LIMITED WAIVER AGREEMENT
Exhibit
10.10.2.2
THIS
LIMITED WAIVER AGREEMENT (this “Waiver”), dated as of
April 13, 2009, is made among (i) BUILDING MATERIALS HOLDING
CORPORATION, a Delaware corporation (“Holdings”), as
borrower, (ii) BMC WEST CORPORATION, a Delaware corporation (the “Company”), and
certain other affiliates of Holdings, as guarantors, (iii) the Lenders
party to the Credit Agreement referenced below, and (iv) XXXXX FARGO BANK,
NATIONAL ASSOCIATION (“Xxxxx Fargo”), as the
L/C Issuer, the Swingline Lender and the administrative agent for the Lenders
(in such capacity, the “Administrative
Agent”).
A. WHEREAS,
Holdings, the Company and the other Guarantors, the Lenders and the
Administrative Agent are parties to a Second Amended and Restated Credit
Agreement, dated as of November 10, 2006, as amended by that certain First
Amendment to Second Amended and Restated Credit Agreement, dated as of
February 29, 2008, and that certain Second Amendment to Second Amended and
Restated Credit Agreement, dated as of September 30, 2008 (as so amended and as
further amended, restated, supplemented or otherwise modified from time to time,
the “Credit
Agreement”).
B. WHEREAS,
by written notice dated April 6, 2009 (the “Notice Letter”),
Holdings notified the Administrative Agent of certain potential or actual
Defaults under the Credit Agreement as more specifically described in such
Notice Letter, a copy of which is attached hereto as Exhibit A (such
Defaults specified in the Notice Letter, the “Specified
Defaults”).
C. WHEREAS,
as a result of such Specified Defaults, (i) Holdings may be unable to request
additional Credit Extensions under the Credit Agreement, inasmuch as Holdings
may be unable to satisfy the conditions precedent to such Credit Extensions
under Section 5.03 of
the Credit Agreement, and (ii) Holdings may be unable to dispose of assets as
may otherwise be permitted under Section 8.02(h) of
the Credit Agreement, inasmuch as clause (i) of such Section 8.02(h)
requires that at the time of any such disposition no Event of Default shall
exist.
D. WHEREAS,
pursuant to the terms and conditions of that certain Limited Waiver Agreement
dated as of March 11, 2009 (the “Limited Waiver
Agreement”), the Majority Lenders agreed to a limited waiver until April
15, 2009, of (i) the conditions precedent to additional Credit Extensions set
forth in Sections 5.03(b),
5.03(c) and
5.03(d), so
that, subject to availability under the Borrowing Base, Holdings may continue to
have access to Revolving Loans of up to a maximum aggregate principal amount of
$20,000,000, notwithstanding the existence of the Specified Defaults, and (ii)
the requirement under clause (i) of Section 8.02(h) that
no Event of Default shall exist at the time of any disposition otherwise
permitted under such Section 8.02(h) so
that Holdings may continue to pursue asset sales, notwithstanding the existence
of the Specified Defaults, the proceeds of which shall be applied to prepay the
Term B Loans in accordance with Section 2.08(a)(iii)
of the Credit Agreement.
E. WHEREAS,
in order to allow further discussions with the Administrative Agent and the
Lenders with respect to the Specified Defaults, Holdings has asked that the
Waiver Termination Date be extended to June 1, 2009.
F. WHEREAS,
the Majority Lenders have agreed to such request, subject to the terms and
conditions hereof.
Accordingly,
the parties hereto agree as follows:
SECTION
1 Definitions;
Interpretation.
(a) Terms Defined in Credit
Agreement. All capitalized terms used in this Waiver
(including in the preamble and recitals hereof) and not otherwise defined herein
shall have the meanings assigned to them in the Credit Agreement.
(b) Interpretation. The
rules of interpretation set forth in Section 1.02 of
the Credit Agreement shall be applicable to this Waiver and are incorporated
herein by this reference.
SECTION
2 Limited
Waiver.
