Exhibit 10.93
AMENDMENT NO. 2 TO THE CREDIT AGREEMENT
AND AMENDMENT NO. 1 TO THE PLEDGE AND SECURITY AGREEMENT
Dated as of March 14, 2005
AMENDMENT NO. 2 TO THE CREDIT AGREEMENT AND AMENDMENT NO. 1 TO THE
PLEDGE AND SECURITY AGREEMENT (this "Amendment No. 2") among Headwaters
Incorporated, a Delaware corporation, (the "Borrower"), the Lenders (as
hereinafter defined) party hereto, Morgan Stanley & Co. Incorporated ("MS&Co."),
as collateral agent (the "Collateral Agent") and Morgan Stanley Senior Funding,
Inc. ("Morgan Stanley"), as administrative agent (the "Administrative Agent";
together with the Collateral Agent, the "Agents").
PRELIMINARY STATEMENTS:
(1) The Borrower, certain financial institutions and other
persons from time to time parties thereto (collectively, the "Lenders"), the
Agents, JPMorgan Chase Bank, N.A. ("JPMCB") (as successor to JPMorgan Chase
Bank), as syndication agent, and Morgan Stanley and J.P. Morgan Securities Inc.,
as joint lead arrangers and joint bookrunners, have entered into that certain
Credit Agreement dated as of September 8, 2004 (as amended, restated,
supplemented or otherwise modified, the "Credit Agreement"; capitalized terms
used herein but not defined shall be used herein as defined in the Credit
Agreement).
(2) The Borrower desires to convert outstanding Term B Loans
under the Credit Agreement to a new class of Loans under the Credit Agreement,
having identical terms with, and having the same rights and obligations under
the Loan Documents, as the Term B Loans, as set forth in the Loan Documents,
except as such terms are amended hereby (the "Term B1 Loans").
(3) The Borrower has received Net Cash Proceeds from an equity
Financing which it applied in accordance with Section 2.2(c) of the Credit
Agreement to prepay a portion of the Term B Loans and to prepay $50,000,000 of
the Second Lien Financing.
(4) Each Lender that has a Term B Loan outstanding as of the
date hereof (each, a "Term B Lender") who executes and delivers this Amendment
No. 2 shall be deemed, upon the effectiveness of this Amendment No. 2, to have
converted its Term Loan B Commitment and Term B Loans (which Term Loan B
Commitment and Term B Loans shall thereafter be deemed terminated and refinanced
in full) to a Converted Term B1 Commitment (as hereinafter defined) and Term B1
Loans, respectively, with such Converted Term B1 Commitment, in the same
aggregate principal amount as such Lender's outstanding Term B Loans,
immediately prior to the effectiveness of this Amendment No. 2, as set forth in
the Commitment Schedule to the Credit Agreement, as amended as of the Amendment
No. 2 Effective Date (as hereinafter defined) (the "Amended Commitment
Schedule"), and such Term B Lender shall thereafter become a Term B1 Lender (as
hereinafter defined).
(5) Each Person who executes and delivers this Amendment No. 2
as an additional Term B1 Lender (each, an "Additional Term B1 Lender"), will
make Term B1 Loans in the aggregate amount of its Additional Term B1 Commitment
(as hereinafter defined) on the Amendment No. 2 Effective Date (as hereinafter
defined) (each, an "Additional Term B1 Loan") to the Borrower in an aggregate
principal amount equal to the amount set forth opposite its name on the Amended
Commitment Schedule, the proceeds of which will be used by the Borrower, in
part, to refinance in full the outstanding principal amount of Term B Loans of
Term B Lenders, if any, who do not execute and deliver this Amendment No. 2, it
being understood that an Additional Term B1 Lender may be a Term B Lender prior
to the Amendment No. 2 Effective Date.
(6) The Borrower shall pay to each Term B Lender all accrued
and unpaid interest on its Term B Loans to the Amendment No. 2 Effective Date on
such Amendment No. 2 Effective Date.
(7) The Borrower has requested that the Required Lenders (a)
amend the Credit Agreement (i) to effect the changes described above and (ii) to
make other amendments set forth below and (b) amend the Pledge and Security
Agreement as set forth below.
