U.S. AGGREGATES, INC.
-----------------------------------
AMENDMENT NO. 2 TO AMENDED AND RESTATED
NOTE AND WARRANT PURCHASE AGREEMENT
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DATED AS OF AUGUST 12, 1999
$30,000,000 10.34% SENIOR SUBORDINATED NOTES DUE NOVEMBER 22, 2006
AND
$15,000,000 10.09% SENIOR SUBORDINATED NOTES DUE NOVEMBER 22, 2008
U.S. AGGREGATES, INC.
$30,000,000 10.34% SENIOR SUBORDINATED NOTES DUE NOVEMBER 22, 2006
AND
$15,000,000 10.09% SENIOR SUBORDINATED NOTES DUE NOVEMBER 22, 2008
AMENDMENT NO. 2 TO AMENDED AND RESTATED
NOTE AND WARRANT PURCHASE AGREEMENT
As of August 12, 1999
The Prudential Insurance Company of America
c/o Prudential Capital Group
Xxx Xxxxxxx Xxxxxx, 00 Xxxxx
Xxxxxx, Xxx Xxxxxx 00000
Ladies and Gentlemen:
U.S. AGGREGATES, INC., a Delaware corporation (together with its successors
and assigns, the "COMPANY"), agrees with you as follows:
1. PRIOR AMENDMENT AND ISSUANCE OF NOTES.
The Company has entered into an Amendment No. 1 to Amended and Restated
Note and Warrant Purchase Agreement, dated as of April 14, 1999 (as in effect
immediately prior to giving effect to the amendments provided for by this
Agreement, the "EXISTING NOTE PURCHASE AGREEMENT" and, as amended pursuant to
this Agreement and as may be further amended, restated or otherwise modified
from time to time, the "AMENDED NOTE PURCHASE AGREEMENT"), pursuant to which
certain amendments were made to the Amended and Restated Note and Warrant
Purchase Agreement dated as of June 5, 1998 whereby $30,000,000 aggregate
principal amount of 10.34% Senior Subordinated Notes due November 22, 2006 and
$15,000,000 aggregate principal amount of 10.09% Senior Subordinated Notes due
November 22, 2008 (such Notes, as may be amended, restated or otherwise modified
from time to time, the "NOTES") of the Company have been issued to you and are
currently outstanding.
2. DEFINED TERMS.
Capitalized terms used herein and not otherwise defined have the meanings
ascribed to them in the Existing Note Purchase Agreement.
3. REQUEST FOR CONSENT TO AMENDMENTS.
The Company requests that you consent to the amendments to the Existing
Note Purchase Agreement provided for by this Agreement (the "AMENDMENTS").
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
To induce you to enter into this Agreement and to consent to the
Amendments, the Company represents and warrants as follows:
4.1 ORGANIZATION AND EXISTENCE.
The Company is a corporation duly organized and existing in good standing
under the laws of the State of Delaware and has the requisite corporate power
and authority to execute and deliver this Agreement and to perform its
obligations under the Amended Note Purchase Agreement.
4.2 ACTIONS PENDING.
There are no actions, suits, investigations or proceedings pending or, to
the knowledge of the Company, threatened against the Company or any of its
Subsidiaries, or any properties or rights of the Company or any of its
Subsidiaries, by or before any court, arbitrator or administrative or
governmental body that, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
4.3 AMENDMENT AUTHORIZED; OBLIGATIONS ENFORCEABLE.
(a) AGREEMENT IS LEGAL AND AUTHORIZED. The execution and delivery by
the Company of this Agreement, and compliance by the Company with all of the
provisions of the Amended Note Purchase Agreement, are within the corporate
powers of the Company.
