EXHIBIT 10b(i)
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AMENDED AND RESTATED
CREDIT AGREEMENT
by and among
WORLD FUEL SERVICES CORPORATION
as Borrower,
NATIONSBANK, N.A. (SOUTH),
as Lender
February 21, 1997
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TABLE OF CONTENTS
PAGE
ARTICLE I Amendment and Restatement; Definitions
1.1. Amendment and Restatement...............................................2
1.2. Definitions.............................................................2
1.3. Rules of Interpretation................................................21
ARTICLE II The Revolving Credit Facility
2.1. Loans..................................................................24
2.2. Payment of Interest....................................................26
2.3. Payment of Principal...................................................26
2.4. Non-Conforming Payments................................................26
2.5. Notes..................................................................27
2.6. Reductions.............................................................27
2.7. Conversions and Elections of Subsequent Interest Periods...............27
2.8. Increase and Decrease in Amounts.......................................28
2.9. Fees...................................................................28
2.10. Use of Proceeds........................................................28
ARTICLE III Letters of Credit
3.1. Letters of Credit......................................................29
3.2. Reimbursement..........................................................29
3.3. Letter of Credit Facility Fees.........................................32
3.4. Administrative Fees....................................................32
ARTICLE IV Yield Protection and Illegality
4.1. Additional Costs.......................................................33
4.2. Suspension of Loans....................................................34
4.3. Illegality.............................................................35
4.4. Compensation...........................................................35
ARTICLE VConditions to Making Loans and Issuing Letters of Credit
5.1. Conditions of Initial Advance..........................................37
5.2. Conditions of Loans and Letter of Credit...............................38
ARTICLE VI Representations and Warranties
6.1. Organization and Authority.............................................40
6.2. Loan Documents.........................................................40
6.3. Solvency...............................................................41
6.4. Subsidiaries and Stockholders..........................................41
6.5. Ownership Interests....................................................41
6.6. Financial Condition....................................................42
6.7. Title to Properties....................................................42
6.8. Taxes..................................................................42
6.9. Other Agreements.......................................................43
6.10. Litigation.............................................................43
6.11. Margin Stock...........................................................43
6.12. Investment Company.....................................................43
6.13. Patents, Etc...........................................................44
6.14. No Untrue Statement....................................................44
6.15. No Consents, Etc.......................................................44
6.16. Employee Benefit Plans.................................................44
6.17. No Default.............................................................46
6.18. Hazardous Materials....................................................46
6.19. RICO...................................................................46
ARTICLE VII Affirmative Covenants
7.1. Financial Reports, Etc.................................................47
7.2. Maintain Properties....................................................48
7.3. Existence, Qualification, Etc..........................................49
7.4. Regulations and Taxes..................................................49
7.5. Insurance..............................................................49
7.6. True Books.............................................................49
7.7. Right of Inspection....................................................49
7.8. Observe all Laws.......................................................50
7.9. Governmental Licenses..................................................50
7.10. Covenants Extending to Other Persons...................................50
7.11. Officer's Knowledge of Default.........................................50
7.12. Suits or Other Proceedings.............................................50
7.13. Notice of Discharge of Hazardous Material or Environmental Complaint...50
7.14. Environmental Compliance...............................................50
7.15. Indemnification........................................................51
7.16. Further Assurances.....................................................51
7.17. Employee Benefit Plans.................................................51
7.18. Continued Operations...................................................52
7.19. New Subsidiaries.......................................................52
ARTICLE VIII Negative Covenants
8.1. Financial Covenants....................................................54
8.2. Acquisitions...........................................................54
8.3. Capital Expenditures...................................................55
8.4. Liens..................................................................55
8.5. Indebtedness...........................................................56
8.6. Transfer of Assets.....................................................57
8.7. Investments............................................................57
8.8. Merger or Consolidation................................................58
8.9. Restricted Payments....................................................58
8.10. Transactions with Affiliates...........................................59
8.11. Compliance with ERISA..................................................59
8.12. Fiscal Year............................................................60
8.13. Dissolution, etc.......................................................60
8.14. Negative Pledge Clauses................................................60
8.15. Partnerships...........................................................60
8.16. WFI Capitalization.....................................................60
ARTICLE IX Events of Default and Acceleration
9.1. Events of Default......................................................61
9.2. Lender to Act..........................................................64
9.3. Cumulative Rights......................................................64
9.4. No Waiver..............................................................64
9.5. Allocation of Proceeds.................................................65
ARTICLE X Miscellaneous
10.1. Participations.........................................................66
10.2. Notices................................................................66
10.3. Setoff ................................................................67
10.4. Survival...............................................................67
10.5. Expenses...............................................................67
10.6. Amendments.............................................................68
10.7. Counterparts...........................................................69
10.8. Termination............................................................69
10.9. Indemnification; Limitation of Liability...............................70
10.10. Severability...........................................................70
10.11. Entire Agreement.......................................................71
10.12. Agreement Controls.....................................................71
10.13. Usury Savings Clause...................................................71
10.14. Governing Law; Waiver of Jury Trial....................................71
EXHIBIT A Applicable Commitment Percentages..............................A-1
EXHIBIT B Notice of Appointment (or Revocation) of
Authorized Representative.....................................B-1
EXHIBIT C Form of Borrowing Notice.......................................C-1
EXHIBIT D Form of Interest Rate Selection Notice.........................D-1
EXHIBIT E Form of Revolving Note.........................................E-1
EXHIBIT F Form of Opinion of Borrower's Counsel..........................F-1
EXHIBIT G Compliance Certificate.........................................G-1
EXHIBIT H FORM OF GUARANTY AGREEMENT.....................................H-1
Schedule 6.4 Subsidiaries and Investments in Other Persons..................S-1
Schedule 6.6 Indebtedness...................................................S-2
Schedule 6.7 Liens..........................................................S-3
Schedule 6.8 Tax Matters....................................................S-4
Schedule 6.10 Litigation.....................................................S-5
Schedule 6.18 Hazardous Materials............................................S-6
Schedule 7.6 Indebtedness...................................................S-7
AMENDED AND RESTATED
CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT, dated as of February 21, 1997
(the "Agreement"), is made by and between WORLD FUEL SERVICES CORPORATION (f/k/a
International Recovery Corp.), a Florida corporation having its principal place
of business in Miami Springs, Florida (the "Borrower"), NATIONSBANK, N.A.
(SOUTH)(successor in interest by merger to the Citizens and Southern National
Bank of Florida, N.A.), a national banking association organized and existing
under the laws of the United States, as a Lender (the "Lender");
W I T N E S S E T H:
WHEREAS, the Borrower and the Citizens and Southern National Bank of
Florida, N.A. have entered into a Revolving Loan Agreement and Credit Facility
dated as of March 1, 1991, as amended by the First Amendment to Revolving Loan
Agreement and Credit Facility dated April 13, 1993, that certain Letter
Agreement dated January 21, 1994, that certain Letter Agreement dated October 3,
1994, and as further amended by the Consolidated Amendment Agreement No. 3 dated
May 5, 1995, the Amendment Agreement No. 4 dated September 25, 1995 and the
Amendment Agreement No. 5 dated May 15, 1996 (as so amended, the "Prior Credit
Agreement"), pursuant to the which the Citizens and Southern National bank of
Florida, N.A. agreed to make available, and pursuant to which NationsBank, as
successor in interest by merger to the Citizens and Southern National Bank of
Florida, N.A. has continued to make available to the Borrower a revolving credit
facility in the principal amount of up to $25,000,000; and
WHEREAS, the Borrower has requested and the Lender has agreed, subject to
terms and conditions of this Agreement, to amend and restate the Prior Credit
Agreement in its entirety and pursuant to which the Lender shall make available
to the Borrower a revolving credit facility of up to $25,000,000, the proceeds
of which are to be used for working capital, capital expenditures and other
general corporate purposes and which shall include a letter of credit facility
of up to $10,000,000 for the issuance of documentary and standby letters of
credit; and
NOW, THEREFORE, the Borrower and the Lender hereby amend and restate the
Prior Credit Agreement in its entirety and agree as follows:
ARTICLE I
AMENDMENT AND RESTATEMENT; DEFINITIONS AMENDMENT AND RESTATEMENT; DEFINITIONS
I.1. AMENDMENT AND RESTATEMENT. The Borrower the Lender hereby agree that
upon the effectiveness of this Agreement, the terms and provisions of the Prior
Credit Agreement shall be and hereby are amended and restated in their entirety
by the terms and conditions of this Agreement and the terms and provisions of
the Prior Credit Agreement, except as otherwise provided herein, shall be
superseded by this Agreement.
Notwithstanding the amendment and restatement of the Prior Credit Agreement
by this Agreement, the Borrower shall continue to be liable to NationsBank with
respect to agreements on the part of the Borrower under the Prior Credit
Agreement to indemnify and hold harmless NationsBank from and against all
claims, demands, liabilities, damages, losses, costs, charges and expenses to
which NationsBank may be subject arising in connection with the Prior Credit
Agreement. This Agreement is given as a substitution of, and not as a payment
of, the obligations of Borrower under the Prior Credit Agreement and is not
intended to constitute a novation of the Prior Credit Agreement. Except as
otherwise selected by the Borrower by delivery of a Borrowing Notice prior to
the Closing Date in accordance with the terms hereof, upon the effectiveness of
this Agreement all amounts outstanding and owing by Borrower under the Prior
Credit Agreement as of the Closing Date, as determined by the Lender, shall
constitute Advances hereunder accruing interest (a) with respect to LIBOR Loans
under the Prior Credit Agreement, at the LIBOR Rate hereunder and (b) with
respect to Base Rate Loans under the Prior Credit Agreement, at the Base Rate
hereunder. The parties hereto agree that all LIBOR Rate Loans outstanding under
the Prior Credit Agreement on the Closing Date shall continue as LIBOR Rate
Loans hereunder without any compensation pursuant to SECTION 4.4 hereof being
due to the Lender. Except as otherwise provided for by the Borrower by delivery
to the Issuing Bank of an Application and Agreement for Letters of Credit prior
to the Closing Date in accordance with the terms hereof, upon the effectiveness
of this Agreement (x) all Documentary Letters of Credit issued for the account
of the Borrower or any of its Subsidiaries under the Prior Credit Agreement as
of the Closing Date shall constitute Documentary Letters of Credit hereunder,
and (y) all Standby Letters of Credit issued for the account of the Borrower or
any of its Subsidiaries under the Prior Credit Agreement as of the Closing Date
shall constitute Standby Letters of Credit hereunder; PROVIDED, however, that as
of the Closing Date the Letter of Credit Outstandings shall not exceed the Total
Letter of Credit Commitment.
I.2 DEFINITIONS. For the purposes of this Agreement, in addition to the
definitions set forth above, the following terms
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shall have the respective meanings set forth below:
"Acquisition" means the acquisition of (i) a controlling equity
interest in another Person (including the purchase of an option,
warrant or convertible or similar type security to acquire such a
controlling interest at the time it becomes exercisable by the holder
thereof), whether by purchase of such equity interest or upon exercise
of an option or warrant for, or conversion of securities into, such
equity interest, or (ii) assets of another Person which constitute all
or substantially all of the assets of such Person or of a line or lines
of business conducted by such Person.
"Advance" means a borrowing under the Revolving Credit Facility
consisting of a Base Rate Loan or a LIBOR Rate Loan.
"Affiliate" means any Person (i) which directly or indirectly
through one or more intermediaries controls, or is controlled by, or is
under common control with the Borrower; or (ii) which beneficially owns
or holds 20% or more of any class of the outstanding voting stock (or
in the case of a Person which is not a corporation, 20% or more of the
equity interest) of the Borrower; or 20% or more of any class of the
outstanding voting stock (or in the case of a Person which is not a
corporation, 20% or more of the equity interest) of which is
beneficially owned or held by the Borrower. The term "control" means
the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person, whether
through ownership of voting stock, by contract or otherwise.
"Applicable Margin" means that percent per annum set forth below,
which shall be based upon the Consolidated Fixed Charge Coverage Ratio
for the Four-Quarter Period most recently ended as specified below:
APPLICABLE
MARGIN
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CONSOLIDATED FIXED LIBOR
CHARGE COVERAGE RATIO RATE
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(a) Greater than or equal
to 5.00 to 1.0 .65%
(b) Greater than or equal
to 4.00 to 1.00 but
less than 5.00 to 1.00 .75%
(c) Greater than or equal
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to 3.00 to 1.00 but
less than 4.00 to 1.00 .875%
(d) Greater than or equal
to 1.35 to 1.00 but
less than 3.00 to 1.00 1.00%
The Applicable Margin shall be established at the end of each fiscal
quarter of the Borrower (each, a "Determination Date"). Any change in
the Applicable Margin following each Determination Date shall be
determined based upon the computations set forth in the certificate
furnished to the Lender pursuant to SECTION 7.1(A)(II) and SECTION
7.1(B)(II), subject to review and approval of such computations by the
Lender, and shall be effective commencing on the date following the
date such certificate is received (or, if earlier, the date such
certificate was required to be delivered) until the date following the
date on which a new certificate is delivered or is required to be
delivered, whichever shall first occur.
"Applicable Unused Fee" means that percent per annum set forth
below, which shall be based upon the Consolidated Fixed Charge Coverage
Ratio for the Four-Quarter Period most recently ended as specified
below:
APPLICABLE
CONSOLIDATED FIXED UNUSED
CHARGE COVERAGE RATIO FEE
--------------------- ----------
(a) Greater than or equal
to 5.00 to 1.0 .20%
(b) Greater than or equal
to 4.00 to 1.00 but
less than 5.00 to 1.00 .25%
(c) Greater than or equal
to 3.00 to 1.00 but
less than 4.00 to 1.00 .3125%
(d) Greater than or equal
to 1.35 to 1.00 but
less than 3.00 to 1.00 .375%
The Applicable Unused Fee shall be established at the end of each
fiscal quarter of the Borrower (the "Determination Date"). Any change
in the Applicable Unused Fee following each Determination Date shall be
determined based upon the computations set forth in the certificate
furnished to the Lender pursuant to SECTION 7.1(A)(II) and SECTION
7.1(B)(II), subject to review and approval of such
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computations by the Lender and shall be effective commencing on the
date following the date such certificate is received (or, if earlier,
the date such certificate was required to be delivered) until the date
following the date on which a new certificate is delivered or is
required to be delivered, whichever shall first occur.
"Applications and Agreements for Letters of Credit" means,
collectively, the Applications and Agreements for Letters of Credit, or
similar documentation, executed by the Borrower from time to time and
delivered to the Issuing Bank to support the issuance of Letters of
Credit.
"Authorized Representative" means any of the President, Executive
Vice President, Chief Financial Officer or Chairman of the Board of
Directors of the Borrower, or any other Person expressly designated by
the Board of Directors of the Borrower (or the appropriate committee
thereof) as an Authorized Representative of the Borrower, as set forth
from time to time in a certificate in the form of EXHIBIT B.
"Base Rate" means the per annum rate of interest equal to the
greater of (i) the Prime Rate or (ii) the Federal Funds Effective Rate
plus one-half of one percent (1/2%). Any change in the Base Rate
resulting from a change in the Prime Rate or the Federal Funds
Effective Rate shall become effective as of 12:01 A.M. of the Business
Day on which each such change occurs. The Base Rate is a reference rate
used by the Lender in determining interest rates on certain loans and
is not intended to be the lowest rate of interest charged on any
extension of credit to any debtor.
"Base Rate Loan" means a Loan for which the rate of interest is
determined by reference to the Base Rate.
"Base Rate Refunding Loan" means a Base Rate Loan made to satisfy
Reimbursement Obligations arising from a drawing under a Letter of
Credit.
"Board" means the Board of Governors of the Federal Reserve System
(or any successor body).
"Borrower's Account" means a demand deposit account with the
Lender, which may be maintained at one or more offices of the Lender.
"Borrowing Notice" means the notice delivered by an Authorized
Representative in connection with an Advance under the Revolving Credit
Facility, in the form of EXHIBIT C.
"Business Day" means, (i) with respect to any Base Rate Loan,
any day which is not a Saturday, Sunday or a day on
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which banks in the States of New York and North Carolina are authorized
or obligated by law, executive order or governmental decree to be
closed and, (ii) with respect to any LIBOR Rate Loan, any day which is
a Business Day, as described above, and on which the relevant
international financial markets are open for the transaction of
business contemplated by this Agreement in London, England, New York,
New York and Charlotte, North Carolina.
"Capital Expenditures" means, with respect to the Borrower and its
Subsidiaries, for any period the SUM of (without duplication) (i) all
expenditures (whether paid in cash or accrued as liabilities) by the
Borrower or any Subsidiary during such period for items that would be
classified as "property, plant or equipment" or comparable items on the
consolidated balance sheet of the Borrower and its Subsidiaries,
including without limitation all transactional costs incurred in
connection with such expenditures provided the same have been
capitalized, excluding, however, the amount of any Capital Expenditures
paid for with proceeds of casualty insurance as evidenced in writing
and submitted to the Lender together with any compliance certificate
delivered pursuant to SECTION 7.1(A) or (B), and (ii) with respect to
any Capital Lease entered into by the Borrower or its Subsidiaries
during such period, the present value of the lease payments due under
such Capital Lease over the term of such Capital Lease applying a
discount rate equal to the interest rate provided in such lease (or in
the absence of a stated interest rate, that rate used in the
preparation of the financial statements described in SECTION 7.1(A)),
all the foregoing in accordance with GAAP applied on a Consistent
Basis.
"Capital Leases" means all leases which have been or should be
capitalized in accordance with GAAP as in effect from time to time
including Statement No. 13 of the Financial Accounting Standards Board
and any successor thereof.
"Change of Control" means, at any time any "person" or "group"
(each as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act)
either (A) becomes the "beneficial owner" (as defined in Rule 13d-3 of
the Exchange Act ), directly or indirectly, of Voting Stock of the
Borrower (or securities convertible into or exchangeable for such
Voting Stock) representing 33-1/3% or more of the combined voting power
of all Voting Stock of the Borrower (on a fully diluted basis) or (B)
otherwise has the ability, directly or indirectly, to elect a majority
of the board of directors of the Borrower.
"Closing Date" means the date as of which this Agreement is
executed by the Borrower and the Lender and on
6
which the conditions set forth in SECTION 5.1 have been satisfied.
"Code" means the Internal Revenue Code of 1986, as amended, and
any regulations promulgated thereunder.
"Consistent Basis" means, in reference to the application of GAAP,
that the accounting principles observed in the period referred to are
comparable in all material respects to those applied in the preparation
of the audited financial statements of the Borrower referred to in
SECTION 6.6(A).
"Consolidated Capitalization" means, at any time at which the
amount thereof is to be determined, the sum of Consolidated Funded
Indebtedness plus Consolidated Shareholders' Equity.
"Consolidated Current Liabilities" means, the aggregate amount
carried as current liabilities on the books of the Borrower and its
Subsidiaries, on a consolidated basis and after eliminating all
intercompany items, determined in accordance with GAAP applied on a
Consistent Basis, LESS any such amount constituting Obligations of the
Borrower incurred pursuant to this Agreement.
"Consolidated EBITDA" means, with respect to the Borrower and its
Subsidiaries for any Four-Quarter Period ending on the date of
computation thereof, the SUM of, without duplication, (i) Consolidated
Net Income, (ii) Consolidated Interest Expense, (iii) provisions for
income taxes, (iv) depreciation, and (v) amortization, all determined
on a consolidated basis in accordance with GAAP applied on a Consistent
Basis.
"Consolidated Fixed Charge Coverage Ratio" means, with respect to
the Borrower and its Subsidiaries for any Four-Quarter Period ending on
the date of computation thereof, the ratio of (i) the sum, for such
period, of Consolidated EBITDA, MINUS capital expenditures to(ii)
Consolidated Fixed Charges for such period.
"Consolidated Fixed Charges" means, with respect to Borrower and
its Subsidiaries for any Four-Quarter Period ending on the date of
computation thereof, the SUM of, without duplication, (i) Consolidated
Interest Expense,(ii) Current Maturities of Long-Term Debt (including
all Capital Lease obligations), and (iii) all cash dividends and
distributions paid during such period (regardless of when declared) on
any shares of capital stock of the Borrower then outstanding, all
determined on a consolidated basis in accordance with GAAP applied on a
Consistent Basis.
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"Consolidated Funded Indebtedness" means, at any time as of which
the amount thereof is to be determined, (i) all Indebtedness for Money
Borrowed (excluding from the computation thereof Consolidated Current
Liabilities other than Current Maturities of Long-Term Debt), PLUS (ii)
the face amount of all outstanding Standby Letters of Credit issued for
the account of the Borrower or any of its Subsidiaries and all
obligations (to the extent not duplicative) arising under such Letters
of Credit, all determined on a consolidated basis in accordance with
GAAP applied on a Consistent Basis.
"Consolidated Interest Expense" means, with respect to any period
of computation thereof, the gross interest expense of the Borrower and
its Subsidiaries, including without limitation (i) the amortization of
debt discounts, (ii) the amortization of all fees (including fees
payable in respect of any Swap Agreement) payable in connection with
the incurrence of Indebtedness to the extent included in interest
expense, and (iii) the portion of any payments made in connection with
Capital Leases allocable to interest expense, all determined on a
consolidated basis in accordance with GAAP applied on a Consistent
Basis.