(8) The Required Lenders and the Term B1 Lenders (as defined
in this Amendment No. 2) have agreed, subject to the terms and conditions
hereinafter set forth, to amend the Credit Agreement and the Pledge and Security
Agreement in certain respects as set forth below.
NOW, THEREFORE, in consideration of the premises and for other
good and valuable consideration (the receipt and sufficiency of which is hereby
acknowledged), the parties hereto hereby agree as follows:
SECTION 1. Amendment of Credit Agreement. The Credit Agreement is,
effective as of the date hereof and subject to the satisfaction of the
conditions precedent set forth in Section 4 of this Amendment No. 2, hereby
amended as follows:
(a) The Pricing Schedule is amended and restated in its
entirety to read as the Pricing Schedule attached hereto.
(b) Section 1.1 of the Credit Agreement is hereby amended as
follows:
(i) By deleting the definition of "Aggregate Term Loan B
Commitment" in its entirety and inserting the following definition in
its place:
""Aggregate Term Loan B1 Commitment" means the aggregate Term
Loan B1 Commitments of all the Lenders, as may be increased or
reduced from time to time pursuant to the terms hereof. The
initial Aggregate Term Loan B1 Commitment is $442,672,500.00."
(ii) By deleting the definition of "Lenders" in its entirety
and inserting the following definition in its place:
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""Lenders" means the Initial Lenders and their respective
successors and assigns and each Additional Term B1 Lender and
its respective successors and assigns. Unless otherwise
specified, the term "Lenders" includes the Swing Line Lender
and each LC Issuer, but in no event shall the term "Lender"
include Bank One."
(iii) By deleting the definition of "Term B Loan" in its
entirety and inserting the following definition in its place:
""Term B1 Loan" means, collectively, (i) with respect to each
Original Term B Lender that executes and delivers Amendment
No. 2 on or prior to the Amendment No. 2 Effective Date, a
term Loan or term Loans made by such Original Term B Lender
pursuant to Section 2.1.2(b) or deemed to have been made
pursuant to Section 2.1.2(a) and (ii) with respect to each
Additional Term B1 Lender, its Additional Term B1 Loan."
(iv) By deleting the definition of "Term Loan B Commitment" in
its entirety and inserting the following definition in its place:
""Term Loan B1 Commitment" means, with respect to each Lender,
the amount set forth opposite such Lender's name on the
Amended Commitment Schedule under the caption "Term Loan B1
Commitment".
(v) By inserting the following new definitions therein in the
appropriate alphabetical order:
""Additional Term B1 Loan" means a term Loan or term Loans
made pursuant to Section 2.1.2(b) of this Agreement on the
Amendment No. 2 Effective Date.
"Additional Term B1 Commitment" means, with respect to an
Additional Term B1 Lender, the commitment of such Additional
Term B1 Lender to make Additional Term B1 Loans on the
Amendment No. 2 Effective Date, in an amount in US Dollars set
forth next to the name of such Additional Term B1 Lender on
the Amended Commitment Schedule thereto under the caption
"Additional Term B1 Commitment". The aggregate amount of the
Additional Term B1 Commitments shall be equal to the
outstanding principal amount of Original Term B Loans of
Original Term B Lenders that do not execute and deliver
Amendment No. 2 on or prior to the Amendment No. 2 Effective
Date.
"Additional Term B1 Lender" means a Person with an Additional
Term B1 Commitment to make Additional Term B1 Loans to the
Borrower on the Amendment No. 2 Effective Date, it being
understood that an Additional Term B1 Lender may be an
Original Term B Lender.
"Amended Commitment Schedule" has the meaning specified in
Amendment No. 2.
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"Amendment No. 2" means the Amendment No. 2 to the Credit
Agreement and Amendment No. 1 to the Pledge and Security
Agreement, dated as of March 14, 2005, among the Borrower, the
Agents and the Lenders party thereto.
"Amendment No. 2 Effective Date" means March 14, 2005.
