EXHIBIT 10.43
SEVENTH AMENDMENT
TO
CREDIT AGREEMENT
By and Among
RAILTEX, INC.,
THE SEVERAL FINANCIAL INSTITUTIONS
PARTY TO THIS AGREEMENT,
and
XXXXX FARGO BANK (TEXAS),
NATIONAL ASSOCIATION,
As Agent
Dated as of November 2, 1998
SEVENTH AMENDMENT TO CREDIT AGREEMENT
This is the Seventh Amendment (the "AMENDMENT"), dated as of November 2,
1998, to a Credit Agreement, dated as of May 17, 1996, among Xxxxx Fargo Bank
(Texas), National Association (formerly known as First Interstate Bank of Texas,
N.A.), individually and as Agent (in its capacity as agent, the "AGENT"),
National Bank of Canada, New York Branch, ABN Amro Bank, N.V. -Houston Agency,
National City Bank of Kentucky (collectively, the "LENDERS") and RailTex, Inc.
(the "BORROWER") and previously amended by amendments dated as of June 1, 1996,
July 22, 1996, August 13, 1996, December 3, 1996, November 14, 1997 and
September 4, 1998 (as amended, the "AGREEMENT").
The Borrower has requested that the Agent and the Lenders (i) waive any
Default or Event of Default related to Borrower's failure to comply as of July
31, 1998 with the limit on capital expenditures set forth in Section 6.13 (the
"WAIVER"), (ii) consent to a sale of a portion of the Borrower's investments
made with proceeds of the Brazilian Acquisition Loans, (iii) amend the limit on
capital expenditures set forth in Section 6.13, and (iv) amend Section 6.5
regarding dispositions of assets in order to permit the Borrower to participate
in certain tax-free exchanges under Section 1031 of the Code (as defined in the
Agreement). Subject to the terms and conditions herein contained, the Agent and
the Lenders are willing to amend the Agreement as set forth below in this
amendment.
In consideration of the following Recitals, for $10 in hand paid and for
other good and valuable considerations, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows, intending to be legally
bound:
Section 1. CERTAIN DEFINED TERMS. Capitalized terms used but not defined
herein have the meanings ascribed to them in the Agreement.
Section 2. WAIVER. Subject to the terms of this Amendment, the Agent and
the Lenders hereby grant the Waiver. The Waiver is limited as set forth herein
and shall not constitute a modification, acceptance or waiver of any other
provision of the Agreement or any other Loan Document. The Agent's and the
Lenders' Waiver shall not constitute and shall not be deemed to constitute a
waiver of any other Event of Default or Default.
Section 3. CONSENT. The Borrower desires to (i) sell approximately 49.5%
of the Borrower's investments made with the proceeds of Brazilian Acquisition
Loans for a price of $11,000,000 (the "TRANSACTION"), and (ii) apply the net
proceeds of the Transaction to reduce outstanding Acquisition Loans or the
Revolving Loans, at the option of the Borrower. The Transaction is not permitted
under the Agreement without the prior written consent of the Majority Lenders
and the Borrower requests that the Majority Lenders (i) consent to the
Transaction, (ii) waive SECTION 6.5(IV) and SECTION 3.5(A) of the Agreement in
connection with the Transaction, and (iii) waive any Default or Event of Default
that would occur as a result thereof (the "REQUESTED CONSENT"). The Agent and
the Lenders grant the Requested Consent
on the express condition that the Borrower applies the net proceeds of the
Transaction to the Obligations as set forth in Section 4 below.
Section 4. BORROWER'S AGREEMENT. As an inducement for the Agent and the
Lenders to give the Required Consent to the Transaction, the Borrower covenants
and agrees as follows, intending to be legally bound:
(i) contemporaneously with the receipt of net proceeds of the Transaction,
the Borrower shall cause the same to be used to reduce either the Acquisition
Loans or the Revolving Loans, or both; and
(ii) except with respect to the Requested Consent, all of the terms and
provisions of the Loan Documents remain in full force and effect.