"Consolidated Net Income" means, for the Borrower and its
Subsidiaries, for any period of computation thereof, the amount which,
in conformity with GAAP, would be set forth opposite the caption "Net
Income" (or any like caption) on a consolidated statement of earnings
of the Borrower and its Subsidiaries.
"Consolidated Shareholders' Equity" means, as of any date on which
the amount thereof is to be determined, the sum of the following in
respect of the Borrower and its Subsidiaries (determined on a
consolidated basis and excluding intercompany items among the Borrower
and its Subsidiaries and any upward adjustment after the Closing Date
due to revaluation of assets): (i) the amount of issued and outstanding
share capital, PLUS (ii) the amount of additional paid-in capital and
retained income (or, in the case of a deficit, minus the amount of such
deficit), PLUS (iii) the amount of any foreign currency translation
adjustment (if positive, or, if negative, minus the amount of such
translation adjustment) MINUS (iv) the book value of any treasury stock
and the book value of any stock subscription receivables, all as
determined in accordance with GAAP applied on a Consistent Basis.
"Consolidated Tangible Net Worth" means, as of any date on which
the amount thereof is to be determined, Consolidated Shareholders'
Equity MINUS the net book value of all assets which would be treated as
intangible assets, all as determined on a consolidated basis in
accordance with GAAP applied on a Consistent Basis.
8
"Consolidated Working Assets" means, at any time as of which the
amount thereof is to be determined, the sum of cash PLUS the book value
of cash equivalents, accounts receivable net of allowance for doubtful
accounts, inventory, prepaid fuel, and the current portion of notes
receivable, all determined on a consolidated basis in accordance with
GAAP applied on a Consistent Basis.
"Contingent Obligation" means any agreement, undertaking or
arrangement by which any Person guarantees, endorses or otherwise
becomes or is contingently liable upon (by direct or indirect agreement
to provide funds for payment, to supply funds to, or otherwise to
invest in, a debtor, or otherwise to assure a creditor against loss)
the Indebtedness of any other Person (other than by endorsements of
instruments in the course of collection), or guarantees the payment of
dividends or other distributions upon the shares of any other Person.
The amount of any person's obligation under any Contingent Obligation
shall (subject to any limitation set forth therein) be deemed to be the
outstanding principal amount (or maximum principal amount, if larger)
of the Indebtedness guaranteed thereby.
"Credit Party" means, collectively, the Borrower and each
Guarantor.
"Current Maturities of Long-Term Debt" means, with respect to
Indebtedness for Money Borrowed that matures more than one year from
the date of its creation or matures within one year of the date of its
creation but is renewable or extendable, at the option of the Borrower
or any Subsidiary, to a date more than one year from the date of its
creation, all payments in respect thereof that are required to be made
within one year from the date of any determination thereof.
"Default" means any of the occurrences set forth as such in
SECTION 9.1 which, upon the expiration of any applicable grace period,
would constitute an Event of Default hereunder.
"Default Rate" means (i) with respect to each LIBOR Rate Loan,
until the end of the Interest Period applicable thereto, a rate of two
percent (2%) above the LIBOR Rate applicable to such Loan, and
thereafter at a rate of interest per annum which shall be two percent
(2%) above the Base Rate, (ii) with respect to Base Rate Loans, at a
rate of interest per annum which shall be two percent (2%) above the
Base Rate and (iii) in any case, the maximum rate permitted by
applicable law, if lower.
"Documentary Letters of Credit" means the documentary
9
letters of credit issued by the Issuing Bank for the account of the
Borrower or any of its Subsidiaries upon the terms and conditions of
this Agreement.
"Dollars" and the symbol "$" means dollars constituting legal
tender for the payment of public and private debts in the United States
of America.
"Eligible Securities" means the following obligations and any
other obligations previously approved in writing by the Lender:
(a) Government Securities;
(b) obligations of any corporation organized under the laws
of any state of the United States of America or under the laws of
any other nation, payable in the United States of America,
expressed to mature not later than 92 days following the date of
issuance thereof and rated in an investment grade rating category
by S&P and ▇▇▇▇▇'▇;
(c) interest bearing demand or time deposits issued by the
Lender or certificates of deposit maturing within one year days
from the date of issuance thereof and issued by a bank or trust
company organized under the laws of the United States or of any
state thereof having capital surplus and undivided profits
aggregating at least $400,000,000 and being rated "A-3" or better
by S&P or "A" or better by ▇▇▇▇▇'▇;
(d) Repurchase Agreements;
(e) Municipal Obligations;
(f) Pre-Refunded Municipal Obligations;
(g) shares of mutual funds which invest in obligations
described in paragraphs (a) through (f) above, the shares of which
mutual funds are at all times rated "AAA" by S&P;
(h) tax-exempt or taxable adjustable rate preferred stock
issued by a Person having a rating of its long term unsecured debt
of "A" or better by S&P or "A-3" or better by ▇▇▇▇▇'▇; and
(i) asset-backed remarketed certificates of participation
representing a fractional undivided interest in the assets of a
trust, which certificates are rated at least "A-1" by S&P and
"P-1" by ▇▇▇▇▇'▇.
"Employee Benefit Plan" means any employee benefit plan
10
within the meaning of Section 3(3) of ERISA which (i) is maintained for
employees of the Borrower or any of its ERISA Affiliates or is assumed
by the Borrower or any of its ERISA Affiliates in connection with any
Acquisition or (ii) has at any time been maintained for the employees
of the Borrower or any current or former ERISA Affiliate.
"Environmental Laws" means, collectively, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as
amended, the Superfund Amendments and Reauthorization Act of 1986, the
Resource Conservation and Recovery Act, the Toxic Substances Control
Act, as amended, the Clean Air Act, as amended, the Clean Water Act, as
amended, any other "Superfund" or "Superlien" law or any other federal,
or applicable state or local statute, law, ordinance, code, rule,
regulation, order or decree regulating, relating to, or imposing
liability or standards of conduct concerning, any Hazardous Material.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and any successor statute and all rules
and regulations promulgated thereunder.
"ERISA Affiliate", as applied to the Borrower, means any Person or
trade or business which is a member of a group which is under common
control with the Borrower, who together with the Borrower, is treated
as a single employer within the meaning of Section 414(b) and (c) of
the Code.
"Event of Default" means any of the occurrences set forth as such
in SECTION 9.1, for which the applicable grace period, if any, has
expired.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the regulations promulgated thereunder.
"Facility Guaranty" means the Amended and Restated Guaranty and
Suretyship Agreement between the Guarantors and the Lender, delivered
as of the Closing Date and thereafter each Guaranty and Suretyship
Agreement between one or more Guarantors and the Lender delivered
pursuant to SECTION 7.19, as the same may be amended, modified or
supplemented.
"Facility Termination Date" means the date on which the Revolving
Credit Termination Date shall have occurred, no Letters of Credit shall
remain outstanding and the Borrower shall have fully, finally and
irrevocably paid and satisfied all Obligations.
"Federal Funds Effective Rate" means, for any day, the rate per
annum (rounded upward to the nearest 1/100th of 1%) equal to the
weighted average of the rates on overnight
11
Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank of New York on the Business Day next succeeding
such day, PROVIDED that (a) if such day is not a Business Day, the
Federal Funds Effective Rate for such day shall be such rate on such
transactions on the next preceding Business Day, and (b) if no such
rate is so published on such next succeeding Business Day, the Federal
Funds Effective Rate for such day shall be the average rate quoted to
the Lender on such day on such transaction as determined by the Lender.
"Fiscal Year" means the twelve month fiscal period of the Borrower
and its Subsidiaries commencing on April 1 of each calendar year and
ending on March 31 of the next following calendar year.
"Foreign Benefit Law" means any applicable statute, law,
ordinance, code, rule, regulation, order or decree of any foreign
nation or any province, state, territory, protectorate or other
political subdivision thereof regulating, relating to, or imposing
liability or standards of conduct concerning, any Employee Benefit
Plan.
"Four-Quarter Period" means a period of four full consecutive
fiscal quarters of the Borrower and its Subsidiaries, taken together as
one accounting period.
"GAAP" or "Generally Accepted Accounting Principles" means
generally accepted accounting principles, being those principles of
accounting set forth in pronouncements of the Financial Accounting
Standards Board, the American Institute of Certified Public Accountants
or which have other substantial authoritative support and are
applicable in the circumstances as of the date of a report.
"Government Securities" means direct obligations of, or
obligations the timely payment of principal and interest on which are
fully and unconditionally guaranteed by, the United States of America.
"Governmental Authority" shall mean any Federal, state, municipal,
national or other governmental department, commission, board, bureau,
court, agency or instrumentality or political subdivision thereof or
any entity or officer exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to any
government or any court, in each case whether associated with a state
of the United States, the United States, or a foreign entity or
government.
"Guaranties" means all obligations of the Borrower or any
Subsidiary directly or indirectly guaranteeing, or in effect
guaranteeing, any Indebtedness or other obligation of
12
any other Person.
"Guarantors" means, at any date, the Subsidiaries who are required
to be parties to a Facility Guaranty at such date provided, however,
WFI shall not be a Guarantor for any purpose unless and until WFI shall
be required to deliver its Facility Guaranty in accordance with the
last paragraph of SECTION 7.19 hereof.
"Hazardous Material" means and includes any hazardous, toxic or
dangerous waste, substance or material, the generation, handling,
storage, disposal, treatment or emission of which is subject to any
Environmental Law.
"Indebtedness" means with respect to any Person, without
duplication, all Indebtedness for Money Borrowed, all indebtedness of
such Person for the acquisition of property or arising under Rate
Hedging Obligations, all indebtedness secured by any Lien on the
property of such Person whether or not such indebtedness is assumed,
all liability of such Person by way of endorsements (other than for
collection or deposit in the ordinary course of business), all
Contingent Obligations, that portion of obligations with respect to
Capital Leases and other items which in accordance with GAAP is
required to be classified as a liability on a balance sheet; but
excluding all accounts payable in the ordinary course of business so
long as payment therefor is due within one year; provided that in no
event shall the term Indebtedness include surplus and retained
earnings, lease obligations (other than pursuant to Capital Leases),
reserves for deferred income taxes and investment credits, other
deferred credits or reserves, or deferred compensation obligations.
"Indebtedness for Money Borrowed" means with respect to the
Borrower and its Subsidiaries on a consolidated basis, all indebtedness
of the Borrower or any of its Subsidiaries in respect of money
borrowed, including without limitation all Capital Leases and the
deferred purchase price of any property or asset, evidenced by a
promissory note, bond, debenture or similar written obligation for the
payment of money (including without limitation conditional sales
contracts or similar title retention agreements).
"Interbank Offered Rate" means, with respect to any LIBOR Rate
Loan for the Interest Period applicable thereto, the average (rounded
upward to the nearest one-sixteenth (1/16) of one percent) per annum
rate of interest determined by the office of the Lender (each such
determination to be conclusive and binding) as of two Business Days
prior to the first day of such Interest Period, as the effective rate
at which deposits in immediately available funds in Dollars are being,
have been, or would be offered or quoted by the
13
Lender to major banks in the applicable interbank market for Eurodollar
deposits at any time during the Business Day which is the second
Business Day immediately preceding the first day of such Interest
Period, for a term comparable to such Interest Period and in the amount
of the LIBOR Rate Loan. If no such offers or quotes are generally
available for such amount, then the Lender shall be entitled to
determine the LIBOR Rate by estimating in its reasonable judgment the
per annum rate (as described above) that would be applicable if such
quote or offers were generally available.
"Interest Period" means, for each LIBOR Rate Loan, a period
commencing on the date such LIBOR Rate Loan is made or converted and
ending, at the Borrower's option, on the date one, two, three or six
months thereafter as notified to the Lender by the Authorized
Representative three (3) Business Days prior to the beginning of such
Interest Period; PROVIDED, that,
(i) if the Authorized Representative fails to notify the
Lender of the length of an Interest Period three (3) Business Days
prior to the first day of such Interest Period, the Loan for which
such Interest Period was to be determined shall be deemed to be a
Base Rate Loan as of the first day thereof;
(ii) if an Interest Period for a LIBOR Rate Loan would end on
a day which is not a Business Day, such Interest Period shall be
extended to the next Business Day (unless such extension would
cause the applicable Interest Period to end in the succeeding
calendar month, in which case such Interest Period shall end on
the next preceding Business Day);
(iii) any Interest Period which begins on the last Business
Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of
such Interest Period) shall end on the last Business Day of a
calendar month;
(iv) no Interest Period with respect to any Loans shall
extend past the Stated Termination Date; and
(v) there shall not be more than five (5) Interest Periods in
effect on any day.
"Interest Rate Selection Notice" means the written notice
delivered by an Authorized Representative in connection with the
election of a subsequent Interest Period for any LIBOR Rate Loan or the
conversion of any LIBOR Rate Loan into a Base Rate Loan or the
conversion of any Base Rate Loan into a LIBOR Rate Loan, in the form of
EXHIBIT D.
14
"Issuing Bank" means NationsBank as issuer of Letters of Credit
under ARTICLE III.
"LC Account Agreement" means the LC Account Agreement dated as of
the date hereof between the Borrower and the Issuing Bank, as amended,
modified or supplemented from time to time.
"Lending Office" means the Lending Office of the Lender designated
on the signature pages hereof or such other office of the Lender (or of
an affiliate of the Lender) as the Lender may from time to time specify
to the Authorized Representative as the office by which its Loans are
to be made and maintained.
"Letters of Credit" means, collectively, all Documentary Letters
of Credit, and all Standby Letters of Credit, advancing credit or
securing an obligation on behalf of the Borrower or any of its
Subsidiaries.
"Letter of Credit Commitment" means an amount not to exceed
$10,000,000.
"Letter of Credit Facility" means the facility described in
ARTICLE III hereof providing for the issuance by the Issuing Bank for
the account of the Borrower or any of its Subsidiaries of Letters of
Credit in an aggregate stated amount at any time outstanding not
exceeding the Total Letter of Credit Commitment.
"Letter of Credit Outstandings" means, as of any date of
determination, the aggregate amount remaining undrawn under all Letters
of Credit plus Reimbursement Obligations then outstanding.
"LIBOR Rate Loan" means a Loan for which the rate of interest
is determined by reference to the LIBOR Rate.
"LIBOR Rate" means the interest rate per annum calculated
according to the following formula:
LIBOR = INTERBANK OFFERED RATE + Applicable
------------------------------
Rate 1- LIBOR Reserve Percentage Margin
"LIBOR Reserve Percentage" means, for any day, that percentage
(expressed as a decimal) which is in effect from time to time under
Regulation D or any successor regulation, as the maximum reserve
requirement (including any basic, supplemental, emergency, special, or
marginal reserves) applicable with respect to Eurocurrency liabilities
as that term is defined in Regulation D (or against any other category
of liabilities that includes deposits by reference to which the
interest rate of LIBOR Rate Loans is
15
determined), whether or not the Lender has any Eurocurrency liabilities
subject to such requirements, without benefits of credits or proration,
exceptions or offsets that may be available from time to time to the
Lender. The LIBOR Rate shall be adjusted automatically on and as of the
effective date of any change in the LIBOR Reserve Percentage.
"Lien" means any interest in property securing any obligation owed
to, or a claim by, a Person other than the owner of the property,
whether such interest is based on the common law, statute or contract,
and including but not limited to the lien or security interest arising
from a mortgage, encumbrance, pledge, security agreement, conditional
sale or trust receipt or a lease, consignment or bailment for security
purposes. For the purposes of this Agreement, the Borrower and any
Subsidiary shall be deemed to be the owner of any property which it has
acquired or holds subject to a conditional sale agreement, financing
lease, or other arrangement pursuant to which title to the property has
been retained by or vested in some other Person for security purposes.
"Loan" or "Loans" means any borrowing pursuant to an Advance under
the Revolving Credit Facility.
"Loan Documents" means this Agreement, the Note, the Facility
Guaranties, the LC Account Agreement, the Applications and Agreements
for Letter of Credit, and all other instruments and documents
heretofore or hereafter executed or delivered to or in favor of the
Lender in connection with the Loans made and transactions contemplated
under this Agreement, as the same may be amended, supplemented or
replaced from the time to time.
"Material Adverse Effect" means a material adverse effect on (i)
the business, properties, operations or condition, financial or
otherwise, of the Borrower and its Subsidiaries, taken as a whole, (ii)
the ability of the Borrower or any of its Subsidiaries to pay or
perform its respective obligations, liabilities and indebtedness under
the Loan Documents as such payment or performance becomes due in
accordance with the terms thereof, or (iii) the rights, powers and
remedies of the Lender under any Loan Document or the validity,
legality or enforceability thereof (including for purposes of clauses
(ii) and (iii) the imposition of burdensome conditions thereon);
provided, however, that the termination of the aviation joint venture
in Equador shall not be deemed to have a Material Adverse Effect.
"Material Contracts" means, collectively, any contract, lease,
agreement or commitment of the Borrower or any Subsidiary, including,
without limitation, any fuel purchase
16
agreements, the expiration or termination of which could result in a
Material Adverse Effect.
"▇▇▇▇▇'▇" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA to which the Borrower or any ERISA
Affiliate is making, or is accruing an obligation to make,
contributions or has made, or been obligated to make, contributions
within the preceding six (6) Fiscal Years.
"Municipal Obligations" means general obligations issued by, and
supported by the full taxing authority of, any state of the United
States of America or of any municipal corporation or other public body
organized under the laws of any such state which are rated in the
highest investment rating category by both S&P and ▇▇▇▇▇'▇.
"Note" means the promissory note of the Borrower evidencing Loans
executed and delivered to the Lender substantially in the form of
EXHIBIT E.
"Obligations" means the obligations, liabilities and Indebtedness
of the Borrower with respect to (i) the principal and interest on the
Loans as evidenced by the Note, (ii) the Reimbursement Obligations and
otherwise in respect of the Letters of Credit, (iii) all liabilities of
Borrower to the Lender which arise under a Swap Agreement, and (iv) the
payment and performance of all other obligations, liabilities and
Indebtedness of the Borrower to the Lender hereunder, under any one or
more of the other Loan Documents or with respect to the Loans.
"Outstandings" means, collectively, at any date, the Letter of
Credit Outstandings and Revolving Credit Outstandings on such date.
"PBGC" means the Pension Benefit Guaranty Corporation and any
successor thereto.
"Pension Plan" means any employee pension benefit plan within the
meaning of Section 3(2) of ERISA, other than a Multiemployer Plan,
which is subject to the provisions of Title IV of ERISA or Section 412
of the Code and which (i) is maintained for employees of the Borrower
or any of its ERISA Affiliates or is assumed by the Borrower or any of
its ERISA Affiliates in connection with any Acquisition or (ii) has at
any time been maintained for the employees of the Borrower or any
current or former ERISA Affiliate.
"Person" means an individual, partnership, corporation, trust,
unincorporated organization, association, joint
17
venture or a government or agency or political subdivision thereof.
"Pre-Refunded Municipal Obligations" means obligations of any
state of the United States of America or of any municipal corporation
or other public body organized under the laws of any such state which
are rated, based on the escrow, in the highest investment rating
category by both S&P and ▇▇▇▇▇'▇ and which have been irrevocably called
for redemption and advance refunded through the deposit in escrow of
Government Securities or other debt securities which are (i) not
callable at the option of the issuer thereof prior to maturity, (ii)
irrevocably pledged solely to the payment of all principal and interest
on such obligations as the same becomes due and (iii) in a principal
amount and bear such rate or rates of interest as shall be sufficient
to pay in full all principal of, interest, and premium, if any, on such
obligations as the same becomes due as verified by a nationally
recognized firm of certified public accountants.
"Prime Rate" means the rate of interest per annum announced
publicly by the Lender as its prime rate from time to time. The Prime
Rate is not necessarily the best or the lowest rate of interest offered
by the Lender.
"Principal Office" means the office of the Lender at NationsBank,
N.A. (South), ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇-▇▇-▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Agency Services, or such
other office and address as the Lender may from time to time designate.
"Rate Hedging Obligations" means any and all obligations of the
Borrower or any Subsidiary, whether absolute or contingent and
howsoever and whensoever created, arising, evidenced or acquired
(including all renewals, extensions and modifications thereof and
substitutions therefor), under (i) any and all agreements, devices or
arrangements designed to protect at least one of the parties thereto
from the fluctuations of interest rates, exchange rates or forward
rates applicable to such party's assets, liabilities or exchange
transactions, including, but not limited to, Dollar-denominated or
cross-currency interest rate exchange agreements, forward currency
exchange agreements, interest rate cap or collar protection agreements,
forward rate currency or interest rate options, puts, warrants and
those commonly known as interest rate "swap" agreements; and (ii) any
and all cancellations, buybacks, reversals, terminations or assignments
of any of the foregoing.
"Regulation D" means Regulation D of the Board as the same may be
amended or supplemented from time to time.