"Converted Term B1 Commitment" means for each Original Term B
Lender executing Amendment No. 2 the outstanding principal
amount of its Original Term B Loans, immediately prior to the
Amendment No. 2 Effective Date.
"Initial Lenders" means the lending institutions (other than
Bank One) listed on the signature pages of this Agreement.
"Original Term B Loan" means a "Term B Loan" as defined in
Section 1.1 of this Credit Agreement, as in effect prior to
the Amendment No. 2 Effective Date.
"Original Term B Lender" means a Lender that had a "Term Loan
B Commitment" as defined in Section 1.1 of this Credit
Agreement, as in effect prior to the Amendment No. 2 Effective
Date."
(c) Section 2.1.2 of the Credit Agreement is hereby amended in
its entirety and replaced by the following:
"(a) Conversion. Subject to the terms and conditions hereof,
each Original Term B Lender with a Converted Term B1 Commitment
severally agrees that Original Term B Loans made by such Original Term
B Lender to the Borrower prior to the Amendment No. 2 Effective Date
shall be converted to a like principal amount of Term B1 Loans on the
Amendment No. 2 Effective Date, and from and after the Amendment No. 2
Effective Date such Original Term B Loan shall be deemed to be a Term
B1 Loan made hereunder.
(b) The Additional Term B1 Loans. Subject to the terms and
conditions hereof, each Additional Term B1 Lender severally agrees to
make Additional Term B1 Loans to the Borrower on the Amendment No. 2
Effective Date in a principal amount not to exceed its Additional Term
B1 Commitment. The Borrower shall use a portion of the proceeds of the
Additional Term B1 Loans to repay in full all Original Term B Loans of
the Original Term B Lenders that do not execute and deliver the
Amendment on the Amendment No. 2 Effective Date.
(c) Reborrowing. Amounts borrowed under this Section 2.1.2 and
repaid or prepaid may not be reborrowed.
(d) Interest Periods. On the Amendment No. 2 Effective Date,
the Borrower shall pay all accrued and unpaid interest on the Original
Term B Loans to the Original Term B Lenders; provided, however, that
the existing Interest Periods in effect for the Term B Loans
outstanding prior to the Amendment No. 2 Effective Date shall continue
for such Loans following conversion to Term B1 Loans on and after the
Amendment No. 2 Effective Date.
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(e) Repayment of Loans. The unpaid principal balance of the
Term B1 Loans shall be repaid in twenty-three (23) consecutive
quarterly principal installments, payable on the last Business Day of
each February, May, August and November, commencing on November 30,
2005, and continuing thereafter until the Term Loan B1 Maturity Date,
and the Term B1 Loans shall be permanently reduced by the amount of
each installment on the date payment thereof is made hereunder. Each of
the first twenty (20) installments shall be in an amount equal to
$3,353,579.55, each of the next two (2) installments shall be in an
amount equal to $125,200,303.03 and the last installment shall be in an
amount equal to $125,200,303.04; provided that, notwithstanding the
foregoing, the final installment shall be in the amount of the then
outstanding principal balance of the Term B1 Loans. In addition,
notwithstanding the immediately preceding sentence, the then
outstanding principal balance of the Term B1 Loans, if any, shall be
due and payable on the Term Loan B1 Maturity Date. In addition to the
scheduled payments on the Term B1 Loans, the Borrower (a) may make the
voluntary prepayments described in Section 2.7 for credit against the
scheduled payments on the Term B1 Loans pursuant to Section 2.7 and (b)
shall make the mandatory prepayments prescribed in Section 2.2 for
credit against the scheduled payments on the Term B1 Loans pursuant to
Section 2.2."
(d) Upon the Amendment No. 2 Effective Date, (i) the Term B1
Loans shall have the same terms, rights and obligations as the Original
Term B Loans as set forth in the Loan Documents, except as modified by
Section 1 of this Amendment No. 2, (ii) all references to "Aggregate
Term Loan B Commitment", "Term B Loans", "Term Loan B Commitment" and
"Term Loan B Maturity Date" in the Loan Documents shall be deemed to be
references to "Aggregate Term Loan B1 Commitment", "Term B1 Loans",
"Term Loan B1 Commitment" and "Term Loan B1 Maturity Date",
respectively, and (iii) each reference in the Credit Agreement to the
"Commitment Schedule" shall be deemed to be a reference to the "Amended
Commitment Schedule".
