THIRD AMENDMENT TO CREDIT AGREEMENT

EX-10.19 9 exhibit1019201410k.htm EXHIBIT 10.19 Exhibit 10.19 2014 10K

Exhibit 10.19

This THIRD AMENDMENT, dated as of December 5, 2014 (this “Amendment”),

amends that certain Credit Agreement dated as of March 20, 2013 (as amended by the First Amendment

dated as of May 1, 2013 and the Second Amendment dated as of September 30, 2014, and as further

amended, supplemented, restated, or otherwise modified from time to time, the “Credit Agreement”),

among CST BRANDS, INC., a Delaware corporation (the “Borrower”), the several banks and other

financial institutions or entities from time to time party thereto (the “Lenders”), WELLS FARGO BANK,

NATIONAL ASSOCIATION, as Administrative Agent (the “Administrative Agent”), and the other

agents named therein. Capitalized terms used but not defined herein have the meanings assigned to such

terms in the Credit Agreement.

W I T N E S S E T H

WHEREAS, the Borrower has requested that the Required Lenders agree to amend the

Credit Agreement as set forth herein;

NOW, THEREFORE, in consideration of the premises and mutual covenants contained

herein, the parties hereto agree as follows:

SECTION 1. Amendments to Credit Agreement. Subject to satisfaction of the

conditions set forth in Section 3 hereof, the Borrower, the Lenders and the Administrative Agent hereby

agree that the Credit Agreement is amended as follows:

(a) Section 1.1 of the Credit Agreement is hereby amended by inserting the following

defined term in proper alphabetical sequence therein:

““Captive Insurance Entity” means any captive insurance company established for the

primary purpose of insuring the Borrower and its Subsidiaries and that is or will be

subject to regulation as an insurance subsidiary.”

(b) The definition of “Consolidated EBITDA” appearing in Section 1.1 of the Credit

Agreement is hereby amended and restated in its entirety as follows:

““Consolidated EBITDA” means, for any period (other than those periods described in

the last sentence of this definition), the sum of the following determined on a

Consolidated basis, without duplication, for the Borrower and its Restricted Subsidiaries

in accordance with GAAP: (a) Consolidated Net Income for such period plus (b) the sum

of the following, without duplication, to the extent deducted in determining Consolidated

Net Income for such period: (i) income tax expense for such period, (ii) total interest

expense for such period, (iii) amortization, depreciation and other non-cash charges for

such period (except to the extent that such non-cash charges are reserved for cash charges

to be taken in the future), (iv) extraordinary losses during such period, (v) Transaction

Costs in an aggregate amount not to exceed $15,000,000, plus (c) cash dividends and

distributions to the Borrower or a Restricted Subsidiary from the MLP on account of

Common Units and incentive distribution rights in the MLP held by the Borrower or a

Restricted Subsidiary, plus (d) cash gains to the Borrower or any of its Restricted

Subsidiaries as a result of any Drop Down Transaction (provided that the aggregate

amount added back pursuant to this clause (d) for any four calendar quarter period shall

not exceed 25% of Consolidated EBITDA, calculated after giving effect to this clause

(d), for such period), less (e) non-cash interest income and any extraordinary gains during

such period. For purposes of this Agreement, Consolidated EBITDA (other than for the

calendar quarter ending March 31, 2013) shall be adjusted on a Pro Forma Basis. For

purposes of any calculations under the Loan Documents, Consolidated EBITDA shall be

deemed to be: $63.2 million for the calendar quarter ending September 30, 2012 and

$128.1 million for the calendar quarter ending December 31, 2012.”

Agreement is hereby amended by inserting the following sentence immediately at the end of such

definition:

“Notwithstanding the foregoing, in no event shall the Captive Insurance Entity be

considered a Material Subsidiary, and the book value of its assets shall not be included in

the calculations involved in clause (b) of the proviso of this definition.”