18
"Regulatory Change" means any change effective after the Closing
Date in United States federal or state laws or regulations (including
Regulation D and capital adequacy regulations) or foreign laws or
regulations or the adoption or making after such date of any
interpretations, directives or requests applying to a class of banks,
which includes the Lender, under any United States federal or state or
foreign laws or regulations (whether or not having the force of law) by
any court or governmental or monetary authority charged with the
interpretation or administration thereof or compliance by the Lender
with any request or directive regarding capital adequacy, including
those relating to "highly leveraged transactions," whether or not
having the force of law, and whether or not failure to comply therewith
would be unlawful and whether or not published or proposed prior to the
date hereof.
"Reimbursement Obligation" shall mean at any time, the obligation
of the Borrower with respect to any Letter of Credit to reimburse the
Issuing Bank (including by the receipt by the Issuing Bank of proceeds
of Loans pursuant to SECTION 3.2) for amounts theretofore paid by the
Issuing Bank pursuant to a drawing under such Letter of Credit.
"Repurchase Agreement" means a repurchase agreement entered into
with any financial institution whose debt obligations or commercial
paper are rated "A" by either of S&P or ▇▇▇▇▇'▇ or "A-1" by S&P or
"P-1" by ▇▇▇▇▇'▇.
"Restricted Payment" means (a) any dividend or other distribution,
direct or indirect, on account of any shares of any class of stock of
Borrower or any of its Subsidiaries (other than those payable or
distributable solely to the Borrower) now or hereafter outstanding,
except a dividend payable solely in shares of a class of stock to the
holders of that class; (b) any redemption, conversion, exchange,
retirement or similar payment, purchase or other acquisition for value,
direct or indirect, of any shares of any class of stock of Borrower or
any of its Subsidiaries (other than those payable or distributable
solely to the Borrower) now or hereafter outstanding; (c) any payment
made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of
stock of Borrower or any of its Subsidiaries now or hereafter
outstanding; and (d) any issuance and sale of capital stock of any
Subsidiary of the Borrower (or any option, warrant or right to acquire
such stock) other than to the Borrower.
"Revolving Credit Commitment" means the obligation of the Lender
to make Loans to the Borrower up to an aggregate principal amount at
any one time outstanding equal to
19
$25,000,000.
"Revolving Credit Facility" means the facility described in
ARTICLE II hereof providing for Loans to the Borrower by the Lender in
the aggregate principal amount of the Revolving Credit Commitment.
"Revolving Credit Outstandings" means, as of any date of
determination, the aggregate principal amount of all Loans then
outstanding and all interest accrued thereon.
"Revolving Credit Termination Date" means (i) the Stated
Termination Date or (ii) such earlier date of termination of Lender's
obligations pursuant to SECTION 9.1 upon the occurrence of an Event of
Default, or (iii) such date as the Borrower may voluntarily and
permanently terminate the Revolving Credit Facility by payment in full
of all Revolving Credit Outstandings and Letter of Credit Outstandings
and cancellation of all Letters of Credit.
"S&P" means Standard & Poor's Ratings Group, a division of
▇▇▇▇▇▇-▇▇▇▇.
"Single Employer Plan" means any employee pension benefit plan
covered by Title IV of ERISA in respect of which the Borrower or any
Subsidiary is an "employer" as described in Section 4001(b) of ERISA
and which is not a Multiemployer Plan.
"Solvent" means, when used with respect to any Person, that at the
time of determination:
(i) the fair value of its assets (both at fair valuation and
at present fair saleable value on an orderly basis) is in excess
of the total amount of its liabilities, including Contingent
Obligations; and
(ii) it is then able and expects to be able to pay its debts
as they mature; and
(iii) it has capital sufficient to carry on its business as
conducted and as proposed to be conducted.
"Standby Letters of Credit" means the standby letters of credit
issued by the Issuing Bank for the account of the Borrower or any of
its Subsidiaries upon the terms and conditions of this Agreement.
"Stated Termination Date" means March 1, 2001 or such later date
as the parties may agree pursuant to SECTION 2.13.
"Subsidiary" means any corporation or other entity in which more
than 50% of its outstanding voting stock or more than 50% of all equity
interests is owned directly or indirectly by the Borrower and/or by one
or more of the
20
Borrower's Subsidiaries.
"Swap Agreement" means one or more agreements between the Borrower
and any Person with respect to Indebtedness evidenced by any or all of
the Note, on terms mutually acceptable to Borrower and such Person and
approved by the Lender, which agreements create Rate Hedging
Obligations; PROVIDED, HOWEVER, that no such approval of the Lender
shall be required to the extent such agreements are entered into
between the Borrower and the Lender.
"Termination Event" means: (i) a "Reportable Event" described in
Section 4043 of ERISA and the regulations issued thereunder (unless the
notice requirement has been waived by applicable regulation); or (ii)
the withdrawal of the Borrower or any ERISA Affiliate from a Pension
Plan during a plan year in which it was a "substantial employer" as
defined in Section 4001(a)(2) of ERISA or was deemed such under Section
4068(f) of ERISA; or (iii) the termination of a Pension Plan, the
filing of a notice of intent to terminate a Pension Plan or the
treatment of a Pension Plan amendment as a termination under Section
4041 of ERISA; or (iv) the institution of proceedings to terminate a
Pension Plan by the PBGC; or (v) any other event or condition which
would constitute grounds under Section 4042(a) of ERISA for the
termination of, or the appointment of a trustee to administer, any
Pension Plan; or (vi) the partial or complete withdrawal of the
Borrower or any ERISA Affiliate from a Multiemployer Plan; or (vii) the
imposition of a Lien pursuant to Section 412 of the Code or Section 302
of ERISA; or (viii) any event or condition which results in the
reorganization or insolvency of a Multiemployer Plan under Section 4241
or Section 4245 of ERISA, respectively; or (ix) any event or condition
which results in the termination of a Multiemployer Plan under Section
4041A of ERISA or the institution by the PBGC of proceedings to
terminate a Multiemployer Plan under Section 4042 of ERISA.
"Voting Stock" means shares of capital stock issued by a
corporation, or equivalent interests in any other Person, the holders
of which are ordinarily, in the absence of contingencies, entitled to
vote for the election of directors (or persons performing similar
functions) of such Person, even if the right so to vote has been
suspended by the happening of such a contingency.
"WFI" means World Fuel International, S.A., a corporation
organized under the laws of Costa Rica and a wholly-owned Subsidiary of
the Borrower; WFI also operates under the name 'Petromundo
Internacional, S.A.'
"WFI Capitalization" means, at any time at which the amount
thereof is to be determined, (A) the sum of (i) all Indebtedness for
Money Borrowed of WFI (excluding current liabilities of WFI other than
Current Maturities of Long-Term Debt of WFI) plus (ii) the face
21
amount of all outstanding Standby Letters of Credit issued for the
account of WFI and all obligations of WFI arising in connection with
such letters of credit, PLUS (B) the sum of (i) the amount of issued
and outstanding share capital of WFI, PLUS (ii) the amount of
additional paid-in capital and retained income of WFI (or, in the case
of a deficit, minus the amount of such deficit), PLUS (iii) the amount
of any foreign currency translation adjustment (if positive, or, if
negative, minus the amount of such translation adjustment) MINUS (iv)
the book value of any treasury stock and the book value of any stock
subscription receivables of WFI, all as determined in accordance with
Generally Accepted Accounting Principles applied on a Consistent Basis.
RULES OF INTERPRETATION.
(a) All accounting terms not specifically defined herein shall
have the meanings assigned to such terms and shall be interpreted in
accordance with GAAP applied on a Consistent Basis.
(b) Each term defined in Article 1 or 9 of the Florida Uniform
Commercial Code shall have the meaning given therein unless otherwise
defined herein, except to the extent that the Uniform Commercial Code
of another jurisdiction is controlling, in which case such terms shall
have the meaning given in the Uniform Commercial Code of the applicable
jurisdiction.
(c) The headings, subheadings and table of contents used herein or
in any other Loan Document are solely for convenience of reference and
shall not constitute a part of any such document or affect the meaning,
construction or effect of any provision thereof.
(d) Except as otherwise expressly provided, references herein to
articles, sections, paragraphs, clauses, annexes, appendices, exhibits
and schedules are references to articles, sections, paragraphs,
clauses, annexes, appendices, exhibits and schedules in or to this
Agreement.
(e) All definitions set forth herein or in any other Loan Document
shall apply to the singular as well as the plural form of such defined
term, and all references to the masculine gender shall include
reference to the feminine or neuter gender, and VICE VERSA, as the
context may require.
(f) When used herein or in any other Loan Document, words such as
"hereunder", "hereto", "hereof" and "herein" and other words of like
import shall, unless the context clearly indicates to the contrary,
refer to the whole of the applicable document and not to any particular
article, section, subsection, paragraph or clause thereof.
22
(g) References to "including" means including without limiting the
generality of any description preceding such term, and for purposes
hereof the rule of EJUSDEM GENERIS shall not be applicable to limit a
general statement, followed by or referable to an enumeration of
specific matters, to matters similar to those specifically mentioned.
(h) All dates and times of day specified herein shall refer to
such dates and times at Charlotte, North Carolina.
(i) Each of the parties to the Loan Documents and their counsel
have reviewed and revised, or requested (or had the opportunity to
request) revisions to, the Loan Documents, and any rule of construction
that ambiguities are to be resolved against the drafting party shall be
inapplicable in the construing and interpretation of the Loan Documents
and all exhibits, schedules and appendices thereto.
(j) Any reference to an officer of the Borrower or any other
Person by reference to the title of such officer shall be deemed to
refer to each other officer of such Person, however titled, exercising
the same or substantially similar functions.
(k) All references to any agreement or document as amended,
modified or supplemented, or words of similar effect, shall mean such
document or agreement, as the case may be, as amended, modified or
supplemented from time to time only as and to the extent permitted
therein and in the Loan Documents.
23
ARTICLE II
THE REVOLVING CREDIT FACILITY
II.1. LOANS.
(a) COMMITMENT. Subject to the terms and conditions of this Agreement, the
Lender agrees to make Advances to the Borrower under the Revolving Credit
Facility from time to time from the Closing Date until the Revolving Credit
Termination Date up to but not exceeding the Revolving Credit Commitment,
PROVIDED, however, that the Lender will not be required and shall have no
obligation to make any such Advance (i) so long as a Default or an Event of
Default has occurred and is continuing or (ii) if the Lender has accelerated the
maturity of the Note as a result of an Event of Default; PROVIDED further,
however, that immediately after giving effect to each such Advance, the
principal amount of Revolving Credit Outstandings plus Letter of Credit
Outstandings shall not exceed the Revolving Credit Commitment. Within such
limits, the Borrower may borrow, repay and reborrow under the Revolving Credit
Facility on a Business Day from the Closing Date until, but (as to borrowings
and reborrowings) not including, the Revolving Credit Termination Date;
PROVIDED, however, that (y) no Loan that is a LIBOR Rate Loan shall be made
which has an Interest Period that extends beyond the Stated Termination Date and
(z) each Loan that is a LIBOR Rate Loan may, subject to the provisions of
SECTION 2.6, be repaid only on the last day of the Interest Period with respect
thereto unless such payment is accompanied by the additional payment, if any,
required by SECTION 4.4.
(b) AMOUNTS. Except as otherwise permitted by the Lender from time to time,
the aggregate unpaid principal amount of the Revolving Credit Outstandings plus
Letter of Credit Outstandings shall not exceed at any time the Revolving Credit
Commitment, and, in the event there shall be outstanding any such excess, the
Borrower shall immediately make such payments and prepayments as shall be
necessary to comply with this restriction. Each Loan hereunder, other than Base
Rate Refunding Loans, and each conversion under SECTION 2.7, shall be in an
amount of at least $100,000, and, if greater than $100,000, an integral multiple
of $100,000.
(c) ADVANCES. (i) An Authorized Representative shall give the Lender (1) at
least three (3) Business Days' irrevocable written notice by telefacsimile
transmission of a Borrowing Notice or Interest Rate Selection Notice (as
applicable) with appropriate insertions, effective upon receipt, of each Loan
that is a LIBOR Rate Loan (whether representing an additional borrowing
hereunder or the conversion of a borrowing hereunder from Base Rate Loans to
LIBOR Rate Loans) prior to 10:30 A.M. and (2) irrevocable written notice by
telefacsimile transmission of a Borrowing Notice or Interest Rate Selection
Notice (as
24
applicable) with appropriate insertions, effective upon receipt, of each Loan
(other than Base Rate Refunding Loans to the extent the same are effected
without notice pursuant to SECTION 2.1(C)(IV)) that is a Base Rate Loan (whether
representing an additional borrowing hereunder or the conversion of borrowing
hereunder from LIBOR Rate Loans to Base Rate Loans) prior to 10:30 A.M. on the
day of such proposed Loan. Each such notice shall specify the amount of the
borrowing, the type of Loan (Base Rate or LIBOR Rate), the date of borrowing
and, if a LIBOR Rate Loan, the Interest Period to be used in the computation of
interest.
(ii) Not later than 2:00 P.M. on the date specified for each borrowing
under this SECTION 2.1, the Lender shall, pursuant to the terms and subject to
the conditions of this Agreement, make the amount of the Advance or Advances
available to the Borrower by delivery of the proceeds thereof to the Borrower's
Account or otherwise as shall be directed in the applicable Borrowing Notice by
the Authorized Representative and reasonably acceptable to the Lender.
(iii) The Borrower shall have the option to elect the duration of the
initial and any subsequent Interest Periods and to convert the Loans in
accordance with SECTION 2.8. LIBOR Rate Loans and Base Rate Loans may be
outstanding at the same time, PROVIDED, HOWEVER, there shall not be outstanding
at any one time LIBOR Rate Loans having more than five (5) different Interest
Periods. If the Lender does not receive a Borrowing Notice or an Interest Rate
Selection Notice giving notice of election of the duration of an Interest Period
or of conversion of any Loan to or continuation of a Loan as a LIBOR Rate Loan
by the time prescribed by SECTION 2.1(C) OR 2.7, the Borrower shall be deemed to
have elected to convert such Loan to (or continue such Loan as) a Base Rate Loan
until the Borrower notifies the Lender in accordance with SECTION 2.7.
(iv) Notwithstanding the foregoing, if a drawing is made under any Letter
of Credit, such drawing is honored by the Issuing Bank prior to the Stated
Termination Date, and the Borrower shall not immediately fully reimburse the
Issuing Bank in respect of such drawing, (A) provided that the conditions to
making a Loan as herein provided shall then be satisfied, the Reimbursement
Obligation arising from such drawing shall be paid to the Issuing Bank by the
Lender without the requirement of notice to or from the Borrower from
immediately available funds which shall be advanced as a Base Rate Refunding
Loan by the Lender under the Revolving Credit Facility, and (B) if the
conditions to making a Loan as herein provided shall not then be satisfied, the
Lender shall fund by payment to the Issuing Bank in immediately available funds
the purchase price from the Issuing Bank of the Reimbursement Obligation. Any
such Base Rate Refunding Loan shall be advanced as, and shall continue as, a
Base Rate Loan unless and until the Borrower converts such Base
25
Rate Loan in accordance with the terms of SECTION 2.7.
PAYMENT OF INTEREST. (a) The Borrower shall pay interest to the Lender on
the outstanding and unpaid principal amount of each Loan for the period
commencing on the date of such Loan until such Loan shall be due at the then
applicable Base Rate for Base Rate Loans or applicable LIBOR Rate for LIBOR Rate
Loans, as designated by the Authorized Representative pursuant to SECTION 2.1;
PROVIDED, however, that if any amount shall not be paid when due (at maturity,
by acceleration or otherwise), all amounts outstanding hereunder shall bear
interest thereafter at the Default Rate.
(b) Interest on each Loan shall be computed on the basis of a year of
360 days and calculated in each case for the actual number of days elapsed.
Interest on each Loan shall be paid (i) quarterly in arrears not later than
three (3) Business Days following the last Business Day of each March, June,
September and December, commencing March 31, 1997 for each Base Rate Loan, (ii)
on the last day of the applicable Interest Period for each LIBOR Rate Loan and,
if such Interest Period extends for more than three (3) months, at intervals of
three (3) months after the first day of such Interest Period, and (iii) upon
payment in full of the principal amount of such Loan.
II.3. PAYMENT OF PRINCIPAL. The principal amount of each Loan shall be due
and payable to the Lender in full on the Revolving Credit Termination Date, or
earlier as specifically provided herein. The principal amount of any Base Rate
Loan may be prepaid in whole or in part at any time. The principal amount of any
LIBOR Rate Loan may be prepaid only at the end of the applicable Interest Period
unless the Borrower shall pay to the Lender the additional amount, if any,
required under SECTION 4.4. All prepayments of Loans made by the Borrower shall
be in the amount of $100,000 or such greater amount which is an integral
multiple of $100,000, or the amount equal to all Revolving Credit Outstandings,
or such other amount as necessary to comply with SECTION 2.1(b) or SECTION 2.7.
II.4. NON-CONFORMING PAYMENTS. (a)NTS Each payment of principal (including
any prepayment) and payment of interest and fees, and any other amount required
to be paid to the Lender with respect to the Loans, shall be made to the Lender
at the Principal Office in Dollars and in immediately available funds before
12:30 P.M. on the date such payment is due. The Lender may, but shall not be
obligated to, debit the amount of any such payment which is not made by such
time to any ordinary deposit account, if any, of the Borrower with the Lender.
(b) The Lender shall deem any payment made by or on behalf of the
Borrower hereunder that is not made both in Dollars and in immediately available
funds and prior to 12:30 P.M. to be a non-conforming payment. Any such payment
shall not be deemed to be
26
received by the Lender until the later of (i) the time such funds become
available funds and (ii) the next Business Day. Any non-conforming payment may
constitute or become a Default or Event of Default. Interest shall continue to
accrue on any principal as to which a non-conforming payment is made until the
later of (x) the date such funds become available funds or (y) the next Business
Day at the Default Rate from the date such amount was due and payable.
(c) In the event that any payment hereunder or under the Note becomes
due and payable on a day other than a Business Day, then such due date shall be
extended to the next succeeding Business Day unless provided otherwise under
clause (ii) of the definition of "Interest Period"; PROVIDED that interest shall
continue to accrue during the period of any such extension and PROVIDED further,
that in no event shall any such due date be extended beyond the Revolving Credit
Termination Date.
II.5. NOTES. Loans made or continued by each Lender pursuant to the terms
and conditions of this Agreement shall be evidenced by the Note payable to the
order of the Lender in the Revolving Credit Commitment, which Note shall be
dated the Closing Date and shall be duly completed, executed and delivered by
the Borrower.
II.6. REDUCTIONS. The Borrower shall, by notice from an Authorized
Representative, have the right from time to time but not more frequently than
once each calendar month, upon not less than three (3) Business Days' written
notice to the Lender, effective upon receipt, to reduce the Revolving Credit
Commitment. Each such reduction shall be in the aggregate amount of $500,000 or
such greater amount which is in an integral multiple of $100,000, or the entire
remaining Revolving Credit Commitment, and shall permanently reduce the
Revolving Credit Commitment. Each reduction of the Revolving Credit Commitment
shall be accompanied by payment of the Loans to the extent that the principal
amount of Revolving Credit Outstandings plus Letter of Credit Outstandings
exceeds the Revolving Credit Commitment after giving effect to such reduction,
together with accrued and unpaid interest on the amounts prepaid. No such
reduction shall result in the payment of any LIBOR Rate Loan other than on the
last day of the Interest Period of such LIBOR Rate Loan unless such prepayment
is accompanied by amounts due, if any, under SECTION 4.4.
II.7. CONVERSIONS AND ELECTIONS OF SUBSEQUENT INTEREST PERIODS. Provided
that no Default or Event of Default shall have occurred and be continuing and
subject to the limitations set forth below and in ARTICLE IV, the Borrower may:
(a) upon delivery, effective upon receipt, of a properly completed
Interest Rate Selection Notice to the Lender on or before 10:30 A.M. on any
Business Day, convert all or a
27
part of LIBOR Rate Loans to Base Rate Loans on the last day of the Interest
Period for such LIBOR Rate Loans; and
(b) upon delivery, effective upon receipt, of a properly completed
Interest Rate Selection Notice to the Lender on or before 10:30 A.M. three (3)
Business Days' prior to the date of such election or conversion:
(i) elect a subsequent Interest Period for all or a portion of
LIBOR Rate Loans to begin on the last day of the then current Interest
Period for such LIBOR Rate Loans; and
(ii) convert Base Rate Loans to LIBOR Rate Loans on any Business
Day.
Each election and conversion pursuant to this SECTION 2.7 shall be subject
to the limitations on LIBOR Rate Loans set forth in the definition of "Interest
Period" herein and in SECTIONS 2.1, 2.3 and ARTICLE IV.
II.8. INCREASE AND DECREASE IN AMOUNTS. The amount of the Revolving Credit
Commitment which shall be available to the Borrower as Advances shall be reduced
by the aggregate amount of Outstanding Letters of Credit.
II.9. FEES. FEES
(a) UNUSED FEE. For the period beginning on the Closing Date and ending on
the Revolving Credit Termination Date, the Borrower agrees to pay to the Lender
an unused fee equal to the Applicable Unused Fee multiplied by the average daily
amount by which the Revolving Credit Commitment exceeds the sum of (i) Revolving
Credit Outstandings plus (ii) Letter of Credit Outstandings. Such fees shall be
due in arrears not later than three (3) Business Days following the last
Business Day of each March, June, September and December commencing March 31,
1997 to and on the Revolving Credit Termination Date (or such earlier date as
the Lenders refuse to fund hereunder).