(a) Waiver. Subject
to the terms and conditions of this Waiver, the Majority Lenders hereby
temporarily waive (i) the requirements of Section 7.01(a) of
the Credit Agreement with respect to the audited consolidated financial
statements of Holdings and its Subsidiaries as at December 31, 2008, insofar as
such Section requires that such financial statements be accompanied by an audit
report and opinion that is not subject to any “going concern” or like
qualification or exception, (ii) the requirements of Section 7.01(d) and 7.02(b)
to deliver by the dates specified in such Sections certain updated business
plans, financial forecasts and projections of Holdings, (iii) the requirements
of Section
8.02(h)(i) of the Credit Agreement, (iv) the requirements of Section 8.19(b) of
the Credit Agreement for the month ended February 28, 2009, the month ended
March 31, 2009, the month ending April 30, 2009, and the month ending May 31,
2009, (v) the requirements of Sections 5.03(b),
5.03(c) and
5.03(d) of the
Credit Agreement with respect to additional Revolving Loans requested by
Holdings on or after the Effective Date (as defined in Section 3 below),
(vi) the certifications required under paragraphs (a), (b) and (c) of any Notice
of Borrowing with respect to additional Revolving Loans requested by Holdings on
or after the Effective Date (as defined in Section 3 below), in
the case of each of the preceding clauses (i), (ii), (iii), (iv), (v) and (vi),
insofar as such requirements or certifications cannot be satisfied due solely to
the occurrence of the Specified Defaults, and (vii) the right to exercise
default remedies pursuant to the Loan Documents or applicable law arising solely
as a result of the existence of the Specified Defaults; provided, that (1)
such temporary waiver shall terminate on the earlier to occur of (A) the
occurrence of an Event of Default (other than the Specified Defaults) and (B)
5:00 p.m. (Pacific time) on June 1, 2009 (the earliest to occur of (A) and (B),
the “Waiver
Termination Date”), (2) the Effective Amount of all Revolving Loans shall
not exceed $20,000,000 in the aggregate at any time outstanding, subject to
availability under the Borrowing Base, and (3) Holdings shall not, and shall not
permit any of its Subsidiaries to, make any Capital Expenditures in excess of,
on a consolidated basis, $500,000 from and after the Effective Date through the
Waiver Termination Date.
(b) Milestones. This
Waiver is further conditioned upon the completion of the following events by
such time as the Administrative Agent and Holdings shall have separately agreed
(collectively, the “Milestones”):
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(i) Tax
Return. The Loan Parties shall have made all necessary or
advisable tax filings required by Section 7.22 of the
Credit Agreement in order to pursue all available Tax Refund
Proceeds.
(ii) Revised Business
Plan. The Loan Parties shall have delivered to the
Administrative Agent a revised business plan.
The
failure to achieve any one of these Milestones by the specified time shall, at
the discretion of the Administrative Agent and the Majority Lenders, upon
written notice to Holdings, (A) constitute an immediate Event of Default under
the Loan Documents, and (B) cause the immediate termination of the waiver
provided in Section
2(a).
(c) References Within Credit
Agreement. Each reference in the Credit Agreement to “this
Agreement” and the words “hereof,” “herein,” “hereunder,” or words of like
import, shall mean and be a reference to the Credit Agreement as supplemented by
this Waiver.
SECTION
3 Conditions of
Effectiveness. The effectiveness of Section 2 of
this Waiver shall be subject to the satisfaction of each of the following
conditions precedent (the date on which such conditions are satisfied, the
“Effective
Date”):
(a) Execution. The
Administrative Agent shall have received (i) from Holdings, the Company and
each other Guarantor a duly executed original of this Waiver (or, if elected by
the Administrative Agent, a facsimile or PDF copy of such executed Waiver), and
(ii) from the Majority Lenders duly executed original written consents to
this Waiver (or, if elected by the Administrative Agent, facsimile or PDF copies
of such executed consents) authorizing the Administrative Agent to execute and
deliver this Waiver on the Majority Lenders’ behalf.
(b) Fees and
Expenses. Holdings shall have paid (i) the Waiver
Fee referenced below, and (ii) all invoiced costs and expenses then due in
accordance with Section 8(d) of
this Waiver.
(c) Additional Closing Documents
and Actions. The Administrative Agent shall have received the
following, in form and substance satisfactory to it: a certificate of a
Responsible Officer of Holdings and the Company, stating that (i) the
representations and warranties contained in Section 4 of
this Waiver are true and correct on and as of the Effective Date, and
(ii) on and as of the Effective Date, no Default shall have occurred and be
continuing other than the Specified Defaults.