(d) Section 8.6 of the Credit Agreement is hereby amended by inserting the words “or

with the Captive Insurance Entity, in each case,” immediately following the first parenthetical appearing

in clause (a) of such Section.

(e) Section 9.7(i) of the Credit Agreement is hereby amended by inserting the following

proviso immediately at the end of such Section:

“; provided that, with respect to transactions between the Borrower or any Restricted

Subsidiary, on the one hand, and the Captive Insurance Entity, on the other hand, only (i)

Investments permitted by Section 9.3, (ii) payments of insurance premiums by the

Borrower or any Restricted Subsidiary to the Captive Insurance Entity and (iii) payment

by the Borrower and its Restricted Subsidiaries of the administrative expenses and

overhead of, and provision of administrative services to, the Captive Insurance Entity

shall be permitted by this Section 9.7(i);”

(f) Article IX of the Credit Agreement is hereby amended by inserting a new Section

9.18 at the end of such Article:

“SECTION 9.18. Restrictions Regarding Captive Insurance Entity. (a) The Borrower

will not, at any time, own less than 100% of the Capital Stock of the Captive Insurance

Entity and (b) the Captive Insurance Entity shall not engage in any business, or have any

operations or liabilities, other than providing insurance services in the nature of a

“captive” insurance company and activities and liabilities reasonably related thereto.”

(g) Section 10.1(l) of the Credit Agreement is hereby amended by inserting the words

“or by the Captive Insurance Entity” immediately following the words “independent third party

insurance” appearing therein.

(h) Section 10.1(m) of the Credit Agreement is hereby amended by (i) deleting the words

“or self-insurance” appearing therein and (ii) inserting the words “or by the Captive Insurance Entity”

immediately following the words “independent third party insurance” appearing therein.

SECTION 2. Representations and Warranties. In order to induce the other parties hereto

to enter into this Amendment and to agree to amend the Credit Agreement in the manner provided herein,

each Credit Party represents and warrants that the following statements are true and correct as of the

Effective Date (as defined below), which representations and warranties shall survive the execution and

delivery of this Amendment:

(a) Each Credit Party has the corporate or other organizational right, power and authority

and has taken all necessary corporate and other action to authorize the execution and delivery of this

Amendment and the performance of this Amendment and, in the case of the Borrower, the Credit

Agreement as amended by this Amendment (the “Amended Credit Agreement”), in accordance with their

respective terms. This Amendment has been duly executed and delivered by the duly authorized officers

of each Credit Party, and each of this Amendment and, in the case of the Borrower, the Amended Credit

Agreement constitutes the legal, valid and binding obligation of each Credit Party, enforceable in

accordance with its terms, except as such enforceability may be limited by Debtor Relief Laws from time

to time in effect which affect the enforcement of creditors’ rights in general and the availability of

equitable remedies.

(b) The execution, delivery and performance by each Credit Party of this Amendment

and the performance by the Borrower of the Amended Credit Agreement (a) do not require any

Governmental Approval or any consent by or approval of any other third Person (including shareholders

or any class of directors, whether interested or disinterested, of the Borrower or any other Person), nor is

any such Governmental Approval or other consent or approval necessary for the validity or enforceability

of this Amendment and the Amended Credit Agreement or the consummation of the transactions

contemplated thereby, except (i) such as have been obtained or made and are in full force and effect, (ii)

those third party approvals or consents which, if not made or obtained, would not cause a Default

hereunder or could not, individually or in the aggregate, reasonably be expected to have a Material

Adverse Effect, and (iii) the filing of any required documents with the SEC, (b) will not violate any

Applicable Law (except for such violations that would not reasonably be expected to have a Material

Adverse Effect) or the articles of incorporation, bylaws or other organizational documents of the

Borrower or any Restricted Subsidiary, (c) will not violate or result in a default under any indenture,

agreement or other instrument evidencing Indebtedness over the Threshold Amount binding upon the

Borrower or any Restricted Subsidiary or its Properties, or give rise to a right thereunder to require any

payment to be made by the Borrower or such Restricted Subsidiary and (d) will not result in the creation

or imposition of any Lien on any Property of the Borrower or any Restricted Subsidiary (other than

Permitted Liens).