(b) FACILITY FEE. The Borrower agrees to pay to the Lender, for its own
account a one time fee upon terms and conditions as provided in that certain Fee
Letter dated December 9, 1996 for agreeing to amend and extend the terms of this
Agreement.
II.10. USE OF PROCEEDS. The proceeds of the Loans made pursuant to the
Revolving Credit Facility hereunder shall be used by the Borrower for general
working capital needs and other corporate purposes, including the making of
Acquisitions and Capital Expenditures permitted hereunder.
28
ARTICLE III
LETTERS OF CREDIT
III.1. LETTERS OF CREDIT. The Issuing Bank agrees, subject to the terms and
conditions of this Agreement, upon request of the Borrower to issue from time to
time for the account or benefit of the Borrower or any of its Subsidiaries
Letters of Credit upon delivery to the Issuing Bank of an Application and
Agreement for Letter of Credit relating thereto in form and content acceptable
to the Issuing Bank; PROVIDED, that if a Letter of Credit is to be issued for
the account or benefit of a Subsidiary of the Borrower, both the Borrower and
such Subsidiary jointly and severally as co-applicants shall deliver to the
Issuing Bank an Application and Agreement for Letter of Credit, and PROVIDED
FURTHER, that (i) the Letter of Credit Outstandings shall not exceed the Letter
of Credit Commitment and (ii) no Letter of Credit shall be issued if, after
giving effect thereto, Letter of Credit Outstandings plus Revolving Credit
Outstandings shall exceed the Revolving Credit Commitment. No Letter of Credit
shall have an expiry date (including all rights of the Borrower or any
Subsidiary named in such Letter of Credit to require renewal) or payment date
occurring later than the earlier to occur of (A) one year after the date of its
issuance with respect to Standby Letters of Credit or one hundred eighty days
after the date of its issuance with respect to Documentary Letters of Credit; or
(B) the fifth Business Day prior to the Stated Termination Date. Borrower agrees
that it is jointly and severally liable for all Reimbursement Obligations and
other obligations with respect to Letters of Credit previously issued or to be
issued for the account or benefit of any Subsidiary as if and to the same extent
as if Borrower were the sole applicant therefor, and that any Letters of Credit
issued on application of a Subsidiary or the joint application of the Borrower
and a Subsidiary shall be subject to all the terms of this Agreement, including
applicable sublimits.
III.2. REIMBURSEMENT.URSEMENT
(a) The Borrower hereby unconditionally agrees to pay to the Issuing
Bank immediately on demand at the Principal Office all amounts required to pay
all drafts drawn or purporting to be drawn under the Letters of Credit and all
reasonable expenses incurred by the Issuing Bank in connection with the Letters
of Credit, and in any event and without demand to place in possession of the
Issuing Bank (which shall include Advances under the Revolving Credit Facility
if permitted by SECTION 2.1) sufficient funds to pay all debts and liabilities
arising under any Letter of Credit. The Issuing Bank agrees to give the Borrower
prompt notice of any request for a draw under a Letter of Credit. The Issuing
Bank may charge any account the Borrower may have with it for any and all
amounts the Issuing Bank pays
29
under a Letter of Credit, plus charges and reasonable expenses as from time to
time agreed to by the Issuing Bank and the Borrower; provided that to the extent
permitted by SECTION 2.1(C)(IV) , amounts shall be paid pursuant to Advances
under the Revolving Credit Facility. The Borrower agrees to pay the Issuing Bank
interest on any Reimbursement Obligations not paid when due hereunder at the
Base Rate, or the maximum rate permitted by applicable law, if lower, such rate
to be calculated on the basis of a year of 360 days for actual days elapsed.
(b) In accordance with the provisions of SECTION 2.1(C), the Issuing
Bank shall notify the Lender of any drawing under any Letter of Credit promptly
following the receipt by the Issuing Bank of such drawing.
(c) The issuance by the Issuing Bank of each Letter of Credit shall, in
addition to the conditions precedent set forth in ARTICLE V, be subject to the
conditions that such Letter of Credit be in such form and contain such terms as
shall be reasonably satisfactory to the Issuing Bank consistent with the then
current practices and procedures of the Issuing Bank with respect to similar
letters of credit, and the Borrower shall have executed and delivered such other
instruments and agreements relating to such Letters of Credit as the Issuing
Bank shall have reasonably requested consistent with such practices and
procedures. All Letters of Credit shall be issued pursuant to and subject to the
Uniform Customs and Practice for Documentary Credits, 1993 revision,
International Chamber of Commerce Publication No. 500 and all subsequent
amendments and revisions thereto.
(d) The Borrower agrees that Issuing Bank may, in its sole discretion,
accept or pay, as complying with the terms of any Letter of Credit, any drafts
or other documents otherwise in order which may be signed or issued by an
administrator, executor, trustee in bankruptcy, debtor in possession, assignee
for the benefit of creditors, liquidator, receiver, attorney in fact or other
legal representative of a party who is authorized under such Letter of Credit to
draw or issue any drafts or other documents.
(e) Without limiting the generality of the provisions of SECTION 11.9,
the Borrower hereby agrees to indemnify and hold harmless the Issuing Bank from
and against any and all claims and damages, losses, liabilities, reasonable
costs and expenses which the Issuing Bank may incur (or which may be claimed
against the Issuing Bank) by any Person by reason of or in connection with the
issuance or transfer of or payment or failure to pay under any Letter of Credit;
PROVIDED that the Borrower shall not be required to indemnify the Issuing Bank
for any claims, damages, losses, liabilities, costs or expenses to the extent,
but only to the extent, (i) caused by the willful misconduct or gross negligence
of the party to be indemnified or (ii) caused by the
30
failure of the Issuing Bank to pay under any Letter of Credit after the
presentation to it of a request for payment strictly complying with the terms
and conditions of such Letter of Credit, unless such payment is prohibited by
any law, regulation, court order or decree. The indemnification and hold
harmless provisions of this SECTION 3.2(E) shall survive repayment of the
Obligations, occurrence of the Revolving Credit Termination Date and expiration
or termination of this Agreement.
(f) Without limiting Borrower's rights as set forth in SECTION 3.2(E),
the obligation of the Borrower to immediately reimburse the Issuing Bank for
drawings made under Letters of Credit and the Issuing Bank's right to receive
such payment shall be absolute, unconditional and irrevocable, and that such
obligations of the Borrower shall be performed strictly in accordance with the
terms of this Agreement and such Letters of Credit and the related Applications
and Agreement for any Letter of Credit, under all circumstances whatsoever,
including the following circumstances:
(i) any lack of validity or enforceability of the Letters of
Credit, the obligation supported by the Letters of Credit or any
other agreement or instrument relating thereto (collectively, the
"Related LC Documents");
(ii) any amendment or waiver of or any consent to or
departure from all or any of the Related LC Documents;
(iii) the existence of any claim, setoff, defense (other than
the defense of payment in accordance with the terms of this
Agreement) or other rights which the Borrower may have at any time
against any beneficiary or any transferee of a Letter of Credit
(or any persons or entities for whom any such beneficiary or any
such transferee may be acting), the Lender or any other Person,
whether in connection with the Loan Documents, the Related LC
Documents or any unrelated transaction;
(iv) any breach of contract or other dispute between the
Borrower and any beneficiary or any transferee of a Letter of
Credit (or any persons or entities for whom such beneficiary or
any such transferee may be acting), the Lender or any other
Person;
(v) any draft, statement or any other document presented
under the Letters of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect whatsoever;
(vi) any delay, extension of time, renewal, compromise or
other indulgence or modification granted or agreed to by the
Lender, with or without notice to or
31
approval by the Borrower in respect of any of Borrower's
Obligations under this Agreement; or
(vii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing. Nothing contained in this
subsection (f) shall relieve the Issuing Bank of its obligations
under the Uniform Customs and Practices for Documentary Credits,
1993 revision, International Chamber of Commerce Publication No.
500.
III.3. LETTER OF CREDIT FACILITY FEES. The Borrower shall pay to the Lender
a fee on the aggregate amount available to be drawn on each outstanding Letter
of Credit at a rate equal to (a) .65% per annum for each outstanding Standby
Letter of Credit, and (b) .125% per annum for each outstanding Documentary
Letter of Credit. Such fees shall be due with respect to each Letter of Credit
quarterly in advance on the first day of each January, April, July and October,
the first such payment to be made (x) on the Closing Date with respect to
Letters of Credit outstanding and to the extent such fees have not yet been paid
for such Letters of Credit with respect to the then current calendar quarter, or
(y) on the date of issuance of a Letter of Credit, and thereafter on the first
day of the calendar quarter occurring after either the Closing Date or the date
of issuance of a Letter of Credit as applicable. The fees described in this
SECTION 3.3 shall be calculated on the basis of a year of 360 days for the
actual number of days elapsed.
III.4. ADMINISTRATIVE FEES. The Borrower shall pay to the Issuing Bank such
administrative fee and other fees, if any, in connection with the Letters of
Credit in such amounts and at such times as the Issuing Bank and the Borrower
shall agree from time to time.
32
ARTICLE IV
YIELD PROTECTION AND ILLEGALITY
IV.1. ADDITIONAL COSTS. (a) The Borrower shall promptly pay to the Lender
from time to time, without duplication, such amounts as the Lender may
reasonably determine to be necessary to compensate it for any costs incurred by
the Lender which it determines are attributable to its making or maintaining any
Loan or its obligation to make any Loans, or the issuance or maintenance by the
Issuing Bank of any Letter of Credit issued hereunder, or any reduction in any
amount receivable by the Lender under this Agreement or the Notes in respect of
any of such Loans or the Letters of Credit, including reductions in the rate of
return on the Lender's capital (such increases in costs and reductions in
amounts receivable and returns being herein called "Additional Costs"),
resulting from any Regulatory Change which: (i) changes the basis of taxation of
any amounts payable to the Lender under this Agreement or the Notes in respect
of any of such Loans or the Letters of Credit (other than taxes imposed on or
measured by the income, revenues or assets); or (ii) imposes or modifies any
reserve, special deposit, or similar requirements relating to any extensions of
credit or other assets of, or any deposits with or other liabilities of, the
Lender (other than any such reserve, deposit or requirement reflected in the
Prime Rate, Federal Funds Effective Rate or the Interbank Offered Rate, in each
case computed in accordance with the respective definitions of such terms set
forth in SECTION 1.2); or (iii) has or would have the effect of reducing the
rate of return on capital of the Lender to a level below that which the Lender
could have achieved but for such Regulatory Change (taking into consideration
the Lender's policies with respect to capital adequacy); or (iv) imposes any
other condition adversely affecting the Lender under this Agreement, the Notes
or the issuance or maintenance of, or the Lender's Participation in, the Letters
of Credit (or any of such extensions of credit or liabilities). The Lender will
notify the Authorized Representative of any event occurring after the Closing
Date which would entitle it to compensation pursuant to this SECTION 4.1(A) as
promptly as practicable after it obtains knowledge thereof and determines to
request such compensation.
(b) Without limiting the effect of the foregoing provisions of this
SECTION 4.1, in the event that, by reason of any Regulatory Change, the Lender
either (i) incurs Additional Costs based on or measured by the excess above a
specified level of the amount of a category of deposits or other liabilities of
the Lender which includes deposits by reference to which the interest rate on
LIBOR Rate Loans is determined as provided in this Agreement or a category of
extensions of credit or other assets of the Lender which includes LIBOR Rate
Loans or (ii) becomes subject to restrictions on the amount of such a category
of liabilities or assets which it may hold, then, if the
33
Lender so elects the obligation hereunder of the Lender to make, and to convert
Base Rate Loans into, LIBOR Rate Loans that are the subject of such restrictions
shall be suspended until the date such Regulatory Change ceases to be in effect
and the Borrower shall, on the last day(s) of the then current Interest
Period(s) for outstanding LIBOR Rate Loans convert such LIBOR Rate Loans into
Base Rate Loans.
(c) Determinations by the Lender for purposes of this SECTION 4.1 of
the effect of any Regulatory Change on its costs of making or maintaining, or
being committed to make Loans, or by NationsBank as issuer of any Letter of
Credit of the effect of any Regulatory Change on its costs in connection with
the issuance or maintenance of any Letter of Credit issued hereunder, or the
effect of any Regulatory Change on amounts receivable by the Lender in respect
of Loans or Letters of Credit, and of the additional amounts required to
compensate the Lender in respect of any Additional Costs, shall be made taking
into account the Lender's policies, or the policies of the parent corporation of
the Lender, as to the allocation of capital, costs and other items and shall be
conclusive absent manifest error. The Lender shall furnish to the Authorized
Representative within one hundred eighty (180) days of the incurrence of any
Additional Costs for which compensation is sought an explanation of the
Regulatory Change and calculations, in reasonable detail, setting forth the
Lender's determination of any such Additional Costs.
IV.2. SUSPENSION OF LOANS. Anything herein to the contrary notwithstanding,
if, on or prior to the determination of any interest rate for any LIBOR Rate
Loan for any Interest Period, the Lender determines (which determination made on
a reasonable basis shall be conclusive absent manifest error) that:
(a) quotations of interest rates for the relevant deposits
referred to in the definition of "LIBOR Rate" in SECTION 1.2 are
not being provided in the relevant amounts or for the relevant
maturities for purposes of determining the rate of interest for
such LIBOR Rate Loan as provided in this Agreement; or
(b) the relevant rates of interest referred to in the
definition of "Interbank Offered Rate" in SECTION 1.2 upon the
basis of which the LIBOR Rate for such Interest Period is to be
determined do not adequately reflect the cost to the Lender of
making or maintaining such LIBOR Rate Loan for such Interest
Period;
then the Lender shall give the Authorized Representative prompt notice thereof,
and so long as such condition remains in effect, the Lender shall be under no
obligation to make LIBOR Rate Loans that are subject to such condition, or to
convert Base Rate Loans into LIBOR Rate Loans, and the Borrower shall on the
last day(s) of the then current Interest Period(s) for outstanding LIBOR Rate
Loans, as applicable, convert such LIBOR Rate Loans into another LIBOR Rate
34
Loan if such LIBOR Rate Loan is not subject to the same or similar condition, or
Base Rate Loans, if available hereunder. The Lender shall give the Authorized
Representative notice describing in reasonable detail any event or condition
described in this SECTION 4.2 promptly following the determination by the Lender
that the availability of LIBOR Rate Loans is, or is to be, suspended as a result
thereof.
IV.3. ILLEGALITY. Notwithstanding any other provision of this Agreement, in
the event that it becomes unlawful for the Lender to honor its obligation to
make or maintain LIBOR Rate Loans hereunder, then the Lender shall promptly
notify the Borrower thereof and the Lender's obligation to make or continue
LIBOR Rate Loans, or to convert Base Rate Loans into LIBOR Rate Loans, shall be
suspended until such time as the Lender may again make and maintain LIBOR Rate
Loans, and the Lender's outstanding LIBOR Rate Loans shall be converted into
Base Rate Loans in accordance with SECTION 2.7 or earlier if required by
applicable law.
IV.4. COMPENSATION. The Borrower shall promptly pay to the Lender, upon the
request of the Lender, such amount or amounts as shall be sufficient (in the
reasonable determination of the Lender) to compensate it for any loss, cost or
expense incurred by it as a result of:
(a) any payment, prepayment or conversion of a LIBOR Rate
Loan on a date other than the last day of the Interest Period for
such LIBOR Rate Loan, including without limitation any conversion
required pursuant to SECTIONS 4.1, 4.2 OR 4.3; or
(b) any failure by the Borrower to borrow or convert a LIBOR
Rate Loan on the date for such borrowing or conversion specified
in the relevant Borrowing Notice or Interest Rate Selection Notice
under Article II hereof;
such compensation to include, without limitation, an amount equal to the excess,
if any, of (i) the amount of interest which would have accrued on the principal
amount so paid, prepaid or converted or not borrowed for the period from the
date of such payment, prepayment or conversion or failure to borrow or convert
to the last day of the then current Interest Period for such Loan (or, in the
case of a failure to borrow or convert, the Interest Period for such Loan which
would have commenced on the date scheduled for such borrowing or conversion) at
the applicable rate of interest for such LIBOR Rate Loan provided for herein
over (ii) the Interbank Offered Rate (as reasonably determined by the Lender)
for Dollar deposits of amounts comparable to such principal amount and
maturities comparable to such period. A determination of the Lender as to the
amounts payable pursuant to this SECTION 4.4 shall be conclusive, provided that
such
35
determinations are made on a reasonable basis. If the Lender requests
compensation under this SECTION 4.4 it shall promptly furnish to the Authorized
Representative calculations in reasonable detail setting forth the Lender's
determination of the amount of such compensation.
36
ARTICLE V
CONDITIONS TO MAKING LOANS AND ISSUING LETTERS OF CREDIT
V.1. CONDITIONS OF INITIAL ADVANCE. The obligation of the Lender to make
the initial Advance under the Revolving Credit Facility, and of the Issuing Bank
to issue any additional Letter of Credit, is subject to the conditions precedent
that:
(a) the Lender shall have received on the Closing Date, in form
and substance satisfactory to the Lender, the following:
(i) executed originals of each of this Agreement, the Note,
the initial Facility Guaranties, the LC Account Agreement and the
other Loan Documents, together with all schedules and exhibits
thereto;
(ii) the favorable written opinion or opinions with respect
to the Loan Documents and the transactions contemplated thereby of
counsel to the Credit Parties dated the Closing Date, addressed to
the Lender and satisfactory to ▇▇▇▇▇ ▇▇▇▇▇ Mulliss & ▇▇▇▇▇,
L.L.P., special counsel to the Lender, substantially in the form
of EXHIBIT F;
(iii) resolutions of the boards of directors or other
appropriate governing body (or of the appropriate committee
thereof) of each Credit Party certified by its secretary or
assistant secretary as of the Closing Date, approving and adopting
the Loan Documents to be executed by such Person, and authorizing
the execution and delivery thereof;
(iv) specimen signatures of officers of each Credit Party
executing the Loan Documents on behalf of such Credit Party,
certified by the secretary or assistant secretary of such Credit
Party;
(v) the charter documents of each Credit Party certified as
of a recent date by the Secretary or Assistant Secretary of the
Borrower;
(vi) the bylaws of each Credit Party certified as of the
Closing Date as true and correct by its secretary or assistant
secretary;
(vii) certificates issued as of a recent date by the
Secretaries of State of the respective jurisdictions of formation
of each Credit Party as to the due existence and good standing of
each Credit Party;
37
(viii) notice of appointment of the initial Authorized
Representative(s);
(ix) certificate of an Authorized Representative dated the
Closing Date demonstrating compliance with the financial covenants
contained in SECTIONS 8.1(A) through 8.1(D) as of the most
recently ended fiscal quarter period, substantially in the form of
EXHIBIT G;
(x) an initial Borrowing Notice, if any, and, if elected by
the Borrower, Interest Rate Selection Notice;
(xi) evidence that all fees payable by the Borrower on the
Closing Date to the Lender have been paid in full;
(xii) such other documents, instruments, certificates and
opinions as the Lender may reasonably request on or prior to the
Closing Date in connection with the consummation of the
transactions contemplated hereby; and
(b) In the good faith judgment of the Lender:
(i) 19 14 there shall not have occurred or become known to
the Lender any event, condition, situation or status since the
date of the information contained in the financial and business
projections, budgets, pro forma data and forecasts concerning the
Borrower and its Subsidiaries delivered to the Lender prior to the
Closing Date that has had or could reasonably be expected to
result in a Material Adverse Effect;
(ii) no litigation, action, suit, investigation or other
arbitral, administrative or judicial proceeding shall be pending
or threatened which could reasonably be likely to result in a
Material Adverse Effect; and
(iii) the Borrower and its Subsidiaries shall have received
all approvals, consents and waivers, and shall have made or given
all necessary filings and notices as shall be required to
consummate the transactions contemplated hereby without the
occurrence of any default under, conflict with or violation of (A)
any applicable law, rule, regulation, order or decree of any
Governmental Authority or arbitral authority or (B) any agreement,
document or instrument to which any of the Borrower or any
Subsidiary is a party or by which any of them or their properties
is bound.