(d) Representations and
Warranties; No Default. On the Effective
Date (i) the representations and warranties contained in Section 4 of
this Waiver shall be true and correct on and as of the Effective Date as though
made on and as of such date; and (ii) no Default shall have occurred and be
continuing other than the Specified Defaults.
(e) Additional
Documents. The Administrative Agent shall have received, in
form and substance satisfactory to it, such additional approvals, opinions,
documents and other information as the Administrative Agent or the Majority
Lenders (through the Administrative Agent) may reasonably request.
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SECTION
4 Representations and
Warranties. To induce the Lenders to enter into this Waiver,
Holdings, the Company and each other Loan Party hereby represents and warrants
to the Administrative Agent and the Lenders that all representations and
warranties made by each such Person in Article VI of the
Credit Agreement and in the other Loan Documents are true and correct on and as
of the date hereof, except for any inaccuracy of the representations and
warranties in Section
6.06 or Section
6.11(b) resulting from the existence of the Specified
Defaults. For the purposes of this Section 4, (i) each
reference in Article
VI of the Credit Agreement to “this Agreement,” and the words “hereof,”
“herein,” “hereunder,” or words of like import in such Article, shall mean and
be a reference to the Credit Agreement as supplemented by this Waiver, and each
reference in such Article to “the Loan Documents” shall mean and be a reference
to the Loan Documents as supplemented as contemplated hereby, (ii) Section 6.11 of
the Credit Agreement shall be deemed instead to refer to the last day of the
most recent fiscal quarter and fiscal year for which financial statements have
then been delivered, and (iii) any representations and warranties which
relate solely to an earlier date shall not be deemed confirmed and restated as
of the date hereof (provided that such
representations and warranties shall be true and correct as of such earlier
date).
SECTION
5 Waiver
Fee. Holdings shall pay to Administrative Agent, for the
account of each Lender that approves this Waiver, a waiver fee in the amount of
(x) 10 basis points multiplied by
(y) (1) the Revolving Commitment plus (2) the
outstanding principal amount of Term B Loans of each such Lender that approves
this Waiver (the “Waiver
Fee”). Such Waiver Fee shall be fully earned on the Effective
Date and shall be paid only to those Lenders that approve this Waiver by
returning to the Administrative Agent a written consent to this Waiver by no
later than 5:00 p.m. New York time on April 13, 2009.
SECTION
6 Reaffirmation of Liens and
Guarantees.
(a) Each Loan
Party hereby reaffirms that the Liens granted to the Administrative Agent, for
itself and on behalf of and for the ratable benefit of the other Secured
Parties, under the Security Agreement and the other Collateral Documents remain
in full force and effect and constitute, and shall constitute on and after the
Effective Date, valid and perfected Liens on the Collateral (subject only to
Permitted Liens) to secure the Secured Obligations. As used herein,
“Secured Parties” and “Secured Obligations” shall have the meanings given to
such terms in the Security Agreement.
(b) Each of
the undersigned Guarantors, in its capacity as a Guarantor, does hereby consent
to this Waiver and to the documents and agreements referred to herein, and
nothing herein shall in any way limit any of the terms or provisions of the
Guaranty of such Guarantor or the Collateral Documents executed by such
Guarantor or any other Loan Document executed by such Guarantor (as the same may
be amended from time to time), all of which are hereby ratified and affirmed in
all respects.
SECTION
7 Release.
(a) Holdings
and each other Loan Party hereby absolutely and unconditionally waives,
releases, remises and forever discharges the Administrative Agent and the
Lenders, and any and all of their respective participants, members, related
funds, parent corporations, subsidiary corporations, affiliated corporations,
insurers, indemnitors, successors and assigns thereof, together with all of the
present and former directors, officers, agents and employees of any of the
foregoing (each a “Released Party”),
from any and all claims, suits, investigations, proceedings, demands,
obligations, liabilities, damages, losses, costs, expenses, or causes of action
of any kind, nature or description, whether based in law, equity, contract,
tort, implied or express warranty, strict liability, criminal or civil statute,
common law, or under any state or federal law or otherwise, of any kind or
character, known or unknown, past or present, liquidated or unliquidated,
suspected or unsuspected, matured or unmatured, known or unknown, in each case,
which Holdings or such other Loan Party has had, now has, or has made claim to
have against any such Released Party for or by reason of any act, omission,
matter, cause or thing whatsoever which relates, directly or indirectly to the
Credit Agreement or any other Loan Document, provided, however, that the
foregoing shall not effect or otherwise constitute a release of any duties or
obligations set forth in this Waiver, the Credit Agreement or the other Loan
Documents. It is the intention of Holdings and each other Loan Party
in providing this release that the same shall be effective as a bar to each and
every claim, demand and cause of action specified, and in furtherance of this
intention it waives and relinquishes all rights and benefits under Section 1542
of the Civil Code of the State of California (or any comparable provision of any
other applicable law), which provides:
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“A
GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH A CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER, MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.”
