGET. An operating budget for the period from
February 1, 2002 through March 16, 2002 for the Company and its Subsidiaries
(setting forth anticipated cash receipts and disbursements for each week in such
month in an aggregate amount not to exceed $5,000,000).
4.1.5. OTHER DOCUMENTS. Such other documents as the Agent or any
Lender may reasonably request.
4.2 FORBEARANCE EFFECTIVENESS. The forbearance set forth in
SECTION 2 above shall become effective as of the date hereof (the "FORBEARANCE
EFFECTIVE DATE"), if and only if:
4.2.1. EXECUTION OF THIS AGREEMENT. The Agent shall have received
counterparts of this Agreement duly executed by the Company and the Required
Lenders.
4.2.2. ABSENCE OF DEFAULT. No Forbearance Default or Unmatured Event of
Default or Event of Default (other than the defaults listed on EXHIBIT B hereto
(the "SPECIFIED DEFAULTS")) under the Loan Documents shall have occurred and be
continuing.
4.2.3. AGREEMENTS WITH OTHER LENDERS. The Company shall have entered
into one or more forbearance agreements (collectively, the "OTHER FORBEARANCE
AGREEMENTS") that are binding upon, and in full force and effect with respect
to, (i) each of the holders of the 1996 Subordinated Notes, the 1998
Subordinated Notes and the 2001 Subordinated Note and (ii) BancBoston Leasing
and Fleet Capital Corporation, and shall have disclosed the terms of each
thereof to the Lenders, and in each case the terms of which shall be acceptable
to the Agent.
4.2.4. REAFFIRMATION. The Agent shall have received counterparts of
the Reaffirmation of Loan Documents, substantially in the form of EXHIBIT A,
executed by the Company, each Guarantor and each Pledgor.
It is the current intention of the undersigned Lenders to forbear as specified
in the first sentence of SECTION 2 hereof if the conditions set forth in
SECTIONS 4.2.1, 4.2.2 and 4.2.4 are satisfied from the date such conditions are
satisfied until the earlier to occur of (x) termination of the Forbearance
Period that would have commenced had all conditions set forth in this SECTION
4.2 been satisfied on such date and (y) any acceleration of maturity, or the
exercise of any other remedy, by any holder of the 1996 Subordinated Notes, the
1998 Subordinated Notes or the 2001 Subordinated Note, BancBoston Leasing or
Fleet Capital Corporation.
SECTION 5 MISCELLANEOUS.
5.1 CONTINUING EFFECTIVENESS, ETC.
5.1.1. Except as otherwise expressly provided in this Agreement, and
both during and following the expiration or termination of the Forbearance
Period, the Loan Documents shall each remain in full force and effect, and shall
not be waived, modified, supplemented, superseded or otherwise affected by this
Agreement. This Agreement is not a novation nor is it to be construed as, or
otherwise deemed to be, a release, waiver or modification of any term,
condition, representation, warranty, covenant, right or remedy set forth in any
of the Loan Documents, except as specifically set forth herein. The Agent and
the Lenders specifically
reserve any and all rights, claims and remedies that they have or may have
against the Company under any of the Loan Documents, applicable law or
otherwise.
5.1.2. As herein amended, the Credit Agreement shall remain in full
force and effect and is hereby ratified and confirmed in all respects. After the
Tenth Amendment Effective Date, all references in the Credit Agreement, the
Notes, each other Loan Document and any similar document to the "Credit
Agreement" or similar terms shall refer to the Amended Credit Agreement.
5.2 COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the different parties on separate counterparts, and each
such counterpart shall be deemed to be an original but all such counterparts
shall together constitute one and the same Agreement.
5.3 EXPENSES. The Company agrees to pay the reasonable costs and
expenses of the Agent (including reasonable fees and disbursements of counsel,
including, without duplication, the allocable costs of internal legal services
and all disbursements of internal legal counsel and the reasonable fees of
PricewaterhouseCoopers, L.L.P. ("PWC"), which shall continue to be retained as
financial advisor to the Agent) in connection with the preparation, execution
and delivery of this Agreement and the ongoing work being done by PwC in
connection with the workout of the Company's Debt.
5.4 GOVERNING LAW. This Agreement shall be a contract made under
and governed by the laws of the State of Illinois applicable to contracts made
and to be wholly performed within the State of Illinois.
5.5 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
Company, the Lenders and the Agent and their respective successors and assigns,
and shall inure to the benefit of the Company, the Lenders and the Agent and the
successors and assigns of the Lenders and the Agent.