V.2. CONDITIONS OF LOANS AND LETTER OF CREDIT. The obligations of the
Lender to make any Loans, and the Issuing Bank
38
to issue Letters of Credit, hereunder on or subsequent to the Closing Date are
subject to the satisfaction of the following conditions:
(a) the Lender shall have received a Borrowing Notice if required
by ARTICLE II;
(b) the representations and warranties of the Borrower and the
Subsidiaries set forth in ARTICLE VI and in each of the other Loan
Documents shall be true and correct in all material respects on and as
of the date of such Advance, with the same effect as though such
representations and warranties had been made on and as of such date,
except to the extent that such representations and warranties expressly
relate to an earlier date and except that the financial statements
referred to in SECTION 6.6(A) shall be deemed to be those financial
statements most recently delivered to the Lender pursuant to SECTION
7.1 from the date financial statements are delivered to the Lender in
accordance with such Section;
(a) in the case of the issuance of a Letter of Credit, the
Borrower with any of its Subsidiaries as co-applicant, as applicable,
shall have executed and delivered to the Issuing Bank an Application
and Agreement for Letter of Credit in form and content acceptable to
the Issuing Bank together with such other instruments and documents as
it shall request;
(b) at the time of (and after giving effect to) each Advance or
the issuance of a Letter of Credit, no Default or Event of Default
specified in ARTICLE IX shall have occurred and be continuing; and
(c) immediately after giving effect to:
i) a Loan, the aggregate principal balance of all outstanding
Loans shall not exceed the Revolving Credit Commitment;
(ii) a Letter of Credit or renewal thereof, the aggregate
principal balance of all outstanding Letters of Credit and
Reimbursement Obligations for the Lender shall not exceed the
Letter of Credit Commitment;
(iii) a Loan or a Letter of Credit or renewal thereof, the sum
of Letter of Credit Outstandings plus Revolving Credit
Outstandings shall not exceed the Revolving Credit Commitment.
39
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants with respect to itself and to its
Subsidiaries (which representations and warranties shall survive the delivery of
the documents mentioned herein and the making of Loans), that:
V.I. ORGANIZATION AND AUTHORITY.UTHORITY
(a) The Borrower and each Subsidiary is a corporation or
partnership duly organized and validly existing under the laws of the
jurisdiction of its formation;
(b) The Borrower and each Subsidiary (x) has the requisite power
and authority to own its properties and assets and to carry on its
business as now being conducted and as contemplated in the Loan
Documents, and (y) is qualified to do business in every jurisdiction in
which failure so to qualify would have a Material Adverse Effect;
(c) The Borrower has the power and authority to execute, deliver
and perform this Agreement and the Notes, and to borrow hereunder, and
to execute, deliver and perform each of the other Loan Documents to
which it is a party;
(d) Each Subsidiary has the power and authority to execute,
deliver and perform the Facility Guaranty and each of the other Loan
Documents to which it is a party; and
(e) When executed and delivered, each of the Loan Documents to
which the Borrower or any Subsidiary is a party will be the legal,
valid and binding obligation or agreement, as the case may be, of the
Borrower or such Subsidiary, enforceable against the Borrower or such
Subsidiary in accordance with its terms, subject to the effect of any
applicable bankruptcy, moratorium, insolvency, reorganization or other
similar law affecting the enforceability of creditors' rights generally
and to the effect of general principles of equity (whether considered
in a proceeding at law or in equity).
VI.2. LOAN DOCUMENTS. The execution, delivery and performance by the
Borrower and each Subsidiary of each of the Loan Documents to which it is a
party:
(a) have been duly authorized by all requisite corporate action
(including any required shareholder or partner approval) of the
Borrower and each Subsidiary required for the lawful execution,
delivery and performance thereof;
40
(b) do not violate any provisions of (i) applicable law, rule or
regulation, (ii) any judgment, writ, order, determination, decree or
arbitral award of any Governmental Authority or arbitral authority
binding on the Borrower or any Subsidiary or its properties, or (iii)
the charter documents, partnership agreement or bylaws of the Borrower
or any Subsidiary;
(c) does not and will not be in conflict with, result in a breach
of or constitute an event of default, or an event which, with notice or
lapse of time or both, would constitute an event of default, under any
contract (including without limitation any Material Contract),
indenture, agreement or other instrument or document to which Borrower
or any Subsidiary is a party, or by which the properties or assets of
Borrower or any Subsidiary are bound; and
(d) does not and will not result in the creation or imposition of
any Lien upon any of the properties or assets of Borrower or any
Subsidiary.
VI.3. SOLVENCY. The Borrower and each Subsidiary is Solvent after giving
effect to the transactions contemplated by the Loan Documents.
VI.4. SUBSIDIARIES AND STOCKHOLDERS. The Borrower has no Subsidiaries other
than those Persons listed as Subsidiaries in SCHEDULE 6.4 and additional
Subsidiaries created or acquired after the Closing Date in compliance with
SECTION 7.19; SCHEDULE 6.4 states as of the date hereof the organizational form
of each entity, the authorized and issued capitalization of each Subsidiary
listed thereon, the number of shares or other equity interests of each class of
capital stock or interest issued and outstanding of each such Subsidiary and the
number and/or percentage of outstanding shares or other equity interest
(including options, warrants and other rights to acquire any interest) of each
such class of capital stock or other equity interest owned by Borrower or by any
such Subsidiary; the outstanding shares or other equity interests of each such
Subsidiary have been duly authorized and validly issued and are fully paid and
nonassessable; and Borrower and each such Subsidiary owns beneficially and of
record all the shares and other interests it is listed as owning in SCHEDULE
6.4, free and clear of any Lien.
VI.5. OWNERSHIP INTERESTS. Borrower owns no interest in any Person other
than the Persons listed in SCHEDULE 6.4, equity investments in Persons not
constituting Subsidiaries permitted under SECTION 8.7 and additional
Subsidiaries created or acquired after the Closing Date in compliance with
SECTION 7.19.
▇▇.▇.▇▇▇▇▇▇▇▇▇ CONDITION.
41
(a) The Borrower has heretofore furnished to the Lender an audited
consolidated balance sheet of the Borrower and its Subsidiaries as of
March 31, 1996 and the notes thereto and the related consolidated
statements of income, stockholders' equity and cash flows for the
Fiscal Year then ended as examined and certified by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP
and unaudited consolidated interim financial statements of the Borrower
and its Subsidiaries consisting of consolidated balance sheets and
related consolidated statements of income, stockholders' equity and
cash flows, in each case without notes, for and as of the end of the
nine (9) month period ending December 31, 1996. Except as set forth
therein, such financial statements (including the notes thereto)
present fairly the financial condition of the Borrower and its
Subsidiaries as of the end of such Fiscal Year and nine (9) month
period and results of their operations and the changes in its
stockholders' equity for the Fiscal Year and interim period then ended,
all in conformity with GAAP applied on a Consistent Basis, subject
however, in the case of unaudited interim statements to year end audit
adjustments;
(b) since December 31, 1996 there has been no material adverse
change in the condition, financial or otherwise, of the Borrower and
its Subsidiaries taken as a whole or in the businesses, properties,
performance, prospects or operations of the Borrower and its
Subsidiaries taken as a whole, nor have such businesses or properties
been materially adversely affected as a result of any fire, explosion,
earthquake, accident, strike, lockout, combination of workers, flood,
embargo or act of God; and
(c) except as set forth in the financial statements referred to in
SECTION 6.6(A) or in SCHEDULE 6.6 or permitted by SECTION 8.5, neither
Borrower nor any Subsidiary has incurred, other than in the ordinary
course of business, any material Indebtedness, Contingent Obligation or
other commitment or liability which remains outstanding or unsatisfied.
VI.7. TITLE TO PROPERTIES. The Borrower and each of its Subsidiaries has
good and marketable title to all its real and personal properties, subject to no
transfer restrictions or Liens of any kind, except for the transfer restrictions
and Liens described in SCHEDULE 6.7 and Liens permitted by SECTION 8.4.
VI.8. TAXES. Except as set forth in SCHEDULE 6.8, the Borrower and each of
its Subsidiaries has filed or caused to be filed all federal, state and local
tax returns which are required to be filed by it and, except for taxes and
assessments being contested in good faith by appropriate proceedings diligently
conducted and against which reserves reflected in the financial
42
statements described in SECTION 6.6(A) and satisfactory to the Borrower's
independent certified public accountants have been established, have paid or
caused to be paid all taxes as shown on said returns or on any assessment
received by it, to the extent that such taxes have become due.
VI.9. OTHER AGREEMENTS. Neither the Borrower nor any Subsidiary is
(a) a party to or subject to any judgment, order, decree,
agreement, lease or instrument, or subject to other restrictions, which
individually or in the aggregate could reasonably be expected to have a
Material Adverse Effect; or
(b) in default in the performance, observance or fulfillment of
any of the obligations, covenants or conditions contained in any
agreement or instrument, including without limitation any Material
Contract, to which the Borrower or any Subsidiary is a party, which
default has, or if not remedied within any applicable grace period
could reasonably be likely to have, a Material Adverse Effect.
VI.10 LITIGATION. Except as set forth in SCHEDULE 6.10, there is no action,
suit, investigation or proceeding at law or in equity or by or before any
governmental instrumentality or agency or arbitral body pending, or, to the
knowledge of the Borrower, threatened by or against the Borrower or any
Subsidiary or affecting the Borrower or any Subsidiary or any properties or
rights of the Borrower or any Subsidiary or other Credit Party, which could
reasonably be likely to have a Material Adverse Effect.
VI.11 MARGIN STOCK. The proceeds of the borrowings made hereunder will be
used by the Borrower only for the purposes expressly authorized herein. None of
such proceeds will be used, directly or indirectly, for the purpose of
purchasing or carrying any margin stock or for the purpose of reducing or
retiring any Indebtedness which was originally incurred to purchase or carry
margin stock or for any other purpose which might constitute any of the Loans
under this Agreement a "purpose credit" within the meaning of said Regulation U
or Regulation X (12 C.F.R. Part 224) of the Board. Neither the Borrower nor any
agent acting in its behalf has taken or will take any action which might cause
this Agreement or any of the documents or instruments delivered pursuant hereto
to violate any regulation of the Board or to violate the Securities Exchange Act
of 1934, as amended, or the Securities Act of 1933, as amended, or any state
securities laws, in each case as in effect on the date hereof.
VI.12. INVESTMENT COMPANY. Neither the Borrower nor any of its Subsidiaries
is an "investment company," or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an
43
"investment company", as such terms are defined in the Investment Company Act of
1940, as amended (15 U.S.C. ss. 80a-1, et seq.). The application of the proceeds
of the Loans and repayment thereof by the Borrower and the performance by the
Borrower and its Subsidiaries of the transactions contemplated by the Loan
Documents will not violate any provision of said Act, or any rule, regulation or
order issued by the Securities and Exchange Commission thereunder, in each case
as in effect on the date hereof.
VI.13. PATENTS, ETC. The Borrower and each of its Subsidiaries owns or has
the right to use, under valid license agreements or otherwise, all material
patents, licenses, franchises, trademarks, trademark rights, trade names, trade
name rights, trade secrets and copyrights necessary to or used in the conduct of
its businesses as now conducted and as contemplated by the Loan Documents,
without known conflict with any patent, license, franchise, trademark, trade
secret, trade name, copyright, other proprietary right of any other Person.
VI.14. NO UNTRUE STATEMENT. Neither (a) this Agreement nor any other Loan
Document or certificate or document executed and delivered by or on behalf of
the Borrower or any Subsidiary in accordance with or pursuant to any Loan
Document nor (b) any statement, representation, or warranty provided to the
Lender in connection with the negotiation or preparation of the Loan Documents
contains any misrepresentation or untrue statement of material fact or omits to
state a material fact necessary, in light of the circumstance under which it was
made, in order to make any such warranty, representation or statement contained
therein not misleading.
VI.15. NO CONSENTS, ETC. Neither the respective businesses or properties of
the Borrower or any Subsidiary, nor any relationship between the Borrower or any
Subsidiary and any other Person, nor any circumstance in connection with the
execution, delivery and performance of the Loan Documents and the transactions
contemplated thereby, is such as to require a consent, approval or authorization
of, or filing, registration or qualification with, any Governmental Authority or
any other Person on the part of the Borrower or any Subsidiary as a condition to
the execution, delivery and performance of, or consummation of the transactions
contemplated by the Loan Documents, which, if not obtained or effected, would be
reasonably likely to have a Material Adverse Effect, or if so, such consent,
approval, authorization, filing, registration or qualification has been duly
obtained or effected, as the case may be.
VI.16 EMPLOYEE BENEFIT PLANS.T PLANS
(a) The Borrower and each ERISA Affiliate is in compliance with
all applicable provisions of ERISA and the
44
regulations and published interpretations thereunder and in compliance
with all Foreign Benefit Laws with respect to all Employee Benefit
Plans except for any required amendments for which the remedial
amendment period as defined in Section 401(b) of the Code has not yet
expired. Each Employee Benefit Plan that is intended to be qualified
under Section 401(a) of the Code has been determined by the Internal
Revenue Service to be so qualified, and each trust related to such plan
has been determined to be exempt under Section 501(a) of the Code. No
material liability has been incurred by the Borrower or any ERISA
Affiliate which remains unsatisfied for any taxes or penalties with
respect to any Employee Benefit Plan or any Multiemployer Plan;
(b) Neither the Borrower nor any ERISA Affiliate has (i) engaged
in a nonexempt prohibited transaction described in Section 4975 of the
Code or Section 406 of ERISA affecting any of the Employee Benefit
Plans or the trusts created thereunder which could subject any such
Employee Benefit Plan or trust to a material tax or penalty on
prohibited transactions imposed under Internal Revenue Code Section
4975 or ERISA, (ii) incurred any accumulated funding deficiency with
respect to any Employee Benefit Plan, whether or not waived, or any
other liability to the PBGC which remains outstanding other than the
payment of premiums and there are no premium payments which are due and
unpaid, (iii) failed to make a required contribution or payment to a
Multiemployer Plan, or (iv) failed to make a required installment or
other required payment under Section 412 of the Code, Section 302 of
ERISA or the terms of such Employee Benefit Plan;
(c) No Termination Event has occurred or is reasonably expected to
occur with respect to any Pension Plan or Multiemployer Plan, and
neither the Borrower nor any ERISA Affiliate has incurred any unpaid
withdrawal liability with respect to any Multiemployer Plan;
(d) The present value of all vested accrued benefits under each
Employee Benefit Plan which is subject to Title IV of ERISA, did not,
as of the most recent valuation date for each such plan, exceed the
then current value of the assets of such Employee Benefit Plan
allocable to such benefits;
(e) To the best of the Borrower's knowledge, each Employee Benefit
Plan subject to Title IV of ERISA, maintained by the Borrower or any
ERISA Affiliate, has been administered in accordance with its terms in
all material respects and is in compliance in all material respects
with all applicable requirements of ERISA and other applicable laws,
regulations and rules;
45
(f) The consummation of the Loans and the issuance of the Letters
of Credit provided for herein will not involve any prohibited
transaction under ERISA which is not subject to a statutory or
administrative exemption; and
(g) No material proceeding, claim, lawsuit and/or investigation
exists or, to the best knowledge of the Borrower after due inquiry, is
threatened concerning or involving any Employee Benefit Plan.
VI.17. NO DEFAULT. As of the date hereof, there does not exist any Default
or Event of Default hereunder.
VI.18. HAZARDOUS MATERIALS. Except as set forth on SCHEDULE 6.18, the
Borrower and each Subsidiary is in compliance with all applicable Environmental
Laws in all material respects. Neither the Borrower nor any Subsidiary has been
notified of any action, suit, proceeding or investigation which, and neither the
Borrower nor any Subsidiary is aware of any facts which, (i) calls into
question, or could reasonably be expected to call into question, compliance by
the Borrower or any Subsidiary with any Environmental Laws, (ii) which seeks, or
could reasonably be expected to form the basis of a meritorious proceeding, to
suspend, revoke or terminate any license, permit or approval necessary for the
generation, handling, storage, treatment or disposal of any Hazardous Material,
or (iii) seeks to cause, or could reasonably be expected to form the basis of a
meritorious proceeding to cause, any property of the Borrower or any Subsidiary
to be subject to any restrictions on ownership, use, occupancy or
transferability under any Environmental Law.
VI.19. RICO. Neither the Borrower nor any Subsidiary is engaged in or has
engaged in any course of conduct that could subject any of their respective
properties to any Lien, seizure or other forfeiture under any criminal law,
racketeer influenced and corrupt organizations law, civil or criminal, or other
similar laws.
46
ARTICLE VII
AFFIRMATIVE COVENANTS
Until the Facility Termination Date, unless the Lender shall otherwise
consent in writing, the Borrower will, and where applicable will cause each
Subsidiary to:
VII.1 FINANCIAL REPORTS, ETC. (a) As soon as practical and in any event
within 90 days after the end of each Fiscal Year of the Borrower, deliver or
cause to be delivered to the Lender (i) a consolidated balance sheet of the
Borrower and its Subsidiaries of at the end of such Fiscal Year, and the notes
thereto, and the related consolidated statements of income, stockholders' equity
and cash flows, and the respective notes thereto, for such Fiscal Year, setting
forth comparative financial statements for the preceding Fiscal Year, all
prepared in accordance with GAAP applied on a Consistent Basis and containing,
with respect to the consolidated financial statements, opinions of ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ LLP, or other such independent certified public accountants selected by
the Borrower and approved by the Lender, which are unqualified as to the scope
of the audit performed and as to the "going concern" status of the Borrower and
without any exception not acceptable to the Lender, and (ii) a certificate of an
Authorized Representative demonstrating compliance with SECTIONS 8.1(A) through
8.1(D) and 8.3, which certificate shall be in the form of EXHIBIT G and which
shall include a certification by an Authorized Representative that the Borrower
and the Subsidiaries are (x) current with all trade payables, except trade
payables contested in good faith in the ordinary course of business, and (y) in
full compliance with the established sublimits and terms of the Letters of
Credit issued pursuant this Agreement;
(b) as soon as practical and in any event within 45 days after the end
of each fiscal quarter (except the last fiscal quarter of the Fiscal Year),
deliver to the Lender (i) a consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such fiscal quarter, and the related consolidated
statements of income, stockholders' equity and cash flows for such fiscal
quarter and for the period from the beginning of the then current Fiscal Year
through the end of such reporting period, and accompanied by a certificate of an
Authorized Representative to the effect that such financial statements present
fairly the financial position of the Borrower and its Subsidiaries as of the end
of such fiscal period and the results of their operations and the changes in
their financial position for such fiscal period, in conformity with the
standards set forth in SECTION 6.6(A) with respect to interim financial
statements, and (ii) a certificate of an Authorized Representative containing
computations for such quarter comparable to that required pursuant to SECTION
7.1(A)(II);
47
(c) together with each delivery of the financial statements required by
SECTION 7.1(A)(I), deliver to the Lender a letter from the Borrower's
accountants specified in SECTION 7.1(A)(I) stating that in performing the audit
necessary to render an opinion on the financial statements delivered under
SECTION 7.1(A)(I), they obtained no knowledge of any Default or Event of Default
by the Borrower in the fulfillment of the terms and provisions of this Agreement
insofar as they relate to financial matters (which at the date of such statement
remains uncured); or if the accountants have obtained knowledge of such Default
or Event of Default, a statement specifying the nature and period of existence
thereof;
(d) promptly upon their becoming available to the Borrower, the
Borrower shall deliver to the Lender a copy of (i) all regular or special
reports or effective registration statements which Borrower or any Subsidiary
shall file with the Securities and Exchange Commission (or any successor
thereto) or any securities exchange, (ii) any proxy statement distributed by the
Borrower or any Subsidiary to its shareholders, bondholders or the financial
community in general, and (iii) any management letter or other report submitted
to the Borrower or any Subsidiary by independent accountants in connection with
any annual, interim or special audit of the Borrower or any Subsidiary;
(e) as soon as practicable and in any event within 45 days following
the end of each of the first three fiscal quarters and within ninety (90) days
following each fiscal year end, deliver to the Lender an accounts receivable
aging report in form and detail substantially similar to that furnished to the
Lender prior to the Closing Date; and
(f) promptly, from time to time, deliver or cause to be delivered to
the Lender such other information regarding Borrower's and any Subsidiary's
operations, business affairs and financial condition as the Lender may
reasonably request;
The Lender is hereby authorized to deliver a copy of any such financial or
other information delivered hereunder to the Lender (or any affiliate of the
Lender), to any Governmental Authority having jurisdiction over the Lender
pursuant to any written request therefor or in the ordinary course of
examination of loan files, or to any other Person who shall acquire or consider
the assignment of, or acquisition of any participation interest in, any
Obligation permitted by this Agreement.
VII.2. MAINTAIN PROPERTIES. Maintain all properties necessary to its
operations in good working order and condition, make all needed repairs,
replacements and renewals to such properties, and maintain free from Liens all
Material Contracts, trademarks, trade names, patents, copyrights, trade secrets,
know-how, and other intellectual property and proprietary
48
information (or adequate licenses thereto), in each case as are reasonably
necessary to conduct its business as currently conducted or as contemplated
hereby, all in accordance with customary and prudent business practices.
VII.3. EXISTENCE, QUALIFICATION, ETC. Except as otherwise expressly
permitted under SECTION 8.8, do or cause to be done all things necessary to
preserve and keep in full force and effect its existence and all material rights
and franchises, and maintain its license or qualification to do business as a
foreign corporation and good standing in each jurisdiction in which its
ownership or lease of property or the nature of its business makes such license
or qualification necessary.
VII.4. REGULATIONS AND TAXES. Comply in all material respects with or
contest in good faith all statutes and governmental regulations and pay all
taxes, assessments, governmental charges, claims for labor, supplies, rent and
any other obligation which, if unpaid, would become a Lien against any of its
properties except liabilities being contested in good faith by appropriate
proceedings diligently conducted and against which adequate reserves acceptable
to the Borrower's independent certified public accountants have been established
unless and until any Lien resulting therefrom attaches to any of its property
and becomes enforceable against its creditors.