SECTION 2. Other Amendments. The Credit Agreement is hereby further
amended as follows:
(a) Section 2.2(c) is amended by adding to the end thereof,
immediately before the period, the following:
"provided, further, that so long as no Default has occurred
and is continuing, the Borrower may apply the Net Cash
Proceeds from one or more Financings consisting of Permitted
Indebtedness to prepayment of the Second Lien Financing and
any prepayment premium and additional amounts or costs payable
in connection with such prepayment within 5 Business Days
after receipt thereof. Notwithstanding any other provision to
the contrary contained in this Agreement, if, prior to March
14, 2006, the Borrower shall make any prepayment of the Term
B1 Loans from the proceeds of a Financing consisting of debt
that constitutes a refinancing hereunder solely or primarily
intended to lower the rate of interest payable on the Term B1
Loans, such prepayment shall be accompanied by a premium equal
to 1.00% of the aggregate principal amount of the Term B1
Loans being prepaid".
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(b) Section 2.7 is hereby amended by (x) adding after the
words "without penalty or premium" in each place where they appear in
such Section the following: "(except as otherwise expressly set forth
in this Section 2.7)" and (y) adding to the end of such Section the
following additional sentence: "Notwithstanding any other provision to
the contrary contained in this Agreement, if, prior to March 14, 2006,
the Borrower shall make any voluntary prepayment of the Term B1 Loans
using the proceeds of debt that constitutes a refinancing hereunder
solely or primarily intended to lower the rate of interest payable on
the Term B1 Loans, such prepayment shall be accompanied by a premium
equal to 1.00% of the aggregate principal amount of the Term B1 Loans
being prepaid."
(c) Section 6.10 is hereby amended by (x) substituting for
"and (ii)" in the fourth line thereof "; (ii)" and (y) inserting at the
end thereof immediately before the period the following: "; (iii) the
Borrower may make prepayments of the Second Lien Financing expressly
permitted by Section 2.2(c) and (iv) so long as no Default or unmatured
Default exists at the time thereof or would arise after giving effect
thereto, at any time after September 8, 2005 the Borrower may prepay
the Second Lien Financing with cash on hand".
(d) Section 6.17 is amended by substituting for the figure
"$300 million" where it appears therein the figure "$150 million".
(e) Section 6.23 is amended by deleting the table that appears
therein in its entirety and replacing it with the following:
"For fiscal year: Capital Expenditures
---------------- --------------------
2005 and 2006 $62,000,000
2007 through 2010 $55,000,000
2011 $60,000,000".
SECTION 3. Amendment to the Pledge and Security Agreement. Schedule II
of the Pledge and Security Agreement is hereby deleted in its entirety and
replaced with new Schedule II attached hereto as Annex II.
SECTION 4. Conditions to Effectiveness. This Amendment No. 2 and the
amendments contained herein shall become effective as of the date hereof (the
"Amendment No. 2 Effective Date") when each of the conditions set forth in this
Section 4 to this Amendment No. 2 shall have been fulfilled to the satisfaction
of the Administrative Agent.
(i) Execution of Counterparts. The Administrative Agent shall have
received counterparts of this Amendment No. 2, duly executed
and delivered on behalf of each of the (a) the Borrower, (b)
the Required Lenders and (c) each Original Term B Lender, or
in lieu of one or more Original Term B Lenders, one or more
Additional Term B1 Lenders providing Additional Term B1
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Commitments in an amount sufficient to repay all of the
principal of the Original Term B Loans owed to such
non-consenting Original Term B Lenders or as to any of the
foregoing parties, advice reasonably satisfactory to the
Administrative Agent that each of the foregoing parties has
executed a counterpart of this Amendment No. 2.
(ii) Guarantor Consent. The Administrative Agent shall have
received the Consent attached hereto duly executed by each of
the Guarantors.