5.6 LOAN DOCUMENT. This Agreement is a Loan Document.
5.7 FORBEARANCE DEFAULTS. The following events shall constitute
"FORBEARANCE DEFAULTS": (a) the Company fails to observe or perform any term,
covenant, or agreement binding on it contained in this Agreement, any of the
Loan Documents, or any other agreement, instrument or document executed in
connection with any of the foregoing; (b) the occurrence of an Event of Default
or Unmatured Event of Default, other than a Specified Default; or (c) any
warranty made by the Company herein is untrue or misleading in any material
respect. Upon the expiration or termination of the Forbearance Period, the Agent
and the Lenders shall be entitled (but not required) to exercise any of their
rights and remedies under any of the Loan Documents or applicable law,
including, without limitation, the right to terminate the Commitments, to
declare all of the Indebtedness to be immediately due and payable and to enforce
its liens on, and security interests in, the Collateral. The occurrence of any
Forbearance Default shall constitute an Event of Default under the Loan
Documents.
SECTION 6 RELEASE OF CLAIMS. THE COMPANY HEREBY ACKNOWLEDGES AND AGREES
THAT IT DOES NOT HAVE ANY DEFENSE, COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM
OR DEMAND OF ANY KIND OR NATURE WHATSOEVER THAT CAN BE ASSERTED TO REDUCE OR
ELIMINATE ALL OR ANY PART OF LIABILITY OF THE COMPANY TO REPAY THE AGENT OR ANY
LENDER AS PROVIDED IN THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS OR TO
SEEK AFFIRMATIVE RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM THE AGENT OR ANY
LENDER. THE COMPANY HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER
DISCHARGES THE AGENT AND THE LENDERS, AND THE AGENT'S AND EACH LENDER'S
PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS, FROM ALL POSSIBLE
CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS OR EXPENSES, AND
LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR UNANTICIPATED,
SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT OR CONDITIONAL, AT LAW OR IN EQUITY,
ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS AGREEMENT IS
EXECUTED, WHICH THEY MAY NOW OR HEREAFTER HAVE AGAINST THE AGENT OR ANY SUCH
LENDER, AND THE AGENT'S OR SUCH LENDER'S PREDECESSORS, AGENTS, EMPLOYEES,
SUCCESSORS AND ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS
ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATION OR OTHERWISE,
INCLUDING, WITHOUT LIMITATION, THE EXERCISE OF ANY RIGHT OR REMEDY UNDER THE
CREDIT AGREEMENT OR OTHER LOAN DOCUMENTS, AND NEGOTIATION AND EXECUTION OF THIS
AGREEMENT.
Delivered as of the day and year first above written.
1
U.S. AGGREGATES, INC.
By:
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Title:
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BANK OF AMERICA, N.A., as Agent
By:
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Title:
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BANK OF AMERICA, N.A., as a Lender and as Issuing Lender
By:
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Title:
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FLEET NATIONAL BANK (formerly known as BankBoston,
N.A.), as a Lender
By:
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Title:
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NATIONAL CITY BANK, as a Lender
By:
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Title:
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BANK OF SCOTLAND, as a Lender
By:
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Title:
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IBJ WHITEHALL BANK AND TRUST COMPANY, as a Lender
By:
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Title:
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COMERICA BANK - CALIFORNIA, as a Lender
By:
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Title:
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ZIONS FIRST NATIONAL BANK, as a Lender
By:
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Title:
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UNION BANK OF CALIFORNIA, N.A., as a
Lender
By:
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Title:
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PILGRIM PRIME RATE TRUST, as a Lender
By: Pilgrim Investments, Inc., as its Investment Manager
By:
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Title:
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SENIOR DEBT PORTFOLIO
By: Boston Management and Research, as Investment Advisor
By:
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Title:
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EATON VANCE INSTITUTIONAL SENIOR LOAN FUND
By: Eaton Vance Management, as Investment Advisor
By:
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Title:
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EATON VANCE SENIOR INCOME TRUST
By: Eaton Vance Management, as Investment Advisor
By:
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Title:
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KZH-HIGHLAND - 2 LLC
By:
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Title:
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11
ARCHIMEDES FUNDING II, LLC
By: ING Capital Advisors, LLC, as Collateral Manager
By:
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Title:
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ARCHIMEDES FUNDING III, LLC
By: ING Capital Advisors, LLC, as Collateral Manager
By:
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Title:
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SEQUILS-ING 1 (HBDGM), LTD.
By: ING Capital Advisors, LLC, as Collateral Manager
By:
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Title:
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BANK ONE, N.A.