Section 5. AMENDMENTS. The Agreement is amended as follows:
(i) The definition of "Capital Expenditure Amount Limit" in Section 1.1 of
the Agreement is amended and restated in its entirety as follows:
"CAPITAL EXPENDITURE AMOUNT LIMIT" means $27,000,000.
(ii) Section 3.5(a) of the Agreement is amended by adding the following
language at the end of such subsection:
Notwithstanding the foregoing, if the Borrower sells assets in
connection with an anticipated tax-free exchange permitted under
Section 6.5 hereof, the Borrower shall not be required to make a
mandatory prepayment with the proceeds received from any such sale
so long as the Borrower is diligently pursuing reinvestment of the
proceeds in a like-kind purchase in accordance with the requirements
of Section 1031 of the Code; PROVIDED, however, that during such
time period, the proceeds must be placed in a trust or escrow
arrangement for the benefit of the Agent, and further provided that,
if the Borrower has not reinvested the proceeds in a like-kind
purchase within 180 days of sale, the Borrower shall make a
mandatory prepayment as required by this Section 3.5(a).
(iii) The second proviso in Section 6.5 of the Agreement is amended and
restated in its entirety as follows:
PROVIDED, HOWEVER, that (A) the Borrower may contribute its Property
to wholly-owned Subsidiaries engaged principally in
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domestic United States operations, (B) the Borrower or its
Subsidiaries may contribute, at book value not to exceed
$15,000,000, locomotives to RailTex International provided that the
same are reacquired at book value, within 10 days after the date of
the funding of the Brazilian Acquisition Loans by RailTex
International, and (C) the Borrower may participate in tax-free
exchanges in accordance with Section 1031 of the Code with respect
to the sale of parcels of real estate acquired in connection with
the acquisition of shortline railroads that are not necessary or
useful for the operation of the railroad being acquired or the
Borrower's or any Subsidiary's business.
Section 6. CONDITIONS PRECEDENT. The effectiveness of this Amendment
is subject to the following conditions precedent:
(i) Receipt by the Agent of fully signed counterparts of this
Amendment; and
(ii) Delivery of such other documents from the Borrower as the Agent
shall reasonably request.
Section 7. RATIFICATION OF CONTINUED FORCE AND EFFECT. Except as
specifically amended herein, all of the terms and conditions of the Agreement
and all of the Loan Documents executed in connection therewith or contemplated
thereby are and remain in full force and effect in accordance with their
respective terms. All of the terms used herein have the same meanings as set out
in the Agreement, unless amended hereby or unless the context clearly required
otherwise. References in the Agreement to the "Agreement," and the "Credit
Agreement," "hereof," "herein" and the words of similar import shall be deemed
to be references to the Agreement as amended through the Effective Date. Any
reference in any Note or any other Loan Documents to the "Credit Agreement"
shall be deemed to be references to the Agreement as amended through the
Effective Date.
Section 8. APPLICABLE LAW. This Amendment and all other Loan Documents
executed pursuant hereto shall be deemed to have been made and to be performable
in Houston, Xxxxxx County, Texas and shall be governed by and construed in
accordance with the laws of the State of Texas.
Section 9. SUCCESSORS AND ASSIGNS. This Amendment is binding upon and
shall inure to the benefit of the Lenders, the Agent and the Borrower and their
respective successors and assigns, except the Borrower may not assign or
transfer any of its rights or obligations hereunder without the prior written
consent of the Lenders and the Agent.
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Section 10. COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original,
but all of which when taken together shall constitute one and the same
instrument.
Section 11. EFFECT OF CONSENT AND WAIVER. No consent or waiver, express or
implied, by any Lender or the Agent to or for any breach of or deviation from
any covenant, condition or duty by the Borrower shall be deemed a consent or
waiver to or of any other breach of the same or any other covenant, condition or
duty.
Section 12. HEADINGS. The headings, captions, and arrangements used in
this Amendment are for convenience only and shall not affect the interpretation
of this Amendment.