(iii) Notice of Borrowing. The Borrower shall have provided the
Administrative Agent with a Borrowing Notice in accordance
with the requirements of Section 2.02(a) of the Credit
Agreement prior to the Amendment No. 2 Effective Date with
respect to the borrowing of the Additional Term B1 Loans on
the Amendment No. 2 Effective Date, except that the three (3)
Business Day notice requirement is hereby waived.
(iv) Payment of Fees and Expenses. The Borrower shall have paid all
reasonable expenses (including the reasonable fees and
expenses of Shearman & Sterling LLP) incurred in connection
with the preparation, negotiation and execution of this
Amendment No. 2 and other matters relating to the Credit
Agreement from and after the last invoice to the extent
invoiced.
(v) Evidence of Debt. Each Term B1 Lender shall have received, if
requested, one or more Notes payable to the order of such
Lender duly executed by the Borrower in substantially the form
of Exhibit E-2 to the Credit Agreement, as modified by this
Amendment No. 2, evidencing the Term B1 Loans made by such
Lender.
(vi) Interest, Etc. Simultaneously with the conversion to or making
of the Term B1 Loans, the Borrower shall have paid to all the
Original Term B Lenders all accrued and unpaid interest on the
Original Term B Loans to the Amendment No. 2 Effective Date,
in the case of the repayment in full of any Original Term B
Loans that are not converted to Term B1 Loans, plus any loss
or expense pursuant to Section 3.4 of the Credit Agreement.
(vii) Certificates. The Administrative Agent shall have received (i)
a certificate of the Secretary or an Assistant Secretary of
each of the Credit Parties certifying (A) the names and true
signatures of the officers of each of the Credit Parties
authorized to sign this Amendment No. 2 and the other
documents to be delivered hereunder and (B) the resolutions of
the Board of Directors of the Credit Parties evidencing
approval for this Amendment No. 2 and (ii) a certificate of an
officer of each of the Credit Parties certifying (A) that no
authorization or approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body,
or any third party to any agreements and instruments is
required for the due execution, delivery or performance by
each of the Credit Parties of this Amendment No. 2, (B) the
representations and warranties contained in Section 5 of this
Amendment No. 2 are true and correct and (C) no event has
occurred and is continuing that constitutes a Default.
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(viii) Additional Collateral Documents. All necessary modifications
or confirmations to the Collateral Documents in effect on the
Amendment No. 2 Effective Date shall have been duly executed
and delivered so as to ensure the continued effectiveness of
the security interests created thereby, as reasonably
determined by the Administrative Agent and its counsel, and
the Administrative Agent shall have received evidence that all
such other action (including, without limitation, (A) record
owner and lien searches with respect to any real property of
any Loan Party that is subject to a Mortgage confirming that
the applicable Loan Party is the record owner of the Mortgaged
Property as defined in the applicable Mortgage and that there
are no liens of record with respect to such Mortgaged Property
other than those permitted by the applicable Mortgage, and
payment of all expenses incurred in connection therewith and
(B) payment of all recording fees, if any, in connection with
the transactions contemplated by this Amendment No. 2) as
shall be necessary or desirable to record, perfect or protect
the security interests of the Secured Parties shall have been
taken (it being understood that, with respect to any such
action which has not been taken prior to the Amendment No. 2
Effective Date, the Borrower may, in the reasonable discretion
of the Administrative Agent, be granted an additional period
to take such action not to exceed thirty (30) days (which may
be extended in the sole discretion of the Administrative
Agent) after the Amendment No. 2 Effective Date).
(ix) Legal Details, Etc. All documents executed or submitted
pursuant hereto shall be reasonably satisfactory in form and
substance to the Administrative Agent and Shearman & Sterling
LLP as counsel. The Administrative Agent and its counsel shall
have received all information and such counterpart originals
or such certified or other copies or such materials as the
Administrative Agent or its counsel may reasonably request,
and all legal matters incident to the transactions
contemplated by this Amendment No. 2 shall be reasonably
satisfactory to the Administrative Agent and its counsel.
(x) No Default. No Default or Unmatured Default shall have
occurred and be continuing, or would occur as a result of the
transactions contemplated by this Agreement.