Holdings
and each other Loan Party acknowledges that it may hereafter discover facts
different from or in addition to those now known or believed to be true with
respect to such claims, demands, or causes of action and agrees that this
instrument shall be and remain effective in all respects notwithstanding any
such differences or additional facts. Holdings and each other Loan
Party understands, acknowledges and agrees that the release set forth above may
be pleaded as a full and complete defense and may be used as a basis for an
injunction against any action, suit or other proceeding which may be instituted,
prosecuted or attempted in breach of the provisions of such
release.
(b) Holdings
and each other Loan Party, on behalf of itself and its successors, assigns, and
other legal representatives, hereby absolutely, unconditionally and irrevocably,
covenants and agrees with and in favor of each Released Party above that it will
not xxx (at law, in equity, in any regulatory proceeding or otherwise) any
Released Party on the basis of any claim released, remised and discharged by
such Person pursuant to the above release. Holdings and each other
Loan Party further agrees that it shall not dispute the validity or
enforceability of the Credit Agreement or any of the other Loan Documents or any
of its obligations thereunder, or the validity, priority, enforceability or the
extent of Administrative Agent’s Lien on any item of Collateral under the Credit
Agreement or the other Loan Documents. If Holdings or any other Loan
Party or any of its successors, assigns or other legal representations violates
the foregoing covenant, such Person, for itself and its successors, assigns and
legal representatives, agrees to pay, in addition to such other damages as any
Released Party may sustain as a result of such violation, all reasonable
attorneys’ fees and costs incurred by such Released Party as a result of such
violation.
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SECTION
8 Miscellaneous.
(a) Notice. Subject
to Section
11.07 of the Credit Agreement, the Administrative Agent shall notify
Holdings, the Company and the Lenders of the occurrence of the Effective Date
and promptly thereafter distribute to Holdings, the Company and the Lenders
copies of all documents delivered under Section 3 of
this Waiver.
(b) Credit Agreement Otherwise
Not Affected. Except as expressly waived pursuant hereto, the
Credit Agreement and the other Loan Documents shall remain unchanged and in full
force and effect and are hereby ratified and confirmed in all
respects. The Lenders’ and the Administrative Agent’s execution and
delivery of, or acceptance of, this Waiver and any other documents and
instruments in connection herewith (collectively, the “Waiver Documents”)
shall not be deemed to create a course of dealing or otherwise create any
express or implied duty by any of them to provide any other or further
amendments, consents or waivers in the future.
(c) No
Reliance. Each of Holdings, the Company and each other
Guarantor hereby acknowledges and confirms to the Administrative Agent and the
Lenders that it is executing this Waiver and the other Waiver Documents on the
basis of its own investigation and for its own reasons without reliance upon any
agreement, representation, understanding or communication by or on behalf of any
other Person.
(d) Costs and
Expenses. Holdings agrees to pay to the Administrative Agent
on demand the reasonable out-of-pocket costs and expenses of the Administrative
Agent, and the reasonable fees and disbursements of counsel to the
Administrative Agent, in connection with the negotiation, preparation, execution
and delivery of this Waiver and any other documents to be delivered in
connection herewith.
(e) Binding
Effect. This Waiver shall be binding upon, inure to the
benefit of and be enforceable by Holdings, the Company and each other Guarantor,
the Administrative Agent and each Lender and their respective successors and
assigns.
(f) Governing
Law. THIS
WAIVER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF CALIFORNIA.
