AMENDMENT AND LIMITED WAIVER TO INTERCREDITOR AGREEMENT
Exhibit 10.3
Execution Copy
This
AMENDMENT AND LIMITED WAIVER TO INTERCREDITOR AGREEMENT, dated
as of May 26, 2006 (this “Limited Waiver”) is entered into
by and among COVANTA ENERGY CORPORATION, a Delaware corporation (“Company”), XXXXXXX XXXXX
CREDIT PARTNERS L.P. (“GSCP”), in its capacity as collateral agent under the First Lien
Credit Agreement (as defined below), including its successors in such capacity from time to
time (the “First Lien Collateral Agent”), CREDIT SUISSE, Cayman Islands Branch (“Credit
Suisse”), in its capacity as administrative agent for the Second Lien Credit Agreement (as
defined below), including its successors in such capacity from time to time (the “Second
Lien Administrative Agent”), and Credit Suisse, in its capacity as collateral agent for the
Parity Lien Claimholders, including its successors in such capacity from time to time (the
“Parity Lien Collateral Agent”).
WHEREAS, Company has entered into (i) that certain INTERCREDITOR AGREEMENT, dated as
of June 24, 2005 (as it may be amended, supplemented or otherwise modified, the
“Intercreditor Agreement”), by and among the Company, the First Lien Collateral Agent, the
Second Lien Administrative Agent and the Parity Lien Collateral Agent, (ii) that certain
AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT, dated as
of May 26, 2006 (as it may be
amended, supplemented or otherwise modified, the “First Lien Credit Agreement”), by and
among the Company, Covanta Holding Corporation (“Holding”), GSCP, as Sole Lead Arranger,
Sole Book Runner, Administrative Agent and Collateral Agent, certain Subsidiaries of the
Company as Guarantors, the Lenders party thereto from time to time, JPMC, Calyon and UBS,
as Co-Documentation Agents, and (iii) that certain SECOND LIEN CREDIT AND GUARANTY
AGREEMENT, dated as of June 24, 2005, as amended by the First Amendment thereto, dated as
of May 26, 2006 (as it may be further amended, supplemented or otherwise modified, the
“Second Lien Credit Agreement”) by and among the Company, Holding, certain Subsidiaries of
the Company as Guarantors, the Lenders party thereto from time to time, GSCP and CREDIT
SUISSE, as Joint Book Runners and Co-Syndication Agents, and CREDIT SUISSE, as
Administrative Agent, Paying Agent and Collateral Agent;
WHEREAS, the terms used herein, including in the preamble and recitals hereto, not
otherwise defined herein or otherwise amended hereby shall have the meanings ascribed
thereto in the Intercreditor Agreement;
WHEREAS, the First Lien Credit Agreement has been amended on the date hereof to allow
for, among other things, Delayed Draw Term Loans (as defined in the First Lien Credit
Agreement), the proceeds of which will be applied by Company to prepay up to $140,000,000
of Second Lien Debt and any premium related thereto;
WHEREAS, subject to certain conditions and limitations, Company and the First Lien
Collateral Agent, Second Lien Administrative Agent and Parity Lien Collateral Agent desire
to waive the effects of non-compliance with Section 4.1 of the Intercreditor Agreement
caused by such prepayment;
NOW, THEREFORE, in consideration of the premises and the agreements, provisions and
covenants herein contained, Company, the First Lien Collateral Agent, the Second Lien
Administrative Agent and the Parity Lien Collateral Agent agree as follows:
SECTION 1. AMENDMENT AND WAIVER
1.1 The First Lien Collateral Agent, Second Lien Administrative Agent and Parity Lien
Collateral Agent hereby waive any non-compliance with Section 4.1 of the Intercreditor
Agreement to the
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extent that such provision would prohibit the prepayment of the Second Lien Debt with the
proceeds of the Delayed Draw Term Loans.