VII.5. INSURANCE. (a) Keep all of its insurable properties adequately
insured at all times with responsible insurance carriers against loss or damage
by fire and other hazards to the extent and in the manner as are customarily
insured against by similar businesses owning such properties similarly situated,
(b) maintain general public liability insurance at all times with responsible
insurance carriers against liability on account of damage to persons and
property and (c) maintain insurance under all applicable workers' compensation
laws (or in the alternative, maintain required reserves if self-insured for
workers' compensation purposes) and against loss by reason by business
interruption such policies of insurance to have such limits, deductibles,
exclusions, co-insurance and other provisions providing no less coverages than
are maintained by similar businesses that are similarly situated, such insurance
policies to be in form reasonably satisfactory to the Lender.
VII.6. TRUE BOOKS. Keep true books of record and account in which full,
true and correct entries will be made of all of its dealings and transactions,
and set up on its books such reserves as may be required by GAAP with respect to
doubtful accounts and all taxes, assessments, charges, levies and claims and
with respect to its business in general, and include such reserves in interim as
well as year-end financial statements.
VII.7. RIGHT OF INSPECTION. Permit any Person designated by the Lender to
visit and inspect any of the properties,
49
corporate books and financial reports of the Borrower or any Subsidiary and to
discuss its affairs, finances and accounts with its principal officers and
independent certified public accountants, all at reasonable times, at reasonable
intervals and with reasonable prior notice.
VII.8. OBSERVE ALL LAWS. Conform to and duly observe in all material
respects all laws, rules and regulations and all other valid requirements of any
Governmental Authority with respect to the conduct of its business.
VII.9. GOVERNMENTAL LICENSES.LICENObtain and maintain all licenses,
permits, certifications and approvals of all applicable Governmental Authorities
as are required for the conduct of its business as currently conducted and as
contemplated by the Loan Documents.
VII.10. COVENANTS EXTENDING TO OTHER PERSONS. Cause each of its
Subsidiaries to do with respect to itself, its business and its assets, each of
the things required of the Borrower in SECTIONS 7.2 through 7.9, and 7.18
inclusive.
VII.11 OFFICER'S KNOWLEDGE OF DEFAULT. Upon any officer of the Borrower
obtaining knowledge of any Default or Event of Default hereunder or under any
other obligation of the Borrower or any Subsidiary cause such officer or an
Authorized Representative to promptly notify the Lender of the nature thereof,
the period of existence thereof, and what action the Borrower or such Subsidiary
proposes to take with respect thereto.
VII.12 SUITS OR OTHER PROCEEDINGS. Upon any officer of the Borrower
obtaining knowledge of any litigation or other proceedings being instituted
against the Borrower or any Subsidiary, or any attachment, levy, execution or
other process being instituted against any assets of the Borrower or any
Subsidiary, making a claim or claims in an aggregate amount greater than
$1,000,000 not otherwise covered by insurance, promptly deliver to the Lender
written notice thereof stating the nature and status of such litigation,
dispute, proceeding, levy, execution or other process.
VII.13. NOTICE OF DISCHARGE OF HAZARDOUS MATERIAL OR ENVIRONMENTAL
COMPLAINT. Promptly provide to the Lender true, accurate and complete copies of
any and all notices, complaints, orders, directives, claims, or citations
received by the Borrower or any Subsidiary relating to any (a) violation or
alleged violation by the Borrower or any Subsidiary of any applicable
Environmental Law; (b) release or threatened release by the Borrower or any
Subsidiary, or at any facility or property owned or leased or operated by the
Borrower or any Subsidiary, of any Hazardous Material, except where occurring
legally; or (c) liability or alleged liability of the Borrower or any Subsidiary
for the costs of cleaning up, removing, remediating or responding
50
to a release of Hazardous Materials where, in any of the foregoing events, the
aggregate amount at any time involved exceeds $500,000.
VII.14. ENVIRONMENTAL COMPLIANCE. If the Borrower or any Subsidiary shall
receive any letter, notice, complaint, order, directive, claim or citation
alleging that the Borrower or any Subsidiary has violated any Environmental Law
or is liable for the costs of cleaning up, removing, remediating or responding
to a release of Hazardous Materials, the Borrower shall, within the time period
permitted by the applicable Environmental Law or the Governmental Authority
responsible for enforcing such Environmental Law, remove or remedy, or cause the
applicable Subsidiary to remove or remedy, such violation or release or satisfy
such liability unless and only during the period that the applicability of the
Environmental Law, the fact of such violation or liability or what is required
to remove or remedy such violation is being contested by the Borrower or the
applicable Subsidiary by appropriate proceedings diligently conducted and all
reserves with respect thereto as may be required under Generally Accepted
Accounting Principles, if any, have been made, and no Lien in connection
therewith shall have attached to any property of the Borrower or the applicable
Subsidiary which shall have become enforceable against creditors of such Person.
VII.15. INDEMNIFICATION. Without limiting the generality of SECTION 11.9,
the Borrower hereby agrees to indemnify and hold the Lender and its officers,
directors, employees and agents, harmless from and against any and all claims,
losses, penalties, liabilities, damages and expenses (including assessment and
cleanup costs and reasonable attorneys' fees and disbursements) arising directly
or indirectly from, out of or by reason of (a) the violation of any
Environmental Law by the Borrower or any Subsidiary or with respect to any
property owned, operated or leased by the Borrower or any Subsidiary or (b) the
handling, storage, treatment, emission or disposal of any Hazardous Materials by
or on behalf of the Borrower or any Subsidiary or on or with respect to property
owned or leased or operated by the Borrower or any Subsidiary. The provisions of
this SECTION 7.15 shall survive the Facility Termination Date and expiration or
termination of this Agreement.
VII.16. FURTHER ASSURANCES. At the Borrower's cost and expense, upon
request of the Lender, duly execute and deliver or cause to be duly executed and
delivered, to the Lender such further instruments, documents, certificates,
financing and continuation statements, and do and cause to be done such further
acts that may be reasonably necessary or advisable in the reasonable opinion of
the Lender to carry out more effectively the provisions and purposes of this
Agreement and the other Loan Documents.
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VII.17. EMPLOYEE BENEFIT PLANS.
(a) With reasonable promptness, and in any event within thirty (30) days
thereof, give notice to the Lender of (a) the establishment of any new
Pension Plan (which notice shall include a copy of such plan), (b) the
commencement of contributions to any Employee Benefit Plan to which the
Borrower or any of its ERISA Affiliates was not previously contributing,
(c) any material increase in the benefits of any existing Employee Benefit
Plan, (d) each funding waiver request filed with respect to any Employee
Benefit Plan and all communications received or sent by the Borrower or any
ERISA Affiliate with respect to such request and (e) the failure of the
Borrower or any ERISA Affiliate to make a required installment or payment
under Section 302 of ERISA or Section 412 of the Code by the due date; and
(b) Promptly and in any event within thirty (30) days of becoming aware of
the occurrence or forthcoming occurrence of any (a) Termination Event or
(b) nonexempt "prohibited transaction," as such term is defined in Section
406 of ERISA or Section 4975 of the Code, in connection with any Pension
Plan or any trust created thereunder, deliver to the Lender a notice
specifying the nature thereof, what action the Borrower or any ERISA
Affiliate has taken, is taking or proposes to take with respect thereto
and, when known, any action taken or threatened by the Internal Revenue
Service, the Department of Labor or the PBGC with respect thereto.
VII.18 CONTINUED OPERATIONS. Continue at all times to conduct its business
and engage principally in the same line or lines of business substantially
as heretofore conducted.
VII.19 NEW SUBSIDIARIES. In the event of the acquisition or creation of any
Subsidiary, cause to be delivered to the Lender each of the following
within thirty (30) days of the acquisition or creation of such Subsidiary.
(a) a Facility Guaranty executed by such Subsidiary substantially
in the form of EXHIBIT H;
(b) an opinion of counsel to the Subsidiary dated as of the date
of delivery of the Facility Guaranty provided for in this SECTION 7.19
and addressed to the Lender, in form and substance reasonably
acceptable to the Lender (which opinion may include assumptions and
qualifications of similar effect to those contained in the opinions of
counsel delivered pursuant to SECTION 5.1(A)), to the effect that:
(A) such Subsidiary is duly organized, validly existing and
in good standing in the jurisdiction of its formation, has the
requisite power and authority to own its properties and conduct
its business as then
52
owned and then conducted and proposed to be conducted, and is duly
qualified to transact business and is in good standing as a
foreign corporation or partnership in each other jurisdiction in
which the character of the properties owned or leased, or the
business carried on by it, requires such qualification and the
failure to be so qualified would reasonably be likely to result in
a Material Adverse Effect; and
(B) the execution, delivery and performance of the Facility
Guaranty described in this SECTION 7.19 to which such Subsidiary
is a signatory have been duly authorized by all requisite
corporate or partnership action (including any required
shareholder or partner approval), such agreement has been duly
executed and delivered and constitutes the valid and binding
agreement of such Subsidiary, enforceable against such Subsidiary
in accordance with its terms, subject to the effect of any
applicable bankruptcy, moratorium, insolvency, reorganization or
other similar law affecting the enforceability of creditors'
rights generally and to the effect of general principles of equity
(whether considered in a proceeding at law or in equity);
(c) current copies of the charter documents, including partnership
agreements and certificate of limited partnership, if applicable, and
bylaws of such Subsidiary, minutes of duly called and conducted
meetings (or duly effected consent actions) of the Board of Directors,
partners, or appropriate committees thereof (and, if required by such
charter documents, bylaws or by applicable law, of the shareholders) of
such Subsidiary authorizing the actions and the execution and delivery
of documents described in this SECTION 7.19.
Notwithstanding the foregoing provisions of this SECTION 7.19, the
Borrower shall not be required to cause the Facility Guaranty and related
documents of or pertaining to WFI to be executed and delivered by or on behalf
of WFI until the earlier to occur of the following: (i) the date upon which the
amount of shareholders equity of WFI (calculated in the manner described in
clause (B) of the definition of "WFI Capitalization" contained in SECTION 1.2
hereof) equals or exceeds 25% of Consolidated Shareholders' Equity, or (ii) the
date upon which the sum of the aggregate Advances (cumulative from January 1,
1996) plus the aggregate face amount of all outstanding Letters of Credit in
each case made or issued to fund contributions, loans or advances to,
investments in, or operations at, WFI, shall exceed $10,000,000.
53
ARTICLE VIII
NEGATIVE COVENANTS
Until the Obligations have been paid and satisfied in full, no Letters of
Credit remain outstanding and this Agreement has been terminated in accordance
with the terms hereof, unless the Lender shall otherwise consent in writing, the
Borrower will not, nor will it permit any Subsidiary to:
VIII.1. FINANCIAL COVENANTS.OVENANTS
(a) CONSOLIDATED TANGIBLE NET WORTH. Permit at any time its
Consolidated Tangible Net Worth to be less than $55,000,000;
(b) CONSOLIDATED FUNDED INDEBTEDNESS TO CONSOLIDATED
CAPITALIZATION. Permit at any time the ratio of Consolidated Funded
Indebtedness to Consolidated Capitalization to be equal to or greater
than .55 to 1.00;
(c) CONSOLIDATED FIXED CHARGE COVERAGE RATIO. Permit the
Consolidated Fixed Charge Coverage Ratio to be at any time less than
1.35 to 1.00;
(d) WORKING ASSET COVERAGE RATIO. Permit at any time the ratio of
(i) Consolidated Working Assets to (ii) the SUM of (A) Obligations of
the Borrower under this Agreement PLUS (B) trade
accounts payable to be less than 1.125 to 1.00.
VIII.2. ACQUISITIONS. Enter into any agreement, contract, binding
commitment or other arrangement providing for any Acquisition, or take any
action to solicit the tender of securities or proxies in respect thereof in
order to effect any Acquisition, unless (i) the Person to be (or whose assets
are to be) acquired does not oppose such Acquisition and the line or lines of
business of the Person to be acquired are substantially the same as one or more
line or lines of business conducted by the Borrower and its Subsidiaries, (ii)
no Default or Event of Default shall have occurred and be continuing either
immediately prior to or immediately after giving effect to such Acquisition and
the Borrower shall have furnished to the Lender (A) pro forma historical
financial statements as of the end of the most recently completed Fiscal Year of
the Borrower giving effect to such Acquisition and (B) a certificate in the form
of EXHIBIT G prepared on a historical pro forma basis giving effect to such
Acquisition, which certificate shall demonstrate that no Default or Event of
Default would exist immediately after giving effect thereto, (iii) the Person
acquired shall be a wholly-owned Subsidiary, or be merged into the Borrower or a
wholly-owned Subsidiary, immediately upon consummation of the Acquisition (or if
assets are being acquired, the acquiror shall be the Borrower or a wholly-owned
Subsidiary), and (iv) the cost of acquisition
54
shall not exceed $10,000,000.
VIII.3. CAPITAL EXPENDITURES. Make or become committed to make Capital
Expenditures, excluding Costs of Acquisitions, which exceed in the aggregate in
any Fiscal Year of the Borrower $4,000,000 (on a noncumulative basis, with the
effect that amounts not expended in any Fiscal Year may not be carried forward
to a subsequent period).
VIII.4. LIENS. Incur, create or permit to exist any Lien, charge or other
encumbrance of any nature whatsoever with respect to any property or assets now
owned or hereafter acquired by the Borrower or any Subsidiary, other than
(a) Liens existing as of the date hereof and as set forth in
SCHEDULE 6.7;
(b) Liens imposed by law for taxes, assessments or charges of any
Governmental Authority for claims not yet due or which are being
contested in good faith by appropriate proceedings diligently conducted
and with respect to which adequate reserves or other appropriate
provisions are being maintained in accordance with GAAP and which Liens
are not yet enforceable against other creditors;
(c) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other Liens imposed by law or
created in the ordinary course of business and in existence less than
90 days from the date of creation thereof for amounts not yet due or
which are being contested in good faith by appropriate proceedings
diligently conducted and with respect to which adequate reserves or
other appropriate provisions are being maintained in accordance with
GAAP and which Liens are not yet enforceable against other creditors;
(d) Liens incurred or deposits made in the ordinary course of
business (including, without limitation, surety bonds and appeal bonds)
in connection with workers' compensation, unemployment insurance and
other types of social security benefits or to secure the performance of
tenders, bids, leases, contracts (other than for the repayment of
Indebtedness), statutory obligations and other similar obligations or
arising as a result of progress payments under government contracts;
(e) easements (including reciprocal easement agreements and
utility agreements), rights-of-way, covenants, consents, reservations,
encroachments, variations and zoning and other restrictions, charges or
encumbrances (whether or not recorded), which do not interfere
materially with the ordinary conduct of the business of the Borrower or
any Subsidiary and which do not materially detract from the value of
the
55
property to which they attach or materially impair the use thereof to
the Borrower or any Subsidiary;
(f) purchase money Liens to secure Indebtedness permitted under
SECTION 8.5(D) and incurred to purchase fixed assets, provided such
Indebtedness represents not less than 75% of the purchase price of such
assets as of the date of purchase thereof and no property other than
the assets so purchased secures such Indebtedness; and
(g) Liens arising in connection with Capital Leases permitted
under SECTION 8.5(D); provided that no such Lien shall extend to any
Collateral or to any other property other than the assets subject to
such Capital Leases.
VIII.5. INDEBTEDNESS. Incur, create, assume or permit to exist any
Indebtedness of the Borrower, howsoever evidenced, except:
(a) Indebtedness existing as of the Closing Date as set forth in
SCHEDULE 7.6; PROVIDED, none of the instruments and agreements
evidencing or governing such Indebtedness shall be amended, modified or
supplemented after the Closing Date to change any terms of
subordination, repayment or rights of conversion, put, exchange or
other rights from such terms and rights as in effect on the Closing
Date;
(b) Indebtedness owing to the Lender in connection with this
Agreement, the Note or other Loan Document;
(c) the endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business;
(d) purchase money Indebtedness described in SECTION 8.4(F) and
Indebtedness arising from Capital Leases described in SECTION 8.4(G),
collectively not to exceed an aggregate outstanding amount at any time
of $2,000,000;
(e) unsecured intercompany Indebtedness for loans and advances
made by the Borrower or any Guarantor to the Borrower or any Guarantor,
provided that such intercompany Indebtedness is evidenced by a
promissory note or similar written instrument acceptable to the Lender
which provides that such Indebtedness is subordinated to obligations,
liabilities and undertakings of the holder or owner thereof under the
Loan Documents on terms acceptable to the Lender;
(f) trade credit from vendors incurred in the ordinary course of
business;
(g) loans made by the Borrower to the Petro Sur-World Fuel
joint-venture in Ecuador in an amount not to exceed in
56
the aggregate $2,000,000;
(h) insurance notes payable;
(i) any installment note or capitalized leases assumed through a
permitted Acquisition which by virtue of its terms contains a
prepayment fee;
(j) Indebtedness arising from Rate Hedging Obligations permitted
under SECTION 8.15; and
(k) Indebtedness extending the maturity of, or renewing, refunding
or refinancing, in whole or in part, Indebtedness incurred under
clauses (a) and (j) of this SECTION 8.5, provided that the terms of any
such extension, renewal, refunding or refinancing Indebtedness (and of
any agreement or instrument entered into in connection therewith) are
no less favorable to the Lender than the terms of the Indebtedness as
in effect prior to such action, and provided further that (1) the
aggregate principal amount of such extended, renewed, refunded or
refinanced Indebtedness shall not be increased by such action, (2) the
group of direct or contingent obligors on such Indebtedness shall not
be expanded as a result of any such action, and (3) immediately before
and immediately after giving effect to any such extension, renewal,
refunding or refinancing, no Default or Event of Default shall have
occurred and be continuing; PROVIDED, the Borrower shall not permit WFI
to incur, create, assume or permit to exist any Indebtedness, howsoever
evidenced, other than (i) to the Lender, (ii) to the Borrower in
connection with intercompany loans upon terms and conditions provided
for in SECTION 8.5(E), (iii) trade credit to customers incurred in the
ordinary course of business, and (iv) additional unsecured Indebtedness
in connection with its operations in the ordinary course of business
not to exceed $5,000,000 outstanding in the aggregate at any time, and
PROVIDED, further that the incurring of any such Indebtedness does not
cause, create or result in the occurrence or continuation of a Default
or Event of Default hereunder.
VIII.6. TRANSFER OF ASSETS. Sell, lease, transfer or otherwise dispose of
any assets of Borrower or any Subsidiary other than (a) dispositions of assets
in the ordinary course of business, (b) dispositions of property that is
substantially worn, damaged, obsolete or, in the judgment of the Borrower, no
longer best used or useful in its business or that of any Subsidiary, and (c)
transfers of assets necessary to give effect to merger or consolidation
transactions permitted by SECTION 8.8, and (d) the disposition of Eligible
Securities in the ordinary course of management of the investment portfolio of
the Borrower and its Subsidiaries.
VIII.7. INVESTMENTS. Purchase, own, invest in or
57
otherwise acquire, directly or indirectly, any stock or other securities, or
make or permit to exist any interest whatsoever in any other Person or permit to
exist any loans or advances to any Person, except that Borrower may maintain
investments or invest in:
(a) securities of any Person acquired in an Acquisition permitted
hereunder;
(b) Eligible Securities;
(c) investments existing as of the date hereof and as set forth in
SCHEDULE 6.4;
(d) accounts receivable arising and trade credit granted in the
ordinary course of business and any securities received in satisfaction
or partial satisfaction thereof in connection with accounts of
financially troubled Persons to the extent reasonably necessary in
order to prevent or limit loss;
(e) investments in Subsidiaries which are Guarantors;
(f) loans made by the Borrower to the Petro Sur-World Fuel
joint-venture described in SECTION 8.5(G);
(g) loans between the Borrower and the Guarantors described in
SECTION 8.5(E); and
(h) loans or investments in or to a joint venture of which the
Borrower or a Subsidiary is a party, so long as the aggregate amount of
such loans or investments do not exceed 5% of Consolidated Tangible Net
Worth.
VIII.8. MERGER OR CONSOLIDATION. (a) Consolidate with or merge into any
other Person, or (b) permit any other Person to merge into it, or (c) liquidate,
wind-up or dissolve or sell, transfer or lease or otherwise dispose of all or a
substantial part of its assets (other than sales permitted under SECTION 8.6(A),
(B) AND (D)); PROVIDED, HOWEVER, (i) any Subsidiary of the Borrower may merge or
transfer all or substantially all of its assets into or consolidate with the
Borrower or any wholly-owned Subsidiary of the Borrower, and (ii) any other
Person may merge into or consolidate with the Borrower or any wholly-owned
Subsidiary and any Subsidiary may merge into or consolidate with any other
Person in order to consummate an Acquisition permitted by SECTION 8.2, PROVIDED
further, that any resulting or surviving entity shall execute and deliver such
agreements and other documents, including a Facility Guaranty, and take such
other action as the Lender may require to evidence or confirm its express
assumption of the obligations and liabilities of its predecessor entities under
the Loan Documents.