By:
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Title:
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BRANCH BANKING AND TRUST COMPANY
By:
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Title:
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12
HIGHLAND CRUSADER OFFSHORE PARTNERS
By:________________________________
Title:_____________________________
13
EXHIBIT A
FORM OF REAFFIRMATION
OF LOAN DOCUMENTS
---------------------
as of January 31, 2002
Bank of America, N.A., as Agent
and the other parties to the Third
Amended and Restated Credit
Agreement referred to below
1455 Market Street
San Francisco, California 94103
Attn: Agency Management Services #5596
RE: REAFFIRMATION OF LOAN DOCUMENTS
Ladies and Gentlemen:
Please refer to:
1. The Amended and Restated Security Agreement dated as of June 5, 1998
(the "SECURITY AGREEMENT") among U.S. Aggregates, Inc. (the "COMPANY"), Western
Aggregates Holding Corporation, a Delaware corporation, Jensen Construction and
Development, Inc., a Nevada corporation, Sandia Construction, Inc., a Nevada
corporation, Cox Rock Products Inc., a Utah corporation, Cox Transport
Corporation, a Utah corporation, SRM Holdings Corp., a Delaware corporation, SRM
Aggregates, Inc., an Alabama corporation, A-Block Company, Inc., an Arizona
corporation, A-Block Company, Inc., a California corporation, Mohave Concrete
and Materials, Inc., an Arizona corporation, Mohave Concrete and Materials,
Inc., a Nevada corporation, Mulberry Rock Corporation, a Georgia corporation,
Valley Asphalt, Inc., a Utah corporation, BHY Ready Mix, Inc., a Tennessee
corporation, Geodyne Beck Rock Products, Inc., a Utah corporation, Western Rock
Products Corp., a Utah corporation, Tri-State Testing Laboratories, Inc., a Utah
corporation, Dekalb Stone, Inc., a Georgia corporation, Bradley Stone & Sand,
Inc., a Tennessee corporation, Monroc, Inc., a Delaware corporation, Western
Aggregates, Inc., a Utah corporation, Eagle Valley Materials, Inc., Nevada
Aggregates, Inc., Bama Crushed Corporation, Grove Materials Corporation and Bank
of America, N.A. in its capacity as Agent (in such capacity, the "AGENT");
2. The Amended and Restated Guaranty dated as of June 5, 1998 (the
"GUARANTY") executed in favor of the Agent and various other parties by Western
Aggregates Holding Corporation, Jensen Construction and Development, Inc.,
Sandia Construction, Inc., Cox Rock
14
Products Inc., Cox Transport Corporation, SRM Holdings Corp., SRM Aggregates,
Inc., A-Block Company, Inc., A-Block Company, Inc., Mohave Concrete and
Materials, Inc., Mohave Concrete and Materials, Inc., Mulberry Rock Corporation,
Valley Asphalt, Inc., BHY Ready Mix, Inc., Geodyne Beck Rock Products, Inc.,
Western Rock Products Corp., Tri-State Testing Laboratories, Inc., Dekalb Stone,
Inc ., Bradley Stone & Sand, Inc., Monroc, Inc., Eagle Valley Materials, Inc.,
Nevada Aggregates, Inc., Bama Crushed Corporation, Grove Materials Corporation ;
3. The following Pledge Agreements:
(a) the Amended and Restated Company Pledge Agreement dated as of June 5,
1998 between the Company and the Agent, and
(b) the Amended and Restated Subsidiary Pledge Agreement dated as of June
5, 1998 between Western Aggregates Holding Corp., Western Rock Products Corp.,
SRM Holdings Corp., Southern Ready Mix, Inc., Monroc, Inc., and the Agent,
(all of the foregoing Pledge Agreements, in each case as heretofore amended,
being collectively referred to herein as the "PLEDGE AGREEMENTS").
4. The Patent Security Agreement made as of March 30, 1995 by Cox Rock
Products Inc. in favor of the Agent (the "PATENT SECURITY AGREEMENT").
5. Each other Loan Document (as defined in the Credit Agreement referred to
below).
The Security Agreement, the Guaranty, the Pledge Agreements, the Patent
Security Agreement and the other Loan Documents referred to above, in each case
as heretofore amended, are collectively referred to herein as the "DOCUMENTS".
Capitalized terms not otherwise defined herein will have the meanings given in
the Credit Agreement referred to below.
Each of the undersigned acknowledges that the Company, the Banks and the
Agent have executed the Tenth Amendment to Credit Agreement and Forbearance
Agreement (the "AGREEMENT") with respect to the Third Amended and Restated
Credit Agreement dated as of June 5, 1998 (as amended, supplemented or otherwise
modified from time to time, the "CREDIT AGREEMENT").
