EXHIBIT 10.6
FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this
"Amendment") dated as of September 29, 1998, is by and between Quanta Services,
Inc., a Delaware corporation (the "Borrower"), Bank One, Texas, National
Association ("Bank One"), National City Bank and the other lenders from time to
time parties hereto (each a "Lender" and collectively, the "Lenders"), Bank One
as administrative agent for the Lenders (in such capacity, the "Agent") and
National City Bank as co-agent for the Lenders (in such capacity, the "Co-
Agent").
WITNESSETH:
WHEREAS, the Borrower, the Lenders, the Agent and the Co-Agent have entered
into that certain Amended and Restated Credit Agreement dated as of August 3,
1998, pursuant to which the Lenders have agreed to make Loans to the Borrower
and to issue Letters of Credit for the account of the Borrower pursuant to the
terms thereof (the "Credit Agreement"); and
WHEREAS, the Borrower, the Lenders, the Agent and the Co-Agent desire to
amend the Credit Agreement as hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein contained, the Borrower, the Lenders, the Agent and the Co-Agent hereby
agree as follows:
1. AMENDMENTS TO CREDIT AGREEMENT.
(a) Section 1.1 of the Credit Agreement is hereby amended as follows:
(i) The following definitions of "Beneficial Ownership", "Change
of Control", "Enron Subordinated Debt Documents" and "Exchange Act" are hereby
added in the correct alphabetical order:
"Beneficial Ownership," and "Beneficial Owner" shall have the meanings
assigned to them in Rule 13d-3 under the Exchange Act in effect on
September 29, 1998.
"Change in Control" shall be deemed to have occurred if (i) any Person
acquires, directly or indirectly, the Beneficial Ownership of any
voting security of the Borrower and immediately after such acquisition
such Person is, directly or indirectly, the Beneficial Owner of voting
securities representing 50% or more of the total voting power of all
the then outstanding voting securities of the Borrower entitled to
vote generally in the election of directors; or (ii) individuals who
on September 29, 1998, constitute the Borrower's Board of Directors,
or their successors approved in accordance with the terms below, cease
for any reason to constitute at least a majority thereof, unless the
election or nomination for the election by the Borrower's stockholders
of each new director was approved by vote of at least 2/3rds of the
directors then still in office who were directors on September 29,
1998, or their successors approved in accordance with the terms
hereof.
"Enron Subordinated Debt Documents" means that certain Securities
Purchase Agreement by and among the Borrower, Enron Capital & Trade
Resources Corp. and Joint Energy Development Investments II Limited
Partnership dated as of September 29, 1998, the Convertible
Subordinated Notes of the Borrower issued pursuant thereto and any
other Basic Document as defined therein, as amended from time to time
as permitted hereby.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, and the rules and regulations of the SEC
promulgated thereunder.
(b) Section 6.11(a)(iii) of the Credit Agreement is hereby amended and
restated in its entirety as follows:
"(iii) the maximum cash purchase price paid and Indebtedness incurred
to a seller by the Borrower or any of its Subsidiaries in connection
with (x) any single Acquisition shall not exceed $12,000,000, and (y)
all Acquisitions made during any rolling four (4) fiscal quarters
(excluding any Acquisitions exceeding $12,000,000 for which the
Borrower has obtained approval of the Majority Lenders hereunder and
all Acquisitions made from and after April 9, 1998, through September
29, 1998) shall not exceed twenty-five percent (25%) of the Borrower's
Consolidated Net Worth as of the end of the immediately preceding
fiscal quarter;"
(c) New Section 6.25 of the Credit Agreement is hereby added as follows in
the correct numerical order:
"Section 6.25 Subordinated Debt Investment. The Borrower shall
provide written notice to the Agent (by confirmed fax to each of the
Agent and its legal counsel, Gardere Xxxxx Xxxxxx & Xxxxx, L.L.P.,
attention: Xx. Xxxx X. Xxxxxxxxxx (fax no.: 000-000-0000)) of (i)
any Change of Control within two (2) Business Days following any such
Change of Control, and (ii) any notice received by the Borrower from
any holder of a Subordinated Debt Investment exercising any right to
require the Borrower to redeem all or any part of a Subordinated Debt
Investment within two (2) Business Days of the Borrower's receipt
thereof. The Borrower shall not redeem all or any part of the
Indebtedness evidenced by the Enron Subordinated Debt Documents as a
result of a Change of Control before ten (10) days following the date
of a Redemption Notice (as defined in the Enron Subordinated Debt
Documents) or if prohibited by the subordination provisions contained
therein. The Borrower shall not redeem, pursuant to any optional
redemption right it may have, all or any part of a Subordinated Debt
Investment before the Maturity Date. The Borrower shall not amend,
modify or change in any way any of the Enron Subordinated Debt
Documents so as to change the stated maturity date of the principal of
such Indebtedness, or any installment of interest thereon, to an
earlier date, increase the rate of interest thereon or any premium
payable on the redemption thereof, change any of the redemption or
subordination provisions thereof (or the definitions of any defined
terms contained therein) or otherwise change in any respect materially
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adverse to the interests of the Lenders any of the terms thereof, in
each case, without the consent of the Majority Lenders."