(b) COMPANY OBLIGATIONS ARE ENFORCEABLE. The Company has duly
authorized this Agreement by all necessary action on its part. This Agreement
has been executed and delivered by one or more duly authorized officers of the
Company, and each of this Agreement and the Amended Note Purchase Agreement
constitutes a legal, valid and binding obligation of the Company, enforceable in
accordance with its terms, except that the enforceability thereof may be:
(i) limited by applicable bankruptcy, reorganization, arrangement,
insolvency, moratorium, or other similar laws affecting the enforceability of
creditors' rights generally; and
(ii) subject to the availability of equitable remedies.
4.4 NO CONFLICTS.
Neither the execution nor delivery of this Agreement, nor fulfillment of
nor compliance with the terms and provisions of the Amended Note Purchase
Agreement and the other Financing Documents will conflict with, or result in a
breach of the terms, conditions or provisions of, or constitute a default under,
or result in any violation of, or result in the creation of any Lien upon any of
the Properties of the Company or any of its Subsidiaries pursuant to, the
charter or bylaws of the Company or any of its Subsidiaries, any award of any
arbitrator or any agreement (including any agreement with stockholders),
instrument, order, judgment, decree, statute, law, rule or regulation to which
the Company or any of its Subsidiaries is subject.
4.5 GOVERNMENTAL CONSENT.
Neither the execution and delivery of this Amendment, nor the performance
by the Company of its obligations under the Amended Note Purchase Agreement and
the other Financing Documents, is such as to require any authorization, consent,
approval, exemption or other action by or notice to or filing with any court or
administrative or governmental body (other than routine filings with the
Securities and Exchange Commission and/or state Blue Sky authorities) on the
part of the Company in connection with the execution and delivery of this
Agreement or fulfillment of or compliance with the terms and provisions of the
Amended Note Purchase Agreement or of the other Financing Documents.
4.6 FULL DISCLOSURE.
This Agreement and the documents, certificates or other writings delivered
to you by or on behalf of the Company in connection with the proposal and
negotiation of the Amendments, taken as a whole, do not contain any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein not misleading in light of the circumstances under
which they were made. There is no fact known to the Company that could
reasonably be expected to have a Material Adverse Effect that has not been set
forth herein or in the other documents, certificates and other writings
delivered to you by or on behalf of the Company specifically for use in
connection with the transactions contemplated by the Note Purchase Agreement and
this Agreement.
4.7 AMENDMENT OF BANK CREDIT AGREEMENT.
Attached hereto as Exhibit C is a copy of the Second Amendment to the Bank
Credit Agreement (the "SECOND AMENDMENT"), which has been duly executed and
delivered by each of the parties thereto, is true, correct and complete, and
(subject only to the execution and delivery of this Agreement) is in full force
and effect.
4.8 NO DEFAULTS.
No event has occurred and no condition exists that, upon the execution and
delivery of this Agreement and the effectiveness of the Amendments and the
Second Amendment, would constitute a Default or an Event of Default.
5. AMENDMENTS.
5.1 AMENDMENTS TO EXISTING NOTE PURCHASE AGREEMENT.
Subject to paragraph 5.2, the Existing Note Purchase Agreement is hereby
amended in the manner specified in Exhibit A to this Agreement.
5.2 EFFECTIVENESS OF AMENDMENTS.
The amendments of the Existing Note Purchase Agreement contemplated by
paragraph 5.1 and Exhibit A shall become effective at such time as
(a) the Company and you shall have executed and delivered a counterpart
of this Agreement;
(b) the representations and warranties set forth in paragraph 4 shall
be true and correct;
(c) the Company shall have authorized, by all necessary corporate
action, the execution and delivery of this Agreement and the performance of all
obligations of, and the satisfaction of all closing conditions set forth in,
this paragraph 5 by, and the consummation of all transactions contemplated by
this Agreement by, the Company;
(d) each Restricted Subsidiary shall have executed and delivered the
Guarantor Consent in respect of its obligations under the Subsidiary Guaranty,
substantially in the form attached hereto as Exhibit B;
(e) evidence that the Company has consummated the initial public
offering of its equity securities (the "IPO") and received gross proceeds
therefrom in an amount not less than $[65],000,000, which evidence must be
received on or prior to October 31, 1999;
(f) evidence of the full, final, and indefeasible payment of the Xxxxxx
Trust Note;
(g) the Company shall have paid you an amendment fee in the amount of
$56,250; and
(h) all proceedings taken in connection with this Agreement and all
documents and papers relating thereto shall be satisfactory to you and your
special counsel, and you and your special counsel shall have received copies of
such documents and papers as you or your special counsel may reasonably request
in connection herewith.