Amended Credit Agreement are true and correct in all material respects, except for any representation and

warranty that is qualified by materiality or reference to Material Adverse Effect, which such

representation and warranty shall be true and correct in all respects as of the Effective Date with the same

effect as if made on and as of such date (except for any such representation and warranty that by its terms

is made only as of an earlier date, which representation and warranty shall remain true and correct in all

material respects, except for any representation and warranty that is qualified by materiality or reference

to Material Adverse Effect, which such representation and warranty shall be true and correct in all

respects as of such earlier date).

(d) No Default or Event of Default has occurred and is continuing or would result from

giving effect to this Amendment.

SECTION 3. Conditions Precedent. This Amendment shall become effective upon the

date (such date, the “Effective Date”) that each of the following conditions precedent shall have been

satisfied:

(a) The Administrative Agent shall have received executed counterparts to this

Amendment duly executed and delivered by (i) each Credit Party and (ii) the Required Lenders.

(b) The representations and warranties of the Credit Parties set forth in Section 2(a)-(c)

above shall be true and correct in all material respects as of the Effective Date, except for any

representation and warranty that is qualified by materiality or reference to Material Adverse Effect, which

such representation and warranty shall be true and correct in all respects as of the Effective Date with the

same effect as if made on and as of such date (except for any such representation and warranty that by its

terms is made only as of an earlier date, which representation and warranty shall remain true and correct

in all material respects, except for any representation and warranty that is qualified by materiality or

reference to Material Adverse Effect, which such representation and warranty shall be true and correct in

all respects as of such earlier date).

from giving effect to this Amendment.

(d) The Administrative Agent shall have received a certificate from a Responsible

Officer of the Borrower in form and substance reasonably satisfactory to the Administrative Agent

certifying as to the satisfaction of the condition set forth in clauses (b) and (c) above.

SECTION 4. Reaffirmation. Each Credit Party hereby expressly acknowledges the

terms of this Amendment and the Amended Credit Agreement and reaffirms, as of the date hereof, (i) the

covenants and agreements contained in each Loan Document to which it is a party, including, in each

case, such covenants and agreements as in effect immediately after giving effect to this Amendment and

the transactions contemplated hereby, (ii) its guarantee of the Secured Obligations pursuant to the

Guarantee and Collateral Agreement and (iii) its grant of Liens on the Collateral to secure the Secured

Obligations pursuant to the Security Documents.

SECTION 5. Effects on Loan Documents. Except as specifically amended herein, the

Credit Agreement shall continue to be in full force and effect and is hereby in all respects ratified and

confirmed. This Amendment shall not operate as a waiver of any right, power or remedy of any Lender

or Agent under any of the Loan Documents, nor constitute a waiver of any provision of the Loan

Documents. This Amendment shall constitute a “Loan Document” for all purposes of the Credit

Agreement and the other Loan Documents, and on and after the Effective Date, each reference in the

Credit Agreement to “this Agreement”, “hereunder”, “hereof”, “herein” or words of like import referring

to the Credit Agreement, and each reference in the other Loan Documents to the “Credit Agreement”,

“thereunder”, “thereof” or words of like import referring to the Credit Agreement, shall mean and be a

reference to the Amended Credit Agreement.

SECTION 6. GOVERNING LAW; WAIVER OF JURY TRIAL. THIS AMENDMENT

AND ANY CLAIM, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN

CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO

THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,

THE LAW OF THE STATE OF NEW YORK. EACH PARTY HERETO HEREBY AGREES TO THE

PROVISIONS OF SECTION 12.5 OF THE CREDIT AGREEMENT AS IF SUCH SECTION WAS SET

FORTH IN FULL HEREIN.