58
VII.9. RESTRICTED PAYMENTS. Make any Restricted Payment or apply or set
apart any of their assets therefor or agree to do any of the foregoing; PROVIDED
HOWEVER, the Borrower may (a) issue stock as a dividend up to 10% of total
outstanding shares immediately prior to such; and (b) declare and pay cash
dividends on outstanding shares of any class of its capital stock provided that
the aggregate amount of such dividends declared or paid during any Four-Quarter
Period shall not exceed 25% of Consolidated Net Income for such Four-Quarter
Period so long as prior to such actions in (a) or (b), above and after giving
effect thereto, the Borrower is in compliance with all terms, conditions,
covenants, and representations and warranties in the Agreement, and prior to
such actions defined in (a) and (b) above and after giving effect thereto, no
Default or Event of Default has or will occur.
VIII.1. TRANSACTIONS WITH AFFILIATES. Other than transactions permitted
under SECTIONS 8.7 and 8.8, enter into any transaction after the Closing Date,
including, without limitation, the purchase, sale, lease or exchange of
property, real or personal, or the rendering of any service, with any Affiliate
of the Borrower, except (a) that such Persons may render services to the
Borrower or its Subsidiaries for compensation at the same rates generally paid
by Persons engaged in the same or similar businesses for the same or similar
services, (b) that the Borrower or any Subsidiary may render services to such
Persons for compensation at the same rates generally charged by the Borrower or
such Subsidiary and (c) in either case in the ordinary course of business and
pursuant to the reasonable requirements of the Borrower's (or any Subsidiary's)
business consistent with past practice of the Borrower and its Subsidiaries and
upon fair and reasonable terms no less favorable to the Borrower (or any
Subsidiary) than would be obtained in a comparable arm's-length transaction with
a Person not an Affiliate.
VIII.11. COMPLIANCE WITH ERISA. With respect to any Pension Plan, Employee
Benefit Plan or Multiemployer Plan:
(a) permit the occurrence of any Termination Event which would
result in a liability on the part of the Borrower or any ERISA
Affiliate to the PBGC; or
(b) permit the present value of all benefit liabilities under all
Pension Plans to exceed the current value of the assets of such Pension
Plans allocable to such benefit liabilities; or
(c) permit any accumulated funding deficiency (as defined in
Section 302 of ERISA and Section 412 of the Code) with respect to any
Pension Plan, whether or not waived; or
(d) fail to make any contribution or payment to any
59
Multiemployer Plan which the Borrower or any ERISA Affiliate may be
required to make under any agreement relating to such Multiemployer
Plan, or any law pertaining thereto; or
(e) engage, or permit any Borrower or any ERISA Affiliate to
engage, in any prohibited transaction under Section 406 of ERISA or
Sections 4975 of the Code for which a civil penalty pursuant to Section
502(I) of ERISA or a tax pursuant to Section 4975 of the Code may be
imposed; or
(f) permit the establishment of any Employee Benefit Plan
providing post-retirement welfare benefits or establish or amend any
Employee Benefit Plan which establishment or amendment could result in
liability to the Borrower or any ERISA Affiliate or increase the
obligation of the Borrower or any ERISA Affiliate to a Multiemployer
Plan; or
(g) fail, or permit the Borrower or any ERISA Affiliate to fail,
to establish, maintain and operate each Employee Benefit Plan in
compliance in all material respects with the provisions of ERISA, the
Code, all applicable Foreign Benefit Laws and all other applicable laws
and the regulations and interpretations thereof.
VIII.12. FISCAL YEAR. Change its Fiscal Year.
VIII.13. DISSOLUTION, ETC. Wind up, liquidate or dissolve (voluntarily or
involuntarily) or commence or suffer any proceedings seeking any such winding
up, liquidation or dissolution, except in connection with a merger or
consolidation permitted pursuant to SECTION 8.8.
VIII.14. NEGATIVE PLEDGE CLAUSES. Enter into or cause, suffer or permit to
exist any agreement with any Person other than the Lender pursuant to this
Agreement or any other Loan Documents which prohibits or limits the ability of
any of the Borrower or any Subsidiary to create, incur, assume or suffer to
exist any Lien upon any of its property, assets or revenues, whether now owned
or hereafter acquired, PROVIDED that the Borrower and any Subsidiary may enter
into such an agreement in connection with property subject to any Lien permitted
by this Agreement and not released after the date hereof, when such prohibition
or limitation is by its terms effective only against the assets subject to such
Lien.
VIII.15. PARTNERSHIPS. Become a general partner in any general or limited
partnership except a partnership which complies with the provisions of SECTION
8.07(H).
VIII.16. WFI CAPITALIZATION. Permit the WFI Capitalization to exceed
$14,000,000.
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ARTICLE IX
EVENTS OF DEFAULT AND ACCELERATION
IX.1 EVENTS OF DEFAULT. (A) If any one or more of the following events
(herein called "Events of Default") shall occur for any reason whatsoever (and
whether such occurrence shall be voluntary or involuntary or come about or be
effected by operation of law or pursuant to or in compliance with any judgment,
decree or order of any court or any order, rule or regulation of any
Governmental Authority), that is to say:
(a) if default shall be made in the due and punctual payment of
the principal of any Loan, Reimbursement Obligation or other
Obligation, when and as the same shall be due and payable whether
pursuant to any provision of ARTICLE II or ARTICLE III, at maturity, by
acceleration or otherwise; or
(b) if default shall be made in the due and punctual payment of
any amount of interest on any Loan, Reimbursement Obligation or other
Obligation or of any fees or other amounts payable to the Lender on the
date on which the same shall be due and payable; or
(c) if default shall be made in the performance or observance of
any covenant set forth in SECTION 7.7, 7.11, 7.12, 7.19 or ARTICLE
VIII;
(d) if a default shall be made in the performance or observance
of, or shall occur under, any covenant, agreement or provision
contained in this Agreement or the Note (other than as described in
clauses (a), (b) or (c) above) and such default shall continue for 30
or more days after the earlier of receipt of notice of such default by
the Authorized Representative from the Lender or an Authorized
Representative of the Borrower has actual knowledge of such default, or
if a default shall be made in the performance or observance of, or
shall occur under, any covenant, agreement or provision contained in
any of the other Loan Documents (beyond any applicable grace period, if
any, contained therein) or in any instrument or document evidencing or
creating any obligation, guaranty, or Lien in favor of the Lender or
delivered to the Lender in connection with or pursuant to this
Agreement or any of the Obligations, or if any Loan Document ceases to
be in full force and effect (other than by reason of any action by the
Lender), or if without the written consent of the Lender, this
Agreement or any other Loan Document shall be disaffirmed or shall
terminate, be terminable or be terminated or become void or
unenforceable for any reason whatsoever (other than in accordance with
its terms in the absence of default or by reason of any action by the
Lender); or
61
(e) if there shall occur (i) a default, which is not waived, in
the payment of any principal, interest, premium or other amount with
respect to any Indebtedness or Rate Hedging Obligations (other than the
Loans and other Obligations) of the Borrower or any Subsidiary in an
amount not less than $1,000,000 in the aggregate outstanding, or (ii) a
default, which is not waived, in the performance, observance or
fulfillment of any term or covenant contained in any agreement or
instrument under or pursuant to which any such Indebtedness or Rate
Hedging Obligation may have been issued, created, assumed, guaranteed
or secured by the Borrower or any Subsidiary, or (iii) any other event
of default as specified in any agreement or instrument under or
pursuant to which any such Indebtedness or Rate Hedging Obligation may
have been issued, created, assumed, guaranteed or secured by the
Borrower or any Subsidiary, and such default or event of default shall
continue for more than the period of grace, if any, therein specified,
or such default or event of default shall permit the holder of any such
Indebtedness (or any agent or trustee acting on behalf of one or more
holders) to accelerate the maturity thereof; or
(f) if any representation, warranty or other statement of fact
contained in any Loan Document or in any writing, certificate, report
or statement at any time furnished to the Lender by or on behalf of the
Borrower or any other Credit Party pursuant to or in connection with
any Loan Document, or otherwise, shall be false or misleading in any
material respect when given; or
(g) if the Borrower or any Subsidiary or other Credit Party shall
be unable to pay its debts generally as they become due; file a
petition to take advantage of any insolvency statute; make an
assignment for the benefit of its creditors; commence a proceeding for
the appointment of a receiver, trustee, liquidator or conservator of
itself or of the whole or any substantial part of its property; file a
petition or answer seeking liquidation, reorganization or arrangement
or similar relief under the federal bankruptcy laws or any other
applicable law or statute; or
(h) if a court of competent jurisdiction shall enter an order,
judgment or decree appointing a custodian, receiver, trustee,
liquidator or conservator of the Borrower or any Subsidiary or of the
whole or any substantial part of its properties and such order,
judgment or decree continues unstayed and in effect for a period of
sixty (60) days, or approve a petition filed against the Borrower or
any Subsidiary seeking liquidation, reorganization or arrangement or
similar relief under the federal bankruptcy laws or any other
applicable law or statute of the United
62
States of America or any state, which petition is not dismissed within
sixty (60) days; or if, under the provisions of any other law for the
relief or aid of debtors, a court of competent jurisdiction shall
assume custody or control of the Borrower or any Subsidiary or of the
whole or any substantial part of its properties, which control is not
relinquished within sixty (60) days; or if there is commenced against
the Borrower or any Subsidiary any proceeding or petition seeking
reorganization, arrangement or similar relief under the federal
bankruptcy laws or any other applicable law or statute of the United
States of America or any state which proceeding or petition remains
undismissed for a period of sixty (60) days; or if the Borrower or any
Subsidiary takes any action to indicate its consent to or approval of
any such proceeding or petition; or
(i) if (i) one or more final judgments or orders where the amount
not covered by insurance (or the amount as to which the insurer denies
liability) is in excess of $1,000,000 is rendered against the Borrower
or any Subsidiary, or (ii) there is any attachment, injunction or
execution against any of the Borrower's or Subsidiaries' properties for
any amount in excess of $1,000,000 in the aggregate; and such judgment,
attachment, injunction or execution remains unpaid, unstayed,
undischarged, unbonded or undismissed for a period of thirty (30) days;
or
(j) if the Borrower or any Subsidiary shall, other than in the
ordinary course of business (as determined by past practices), or,
except as specifically permitted by this Agreement, suspend all or any
part of its operations material to the conduct of the business of the
Borrower or such Subsidiary for a period of more than 60 days;
(k) if there shall occur a Change in Control in the Borrower; or
(l) if there shall occur and not be waived an Event of Default as
defined in any of the other Loan Documents;
(B) then, and in any such event and at any time thereafter, if such
Event of Default or any other Event of Default shall have not been waived,
(a) either or both of the following actions may be taken: (i) the
Lender may declare any obligation of the Lender and the Issuing Bank to
make further Loans or to issue additional Letters of Credit terminated,
whereupon the obligation of the Lender to make further Loans and of the
Issuing Bank to issue additional Letters of Credit, hereunder shall
terminate immediately, and (ii) the Lender, at its option,
63
declare by notice to the Borrower any or all of the Obligations to be
immediately due and payable, and the same, including all interest
accrued thereon and all other obligations of the Borrower to the
Lender, shall forthwith become immediately due and payable without
presentment, demand, protest, notice or other formality of any kind,
all of which are hereby expressly waived, anything contained herein or
in any instrument evidencing the Obligations to the contrary
notwithstanding; PROVIDED, however, that notwithstanding the above, if
there shall occur an Event of Default under clause (g) or (h) above,
then the obligation of the Lender to make Loans and of the Issuing Bank
to issue Letters of Credit hereunder shall automatically terminate and
any and all of the Obligations shall be immediately due and payable
without the necessity of any action by the Lender or notice to the
Lender;
(b) the Borrower shall, upon demand of the Lender, deposit cash
with the Issuing Bank in an amount equal to the amount of any Letter of
Credit Outstandings, as collateral security for the repayment of any
future drawings or payments under such Letters of Credit, and such
amounts shall be held by the Issuing Bank pursuant to the terms of the
LC Account Agreement; and
(c) the Lender shall have all of the rights and remedies available
under the Loan Documents or under any applicable law.
Notwithstanding the foregoing provisions of this SECTION 9.1 the rights and
remedies provided with respect to the Subsidiaries and their assets (including
without limitation bank accounts, certificates of deposit and other
instruments), shall be applicable to and available against WFI only from the
date WFI shall be required to become a Guarantor in accordance with the last
paragraph of SECTION 7.19.
IX.2. LENDER TO ACT. In case any one or more Events of Default shall occur
and not have been waived, the Lender may proceed to protect and enforce its
rights or remedies either by suit in equity or by action at law, or both,
whether for the specific performance of any covenant, agreement or other
provision contained herein or in any other Loan Document, or to enforce the
payment of the Obligations or any other legal or equitable right or remedy.
IX.3. CUMULATIVE RIGHTS. No right or remedy herein conferred upon the
Lender is intended to be exclusive of any other rights or remedies contained
herein or in any other Loan Document, and every such right or remedy shall be
cumulative and shall be in addition to every other such right or remedy
contained herein and therein or now or hereafter existing at law
64
or in equity or by statute, or otherwise.
IX.4. NO WAIVER. No course of dealing between the Borrower and the Lender
or any failure or delay on the part of the Lender in exercising any rights or
remedies under any Loan Document or otherwise available to it shall operate as a
waiver of any rights or remedies and no single or partial exercise of any rights
or remedies shall operate as a waiver or preclude the exercise of any other
rights or remedies hereunder or of the same right or remedy on a future
occasion.
IX.5. ALLOCATION OF PROCEEDS. If an Event of Default has occurred and not
been waived, and the maturity of the Note has been accelerated pursuant to
ARTICLE IX hereof, all payments received by the Lender hereunder, in respect of
any principal of or interest on the Obligations or any other amounts payable by
the Borrower hereunder, shall be applied by the Lender in the following order:
(a) amounts due to the Lender pursuant to SECTIONS 2.10, 3.3, 3.4
AND 11.5;
(b) payments of interest on Loans and Reimbursement Obligations;
(c) payments of principal of Loans and Reimbursement Obligations;
(d) payments of cash amounts to the Lender in respect of
outstanding Letters of Credit pursuant to SECTION 9.1(B);
(e) amounts due to the Lender pursuant to SECTIONS 3.2(G), 7.15
and 10.9;
(f) payments of all other amounts due under any of the Loan
Documents, if any;
(g) amounts due to any of the Lender in respect of Obligations
consisting of liabilities under any Swap Agreement with the Lender; and
(h) any surplus remaining after application as provided for
herein, to the Borrower or otherwise as may be required by applicable
law.
65
ARTICLE X
MISCELLANEOUS
X.1. PARTICIPATIONS. The Lender may sell participations at its expense to
one or more banks or other entities as to all or a portion of its rights and
obligations under this Agreement; PROVIDED, that (i) the Lender's obligations
under this Agreement shall remain unchanged, (ii) the Lender shall remain solely
responsible to the Borrower for the performance of such obligations, (iii) the
Lender shall remain the holder of any Note issued to it for the purpose of this
Agreement, (iv) such participations shall be in a minimum amount of $1,000,000
and, if greater, an amount which is an integral multiple of $1,000,000, (v) the
Borrower shall continue to deal solely and directly with the Lender in
connection with the Lender's rights and obligations under this Agreement and
with regard to any and all payments to be made under this Agreement; PROVIDED,
that the participation agreement between the Lender and its participants may
provide that the Lender will obtain the approval of such participant prior to
the Lender's agreeing to any amendment or waiver of any provisions of any Loan
Document which would (A) extend the maturity of the Note, (B) reduce the
interest rates hereunder or (C) increase the Revolving Credit Commitment or
Letter of Credit Commitment, and (vi) the sale of any such participations which
require Borrower to file a registration statement with the United States
Securities and Exchange Commission or under the securities regulations or laws
of any state shall not be permitted.
X.2. NOTICES. Any notice shall be conclusively deemed to have been received
by any party hereto and be effective (i) on the day on which delivered
(including hand delivery by commercial courier service) to such party (against
receipt therefor), (ii) on the date of receipt at such address, telefacsimile
number or telex number as may from time to time be specified by such party in
written notice to the other parties hereto or otherwise received), in the case
of notice by telegram, telefacsimile or telex, respectively (where the receipt
of such message is verified by return), or (iii) on the fifth Business Day after
the day on which mailed, if sent prepaid by certified or registered mail, return
receipt requested, in each case delivered, transmitted or mailed, as the case
may be, to the address, telex number or telefacsimile number, as appropriate,
set forth below or such other address or number as such party shall specify by
notice hereunder:
(a) if to the Borrower:
World Fuel Services Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
66
(b) if to the Lender:
NationsBank, N.A. (South)
Independence Center, ▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Credit Support
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(c) if to any Guarantor, at the address set forth in SECTION
14 of the Facility Guaranty executed by such Guarantor.
X.3. SETOFF. From and after the occurrence of a Default or an Event of
Default the Lender may set off the obligations and liabilities of Borrower
against any and all monies then owed by the Lender to the Borrower in any
capacity whatsoever whether or not then due and the Lender shall be deemed to
have exercised its right to set off immediately at the time its right to elect
such set off accrues even though no charge is made or entered on the books of
the Lender at that time and the same is made subsequent thereto; the Lender may
proceed against the Borrower's bank account(s), certificates of deposit or any
other investments and the Subsidiary's bank account(s) and certificates of
deposit or any other investments. For the purposes of this paragraph, all
remittances and property shall be deemed to be in the possession of the Lender
as soon as the same may be put in transit to it by mail or carrier or by other
bailee.
X.4. SURVIVAL. All covenants, agreements, representations and warranties
made herein shall survive the making by the Lender of the Loans and the issuance
of the Letters of Credit and the execution and delivery to the Lender of this
Agreement and the Notes and shall continue in full force and effect so long as
any of Obligations remain outstanding or the Lender has any commitment hereunder
or the Borrower has continuing obligations hereunder unless otherwise provided
herein. Whenever in this Agreement any of the parties hereto is referred to,
such reference shall be deemed to include the successors and permitted assigns
of such party and all covenants, provisions and agreements by or on behalf of
the Borrower which are contained in the Loan Documents shall inure to the
benefit of the successors and permitted assigns of the Lender.
X.5. EXPENSES. The Borrower agrees (a) to pay or reimburse the Lender
for all its reasonable out-of-pocket costs and expenses incurred in connection
with the preparation, negotiation and execution of, and any amendment,
supplement or modification to, any of the Loan Documents (including due
diligence expenses
67
and travel expenses relating to closing), and the consummation of the
transactions contemplated thereby, including the reasonable fees and
disbursements of counsel to the Lender, which shall not exceed $15,000, (b) to
pay or reimburse the Lender for all of its costs and expenses incurred in
connection with the enforcement or preservation of any rights under the Loan
Documents, including the reasonable fees and disbursements of their counsel and
any payments in indemnification or otherwise payable by the Lender pursuant to
the Loan Documents, and (c) to pay, indemnify and hold the Lender harmless from
any and all recording and filing fees and any and all liabilities with respect
to, or resulting from any failure to pay or delay in paying, documentary, stamp,
excise and other similar taxes, if any, which may be payable or determined to be
payable in connection with the execution and delivery of any of the Loan
Documents, or consummation of any amendment, supplement or modification of, or
any waiver or consent under or in respect of, any Loan Document.
X.6. AMENDMENTS. No amendment, modification or waiver of any provision of
any Loan Document and no consent by the Lender to any departure therefrom by the
Borrower or any other Credit Party shall be effective unless such amendment,
modification or waiver shall be in writing and signed by the Lender, shall have
been approved by the Lender through its written consent, and the same shall then
be effective only for the period and on the conditions and for the specific
instances and purposes specified in such writing; PROVIDED, however, that, no
such amendment, modification or waiver
(i) which changes, extends or waives any provision of SECTION
2.6, SECTION 10.9 or this SECTION 11.6, the amount of or the due
date of any scheduled installment of or the rate of interest
payable on any Obligation, which changes the definition of
"Required Lender", which permits an assignment by any Credit Party
of its Obligations under any Loan Document, which reduces the
required consent of the Lender provided hereunder, which
increases, decreases (other than pursuant to the express terms
hereof) or extends (other than pursuant to the express terms
hereof) the Revolving Credit Commitment or Letter of Credit
Commitment of the Lender, or which waives any condition to the
making of any Loan, shall be effective unless in writing and
signed by the Lender;
(ii) which releases Collateral or the guaranty obligation
under any Facility Guaranty (other than pursuant to the express
terms hereof or thereof) shall be effective unless with the
written consent of the Lender;
(iii) which affects the rights, privileges or obligations of
the Issuing Bank as issuer of Letters of
68
Credit, shall be effective unless signed in writing by the Issuing
Bank;
(iv) which affects the rights, privileges, immunities or
indemnities of the Lender shall be effective unless in writing and
signed by the Lender.
No notice to or demand on the Borrower in any case shall entitle the Borrower to
any other or further notice or demand in similar or other circumstances, except
as otherwise expressly provided herein. No delay or omission on the Lender's
part in exercising any right, remedy or option shall operate as a waiver of such
or any other right, remedy or option or of any Default or Event of Default.