6. EXPENSES.
Whether or not the Amendments become effective, the Company will promptly
(and in any event within 30 days of receiving any statement or invoice therefor)
pay all fees, expenses and costs relating to this Agreement, including, but not
limited to, (a) the cost of reproducing this Agreement and the other documents
delivered in connection herewith and (b) the reasonable fees and disbursements
of your special counsel (namely, Xxxxxxx Xxxx LLP, or its successor or assigns)
incurred in connection with the preparation, negotiation and delivery of this
Agreement and the review of documents produced in connection with the Company's
IPO. Nothing in this paragraph 6 shall limit the Company's obligations under
paragraph 14B of the Amended Note Purchase Agreement.
7. MISCELLANEOUS.
7.1 PART OF NOTE PURCHASE AGREEMENT, FUTURE REFERENCES, etc.
This Agreement shall be construed in connection with and as a part of the
Existing Note Purchase Agreement and, except as expressly amended by this
Agreement, all terms, conditions and covenants contained in the Existing Note
Purchase Agreement and the Notes are hereby ratified and shall be and remain in
full force and effect. Any and all notices, requests, certificates and other
instruments executed and delivered after the execution and delivery of this
Agreement may refer to the Existing Note Purchase Agreement and the Notes
without making specific reference to this Agreement, but nevertheless all such
references shall include this Agreement unless the context otherwise requires.
7.2 COUNTERPARTS; EFFECTIVENESS.
This Agreement may be executed in any number of counterparts, each of which
shall be an original but all of which together shall constitute one instrument.
Delivery of an executed signature page by facsimile transmission shall be
effective as delivery of a manually signed counterpart of this Agreement.
7.3 SUCCESSORS AND ASSIGNS.
All covenants and other agreements in this Agreement contained by or on
behalf of any of the parties hereto shall bind and inure to the benefit of the
respective successors and assigns of the parties hereto (including, without
limitation, any Transferee) whether so expressed or not.
7.4 GOVERNING LAW.
THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE
RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE INTERNAL LAWS OF THE STATE OF
NEW YORK.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK; NEXT PAGE IS SIGNATURE PAGE.]
If you are in agreement with the foregoing, please so indicate by signing
the agreement below on the accompanying counterpart of this Agreement and return
it to the Company, whereupon the foregoing shall become a binding agreement
among you and the Company.
Very truly yours,
U.S. AGGREGATES, INC.
By: /s/ Xxxxxxxx X. Xxxxx
Name: Xxxxxxxx X. Xxxxx
Title: Chief Financial Officer
The foregoing Agreement is
hereby accepted as of the
date first above written.
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
EXHIBIT A
AMENDMENTS
1. PARAGRAPH 6C(iv)(a) OF THE EXISTING NOTE PURCHASE AGREEMENT (CHANGE IN
CONTROL) IS HEREBY AMENDED AND RESTATED IN ITS ENTIRETY TO READ AS FOLLOWS:
(a) "CHANGE IN CONTROL" means, at any time,
(i) (A) any Person or group of related persons for purposes of Section 13(d) of
the Securities Exchange Act of 1934 (a "GROUP") (other than GTCR LP) shall
become the owner, directly or indirectly, beneficially or of record, of shares
representing thirty percent (30%) or more of all the issued and outstanding
Voting Stock of each class of the Company and (B) GTCR LP shall beneficially
own, directly or directly, in the aggregate a lesser percentage of the Voting
Stock of the Company than such Person or Group; or
(ii) the replacement of a majority of the Board of Directors of the Company over
a two-year period from the directors who constituted the Board of Directors of
the Company at the beginning of such period, and such replacement shall not have
been approved by a vote of at least a majority of the Board of Directors of the
Company then still in office who either were members of such Board of Directors
at the beginning of such period or whose election as a member of such Board of
Directors was previously so approved; or
(iii) any event of condition relating to a Change in Control of the Company
which requires, or permits the holder or holders (or any agent or trustee
therefor) of any Debt of the Company or any Restricted Subsidiary to require the
purchase or repurchase prior to its expressed maturity of any Debt (excluding
the Notes) of the Company or any Restricted Subsidiary in an aggregate principal
amount (for all such Debt) of $1,000,000 or more.