SECTION 5. Confirmation of Representations and Warranties. Each of the
Credit Parties hereby represents and warrants, on and as of the date hereof,
that the representations and warranties contained in the Credit Agreement are
correct and true in all material respects on and as of the date hereof, before
and after giving effect to this Amendment No. 2, as though made on and as of the
date hereof, other than any such representations or warranties that, by their
terms, refer to a specific date.
SECTION 6. Reference to and Effect on the Loan Documents. (a) On and
after the effectiveness of this Amendment No. 2, each reference (i) in the
Credit Agreement to "hereunder", "hereof" or words of like import referring to
the Credit Agreement, and each reference in the other transaction documents to
the "Credit Agreement", "thereunder", "thereof" or words of like import
referring to the Credit Agreement, shall mean and be a reference to the Credit
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Agreement as modified by this Amendment No. 2 and (ii) in the Pledge and
Security Agreement to "hereunder", "hereof" or words of like import referring to
the Pledge and Security Agreement, and each reference in the other transaction
documents to the "Pledge and Security Agreement", "thereunder", "thereof" or
words of like import referring to the Pledge and Security Agreement, shall mean
and be a reference to the Pledge and Security Agreement as modified by this
Amendment No. 2.
(b) The Credit Agreement, the Pledge and Security Agreement,
the Notes and each of the other Loan Documents, as specifically amended
by this Amendment No. 2, are and shall continue to be in full force and
effect and are hereby in all respects ratified and confirmed. Without
limiting the generality of the foregoing, the Collateral Documents and
all of the Collateral described therein do and shall continue to secure
the payment of all Obligations of the Credit Parties under the Loan
Documents, in each case as amended by this Amendment No. 2.
(c) The execution, delivery and effectiveness of this
Amendment No. 2 shall not, except as expressly provided herein, operate
as a waiver of any right, power or remedy of any Lender or any Agent
under any of the Loan Documents, nor constitute a waiver of any
provision of any of the Loan Documents.
SECTION 7. Execution in Counterparts. This Amendment No. 2 may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed 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 counterpart of a signature page to this
Amendment No. 2 by facsimile shall be effective as delivery of a manually
executed original counterpart of this Amendment No. 2.
SECTION 8. Governing Law. This Amendment No. 2 shall be governed by,
and construed in accordance with, the laws of the State of New York, and shall
be subject to the jurisdictional and service provisions of the Credit Agreement,
as if this were a part of the Credit Agreement.
SECTION 9. Entire Agreement; Modification. This Amendment No. 2
constitutes the entire agreement of the parties hereto with respect to the
subject matter hereof, there being no other agreements or understandings, oral,
written or otherwise, respecting such subject matter, any such agreement or
understanding being superseded hereby, shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns, and
may not be amended, extended or otherwise modified, except in a writing executed
in whole or in counterparts by each party hereto.
[Signatures follow.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
HEADWATERS INCORPORATED
By /s/ Steven G. Stewart
---------------------------------
Title: CFO
MORGAN STANLEY SENIOR FUNDING, INC.,
as Administrative Agent and as a Lender
By /s/ Todd Vannucci
---------------------------------
Title: Executive Director
MORGAN STANLEY & CO. INCORPORATED,
as Collateral Agent
By /s/ Todd Vannucci
---------------------------------
Title:
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JPMORGAN CHASE BANK, N.A., as a Lender
By /s/ Brian McDougal
---------------------------------
Title: Vice President
[And Other Lenders]
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PRICING SCHEDULE
========================= ============= ============= ============= ============
APPLICABLE LEVEL I LEVEL II LEVEL III LEVEL IV
MARGIN FOR REVOLVING STATUS STATUS STATUS STATUS
LOANS
- ------------------------- ------------- ------------- ------------- ------------
Eurodollar Rate 1.75% 2.00% 2.25% 2.50%
- ------------------------- ------------- ------------- ------------- ------------
Floating Rate 0.75 1.00% 1.25% 1.50%
========================= ============= ============= ============= ============
========================= ============= ============= ============= ============
APPLICABLE FEE LEVEL I LEVEL II LEVEL III LEVEL IV
RATE STATUS STATUS STATUS STATUS
- ------------------------- ------------- ------------- ------------- ------------
Commitment Fee 0.50% 0.625% 0.625% 0.75%
========================= ============= ============= ============= ============
================================== ============== =============== ==============
APPLICABLE TERM LEVEL I TERM LEVEL II TERM LEVEL III
MARGIN FOR TERM B LOANS STATUS STATUS STATUS
- ---------------------------------- -------------- --------------- --------------
Eurodollar Rate 2.00% 2.25% 2.50%
- ---------------------------------- -------------- --------------- --------------
Floating Rate 1.00% 1.25% 1.50%
================================== ============== =============== ==============
For the purposes of this Schedule, the following terms have the
following meanings, subject to the final paragraph of this Schedule:
"Financials" means the annual or quarterly financial statements of the
Borrower delivered pursuant to Section 6.1.1 or 6.1.2.
