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EXHIBIT 10.45
SECOND AMENDMENT TO
REVOLVING CREDIT AGREEMENT
THIS SECOND AMENDMENT TO REVOLVING CREDIT AGREEMENT (this "Second
Amendment") is made and entered into as of the 26th day of November, 1996, by
and among NORCAL WASTE SYSTEMS, INC., a California corporation (the
"Borrower"), its Subsidiaries (other than the Excluded Subsidiaries)
(collectively, the "Guarantors"), THE FIRST NATIONAL BANK OF BOSTON, a national
banking association (in its individual capacity, "FNBB"), and the other
financial institutions party hereto (collectively, the "Banks"), and FNBB as
the agent for the Banks (in such capacity, the "Agent").
WHEREAS, the Borrower, the Guarantors, the Banks and the Agent entered
into a Revolving Credit Agreement dated as of November 21, 1995 (as heretofore
amended, the "Credit Agreement"), pursuant to which the Banks extended credit
to the Borrower on the terms set forth therein;
WHEREAS, the parties desire to amend the Credit Agreement on the terms
and conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree to amend the Credit Agreement as follows:
1. DEFINITIONS. Capitalized terms used herein without definition
shall have the meanings assigned to such terms in the Credit Agreement.
2. AMENDMENTS TO SECTION 1 OF THE CREDIT AGREEMENT.
(a) Section 1 of the Credit Agreement is hereby amended by
inserting therein the following newly defined terms in the appropriate
alphabetical sequence:
Exchange. Any exchange of assets of a similar type and having
a comparable value, as defined in, and in accordance with, Section
1031 of the Code.
Maintenance Capital Expenditures. With respect to any period
the sum of (a) depreciation expense and (b) amortization expense
recognized in such period in connection with landfills operated by the
Borrower and its Subsidiaries, but only to the extent included in
determining EBITDA for such period.
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(b) Section 1 of the Credit Agreement is further amended
by amending certain defined terms therein as follows:
(i) The defined term "Adjusted EBITDA" is hereby amended
by deleting from the first sentence thereof the phrase "in the event
that the financial statements of such Person have been certified by a
reputable certified public accounting firm and furnished to the Agent"
and replacing it with the phrase "provided that the aggregate EBITDA
of such Persons who have not furnished to the Agent financial
statements certified by a reputable certified public accounting firm
shall in no event exceed ten percent (10%) of Adjusted EBITDA".
(ii) The defined term "Consolidated Cash Flow" is hereby
amended by inserting prior to the words "Capital Expenditures"
appearing in clause (c) thereof the word "Maintenance".
(iii) The defined term "GAAP" is hereby amended by
inserting at the end of such defined term the following new clause:
except with respect to the accounting treatment of
landfill liners which shall be capitalized and amortized based
upon the total expected site costs and annualized utilization
for the applicable period in accordance with the accounting
practices reflected in the consolidated financial statements
of the Borrower and its Subsidiaries as of October 31, 1996.
(iv) The defined term "Indebtedness" is hereby amended by
deleting such definition in its entirety and replacing it with the
following new definition:
Indebtedness. Collectively without duplication,
whether classified as Indebtedness, an Investment or otherwise
on the obligor's balance sheet, (a) all indebtedness for
borrowed money or credit obtained or other similar monetary
obligation, direct or indirect, (b) all obligations for the
deferred purchased price of property or services (other than
trade payables not overdue by more than ninety (90) days
incurred in the ordinary course of business), (c) all
obligations evidenced by notes, bonds, debentures or other
similar debt instruments, (d) all obligations created or
arising under any conditional sale or other title retention
agreement with respect to property acquired (even though the
rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession
or sale of such property), (e) all obligations, liabilities
and indebtedness under Capitalized Leases, (f) all
obligations, contingent
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or otherwise, under acceptance, letter of credit or similar facilities,
(g) all agreements for indemnification, (h) all liabilities or
obligations in respect of judgments or awards against such Person, (i)
all obligations, liabilities or indebtedness (contingent or otherwise)
under surety, performance bonds or any other bonding arrangements, (j)
all Indebtedness of others referred to in clauses (a) through (i) above
which is guaranteed, or in effect guaranteed, directly or indirectly in
any manner, including, without limitation, through an agreement (in
each case with respect to Indebtedness of the type referred to in
clauses (a) through (i) above) (A) to pay or purchase such Indebtedness
or to advance or supply funds for the payment or purchase of such
Indebtedness, (B) to purchase, sell or lease (as lessee or lessor)
property, or to purchase or sell services, primarily for the purpose of
enabling any Person to make payment of such Indebtedness, (C) to supply
funds to or in any other manner invest in any Person (including any
agreement to pay for property or services irrespective of whether such
property is received or such services are rendered but excluding any
contributions to any Employee Benefit Plan or Multiemployer Plan not
otherwise prohibited under the Credit Agreement) or (D) otherwise to
assure any Person against loss, and (k) all Indebtedness referred to in
clauses (a) through (j) above secured or supported by (or for which the
holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured or supported by) any lien or encumbrance on
(or other right of recourse to or against) property (including, without
limitation, accounts and contract rights), even though the owner of the
property has not assumed or become liable, contractually or otherwise,
for the payment of such Indebtedness.