Section . NON-APPLICATION OF CHAPTER 346 OF TEXAS FINANCE CODE. The
provisions of Chapter 346 of the Texas Finance Code are specifically declared by
the parties not to be applicable to this Amendment or any of the Loan Documents
or the transactions contemplated hereby.
Section 14. ENTIRE AGREEMENT. THIS AMENDMENT, THE AGREEMENT AND ALL OTHER
INSTRUMENTS, DOCUMENTS, AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION WITH
THIS AMENDMENT REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES HERETO MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES HERETO.
[Balance of this page intentionally left blank.]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed and delivered effective as of the date first written above.
BORROWER:
RAILTEX, INC. Address: 0000 Xxxxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxx 00000
Attn: Xxx Xxxxxx
Telephone No. (000) 000-0000
By:/s/XXXXXX X. XXXXXX Telecopy No. (000) 000-0000
Xxxxxx X. Xxxxxx
Treasurer
AGENT:
XXXXX FARGO BANK (TEXAS), Domestic Lending Office and
NATIONAL ASSOCIATION Eurodollar Lending Office
Address: 000 X. Xx. Xxxx'x Xxxxxx
Xxxxx 000
By:/s/XXXXXX X. XXXXXX San Antonio, Texas 78205
Xxxxxx X. Xxxxxx Attn: Xxxxxx X. Xxxxxx
Vice President Telephone No. (000) 000-0000
Telecopy No. (000) 000-0000
LENDERS:
XXXXX FARGO BANK (TEXAS), Domestic Lending Office and
NATIONAL ASSOCIATION Eurodollar Lending Office
Address: 000 X. Xx. Xxxx'x Xxxxxx
Xxxxx 000
Xxx Xxxxxxx, Xxxxx 00000
Attn: Xxxxxx X. Xxxxxx
Vice President
Telephone No. (000) 000-0000
By:/s/XXXXXX X. XXXXXX Telecopy No. (000) 000-0000
Xxxxxx X. Xxxxxx
Vice President
NATIONAL BANK OF CANADA, Domestic Lending Office and
NEW YORK BRANCH Eurodollar Lending Office
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By:/s/XXXXX X. XXXXX Address: National Bank of Canada,
Xxxxx X. Xxxxx New York Branch
Vice President and Manager 000 X. 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
With a copy to:
and
By:/s/XXXXXXX XXXXX National Bank of Canada
Xxxxxxx Xxxxx 0000 Xxx Xxxxxxx, Xxxxx 0000
Vice President Xxxxxx, Xxxxx 00000
Attn: Mr. Xxxxxxx Xxxxx
Vice President
Telephone No. (000) 000-0000
Telecopy No. (000) 000-0000
ABN AMRO BANK, N.V. Domestic Lending Office and
Eurodollar Lending Office
Address: ABN AMRO Bank, N.V.
By:/s/XXXXXX X. XXXX 000 X. XxXxxxx Xx., Xxxxx 000
Xxxxxx X. Xxxx Xxxxxxx, Xxxxxxxx 00000
Group Vice President ATTN: Loan Administrator
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
With a copy to:
and
By:/s/XXXX X. XXXXXXXXXXXXX
Xxxx X. Xxxxxxxxxxxxx ABN AMRO Bank, N.V.
Assistant Vice President Xxxxx Xxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Xxxxxx X. Xxxx
Telephone No. (000) 000-0000
Telecopy No. (000) 000-0000
NATIONAL CITY BANK OF KENTUCKY Domestic Lending Office and
Eurodollar Lending Office
Address: 000 Xxxxx Xxxxx Xxxxxx
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By:/s/XXXXXX X. XXXXXX, XX. Xxxxxxxxxx, Xxxxxxxx 00000
Xxxxxx X. Xxxxxx, Xx. Attn: Xxxxxx X. Xxxxxx, Xx.
Vice President Telephone No. (000) 000-0000
Telecopy No. (000) 000-0000
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