Each of the undersigned hereby (i) confirms that each Document to which
such undersigned is a party remains in full force and effect after giving effect
to the effectiveness of the Agreement and that, upon the Tenth Amendment
Effective Date, all references in such Document to the "Credit Agreement" shall
be references to the Credit Agreement as amended by the Agreement, (ii)
acknowledges and agrees that its obligations under the Documents are absolute
and unconditional, and there exists no right of setoff or recoupment,
counterclaim or defense of any nature whatsoever thereto and (iii) VOLUNTARILY
AND KNOWINGLY RELEASES AND
FOREVER DISCHARGES THE AGENT AND THE LENDERS, AND THE AGENT'S AND LENDER'S
PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS, FROM ALL POSSIBLE
CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, OR EXPENSES, AND
LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR UNANTICIPATED,
SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT OR CONDITIONAL, AT LAW OR IN EQUITY,
ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THE FOREGOING AGREEMENT IS
EXECUTED, WHICH IT MAY NOW OR HEREAFTER HAVE AGAINST THE AGENT OR ANY SUCH
LENDER, AND THE AGENT'S OR SUCH LENDER'S PREDECESSORS, AGENTS, EMPLOYEES,
SUCCESSORS AND ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS
ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATION, OR OTHERWISE,
INCLUDING, WITHOUT LIMITATION, THE EXERCISE OF ANY RIGHT OR REMEDY UNDER THE
CREDIT AGREEMENT OR ANY OTHER DOCUMENT, AND NEGOTIATION AND EXECUTION OF THE
FOREGOING AGREEMENT.
3
The letter agreement may be signed in counterparts and by the various
parties as herein on separate counterparts. This letter agreement shall be
governed by the laws of the State of Illinois applicable to contracts made and
to be performed entirely within such State.
U.S. AGGREGATES, INC.
By:_______________________________
Title:____________________________
SRM HOLDINGS CORP.
By:________________________________
Title:_____________________________
WESTERN AGGREGATES HOLDING CORP.
By:________________________________
Title:_____________________________
WESTERN ROCK PRODUCTS CORP.
By:________________________________
Title:_____________________________
JENSEN CONSTRUCTION & DEVELOPMENT,
INC.
By:________________________________
Title:_____________________________
SANDIA CONSTRUCTION, INC.
By:________________________________
Title:_____________________________
TRI-STATE TESTING LABORATORIES, INC.
By:________________________________
Title:_____________________________
4
MOHAVE CONCRETE AND MATERIALS, INC.,
a Nevada corporation
By:________________________________
Title:_____________________________
MOHAVE CONCRETE AND MATERIALS, INC.,
an Arizona corporation
By:________________________________
Title:_____________________________
A-BLOCK COMPANY, INC.,
an Arizona corporation
By:________________________________
Title:_____________________________
A-BLOCK COMPANY, INC.,
a California corporation
By:________________________________
Title:_____________________________
5
COX ROCK PRODUCTS, INC.
By:________________________________
Title:_____________________________
COX TRANSPORT CORPORATION
By:________________________________
Title:_____________________________
VALLEY ASPHALT, INC.
By:________________________________
Title:_____________________________
GEODYNE BECK ROCK PRODUCTS, INC.
By:________________________________
Title:_____________________________
SRM AGGREGATES, INC.
By:________________________________
Title:_____________________________
DEKALB STONE, INC.
By:________________________________
Title:_____________________________
MULBERRY ROCK CORPORATION
By:________________________________
Title:_____________________________
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BHY READY MIX, INC.
By:________________________________
Title:_____________________________
BRADLEY STONE & SAND, INC.
By:________________________________
Title:_____________________________
MONROC, INC.
By:________________________________
Title:_____________________________
WESTERN AGGREGATES, INC.
By:________________________________
Title:_____________________________
EAGLE VALLEY MATERIALS, INC.
By:________________________________
Title:________________________
NEVADA AGGREGATES, INC.
By:________________________________
Title:_____________________________
BAMA CRUSHED CORPORATION
By:________________________________
Title:__________________________
GROVE MATERIALS CORPORATION
By:________________________________
Title:_____________________________
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ACKNOWLEDGED AND AGREED
as of the date first written above
BANK OF AMERICA, N.A., as Agent
By:________________________________
Title:_______________________________
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EXHIBIT B
SPECIFIED DEFAULTS
1. Any Event of Default caused by failure to pay the Term C Loans (and all
Capitalized Interest and other amounts owing with respect thereto) on January
31, 2002.
2. Any Event of Default caused by failure to pay the interest in cash on the
Loans on at any time from and including January 31, 2002 through and including
the termination of the Forbearance Period.
3. Any Event of Default caused by failure to pay fees on at any time from and
including January 31, 2002 through and including the termination of the
Forbearance Period.
4. Any Event of Default caused by the failure to comply with Section 10.6.4 of
the Credit Agreement on December 31, 2001.
5. Any Event of Default caused by the failure of the Company to comply with
Section 6.2.1(b) of the Credit Agreement at any time during the Forbearance
Period.
9