(v) The defined term "Investments" is hereby amended by
deleting the phrase "or other obligation of any other Person" and
replacing it with the phrase "or other payment obligation of any Person
who is not a Borrower or Guarantor".
3. AMENDMENT TO SECTION 7.1(b)(xii) OF THE CREDIT AGREEMENT.
Section 7.1(b)(xii) of the Credit Agreement is hereby amended by deleting said
subsection in its entirety and replacing it with the following new subsection:
(xii) Unsecured Indebtedness incurred in connection with
acquisitions after the date hereof of any stocks of, partnership or
joint venture interests in, or assets of any Person and owing to the
seller(s) of such stocks, partnership or joint venture interests, or
assets; provided that (A) the principal amount of any such
Indebtedness owed (when aggregated with all such other Indebtedness
permitted pursuant to this Section 7.1(b)(xii)) shall not exceed
$25,000,000; (B) the aggregate principal amount of any such
Indebtedness owed by the Guarantors shall not exceed
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$10,000,000; (C) the final maturity of any such Indebtedness owed by
the Borrower shall extend beyond the Maturity Date; (D) the dollar
weighted average life of any such Indebtedness owed by the Borrower
shall exceed the remaining period of time until the Maturity Date; (E)
no such Indebtedness owed by the Borrower shall be guaranteed by any of
the Guarantors; (F) the principal amount of any such Indebtedness owed
by the Borrower with respect to any one such acquisition shall not
exceed $10,000,000; and (G) the principal amount of any such
Indebtedness owed by the Guarantors with respect to any one such
acquisition shall not exceed $2,000,000; and provided, further, that
such acquisition shall be otherwise permitted pursuant to the terms
hereof;
4. AMENDMENT TO SECTION 7.4(d) OF THE CREDIT AGREEMENT. Section
7.4(d) is hereby amended by deleting clause (iv) thereof and replacing it with
the following:
(iv) Exchanges in which the book value of the assets
transferred by the Borrower or any of its Subsidiaries, when
aggregated with the book value of all other Exchanges made by the
Borrower or any Subsidiary in any fiscal year, does not exceed
$10,000,000, provided that no Exchanges of landfills or of stock,
partnership or joint venture interests shall be permitted hereunder,
and (v) sales of assets with a book value which, when aggregated with
the book value of all other assets sales made pursuant to this Section
7.4(d)(v), does not exceed five percent (5%) of Consolidated Total
Assets as set forth in the most recent financial statements delivered
to the Banks pursuant to Section 6.4 hereof.
5. AMENDMENT TO SECTION 7.9 OF THE CREDIT AGREEMENT. Section 7.9
of the Credit Agreement is hereby amended by deleting said section in its
entirety and replacing it with the following new section:
SECTION 7.9. CAPITAL EXPENDITURES. The Borrower AND
its Subsidiaries shall not make or commit to make annual Capital
Expenditures (excluding any acquisition permitted by Section 7.4
hereof but including in the case of Exchanges only the net amount of
cash expended by the Borrower or any of its Subsidiaries, if positive,
in each Exchange) in any fiscal year which are in an amount in excess
of (a) one and six-tenths (1.6) times the sum of depreciation and
landfill amortization expense for such fiscal year, plus (b) THE
AMOUNT OF ANY Capital Expenditures permitted to be made under clause
(a) of this Section 7.9 in the previous fiscal year, which were not
actually made in such fiscal year.