2. ANY AND ALL REFERENCES TO THE XXXXXX TRUST NOTE (INCLUDING, BUT NOT
LIMITED TO THE REFERENCE IN PARAGRAPH 8C(I) IN THE CALCULATION OF CONSOLIDATED
DEBT, THE REFERENCE IN THE CALCULATION OF CONSOLIDATED INTEREST EXPENSE AND THE
DEFINED TERM IN PARAGRAPH 13B) IN THE EXISTING NOTE PURCHASE AGREEMENT ARE
HEREBY DELETED.
3. PARAGRAPH 8E OF THE EXISTING NOTE PURCHASE AGREEMENT (RESTRICTED
PAYMENTS) IS HEREBY AMENDED AND RESTATED AS FOLLOWS:
8E. RESTRICTED PAYMENTS. The Company will not and will not permit any
Restricted Subsidiary to,
(i) declare or pay any dividend (other than stock dividends) or
distribution on any of its capital stock,
(ii) purchase or redeem any capital stock of the Company or any
Restricted Subsidiary (or any warrants, options or other rights in respect
thereof),
(iii) make any other distribution to shareholders of the Company or any
Restricted Subsidiary,
(iv) prepay, purchase, defease or redeem any Debt subordinate to the
Notes, or
(v) set aside funds for any of the foregoing;
provided that
(a) the Company may convert 300,842.2 shares of its preferred stock, par value
$0.01 per share, into common stock at a conversion price equal to the offering
price per share of common stock in its Initial Public Offering of such common
stock;
(b) any Restricted Subsidiary may declare dividends, or make other
distributions, to the Company or to another Restricted Subsidiary of the Company
(but not to any other Person); and
(c) so long as no Default or Event of Default exists or would result therefrom,
(1) the Company or any Restricted Subsidiary may repurchase or redeem its stock
from any former employee, director or consultant to, a Restricted Subsidiary (or
any heirs or legal representatives of any such employee, director or consultant)
in an aggregate amount, for all such purposes, not exceeding $1,000,000 in any
fiscal year; and
(2) the Company may declare and pay dividends on its common stock (A) in its
third and fourth fiscal quarters of 1999 in an amount not to exceed $600,000 in
either such fiscal quarter and (B) in any of its fiscal years (commencing with
the fiscal year beginning January 1, 2000) in an amount not to exceed 15% of
Consolidated Net Income for the immediately preceding fiscal year (provided
that the Company may only pay any dividend pursuant to this clause (c)(2) if,
after giving effect thereto, the Company shall be in compliance with all
financial covenants in Paragraph 8 and such dividends may be paid within 60 days
after the date of declaration thereof if at such date of declaration such
dividend complied with this clause (c)(2)).
4. THE DEFINITION OF "CONSOLIDATED FIXED CHARGES" IN PARAGRAPH 13B OF THE
EXISTING NOTE PURCHASE AGREEMENT (OTHER TERMS) IS HEREBY AMENDED AND RESTATED AS
FOLLOWS:
"CONSOLIDATED FIXED CHARGES" means, in respect of any period of four (4)
consecutive fiscal quarters of the Company, the sum of
(i) Consolidated Interest Expense in respect of such period, plus
(ii) Consolidated Capital Expenditures made during such period, plus
(iii) taxes paid in cash by the Company and its Restricted Subsidiaries
during such period, plus
(iv) all scheduled principal payments due on any Consolidated Debt
during such period, other than any principal payments to be made as a result of
any mandatory reduction of commitments under the Revolving Credit Facility, plus
(v) the amount of all cash dividends declared by the Company.
