1
December 20, 1996
Granite Construction Incorporated
585 West Beach Street
Watsonville, CA 95076
Attention: Mr. William E. Barton
Vice President & Chief Financial Officer
Re: SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT DATED AS OF
MARCH 31, 1995 AMONG GRANITE CONSTRUCTION INCORPORATED, BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, AS AGENT, AND THE
OTHER FINANCIAL INSTITUTIONS PARTY THERETO, AS AMENDED BY A FIRST
AMENDMENT DATED AS OF MAY 31, 1996 (THE "CREDIT AGREEMENT")
Ladies and Gentlemen:
We are writing regarding the captioned Credit Agreement. Capitalized
terms not defined in this letter shall have the meanings assigned to them in
the Credit Agreement.
You have advised us that the Company is considering an acquisition of
30% of the capital stock of TIC Holdings, Inc. for a purchase price expected to
be not more than $21,000,000 (the "TIC Acquisition"). You have advised as well
that a part of the TIC Acquisition may be concluded in 1996; to the extent not
concluded in 1996, the TIC Acquisition will be concluded in 1997. You have
requested that we amend the Credit Agreement to provide that the TIC
Acquisition, to the extent closed in 1997, and to the extent not in excess of
such 30% or $21,000,000 amounts, not be considered a usage of the basket for
equity investments set forth in subsection 8.04(d) of the Credit Agreement.
The Banks are willing to amend the Credit Agreement, subject to the
terms and conditions of this letter agreement (the "Amendment").
1. For valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the parties hereby agree that the Credit Agreement
shall be amended as follows:
(a) Section 8.04 of the Credit Agreement shall be amended
and restated in its entirety to read as follows:
8.04 Loans and Investments. The Company shall not,
directly or indirectly,
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Granite Construction Incorporated
December 20, 1996
Page 2
purchase or acquire, or permit any of its Subsidiaries to purchase or acquire,
or make any commitment therefor, any capital stock, equity interest, assets,
obligations or other securities of or any interest in, any Person, or make any
advance, loan, extension of credit or capital contribution to or any other
investment in, any Person including, without limitation, any Affiliates of the
Company, except for: (a) investments in accordance with Schedule 8.04; (b)
extensions of credit in the nature of accounts receivable or notes receivable
arising from the sale or lease of goods or services in the Ordinary Course of
Business; (c) extensions of credit by the Company to any of its wholly-owned
Subsidiaries or by any of its wholly-owned Subsidiaries to another of the
wholly-owned Subsidiaries of the Company; (d) investments in up to 30% (when
aggregated with the amount of any such investments made in 1996) of the capital
stock of TIC Holdings, Inc., not to exceed in aggregate amount (when aggregated
with the amount of any such investments made in 1996) the amount of
$21,000.000; provided, that, such investments are made during the calendar year
1997; or (e) additional purchases of or investments in the stock of
Subsidiaries or the capital stock, assets, obligations or other securities of
or interest in other Persons not exceeding in any fiscal year 10% of the
Company's consolidated Tangible Net Worth as of the last day of the immediately
preceding fiscal year.
(b) All cross-references in the Credit Agreement (including in any
exhibit thereto) to subsection 8.04(d) shall be amended to refer to subsection
8.04(e).
2. This Amendment will become effective as of the date first
above Written, provided that the Agent has received from the Company and the
Majority Banks a duly executed Original of this Amendment and from each
Guarantor an executed Guarantor Acknowledgment and Consent in the form attached
hereto.
3. The Company hereby represents and warrants to the Bank that:
(a) no Default or Event of Default has occurred and is
continuing;
(b) the execution, delivery and performance by the
Company of this Amendment have been duly authorized by all necessary corporate
and other action and do not and will not require any registration with, consent
or approval of, notice to or action by, any Person (including any Governmental
Authority) in order to be effective and enforceable;
(c) the Credit Agreement, as amended by this Amendment
constitutes the legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with their respective terms,
without defense, counterclaim or offset;
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Granite Construction Incorporated
December 20, 1996
Page 3
(d) all representations and warranties of the Company
contained in the Credit Agreement are true and correct as of the date first
above written (except to the extent such representations and warranties
expressly refer to an earlier date, in which case they are true and correct as
of such earlier date); and
(e) the Company is entering into this Amendment on the
basis of its own investigation and for its own reasons, without reliance upon
the Agent, any Bank or any other Person.
4. The Company acknowledges and agrees that the execution and
delivery by the Agent and the Banks of this Amendment shall not be deemed to
create a course of dealing or otherwise obligate Agent or the Banks to execute
similar amendments under the same or similar circumstances in the future.
5. Except as herein expressly amended, all terms, covenants and
provisions of the Credit Agreement are and shall remain in full force and
effect, and all references thereto shall henceforth refer to such documents as
amended by this Amendment. This Amendment shall be deemed incorporated into,
and a part of, the Credit Agreement.
6. This Amendment, together with the Credit Agreement, contains
the entire and exclusive agreement of the parties hereto with reference to the
matters discussed herein and therein. This Amendment Supersedes all prior
drafts and communications with respect thereto. This Amendment may not be
amended except in writing executed and delivered by both parties hereto.
Please indicate your acceptance of this Amendment by signing and
returning the duplicate copy hereof, whereupon this Amendment will constitute a
binding agreement between the Company, the Agent and the Banks, and their
respective successors and assigns, which shall be governed by and construed in
accordance with the law of the State of California. This Amendment may be
signed in one or more counterparts. No third party beneficiaries are intended
in connection with this Amendment.