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6. AMENDMENT TO SECTION 8.1 OF THE CREDIT AGREEMENT. Section 8.1
of the Credit Agreement is hereby amended by deleting the table set forth
therein in its entirety and by replacing it with the following new table:
Period Ratio
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Ending 9/30/97 4.00:1
12/31/97 to 9/30/98 3.75:1
12/31/98 to Maturity Date 3.50:1
7. AMENDMENT TO SECTION 8.2 OF THE CREDIT AGREEMENT. Section 8.2
of the Credit Agreement is hereby amended by deleting the table set forth
therein in its entirety and by replacing it with the following new table:
Period Ratio
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Closing Date to 9/30/97 2.00:1
12/31/97 to 9/30/98 2.10:1
12/31/98 to 9/30/99 2.20:1
12/31/99 to Maturity Date 2.30:1
8. AMENDMENTS TO SECTION 12.1 OF THE CREDIT AGREEMENT. Section
12.1 is hereby amended as follows:
(a) Section 12.1(n) of the Credit Agreement hereby
amended by deleting at the end of such subsection the word "or".
(b) Section 12.1(o) of the Credit Agreement is hereby
amended by inserting at the end of such subsection the word "or".
(c) Section 12.1 of the Credit Agreement is hereby
amended by inserting at the end of such section the following new subsection
(p):
(p) if the financial statements, certificates and
information delivered by the Borrower to the Banks pursuant to
Section 6.4(a) with respect to the fiscal year ended September
30, 1996 materially differ, in the reasonable opinion of the
Agent, in any adverse respect from the management prepared
financial information for the fiscal year ended September 30,
1996 delivered to the Banks in connection with the bank
meeting held November 14, 1996.
9. AMENDMENT TO EXHIBIT C OF THE CREDIT AGREEMENT. The Credit
Agreement is hereby further amended by deleting Exhibit C thereto in its
entirety and replacing it with Exhibit C attached hereto.
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10. REPRESENTATIONS AND WARRANTIES. The Borrower and the Guarantors
jointly and severally represent and warrant as follows:
(a) The execution and delivery of this Second Amendment and the
Credit Agreement, as modified by this Second Amendment, and the performance of
the transactions contemplated hereby and thereby (i) are within the corporate
authority of the Borrower and each of the Guarantors, (ii) have been duly
authorized by all necessary corporate proceedings on the part of the respective
Borrower or Guarantor, (iii) do not conflict with or result in any material
breach or contravention of any provision of law, statute, rule or regulation to
which the Borrower or any Guarantor is subject or any judgment, order, writ,
injunction, license or permit applicable to the Borrower or any Guarantor so as
to materially adversely affect the assets, business or any activity of the
Borrower and the Guarantors as a whole, and (iv) do not conflict with any
provision of the corporate charter or bylaws of the Borrower or any Guarantor
or any agreement or other instrument binding upon the Borrower or any
Guarantor. There have been no amendments to the charter documents or bylaws of
the Borrower or any Guarantor since November 21, 1995, except as otherwise
disclosed to the Banks.
(b) The execution and delivery of this Second Amendment and the
Credit Agreement, as modified by this Second Amendment, and the performance of
the transactions contemplated hereby and thereby will result in valid and
legally binding obligations of the Borrower and the Guarantors party thereto
enforceable against each in accordance with the respective terms and provisions
hereof and thereof, except as enforceability is limited by bankruptcy,
insolvency, reorganization, moratorium or other laws relating to or affecting
generally the enforcement of creditors rights and except to the extent that
availability of the remedy of specific performance or injunctive relief is
subject to the discretion of the court before which any proceeding therefor may
be brought.
(c) The execution and delivery by the Borrower and the Guarantors
of this Second Amendment and the Credit Agreement, as modified by this Second
Amendment, and the consummation by the Borrower and the Guarantors of the
transactions contemplated hereby and thereby do not require any approval or
consent of, or filing with, any governmental agency or authority other than
those already obtained.