(d) Section 7.1 of the Credit Agreement is hereby amended as follows:
(i) Section 7.1(k) of the Credit Agreement is hereby amended and
restated in its entirety as follows:
"(k) a Change of Control shall occur or the common stock of the
Borrower shall be delisted from the New York Stock Exchange; or"
(ii) A new Section 7.1(l) of the Credit Agreement is added as follows:
"(l) an Event of Default shall occur and be continuing under the Enron
Subordinated Debt Documents or any other documents evidencing a
Subordinated Debt Investment."
2. CONSENT TO ENRON SUBORDINATED DEBT DOCUMENTS. The Lenders hereby
consent to the terms of the Enron Subordinated Debt Documents as in effect on
September 29, 1998 and agree that the subordinated Indebtedness evidenced
thereby shall be a Subordinated Debt Investment for purposes of the Credit
Agreement, provided that the Borrower secures, and it hereby agrees to so
secure, the repayment of the Obligations with the assets of the Borrower and its
Subsidiaries pursuant to documentation standard and customary for secured credit
facilities of this type on or before November 29, 1998.
3. REAFFIRMATION OF REPRESENTATIONS AND WARRANTIES. To induce the
Lenders, the Agent and the Co-Agent to enter into this Amendment, the Borrower
hereby reaffirms, as of the date hereof, its representations and warranties in
their entirety contained in the Credit Agreement and in all other documents
executed pursuant thereto (except to the extent such representations and
warranties relate solely to an earlier date) and additionally represents and
warrants as follows:
(a) The execution and delivery of this Amendment and the performance
by the Borrower of its obligations under this Amendment and the Credit Agreement
as amended hereby are within the Borrower's corporate powers, have been duly
authorized by all necessary corporate action, have received all necessary
governmental and other approvals (if any shall be required), and do not and will
not contravene or conflict with the governance documents of the Borrower or any
provision of law, any presently existing requirement or restriction imposed by
any judicial, arbitral, regulatory or governmental instrumentality or constitute
a default under, or result in the creation or imposition of any Lien other than
a Permitted Lien upon any property or assets of the Borrower or any Guarantor
under, any agreement, instrument or indenture by which the Borrower or any
Guarantor is bound;
(b) This Amendment has been duly executed and delivered on behalf of
the Borrower and this Amendment and the Credit Agreement as amended hereby are
the legal, valid and binding obligations of the Borrower, enforceable in
accordance with its terms subject as to enforcement only to bankruptcy,
insolvency, reorganization, moratorium or other similar laws and equitable
principles affecting the enforcement of creditors' rights generally; and
(c) No Default or Event of Default has occurred and is continuing.
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4. REAFFIRMATION OF CREDIT AGREEMENT. This Amendment shall be deemed to
be an amendment to the Credit Agreement, and the Credit Agreement, as amended
hereby, is hereby ratified, approved and confirmed in each and every respect.
All references to the Credit Agreement herein and in any other document,
instrument, agreement or writing shall hereafter be deemed to refer to the
Credit Agreement as amended hereby.
5. DEFINED TERMS. Except as amended hereby, terms used herein when
defined in the Credit Agreement shall have the same meanings herein unless the
context otherwise requires.
6. GOVERNING LAW; ARBITRATION; SUBMISSION TO JURISDICTION; WAIVER OF JURY
TRIAL.
(a) The Credit Agreement, as amended hereby, and the other Credit
Documents, and the rights and duties of the parties thereto, shall be construed
in accordance with and governed by the internal laws of the State of Texas.