"Level I Status" exists at any date if, as of the last day of the
fiscal quarter of the Borrower referred to in the most recent Financials, the
Total Leverage Ratio is less than 3.0 to 1.0.
"Level II Status" exists at any date if, as of the last day of the
fiscal quarter of the Borrower referred to in the most recent Financials, (i)
the Borrower has not qualified for Level I Status and (ii) the Total Leverage
Ratio is less than 3.5 to 1.0.
"Level III Status" exists at any date if, as of the last day of the
fiscal quarter of the Borrower referred to in the most recent Financials, (i)
the Borrower has not qualified for Level I Status or Level II Status and (ii)
the Total Leverage Ratio is less than 4.0 to 1.0.
"Level IV Status" exists at any date if, as of the last day of the
fiscal quarter of the Borrower referred to in the most recent Financials, the
Borrower has not qualified for Level I Status or Level II Status or Level III
Status.
"Moody's" means Moody's Investors Service, Inc.
"Rating" means the credit rating that has been most recently announced
for the Loans by S&P or Moody's, as the case may be.
"S&P" means Standard & Poors Ratings Services, a division of The
McGraw-Hill Companies, Inc.
"Status" means (x) either Level I Status, Level II Status, Level III
Status or Level IV Status and (y) either Term Level I Status, Term Level II
Status or Term Level III Status, as applicable.
"Term Level I Status" exists at any date if, as of such date, the
Rating is (a) at least B+ (with at least a stable outlook) by S&P and at least
Ba3 (with at least a stable outlook) by Moody's or (b) at least BB- (with at
least a stable outlook) by S&P and at least B1 (with at least a stable outlook)
by Moody's.
"Term Level II Status" exists at any date if, as of such date, Term
Level I Status does not apply and the Rating is (a) at least B+ (with at least a
stable outlook) by S&P and at least B2 (with at least a stable outlook) by
Moody's or (b) at least B (with at least a stable outlook) by S&P and at least
B1 (with at least a stable outlook) by Moody's.
"Term Level III Status" exists at any date if, as of such date, neither
Term Level I Status nor Term Level II Status applies.
The Applicable Margin in respect of each Facility and Applicable Fee
Rate shall be determined in accordance with the foregoing table applicable to
such Facility or fee based on the Borrower's Status as reflected in the then
most recent Financials or the then most recently announced Ratings, as
applicable. Adjustments, if any, to the Applicable Margin or Applicable Fee Rate
shall be effective five Business Days after the Administrative Agent has
received the applicable Financials or as of the date that S&P or Moody's
announces the change in such Rating, as applicable. If the Borrower fails to
deliver the Financials to the Administrative Agent at the time required pursuant
to Section 6.1, then the Applicable Margin in respect of the Revolving Loans and
Applicable Fee Rate shall be the highest Applicable Margin and Applicable Fee
Rate set forth in the foregoing table applicable to the Revolving Loans or such
fee until five days after such Financials are so delivered.