SECTION 7. Execution in Counterparts. This Amendment may be executed in any

number of counterparts and by the different parties hereto on separate counterparts, including by means of

facsimile or electronic transmission (including .pdf format), each of which when so executed and

delivered shall be an original, but all of which shall together constitute one and the same instrument.

SECTION 8. FATCA. For purposes of determining withholding Taxes imposed under

FATCA, from and after the Effective Date, the Borrower and the Administrative Agent shall treat (and

the Lenders hereby authorize the Borrower and the Administrative Agent to treat) the Credit Agreement

and the Loans as not qualifying as a “grandfathered obligation” within the meaning of Treasury

Regulation Section 1.1471-2(b)(2)(i).

[Signature pages follow]

·l

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their respective proper and duly authorized officers as of the day and year first above written.

BORROWER:

CST BRANDS, INC.

By: /s/ Clayton E. Killinger

Name: Clayton E. Killinger

Title: Senior Vice President and Chief Financial Officer

SUBSIDIARY GUARANTORS:

CST DIAMOND, L.P.

By: Emerald Marketing, Inc., its General Partner

By: /s/ Clayton E. Killinger

Name: Clayton E. Killinger

Title: Senior Vice President and Chief Financial Officer

CST SECURITY SERVICES, INC.

By: /s/ Clayton E. Killinger

Name: Clayton E. Killinger

Title: Senior Vice President and Treasurer

Signature Page to Third Amendment

AUTOTRONIC SYSTEMS, INC.

BIG DIAMOND, LLC

BIG DIAMOND NUMBER 1, LLC

CST ARKANSAS STATIONS, LLC

CST CALIFORNIA STATIONS, INC.

CST MARKETING AND SUPPLY COMPANY

CST METRO LLC

CST SERVICES LLC

CST USA INC.

CST ARIZONA STATIONS, INC.

CST SHAMROCK STATIONS, INC.

EMERALD MARKETING, INC.

NATIONAL CONVENIENCE STORES INCORPORATED

SIGMOR BEVERAGE, INC.

SIGMOR COMPANY, LLC

SIGMOR NUMBER 5, INC.

SIGMOR NUMBER 43, INC.

SIGMOR NUMBER 79, INC.

SIGMOR NUMBER 80, INC.

SIGMOR NUMBER 103, INC.

SIGMOR NUMBER 105, INC.

SIGMOR NUMBER 119, INC.

SIGMOR NUMBER 178, INC.

SIGMOR NUMBER 196, INC.

SIGMOR NUMBER 238, INC.

SIGMOR NUMBER 259, INC.

SIGMOR NUMBER 422, INC.

SKIPPER BEVERAGE COMPANY, LLC

SUNSHINE BEVERAGE CO.

TOC-DS COMPANY

VALLEY SHAMROCK, INC.

CST DIAMOND HOLDINGS LLC

REAL ESTATE VENTURES, LLC

ELR, LLC

CST REAL ESTATE HOLDINGS, LLC

CST BRANDS HOLDINGS, LLC

CST BRANDS HOLDINGS, INC.

CST ARIZONA, LLC

CST LOUISIANA, LLC

CST STATIONS TEXAS, LLC

CST MANAGEMENT, INC.

By: /s/ Clayton E. Killinger

Name: Clayton E. Killinger

Title: Senior Vice President and Chief Financial Officer

Signature Page to Third Amendment

N2I ONE, LLC

N2I TWO, LLC

By: /s/ Gerard J. Sonnier

Name: Gerard J. Sonnier

Title: Senior Vice President and Secretary

CAPL HOLDING, INC.