(g) Complete Agreement;
Amendments. This Waiver, together with the other Waiver
Documents and the other Loan Documents, contains the entire and exclusive
agreement of the parties hereto and thereto with reference to the matters
discussed herein and therein. This Waiver supersedes all prior
commitments, drafts, communications, discussion and understandings, oral or
written, with respect thereto. This Waiver may not be modified,
amended or otherwise altered except in accordance with the terms of Section 11.01 of
the Credit Agreement.
(h) Severability.
Whenever possible, each provision of this Waiver shall be interpreted in such
manner as to be effective and valid under all applicable laws and
regulations. If, however, any provision of this Waiver shall be
prohibited by or invalid under any such law or regulation in any jurisdiction,
it shall, as to such jurisdiction, be deemed modified to conform to the minimum
requirements of such law or regulation, or, if for any reason it is not deemed
so modified, it shall be ineffective and invalid only to the extent of such
prohibition or invalidity without affecting the remaining provisions of this
Waiver, or the validity or effectiveness of such provision in any other
jurisdiction.
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(i) Counterparts. This
Waiver 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 instrument.
(j) Loan
Documents. This Waiver and the other Waiver Documents shall
constitute Loan Documents.
(k) Reservation of
Rights. The Administrative Agent and the Lenders continue to
evaluate their response to the Specified Defaults, and, except as specifically
set forth in Section
2 above, nothing contained in this Waiver is intended to or shall be
construed as a waiver or forbearance of any of the rights, remedies, and powers
of the Administrative Agent or any Lender or against the Borrower, any Guarantor
or the Collateral, or a waiver of any Defaults or Events of Default, whether
specified herein or otherwise, as an agreement to continue to make Credit
Extensions to the Borrower under the Credit Agreement except as specifically set
forth in Section
2 above, or a consent to any departure by the Borrower or any Guarantor
from the express provisions of the Credit Agreement and the other Loan
Documents. The Administrative Agent and each Lender hereby expressly
reserves all of its remedies, powers, rights and privileges under the Credit
Agreement and the other Loan Documents, at law (including under the Uniform
Commercial Code), in equity or otherwise. Please be advised that
neither the Administrative Agent nor the Lenders has any obligation to forbear
from enforcing its rights and remedies with respect to any Default or Event of
Default, other than in respect of the Specified Defaults (but then only until
the Waiver Termination Date). Any forbearance must be in writing and
agreed to by the Administrative Agent and the requisite Lenders.
[Signature
Pages Follow]
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IN
WITNESS WHEREOF, the parties hereto have duly executed this Waiver, as of the
date first above written.
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THE
BORROWER
By
Name:
Title:
THE
GUARANTORS
BMC
WEST CORPORATION
By
Name:
Title:
SELECTBUILD
CONSTRUCTION, INC.
By
Name:
Title:
SELECTBUILD
NORTHERN CALIFORNIA, INC.
By
Name:
Title:
SELECTBUILD
DISTRIBUTION, INC.
By
Name:
Title:
|
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C
CONSTRUCTION, INC.
By
Name:
Title:
TWF
CONSTRUCTION, INC.
By
Name:
Title:
H.N.R.
FRAMING SYSTEMS INC.
By
Name:
Title:
SELECTBUILD,
L.P.
By
Name:
Title:
SELECTBUILD
SOUTHERN CALIFORNIA, INC.
By
Name:
Title:
SELECTBUILD
NEVADA, INC.
By
Name:
Title:
|
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SELECTBUILD
ARIZONA, LLC
By
Name:
Title:
SELECTBUILD
MID-ATLANTIC, LLC
By
Name:
Title:
SELECTBUILD
FLORIDA, LLC
By
Name:
Title:
SELECTBUILD
TRIM, LLC
By
Name:
Title:
KBI
STUCCO, INC.
By
Name:
Title:
|
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KBI
WINDOWS, INC.
By
Name:
Title:
A-1
BUILDING COMPONENTS, LLC.
By
Name:
Title:
SELECTBUILD
MECHANICAL, LLC.
By
Name:
Title:
SELECTBUILD
ILLINOIS, LLC.
By
Name:
Title:
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THE ADMINISTRATIVE
AGENT
XXXXX
FARGO BANK, NATIONAL
ASSOCIATION,
as Administrative Agent
By
Name:
Title:
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EXHIBIT
A
Notice
Letter
[Please
see attached]