CONSENT
Dated as of March 14, 2005
Reference is made to the Credit Agreement referred to in the foregoing
Amendment (capitalized terms used herein and not defined being used herein as
defined in the Credit Agreement). Each of the undersigned, in its capacity as a
Guarantor under the Guaranty Agreement and as a Grantor under the Pledge and
Security Agreement, hereby (i) consents to the execution, delivery and
performance of the Amendment and agree that each of the Guaranty Agreement and
the Pledge and Security Agreement is, and shall continue to be, in full force
and effect and is hereby in all respects ratified and confirmed on the Amendment
No. 2 Effective Date, except that, on and after the Amendment No. 2 Effective
Date, each reference to "the Credit Agreement", "the Pledge and Security
Agreement," "thereunder", "thereof", "therein" or words of like import referring
to the Credit Agreement or the Pledge and Security Agreement shall mean and be a
reference to the Credit Agreement or the Pledge and Security Agreement, as
applicable, as amended and otherwise modified by the Amendment and (ii) confirms
that the Collateral Documents to which each of the undersigned is a party and
all of the Collateral described therein do, and shall continue to, secure the
payment of all of the Secured Obligations.
BEST MASONRY & TOOL SUPPLY, LP
CHIHUAHUA STONE LLC,
COVOL COAL COMPANY, LLC
COVOL ENGINEERED FUELS, LC,
COVOL SERVICES CORPORATION,
DON'S BUILDING SUPPLY, L.P.,
EAGLE STONE & BRICK LLC,
ELDORADO G-ACQUISITION CO.,
ELDORADO SC-ACQUISITION CO.,
ELDORADO STONE ACQUISITION CO., LLC,
ELDORADO STONE CORPORATION,
ELDORADO STONE FUNDING CO., LLC,
ELDORADO STONE LLC,
ELDORADO STONE OPERATIONS LLC,
GLOBAL CLIMATE RESERVE CORPORATION,
HCM BLOCK & BRICK GENERAL, INC.,
HCM BLOCK & BRICK PARTNER, LLC,
HCM BLOCK & BRICK, LLC,
HCM BLOCK & BRICK, LP,
HCM FLEXCRETE, LP,
HCM MORTAR & STUCCO PARTNER, LLC
HCM MORTAR & STUCCO, INC.
HCM STONE, LLC
HCM UTAH, INC.
HEADWATERS CONSTRUCTION MATERIALS, INC.,
HEADWATERS ENERGY SERVICES CORP.,
HEADWATERS HEAVY OIL, LLC,
HEADWATERS NANOKINETIX, INC.,
HEADWATERS RESOURCES, INC.
HEADWATERS SYNFUEL INVESTMENTS, LLC
HEADWATERS TECHNOLOGY INNOVATION GROUP, INC.,
HYDROCARBON TECHNOLOGIES, INC.,
ISG SERVICES CORPORATION,
L&S STONE LLC,
L-B STONE LLC,
NW PROPERTIES LLC,
NORTHWEST STONE & BRICK CO., INC.,
NORTHWEST STONE & BRICK LLC,
PALESTINE CONCRETE TILE COMPANY, L.P.,
STONECRAFT INDUSTRIES LLC,
TEMPE STONE LLC,
VFL TECHNOLOGY CORPORATION,
each as a Guarantor
By /s/ Steven G. Stewart
-----------------------------------------
Name: Steven G. Stewart
Title: Chief Financial Officer
HCM MORTAR & STUCCO HOLDING, LLC,
as Guarantor
By /s/ Steven G. Stewart
-----------------------------------------
Name: Steven G. Stewart
Title: Manager
TAPCO HOLDINGS, INC.,
TAPCO INTERNATIONAL CORPORATION,
VANTAGE BUILDING PRODUCTS CORPORATION,
MTP, INC.,
ATLANTIC SHUTTER SYSTEMS, INC.,
METAMORA PRODUCTS CORPORATION,
METAMORA PRODUCTS CORPORATION OF ELKLAND,
WAMCO CORPORATION,
BUILDERS EDGE, INC.,
COMACO, INC.,
each as a Guarantor
By /s/ Harlan M. Hatfield
-----------------------------------------
Name: Harlan M. Hatfield
Title: Assistant Secretary