(b) THE AGENT, THE CO-AGENT, EACH LENDER AND THE BORROWER HEREBY
WAIVES ITS RIGHT TO RESOLVE DISPUTES, CLAIMS, AND CONTROVERSIES ARISING FROM THE
CREDIT AGREEMENT, AS AMENDED HEREBY, ANY OTHER CREDIT DOCUMENT OR ANY MATTER IN
CONNECTION THEREWITH, INCLUDING, WITHOUT LIMITATION, CONTRACT DISPUTES AND TORT
CLAIMS, THROUGH ANY COURT PROCEEDING OR LITIGATION AND ACKNOWLEDGES THAT ALL
SUCH DISPUTES, CLAIMS AND CONTROVERSIES SHALL BE RESOLVED PURSUANT TO THIS
SECTION, EXCEPT THAT EQUITABLE RELIEF AND CERTAIN OTHER RIGHTS AND REMEDIES SET
FORTH BELOW MAY BE SOUGHT FROM ANY COURT OF COMPETENT JURISDICTION. EACH PARTY
REPRESENTS TO THE OTHER PARTIES THAT THIS WAIVER IS MADE KNOWINGLY AND
VOLUNTARILY AFTER CONSULTATION WITH AND UPON ADVICE OF ITS COUNSEL AND IS A
MATERIAL PART OF THIS AGREEMENT. ALL SUCH DISPUTES, CLAIMS AND CONTROVERSIES
SHALL BE RESOLVED BY BINDING ARBITRATION PURSUANT TO THE COMMERCIAL RULES OF THE
AMERICAN ARBITRATION ASSOCIATION ("AAA"). Any arbitration proceeding held
pursuant to this arbitration provision shall be conducted in Houston, Texas or
at any other place selected by mutual agreement of the parties. No act to take
or dispose of any collateral shall constitute a waiver of this arbitration
agreement or be prohibited by this arbitration agreement. This arbitration
provision shall not limit the right of any party during any dispute, claim or
controversy to seek, use, and employ ancillary, or preliminary rights and/or
remedies, judicial or otherwise, for the purposes of realizing upon, preserving,
protecting, foreclosing upon or proceeding under forcible entry and detainer for
possession of, any real or personal property, and any such action shall not be
deemed an election of remedies. Such remedies include, without limitation,
obtaining injunctive relief or a temporary restraining order, invoking a power
of sale under any deed of trust or mortgage, obtaining a writ of attachment or
imposition of a receivership, or exercising any rights relating to personal
property, including exercising the right of set-off, or taking or disposing of
such property with or without judicial process pursuant to the Uniform
Commercial Code. Any disputes, claims or controversies concerning the
lawfulness or reasonableness of an act, or exercise of any right or remedy
concerning any collateral, including any claim to rescind, reform, or otherwise
modify any agreement relating to the collateral, shall also be arbitrated;
provided, however that no arbitrator shall have the right or the power to enjoin
or restrain any act of either party. Judgment upon any award rendered by any
arbitrator may be entered in any court having jurisdiction. The statute of
limitations, estoppel, waiver, laches and similar doctrines which would
otherwise be applicable in an action brought by a party shall be
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applicable in any arbitration proceeding, and the commencement of an arbitration
proceeding shall be deemed the commencement of any action for these purposes.
The federal arbitration act (Title 9 of the United States Code) shall apply to
the construction, interpretation, and enforcement of this arbitration provision.
(c) To the fullest extent permitted by applicable law, each party
hereto agrees that any court proceeding or litigation permitted by Section 6(b)
may be brought and maintained in the courts of the State of Texas sitting in
Xxxxxx County or the United States District Court for the Southern District of
Texas. To the fullest extent permitted by applicable law, the Borrower hereby
expressly and irrevocably submits to the jurisdiction of the courts of the State
of Texas and the United States District Court for the Southern District of Texas
for the purpose of any such litigation as set forth above and irrevocably agrees
to be bound by any judgment rendered thereby in connection with such litigation.
To the fullest extent permitted by applicable law, the Borrower further
irrevocably consents to the service of process, by registered mail, postage
prepaid, or by personal service within or without the state of Texas. To the
fullest extent permitted by applicable law, the Borrower hereby expressly and
irrevocably waives any objection which it may have or hereafter may have to the
laying of venue of any such litigation brought in any such court referred to
above and any claim that any such litigation has been brought in an inconvenient
forum. To the extent that the Borrower has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process (whether
through service of notice, attachment prior to judgment, attachment in aid of
execution or otherwise) with respect to itself or its property, the Borrower
hereby irrevocably waives to the fullest extent permitted by applicable law,
such immunity in respect of its obligations under the Credit Agreement, as
amended hereby, and the other Credit Documents.