(d) The representations and warranties contained in the Credit
Agreement or in any document or instrument delivered pursuant to or in
connection with the Credit Agreement or this Second Amendment were true as of
the date as of which they were made and are true at and as of the Effective
Date (as such term is defined in Section 16 hereof) with the same effect as if
made at and as of that time (except that since the date of the Credit Agreement
the Borrower has acquired Butte Disposal & Recycling, Inc., such acquisition
having been previously disclosed to the Banks, and except to the extent of
changes resulting from transactions
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contemplated or permitted by the Credit Agreement and changes occurring in the
ordinary course of business which singly or in the aggregate are not materially
adverse, and to the extent that such representations and warranties relate
expressly and solely to an earlier date).
(e) The Borrower and the Guarantors have performed and complied,
and have caused the Borrower's Subsidiaries to perform and comply, with all
terms and conditions in the Credit Agreement and this Second Amendment,
required to be performed or complied with by them prior to or at the Effective
Date, and no default or event of default or condition which would result in a
default or event of default has occurred and is continuing. Notwithstanding
the foregoing, the Borrower acknowledges that it has not yet delivered to the
Agent the stock of Butte Disposal & Recycling, Inc., and has not yet caused
such new Subsidiary to become a Guarantor under the Credit Agreement and the
other Loan Documents. The Agent and the Banks hereby reserve all of their
rights under the Credit Agreement, including the right to declare an Event of
Default in the event that such actions are not taken as soon as practicable in
accordance with the terms of the Credit Agreement.
11. RATIFICATION, ETC. Except as expressly amended hereby, the
Credit Agreement, the other Loan Documents and all documents, instruments and
agreements related thereto are hereby ratified and confirmed in all respects
and shall continue in full force and effect. Each of the Guarantors hereby
confirms that the guaranty contained in Section 27 of the Credit Agreement and
its Guaranteed Obligations remain in full force and effect. This Second
Amendment and the Credit Agreement shall hereafter be read and construed
together as a single document, and all references in the Credit Agreement, any
other Loan Document or any agreement or instrument related to the Credit
Agreement shall hereafter refer to the Credit Agreement as amended by this
Second Amendment.
12. GOVERNING LAW. THIS SECOND AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS
(WITHOUT REFERENCE TO CONFLICT OF LAWS) AND SHALL TAKE EFFECT AS A SEALED
INSTRUMENT IN ACCORDANCE WITH SUCH LAWS.
13. COUNTERPARTS. This Second Amendment may be executed in any
number of counterparts and by different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an
original, but all of which counterparts taken together shall be deemed to
constitute one and the same instrument.
14. HEADINGS. Headings or captions used in this Second Amendment are
for convenience of reference only and shall not define or limit the provisions
hereof.
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15. EXPENSES. The Borrower and the Guarantors hereby jointly and
severally agree to pay to the Agent, on demand by the Agent, all reasonable
out-of-pocket costs and expenses incurred or sustained by the Agent in
connection with the preparation of this Second Amendment (including reasonable
legal fees).
16. EFFECTIVENESS. This Second Amendment shall become effective
upon the satisfaction of each of the following conditions (the "Effective
Date"):
(a) This Second Amendment shall have been executed and delivered
by the Borrower, the Guarantors, the Agent and the Majority Banks; and
(b) The Borrower shall have paid to the Agent for the pro-rata
accounts of each Bank who has executed and delivered this Second Amendment on
or before November 26, 1996 an amendment fee in the amount of $1,000 times such
Bank's Commitment Percentage.
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IN WITNESS WHEREOF, the parties have executed this Second Amendment
under seal as of the date first above written.
THE BORROWER:
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NORCAL WASTE SYSTEMS, INC.
By: /s/ XXXXXXX X. XXXXXXXXXX
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Xxxxxxx X. Xxxxxxxxxx
President
THE GUARANTORS:
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ALTA ENVIRONMENTAL SERVICES, INC.
ALTA EQUIPMENT LEASING CO., INC.
AUBURN PLACER DISPOSAL SERVICE
B & J DROP BOX
BUONATERRA, INC.
CITY GARBAGE COMPANY OF EUREKA
CONSOLIDATED ENVIRONMENTAL
INDUSTRIES, INC.