1.2 The
definition of “First Lien Obligations” in Section 1.1
of the Credit Agreement is hereby amended by deleting the existing
reference to “$786,500,000” in its entirety and replacing
it with “$789,312,500”.
SECTION 2. LIMITATION OF WAIVER
2.1 Without limiting the generality of the provisions of Section 8.3 of the
Intercreditor Agreement, the provisions set forth in Section 1
hereof shall be limited precisely as written
and relate solely to the provisions of the Intercreditor Agreement in the
manner and to the extent described above, and nothing in this Limited Waiver shall be
deemed to:
(a) constitute a waiver of compliance by any party with respect to any term,
provision or condition of the Intercreditor Agreement or any other instrument or
agreement referred to therein; or
(b) prejudice any right or remedy that any Person may now have (except to the
extent such right or remedy was based upon existing defaults that will not exist
after giving effect to this Limited Waiver) or may have in the future under or in
connection with the Intercreditor Agreement or any other instrument or agreement
referred to therein.
2.2 Except as expressly set forth herein, the terms, provisions and conditions of the
Intercreditor Agreement shall remain in full force and effect and in all other respects are
hereby ratified and confirmed.
SECTION 3. CONDITION PRECEDENT TO EFFECTIVENESS
The
provisions set forth in Section 1 hereof are subject to the satisfaction, or waiver, of the following condition on the date
hereof (the “Limited Waiver Closing Date”): the First Lien Collateral Agent, Second Lien
Administrative Agent and Parity Lien Collateral Agent shall have indicated their consent by
the execution and delivery of the signature pages hereto to the First Lien Collateral
Agent.
SECTION 4. MISCELLANEOUS
4.1 This Limited Waiver shall be binding upon the parties hereto and their respective
successors and assigns and shall inure to the benefit of the parties hereto and their
respective successors and assigns.
4.2 In case any provision in or obligation hereunder shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of the
remaining provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.
4.3 Except as specifically waived by this Limited Waiver, the Intercreditor Agreement
shall remain in full force and effect and are hereby ratified and confirmed.
4.4 Section headings herein are included herein for convenience of reference only and
shall not constitute a part hereof for any other purpose or be given any substantive
effect.
4.5 THIS LIMITED WAIVER AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL
BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.
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4.6 This Limited Waiver may be executed in any number of counterparts, each of which
when so executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument.
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| COVANTA ENERGY CORPORATION, | ||||||
| as Company | ||||||
By: |
/s/ Xxxxxxx X. Xxxxxxx | |||||
Name: Xxxxxxx X. Xxxxxxx |
||||||
Title: Senior Vice President, General
Counsel and Secretary |
||||||
| XXXXXXX SACHS CREDIT PARTNERS L.P., | ||||||
| as the First Lien Collateral Agent | ||||||
By: |
/s/ Xxxxx X. Xxxxxxxxxx | |||||
| Authorized Signatory | ||||||
| CREDIT SUISSE, CAYMAN ISLANDS BRANCH, | ||||||
| as the Second Lien Administrative Agent | ||||||
By: |
/s/ Xxxxxx X. Xxxxxxxx | |||||
Name: |
Xxxxxx X. Xxxxxxxx | |||||
Title: |
Vice President | |||||
By: |
/s/ Xxxxx Xxxxx | |||||
Name: |
Xxxxx Xxxxx | |||||
Title: |
Associate | |||||
| CREDIT SUISSE, CAYMAN ISLANDS BRANCH, | ||||||
| as the Parity Lien Collateral Agent | ||||||
By: |
/s/ Xxxxxx X. Xxxxxxxx | |||||
Name: |
Xxxxxx X. Xxxxxxxx | |||||
Title: |
Vice President | |||||
By: |
/s/ Xxxxx Xxxxx | |||||
Name: |
Xxxxx Xxxxx | |||||
Title: |
Associate | |||||
Signature Page to Limited Waiver