Sincerely,
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION,
As Agent
By:
--------------------------------------
Title: Vice President
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Granite Construction Incorporated
December 20, 1996
Page 4
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION,
as a Bank
and as Issuing Bank
By:
---------------------------------------
Title: Vice President
UNION BANK OF CALIFORNIA, N.A.
By:
---------------------------------------
Title: Vice President
------------------------------------
BANQUE NATIONALS DE PARIS
By:
---------------------------------------
Title: Jennifer Y. Cho
------------------------------------
Vice President
By:
---------------------------------------
Title: Charles H. Day
------------------------------------
Assistant Vice President
ABN-AMRO BANK N.V.
San Francisco International Branch
By: ABN AMRO North America, Inc.,
as agent
By:
---------------------------------------
Title: Bradford H. Leahy
------------------------------------
Officer
By:
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Title: L.T. Osborne
------------------------------------
Group Vice President
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Granite Construction Incorporated
December 20, 1996
Page 5
Accepted and agreed this 20 day of December, 1996:
GRANITE CONSTRUCTION INCORPORATED
By:
-----------------------------------------------
Title: W.E. Barton, Vice President & CFO
--------------------------------------------
By:
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Title: R.C. Allbritton, Vice President & Treasurer
---------------------------------------------
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Granite Construction Incorporated
December 20, 1936
Page 6
GUARANTOR ACKNOWLEDGMENT
AND CONSENT
The undersigned, each a guarantor with respect to the Company's
obligations to the Agent and the Banks under the Credit Agreement, each hereby
(i) acknowledge and consent to the execution, delivery and performance by
Company of the foregoing letter amendment to the Credit Agreement (the
"Amendment"), and (ii) reaffirm and agree that the respective guaranty to which
the undersigned is party and all other documents and agreements executed and
delivered by the undersigned to the Agent and the Banks in Connection with the
Credit Agreement are in full force and effect, without defense, offset or
counterclaim. (Capitalized terms used herein have the meanings specified in the
Amendment.)
GRANITE CONSTRUCTION COMPANY
By:
--------------------------------------
Title: W.E. Barton, Vice President & CFO
--------------------------------------
By:
---------------------------------------
Title: R.C. Allbritton, Vice Pres. & Treasurer
---------------------------------------
Dated December 20, 1996
GRANITE SR91 CORPORATION
By:
---------------------------------------
Title: W.E. Barton, Vice President & CFO
---------------------------------------
By:
---------------------------------------
Title: R.C. Allbritton, Vice Pres. & Treasurer
---------------------------------------
Dated December 20 , 1996
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Granite Construction Incorporated
December 20, 1996
Page 7
WILCOTT CORPORATION
By:
---------------------------------------
Title: D.H. Watts, President & CEO
------------------------------------
By:
---------------------------------------
Title: W.E. Barton, Vice President & CFO
------------------------------------
Dated December 20 , 1996
DESERT AGGREGATES, INC.
By:
---------------------------------------
Title: D.J. Brunton, CFO, Treasurer &
------------------------------------
Assistant Secretary
By:
---------------------------------------
Title: K. Kenan, Assistant Secretary
------------------------------------
Dated December 20 , 1996
GG&R, Inc.
By:
---------------------------------------
Title: D.H. Watts, President & CEO
------------------------------------
By:
---------------------------------------
Title: W.E. Barton, Vice President & CFO
------------------------------------
Dated December 20 , 1996
INTERMOUNTAIN SLURRY SEAL, INC.
By:
---------------------------------------
Title: D.J. Brunton, CFO, Treasurer &
------------------------------------
Assistant Secretary
By:
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Title: K. Kenan, Assistant Secretary
------------------------------------
Dated December 20 , 1996
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Granite Construction Incorporated
December 20, 1996
Page 8
BEAR RIVER CONTRACTORS
By:
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Title: D.J. Brunton, CFO, Treasurer &
------------------------------------
Assistant Secretary
By:
---------------------------------------
Title: K. Kenan, Assistant Secretary
------------------------------------
Dated December 20 , 1996
POZZOLAN PRODUCTS COMPANY
By:
---------------------------------------
Title: D.J. Brunton, CFO, Treasurer &
------------------------------------
Assistant Secretary
By:
---------------------------------------
Title: K. Kenan, Assistant Secretary
------------------------------------
Dated December 20 , 1996
GILC INCORPORATED
By:
---------------------------------------
Title: W.E. Barton, President & CEO
------------------------------------
By:
---------------------------------------
Title:R.C. Allbritton, Vice President & CFO
-------------------------------------
Dated December 20 , 1996
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Granite Construction Incorporated
December 20, 1996
Page 9
GRANITE SR91, L.P.
By: GRANITE SR91 CORPORATION
By:
---------------------------------------
Title: D.H. Watts, President & CEO
------------------------------------
By:
---------------------------------------
Title: W.E. Barton, Vice President & CFO
------------------------------------
Dated December 20 , 1996
GTC, INC.
By:
---------------------------------------
Title: W.E. Barton, President & Treasurer
------------------------------------
By:
---------------------------------------
Title: R.C. Allbritton, Vice President,
------------------------------------
Assistant Secretary & Assistant
Treasurer
Dated December 20 , 1996
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