DEL NORTE DISPOSAL, INC.
DEL NORTE RECOVERY, INC.
XXXXX SANITARY SERVICE
ENVIROCAL, INC.
EXCEL ENVIRONMENTAL, INC.
FOOTHILL DISPOSAL CO., INC.
GOLDEN GATE DISPOSAL &
RECYCLING COMPANY
INTEGRATED ENVIRONMENTAL
SYSTEMS, INC.
LOS ALTOS GARBAGE COMPANY
MACOR, INC.
XXXXX LAND RECLAMATION
COMPANY, INC.
By: /s/ XXXXXXX X. XXXXXXXXXX
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Xxxxxxx X. Xxxxxxxxxx
President
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NORCAL/SAN BERNARDINO,INC.
NORCAL/SAN DIEGO, INC.
NORCAL WASTE SERVICES OF
SACRAMENTO, INC.
NORCAL WASTE SOLUTIONS, INC.
OROVILLE SOLID WASTE DISPOSAL, INC.
SAN BRUNO GARBAGE CO., INC.
SANITARY FILL COMPANY
SOUTH VALLEY REFUSE DISPOSAL, INC.
SOUTHERN HUMBOLDT DISPOSAL
SERVICE, INC.
SUNSET PROPERTIES, INC.
SUNSET SCAVENGER COMPANY
VACAVILLE SANITARY SERVICE
VALLEJO GARBAGE SERVICE, INC.
WEST COAST RECYCLING CO.
WESTERN PLACER RECOVERY COMPANY
YUBA XXXXXX DISPOSAL, INC.
ZANKER ROAD RESOURCE
MANAGEMENT CO.
By: /s/ XXXXXXX X. XXXXXXXXXX
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Xxxxxxx X. Xxxxxxxxxx
President
TRI-COUNTY DEVELOPMENT CO., a
general partnership
By: NORCAL WASTE SYSTEMS, INC.,
General Partner
By: /s/ XXXXXXX X. XXXXXXXXXX
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Xxxxxxx X. Xxxxxxxxxx
President
By: ENVIROCAL, INC., General Partner
By: /s/ XXXXXXX X. XXXXXXXXXX
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Xxxxxxx X. Xxxxxxxxxx
President
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VACAVILLE FILL, a general partnership
By: ALTA ENVIRONMENTAL
SERVICES, INC., General Partner
By: /s/ XXXXXXX X. XXXXXXXXXX
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Xxxxxxx X. Xxxxxxxxxx
President
By: B & J DROP BOX, General Partner
By: /s/ XXXXXXX X. XXXXXXXXXX
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Xxxxxxx X. Xxxxxxxxxx
President
THE BANKS AND AGENT:
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THE FIRST NATIONAL BANK OF
BOSTON, individually and as Agent
By: /s/ XXXXXXX X. XXXXXXX
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Xxxxxxx X. Xxxxxxx
Vice President
THE BANK OF NOVA SCOTIA
By: /s/ XXXX X. XXXXXX
---------------------------------
Xxxx X. Xxxxxx
Relationship Manager
BANQUE PARIBAS
By: /s/ XXXXX XXXXX
---------------------------------
Xxxxx Xxxxx
Assistant Vice President
By: /s/ XXXXXXX X. XXXXXXX
---------------------------------
Xxxxxxx X. Xxxxxxx
General Partner
Western Region
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BHF-BANK AKTIENGESELLSCHAFT
By: /s/ XXXXX XXXXXX
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Xxxxx Xxxxxx
Vice President
By: /s/ XXX DOBRJANSKYI
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Xxx Dobrjanski
Assistant Treasurer
THE LONG-TERM CREDIT BANK OF
JAPAN, LTD.
By: /s/ XXXX XXXXXXXX
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Xxxx Xxxxxxxx
Vice President
By: /s/ T. XXXXXX XXXXXXX XX
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T. Xxxxxx Xxxxxxx XX
Deputy General Manager
UNION BANK OF CALIFORNIA, N.A.
By: /s/ XXXXX XXXXXXXXXX
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Xxxxx Xxxxxxxxxx
Vice President
XXXXX FARGO BANK, N.A.
By: /s/ XXXXX X. XXXXX
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Xxxxx X. Xxxxx
Vice President