CAPL OPERATIONS I, LLC

By: /s/ Gerard J. Sonnier

Name: Gerard J. Sonnier

Title: Senior Vice President, Secretary and General Counsel

Signature Page to Third Amendment

WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent and Lender

By: /s/ Nathan R. Rantala

Name: Nathan R. Rantala

Title: Director

Signature Page to Third Amendment

JPMORGAN CHASE BANK, N.A., as Issuing Lender and Lender

By: /s/ Lauren Baker

Name: Lauren Baker

Title: Vice President

Signature Page to Third Amendment

The Royal Bank of Scotland plc, as Lender

By: /s/ Steve Ray

Name: Steve Ray

Title: Director

Signature Page to Third Amendment

The Bank of Tokyo-Mitsubishi UFJ, Ltd., as Lender

By: /s/ Todd Vaubel

Name: Todd Vaubel

Title: Vice President

Signature Page to Third Amendment

ROYAL BANK OF CANADA, as Issuing Lender and Lender

By: /s/ Gordon MacArthur

Name: Gordon MacArthur

Title: Authorized Signatory

Signature Page to Third Amendment

FIFTH THIRD BANK, as Lender

By: /s/ Brian Anderson

Name: Brian Anderson

Title: Vice President

Signature Page to Third Amendment

Mizuho Bank, Ltd., as Lender

By: /s/ Leon Mo

Name: Leon Mo

Title: Authorized Signatory

Signature Page to Third Amendment

Bank of America, N.A., as Lender

By: /s/ R. Mark Bearfield

Name: R. Mark Bearfield

Title: Senior Vice President

Signature Page to Third Amendment

Regions Bank, as Lender

By: /s/ Brian King

Name: Brian King

Title: Vice President

Signature Page to Third Amendment

BOKF, NA dba Bank of Texas, as Lender

By: /s/ Marian Livingston

Name: Marian Livingston

Title: Senior Vice President

Signature Page to Third Amendment

The Northern Trust Company, as Lender

By: /s/ Keith Burson

Name: Keith Burson

Title: Vice President

Signature Page to Third Amendment

Cadence Bank, N.A., as Lender

By: /s/ Mike Ross

Name: Mike Ross

Title: Executive Vice President

Signature Page to Third Amendment

The Bank of Nova Scotia, as Issuing Bank and Lender

By: /s/ John Frazell

Name: John Frazell

Title: Director

Signature Page to Third Amendment

Scotiabanc Inc., as Lender

By: /s/ J.F. Todd

Name: J.F. Todd

Title: Managing Director

Signature Page to Third Amendment

PNC BANK, NATIONAL ASSOCIATION, as Lender

By: /s/ Jonathan Luchansky

Name: Jonathan Luchansky

Title: Assistant Vice President

Signature Page to Third Amendment

U.S. Bank National Association, as Lender

By: /s/ Mark D. Rodgers

Name: Mark D. Rodgers

Title: Vice President

Signature Page to Third Amendment

Branch Banking & Trust Company, as Lender

By: /s/ Matt McCain

Name: Matt McCain

Title: Senior Vice President

Signature Page to Third Amendment

CANADIAN IMPERIAL BANK OF COMMERCE, NEW YORK BRANCH, as Lender

By: /s/ Richard Antl

Name: Richard Antl

Title: Authorized Signatory

By: /s/ Trudy Nelson

Name: Trudy Nelson

Title: Authorized Signatory

Signature Page to Third Amendment

Compass Bank, as Lender

By: /s/ Collis Sanders

Name: Collis Sanders

Title: Executive Vice President

Signature Page to Third Amendment

Whitney Bank, as Lender

By: /s/ Paul W. Cole

Name: Paul W. Cole

Title: Senior Vice President

Signature Page to Third Amendment

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as Lender

By: /s/ Christopher Day

Name: Christopher Day

Title: Authorized Signatory

By: /s/ Samuel Miller

Name: Samuel Miller

Title: Authorized Signatory

Signature Page to Third Amendment

Frost Bank, as Lender

By: /s/ Sarah Cernosek

Name: Sarah Cernosek

Title: Vice President

Signature Page to Third Amendment