(d) TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY
HERETO VOLUNTARILY, KNOWINGLY, IRREVOCABLY AND UNCONDITIONALLY (BY ITS
ACCEPTANCE HEREOF) WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING PERMITTED BY SECTION 7(B) AND WAIVES ANY RIGHT TO HAVE A JURY
PARTICIPATE IN RESOLVING ANY DISPUTE (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF THE CREDIT AGREEMENT, AS AMENDED HEREBY, ANY OTHER
CREDIT DOCUMENT, ANY OTHER RELATED DOCUMENT OR ANY RELATIONSHIP BETWEEN THE
AGENT, THE CO-AGENT, ANY LENDER, THE BORROWER AND/OR ANY GUARANTOR, AND AGREES
THAT ANY SUCH ACTION, PROCEEDING OR DISPUTE SHALL BE TRIED BEFORE A COURT AND
NOT BEFORE A JURY. THIS PROVISION IS A MATERIAL INDUCEMENT TO THE LENDERS TO
PROVIDE THE LOANS AND THE LETTERS OF CREDIT.
7. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, and by the different parties on different counterpart signature
pages, each of which when executed shall be deemed an original but all such
counterparts taken together shall constitute one and the same Amendment.
8. SEVERABILITY. Any provision of this Amendment that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
9. HEADINGS. Section headings used in this Amendment are for reference
only and shall not affect the construction of this Amendment.
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10. NOTICE OF ENTIRE AGREEMENT. This Amendment, together with the other
Credit Documents, constitute the entire understanding among the Borrower, the
Agent, the Co-Agent and the Lenders and supersedes all earlier or
contemporaneous agreements, whether written or oral, concerning the subject
matter of the Amendment and the other Credit Documents. THIS WRITTEN AMENDMENT
TOGETHER WITH THE OTHER CREDIT DOCUMENTS REPRESENTS THE FINAL AGREEMENT BETWEEN
THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their duly authorized officers as of the day and
year first written above.
BORROWER:
--------
QUANTA SERVICES, INC.
By: /s/ Xxxx Xxxxxxx
----------------------------------------
Name: Xxxx Xxxxxxx
----------------------------------------
Title: Vice President and General Counsel
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LENDERS:
-------
BANK ONE, TEXAS, NATIONAL ASSOCIATION, as
Administrative Agent and as a Lender
By: /s/ Xxxx X. Xxxx, Xx.
----------------------------------------
Name: Xxxx X. Xxxx, Xx.
Title: Vice President
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NATIONAL CITY BANK, as Co-Agent and as a Lender
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
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CONSENT AND ACKNOWLEDGMENT
Each of the undersigned Guarantors, by its signature hereto, acknowledges
and agrees to the terms and conditions of that certain First Amendment to
Amended and Restated Credit Agreement (the "Amendment") dated as of September
29, 1998, by and between Quanta Services, Inc., a Delaware corporation (the
"Borrower"), Bank One, Texas, National Association ("Bank One"), National City
Bank and the other lenders from time to time parties hereto (collectively, the
"Lenders"), Bank One as administrative agent for the Lenders (in such capacity,
the "Agent") and National City Bank as co-agent for the Lenders (in such
capacity, the "Co-Agent"). Each of the undersigned (i) acknowledges and
reaffirms its obligations under its Guaranty (collectively, the "Guaranties"),
and agrees that the Guaranties shall remain in full force and effect, and (ii)
agrees to fulfill the terms of Section 2 of the Amendment to the extent
applicable to its assets.
Dated as of September 29, 1998.
ADVANCED COMMUNICATIONS TECHNOLOGIES, INC.
COAST TO COAST LLC
ENVIRONMENTAL PROFESSIONAL ASSOCIATES LTD.
FIVE POINTS CONSTRUCTION COMPANY
GOLDEN STATE UTILITY CO.
XXXXXX ACQUISITION, INC.
NORAM TELECOMMUNICATIONS INC.
NORTH PACIFIC CONSTRUCTION COMPANY, INC.
PAR ELECTRICAL CONTRACTORS, INC.
POTELCO, INC.
QSI, INC.
QUANTA DELAWARE, INC.
QUANTA SERVICES MANAGEMENT PARTNERSHIP, L.P.
RT TELECOMMUNICATIONS, INC.
XXXXX ACQUISITION DE, INC.
SPALJ CONSTRUCTION CO.
SPAN-CON OF DEERWOOD, INC.
SUMTER BUILDERS, INC.
TELECOM NETWORK SERVICES, INC.
TRANS TECH ELECTRIC, INC.
UNDERGROUND CONSTRUCTION COMPANY
UNION POWER CONSTRUCTION CO.
W.H.O.M. CORPORATION
By: /s/ Xxxx Xxxxxxx
-----------------------------------------
Name: Xxxx Xxxxxxx
-----------------------------------------
Title: Vice President and Assistant Secretary
-----------------------------------------
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