EXHIBIT B
[FORM OF GUARANTOR CONSENT]
Reference is made to that certain Amended and Restated Note and Warrant
Purchase Agreement, dated as of June 5, 1998 (the "Note Purchase Agreement"),
between U.S. Aggregates, Inc. (the "Company") and The Prudential Insurance
Company of America (the "Noteholder"), pursuant to which $30,000,000 principal
amount of 10.34% Senior Subordinated Notes due November 22, 2006 and $15,000,000
principal amount of 10.09% Senior Subordinated Notes due November 22, 2008 (the
"Notes") of the Company have been issued to the Noteholder and are currently
outstanding. Capitalized terms used herein and defined in the Note Purchase
Agreement are used herein with the meanings ascribed to them in the Note
Purchase Agreement. The Note Purchase Agreement was amended pursuant to the
terms of Amendment No. 1 to the Amended and Restated Note and Warrant Purchase
Agreement dated as of April 14, 1999 (as in effect immediately prior to giving
effect to the amendments provided for in Amendment No. 2 to the Amended and
Restated Note and Warrant Purchase Agreement, the "EXISTING NOTE PURCHASE
AGREEMENT" and, as amended pursuant to Amendment No. 2 to the Amended and
Restated Note and Warrant Purchase Agreement and as may be further amended,
restated or otherwise modified from time to time, the "AMENDED NOTE PURCHASE
AGREEMENT"). The Existing Note Purchase Agreement is being amended pursuant to
the terms of Amendment No. 2 to the Note Purchase Agreement dated as of August
12, 1999 (the "SECOND AMENDMENT AGREEMENT").
Each of the undersigned Restricted Subsidiaries (each, a "GUARANTOR") is a
party to the Subsidiary Guaranty entered into in connection with the execution
and delivery of the Note Purchase Agreement and the issuance and sale of the
Notes. Each Guarantor hereby consents to the Second Amendment Agreement and
acknowledges and affirms all of its obligations under the terms of the
Subsidiary Guaranty.
Dated: As of August 12, 1999
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IN WITNESS WHEREOF, each Guarantor has caused this Guarantor Consent to be
executed on its behalf, as of the date first above written, by one of its duly
authorized officers.
SRM HOLDINGS CORP.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
SOUTHERN READY MIX, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
WESTERN AGGREGATES
HOLDING CORP.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
WESTERN ROCK PRODUCTS
CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
XXX ROCK PRODUCTS, INCORPORATED
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
XXX TRANSPORT CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
XXXXXX CONSTRUCTION &
DEVELOPMENT, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
SANDIA CONSTRUCTION, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
SOUTHERN NEVADA AGGREGATES, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
MOHAVE CONCRETE AND MATERIALS, INC. (NEVADA)
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
MOHAVE CONCRETE AND MATERIALS, INC. (ARIZONA)
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
A-BLOCK COMPANY, INC. (ARIZONA)
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
A-BLOCK COMPANY, INC. (CALIFORNIA)
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
VALLEY ASPHALT, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
DEKALB STONE, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
GEODYNE TRANSPORT, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
FALCON RIDGE CONSTRUCTION, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
XXXX PAVING, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
MULBERRY ROCK CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
BHY READY MIX, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
XXXXXXX XXXXX & SAND, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
TRI-STATE TESTING LABORATORIES, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
BIG HORN REDI MIX, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
TREASURE VALLEY CONCRETE, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
MONROC, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
EXHIBIT C
[COPY OF EXECUTED SECOND BANK AMENDMENT]