X.7. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, and it shall not be necessary in making proof of this Agreement to
produce or account for more than one such fully-executed counterpart.
X.8. TERMINATION. The termination of this Agreement shall not affect any
rights of the Borrower or the Lender or any obligation of the Borrower or the
Lender, arising prior to the effective date of such termination, and the
provisions hereof shall continue to be fully operative until all transactions
entered into or rights created or obligations incurred prior to such termination
have been fully disposed of, concluded or liquidated and the Obligations arising
prior to or after such termination have been irrevocably paid in full. The
rights granted to the Lender under the Loan Documents shall continue in full
force and effect, notwithstanding the termination of this Agreement, until all
of the Obligations have been paid in full after the termination hereof (other
than Obligations in the nature of continuing indemnities or expense
reimbursement obligations not yet due and payable, which shall continue) or the
Borrower has furnished the Lender with an indemnification satisfactory to the
Lender with respect thereto. All representations, warranties, covenants, waivers
and agreements contained herein shall survive termination hereof until payment
in full of the Obligations unless otherwise provided herein. Notwithstanding the
foregoing, if after receipt of any payment of all or any part of the
Obligations, the Lender is for any reason compelled to surrender such payment to
any Person because such payment is determined to be void or voidable as a
preference, impermissible setoff, a diversion of trust funds or for any other
reason, this Agreement shall continue in full force and the Borrower shall be
liable to, and shall indemnify and hold the Lender harmless for, the amount of
such payment surrendered until the Lender shall have been finally and
irrevocably paid in full. The provisions of the foregoing sentence shall be and
remain effective notwithstanding any contrary action which may have been taken
by the Lender in reliance upon such payment, and any such
69
contrary action so taken shall be without prejudice to the Lender's rights under
this Agreement and shall be deemed to have been conditioned upon such payment
having become final and irrevocable.
X.9. INDEMNIFICATION; LIMITATION OF LIABILITY. In consideration of the
execution and delivery of this Agreement by the Lender and the extension of
credit under the Loans, the Borrower hereby indemnifies, exonerates and holds
the Lender and its affiliates, officers, directors, employees, agents and
advisors (collectively, the "Indemnified Parties") free and harmless from and
against any and all claims, actions, causes of action, suits, losses, costs,
liabilities and damages, and expenses incurred in connection therewith
(irrespective of whether any such Indemnified Party is a party to the action for
which indemnification hereunder is sought), including reasonable attorneys' fees
and disbursements (collectively, the "Indemnified Liabilities") that may be
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of, or in connection with the
execution, delivery, enforcement, performance or administration of this
Agreement and the other Loan Documents, or any transaction financed or to be
financed in whole or in part, directly or indirectly, with the proceeds of any
Loan or Letter of Credit, whether or not such action is brought against the
Lender, the shareholders or creditors of the Lender or an Indemnified Party or
an Indemnified Party is otherwise a party thereto and whether or not the
transactions contemplated herein are consummated, except to the extent such
claim, damage, loss, liability or expense is found in a final, non-appealable
judgment by a court of competent jurisdiction to have resulted from such
Indemnified Party's gross negligence or willful misconduct, and if and to the
extent that the foregoing undertaking may be unenforceable for any reason, the
Borrower hereby agrees to make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is permissible under
applicable law. The Borrower agrees that no Indemnified Party shall have any
liability (whether direct or indirect, in contract or tort or otherwise) to it,
any of its Subsidiaries, any Credit Party, or any security holders or creditors
thereof arising out of, related to or in connection with the transactions
contemplated herein, except to the extent that such liability is found in a
final non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party's gross negligence or willful misconduct;
provided, however, in no event shall any Indemnified Party be liable for
consequential, indirect or special, as opposed to direct, damages.
X.10. SEVERABILITY. If any provision of this Agreement or the other Loan
Documents shall be determined to be illegal or invalid as to one or more of the
parties hereto, then such provision shall remain in effect with respect to all
parties, if any, as to whom such provision is neither illegal nor invalid,
70
and in any event all other provisions hereof shall remain effective and binding
on the parties hereto.
X.11. ENTIRE AGREEMENT. This Agreement, together with the other Loan
Documents, constitutes the entire agreement among the parties with respect to
the subject matter hereof and supersedes all previous proposals, negotiations,
representations, commitments and other communications between or among the
parties, both oral and written, with respect thereto.
X.12.AGREEMENT CONTROLS. In the event that any term of any of the Loan
Documents other than this Agreement conflicts with any express term of this
Agreement, the terms and provisions of this Agreement shall control to the
extent of such conflict.
X.13. USURY SAVINGS CLAUSE. Notwithstanding any other provision herein, the
aggregate interest rate charged under any of the Notes, including all charges or
fees in connection therewith deemed in the nature of interest under applicable
law shall not exceed the Highest Lawful Rate (as such term is defined below). If
the rate of interest (determined without regard to the preceding sentence) under
this Agreement at any time exceeds the Highest Lawful Rate (as defined below),
the outstanding amount of the Loans made hereunder shall bear interest at the
Highest Lawful Rate until the total amount of interest due hereunder equals the
amount of interest which would have been due hereunder if the stated rates of
interest set forth in this Agreement had at all times been in effect. In
addition, if when the Loans made hereunder are repaid in full the total interest
due hereunder (taking into account the increase provided for above) is less than
the total amount of interest which would have been due hereunder if the stated
rates of interest set forth in this Agreement had at all times been in effect,
then to the extent permitted by law, the Borrower shall pay to the Lender an
amount equal to the difference between the amount of interest paid and the
amount of interest which would have been paid if the Highest Lawful Rate had at
all times been in effect. Notwithstanding the foregoing, it is the intention of
the Lender and the Borrower to conform strictly to any applicable usury laws.
Accordingly, if the Lender contracts for, charges, or receives any consideration
which constitutes interest in excess of the Highest Lawful Rate, then any such
excess shall be cancelled automatically and, if previously paid, shall at the
Lender's option be applied to the outstanding amount of the Loans made hereunder
or be refunded to the Borrower. As used in this paragraph, the term "Highest
Lawful Rate" means the maximum lawful interest rate, if any, that at any time or
from time to time may be contracted for, charged, or received under the laws
applicable to the Lender which are presently in effect or, to the extent allowed
by law, under such applicable laws which may hereafter be in effect and which
allow a higher maximum nonusurious interest rate than applicable laws now allow.
71
X.14. GOVERNING LAW; WAIVER OF JURY TRIAL. TRIAL
(a) THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (OTHER THAN THOSE
SECURITY INSTRUMENTS WHICH EXPRESSLY PROVIDE THAT THEY SHALL BE GOVERNED BY
THE LAWS OF ANOTHER JURISDICTION) SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF FLORIDA APPLICABLE TO CONTRACTS
EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
(A) THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY AGREES AND CONSENTS
THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREIN MAY BE INSTITUTED IN ANY
STATE OR FEDERAL COURT SITTING IN THE STATE OF FLORIDA, UNITED STATES OF
AMERICA AND, BY THE EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER
EXPRESSLY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF VENUE IN, OR TO THE EXERCISE OF JURISDICTION OVER IT AND ITS
PROPERTY BY, ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING, AND THE
BORROWER HEREBY IRREVOCABLY SUBMITS GENERALLY AND UNCONDITIONALLY TO THE
JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.
(B) THE BORROWER AGREES THAT SERVICE OF PROCESS MAY BE MADE BY PERSONAL
SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER LEGAL PROCESS IN
ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED OR CERTIFIED MAIL
(POSTAGE PREPAID) TO THE ADDRESS OF THE BORROWER PROVIDED IN SECTION 10.2,
OR BY ANY OTHER METHOD OF SERVICE PROVIDED FOR UNDER THE APPLICABLE LAWS IN
EFFECT IN THE STATE OF FLORIDA.
(C) NOTHING CONTAINED IN SUBSECTIONS (A) OR (B) HEREOF SHALL PRECLUDE
THE LENDER FROM BRINGING ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO ANY LOAN DOCUMENT IN THE COURTS OF ANY JURISDICTION WHERE THE
BORROWER OR ANY OF THE BORROWER'S PROPERTY OR ASSETS MAY BE FOUND OR
LOCATED. TO THE EXTENT PERMITTED BY THE APPLICABLE LAWS OF ANY SUCH
JURISDICTION, THE BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION
OF ANY SUCH COURT AND EXPRESSLY WAIVES, IN RESPECT OF ANY SUCH SUIT, ACTION
OR PROCEEDING, OBJECTION TO THE EXERCISE OF JURISDICTION OVER IT AND ITS
PROPERTY BY ANY SUCH OTHER COURT OR COURTS WHICH NOW OR HEREAFTER MAY BE
AVAILABLE UNDER APPLICABLE LAW.
(D) IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND
72
ANY RIGHTS OR REMEDIES UNDER OR RELATED TO ANY LOAN DOCUMENT OR ANY
AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN THE
FUTURE BE DELIVERED IN CONNECTION THEREWITH, THE BORROWER, THE LENDER
HEREBY AGREES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THAT ANY SUCH
ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY
AND HEREBY IRREVOCABLY WAIVE, TO THE EXTENT PERMITTED BY APPLICABLE LAW,
ANY RIGHT SUCH PERSON MAY HAVE TO TRIAL BY JURY IN ANY SUCH ACTION OR
PROCEEDING.
[Signatures on following pages]
73
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
made, executed and delivered by their duly authorized officers as of the day and
year first above written.
WORLD FUEL SERVICES CORPORATION
WITNESS:
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chief Financial Officer
NATIONSBANK, N.A. (SOUTH)
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
Lending Office:
NationsBank, N.A. (South)
Independence Center, ▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Credit Support
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
NationsBank, N.A. (South)
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: 136621-▇▇▇▇▇▇▇
Reference: World Fuel Services
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
EXHIBIT A
Applicable Commitment Percentages
LENDER REVOLVING APPLICABLE
CREDIT COMMITMENT
COMMITMENT PERCENTAGE
---------- ----------
NationsBank, N.A. (South)
$25,000,000 100%
----------- ----------
Total $25,000,000 100%
A-1
EXHIBIT B
Notice of Appointment (or Revocation) of Authorized
Representative
Reference is hereby made to the Amended and Restated Credit Agreement dated
as of February 21, 1997 (the "Agreement") by and between World Fuel Services
Corporation, a Florida corporation (the "Borrower") and NationsBank, N.A.
(South) as Lender (the "Lender"). Capitalized terms used but not defined herein
shall have the respective meanings therefor set forth in the Agreement.
The Borrower hereby nominates, constitutes and appoints each individual
named below as an Authorized Representative under the Loan Documents, and hereby
represents and warrants that (i) set forth opposite each such individual's name
is a true and correct statement of such individual's office (to which such
individual has been duly elected or appointed), a genuine specimen signature of
such individual and an address for the giving of notice, and (ii) each such
individual has been duly authorized by the Borrower to act as Authorized
Representative under the Loan Documents:
Name and Address Office Specimen Signature
----------------- ------------------- -------------------
-----------------
-----------------
----------------- ------------------- --------------------
-----------------
-----------------
-----------------
Borrower hereby revokes (effective upon receipt hereof by the Lender) the prior
appointment of ________________ as an Authorized Representative.
This the ___ day of __________________, 19__
WORLD FUEL SERVICES CORPORATION
By:
----------------------
Name:
--------------------
Title:
-------------------
B-1
EXHIBIT C
Form of Borrowing Notice
To: NationsBank, N.A. (South)
Independence Center, ▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Credit Support
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Reference is hereby made to the Amended and Restated Credit Agreement
dated as of February 21, 1997 (the "Agreement") by and between World Fuel
Services Corporation (the "Borrower") and NationsBank, N.A. (South), as Lender
(the "Lender"). Capitalized terms used but not defined herein shall have the
respective meanings therefor set forth in the Agreement.
The Borrower through its Authorized Representative hereby gives notice
to the Lender that Loans of the type and amount set forth below be made on the
date indicated:
TYPE OF LOAN INTEREST AGGREGATE
(CHECK ONE) PERIOD(1) AMOUNT(2) DATE OF LOAN(3)
----------- --------- --------- ---------------
Base Rate Loan ______ _________ _____________
LIBOR Rate Loan ______ _________ _____________
-----------------------
(1) For any LIBOR Rate Loan, one, two, three or six months.
(2) Must be $100,000 or if greater an integral multiple of $100,000, unless a
Base Rate Refunding Loan.
(3) At least three (3) Business Days later if a LIBOR Rate Loan;
The Borrower hereby requests that the proceeds of Loans described in
this Borrowing Notice be made available to the Borrower as follows: _____
[INSERT TRANSMITTAL INSTRUCTIONS] .
The undersigned hereby certifies that:
1. No Default or Event of Default exists either now or after giving
effect to the borrowing described herein; and
2. All the representations and warranties set forth in ARTICLE VI of
the Agreement and in the Loan Documents (other than those expressly stated to
refer to a particular date) are true and correct as of the date hereof except
that the reference to the financial statements in SECTION 6.6(A) of the
Agreement are to those financial statements most recently delivered to you
pursuant to SECTION 7.1 of the Agreement (it being understood
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that any financial
statements delivered pursuant to SECTION 7.1(B) have not been certified by
independent public accountants) and attached hereto are any changes to the
Schedules referred to in connection with such representations and warranties.
3. All conditions contained in the agreement to the making of any Loan
requested hereby have been met or satisfied in full.
WORLD FUEL SERVICES CORPORATION
BY: _______________________________
Authorized Representative
DATE: _____________________________
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EXHIBIT D
Form of Interest Rate Selection Notice
To: NationsBank, N.A. (South)
Independence Center, ▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Credit Support
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Reference is hereby made to the Amended and Restated Credit Agreement
dated as of February 21, 1997 (the "Agreement") by and between World Fuel
Services Corporation, a Florida corporation (the "Borrower") and NationsBank,
N.A. (South), as Lender (the "Lender"). Capitalized terms used but not defined
herein shall have the respective meanings therefor set forth in the Agreement.
The Borrower through its Authorized Representative hereby gives notice
to the Lender of the following selection of a type of Loan and Interest Period:
TYPE OF LOAN INTEREST AGGREGATE
(CHECK ONE) PERIOD(1) AMOUNT(2) DATE OF LOAN(3)
----------- --------- --------- ---------------
Base Rate Loan ______ _________ ____________
LIBOR Rate Loan ______ _________ ____________
-----------------------
(1) For any LIBOR Rate Loan, one, two, three or six months.
(2) Must be $100,000 or if greater an integral multiple of $100,000, unless a
Base Rate Refunding Loan.
(3) At least three (3) Business Days later if a LIBOR Rate Loan;
WORLD FUEL SERVICES CORPORATION
BY: ________________________
Authorized Representative
DATE: ______________________
D-1
EXHIBIT E
Form of Revolving Note
Promissory Note
(Revolving Credit Facility)
$-------------- ---------, --------------
______ __, 199_
FOR VALUE RECEIVED, WORLD FUEL SERVICES CORPORATION, a Florida corporation
having its principal place of business located in Miami Springs, Florida (the
"Borrower"), hereby promises to pay to the order of ____________________________
(the "Lender"), in its individual capacity, at the office of the Lender located
at One Independence Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇-▇▇▇-▇▇-▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (or at such other place or places as the Lender may
designate in writing) at the times set forth in the Amended and Restated Credit
Agreement dated as of February 21, 1997 by and between the Borrower and the
Lender (the "Agreement" -- all capitalized terms not otherwise defined herein
shall have the respective meanings set forth in the Agreement), in lawful money
of the United States of America, in immediately available funds, the principal
amount of ___________ DOLLARS ($__________) or, if less than such principal
amount, the aggregate unpaid principal amount of all Loans made by the Lender to
the Borrower pursuant to the Agreement on the Revolving Credit Termination Date
or such earlier date as may be required pursuant to the terms of the Agreement,
and to pay interest from the date hereof on the unpaid principal amount hereof,
in like money, at said office, on the dates and at the rates provided in ARTICLE
II of the Agreement. All or any portion of the principal amount of Loans may be
prepaid or required to be prepaid as provided in the Agreement.
If payment of all sums due hereunder is accelerated under the terms of the
Agreement or under the terms of the other Loan Documents executed in connection
with the Agreement, the then remaining principal amount and accrued but unpaid
interest shall bear interest which shall be payable on demand at the rates per
annum set forth in the proviso to SECTION 2.2 (A) of the Agreement. Further, in
the event of such acceleration, this Note shall become immediately due and
payable, without presentation, demand, protest or notice of any kind, all of
which are hereby waived by the Borrower.
In the event this Note is not paid when due at any stated or accelerated
maturity, the Borrower agrees to pay, in addition to the principal and interest,
all costs of collection, including reasonable attorneys' fees, and interest due
hereunder thereon at
E-1
the rates set forth above.
Interest hereunder shall be computed as provided in the Agreement.
This Note is one of the Notes referred to in the Agreement and is issued
pursuant to and entitled to the benefits and security of the Agreement to which
reference is hereby made for a more complete statement of the terms and
conditions upon which the Loans evidenced hereby were or are made and are to be
repaid. This Note is subject to certain restrictions on transfer or assignment
as provided in the Agreement.
All Persons bound on this obligation, whether primarily or secondarily
liable as principals, sureties, guarantors, endorsers or otherwise, hereby waive
to the full extent permitted by law the benefits of all provisions of law for
stay or delay of execution or sale of property or other satisfaction of judgment
against any of them on account of liability hereon until judgment be obtained
and execution issues against any other of them and returned satisfied or until
it can be shown that the maker or any other party hereto had no property
available for the satisfaction of the debt evidenced by this instrument, or
until any other proceedings can be had against any of them, also their right, if
any, to require the holder hereof to hold as security for this Note any
collateral deposited by any of said Persons as security. Protest, notice of
protest, notice of dishonor, diligence or any other formality are hereby waived
by all parties bound hereon.
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IN WITNESS WHEREOF, the Borrower has caused this Note to be made, executed
and delivered by its duly authorized representative as of the date and year
first above written, all pursuant to authority duly granted.
WORLD FUEL SERVICES CORPORATION
WITNESS:
______________________ By: _______________________________
______________________ Name: _____________________________
Title: ____________________________
E-3
ACKNOWLEDGMENT OF EXECUTION ON BEHALF OF
WORLD FUEL SERVICES CORPORATION
STATE OF ______________
COUNTY OF _____________
Before me, the undersigned, a Notary Public in and for said County and
State on this ____ day of ________ __, 199_ A.D., personally appeared
_____________________ known to be the __________ of World Fuel Services
Corporation (the "Borrower"), who, being by me duly sworn, says [she][he] works
at _____________________________, and that by authority duly given by, and as
the act of, the Borrower, the foregoing and annexed Note dated __________ __,
199_, was signed by [her][him] as said __________ on behalf of the Borrower.
Witness my hand and official seal this ____ day of ___________, 199_.
-------------------------------------
Notary Public
(SEAL)
My commission expires: __________
E-4
AFFIDAVIT OF _________________
The undersigned, being first duly sworn, deposes and says that:
1. [She][He] is an ________________________ of _________________
______________________________________ (the "Bank") and works at
______________________________.
2. _______ The Note of World Fuel Services Corporation to the Bank in
the principal amount of $__________, dated __________ __, 199_ was executed
before [her][him] and delivered to [her][him] on behalf of the Bank in
__________, __________ on ________ __, 199_.
This the _____ day of __________, 199_.
-----------------------------------
Name:
ACKNOWLEDGMENT OF EXECUTION
STATE OF _______________
COUNTY OF ______________
Before me, the undersigned, a Notary Public in and for said County and
State on this _____ day of ___________ __, 199_ A.D., personally appeared
_________________ who before me affixed his signature to the above Affidavit.
Witness my hand and official seal this the _____ day of __________, 199_.
-----------------------------------
Notary Public
(SEAL)
My Commission Expires: __________
E-5
EXHIBIT F
Form of Opinion of Borrower's Counsel
See attached.
F-1
EXHIBIT G
Compliance Certificate
NationsBank, N.A. (South)
Independence Center, ▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Credit Support
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Reference is hereby made to the Amended and Restated Credit Agreement dated
as of February 21, 1997 (the "Agreement") by and between World Fuel Services
Corporation, a Florida corporation (the "Borrower") and NationsBank, N.A.
(South), as Lender (the "Lender"). Capitalized terms used but not otherwise
defined herein shall have the respective meanings therefor set forth in the
Agreement. The undersigned, a duly authorized and acting Authorized
Representative, hereby certifies to you as of __________ (the "Determination
Date") as follows:
1. Calculations:
A. Consolidated Tangible Net Worth as of the Determination Date
was $__________.
Required: Not less than $55,000,000.
[See Section 8.1(a) of the Agreement]
B. Consolidated Funded Indebtedness to Consolidated Capitalization
as of the Determination Date was _____ to 1.00 calculated as follows:
(i) Consolidated Funded $__________
Indebtedness as of
the Determination
Date:
(ii) Consolidated Capitalization as $__________
of the Determination
Date:
(iii) (i) divided by (ii): __________
Required: Less than .55 to 1.00.
[See Section 8.1(b) of the Agreement]
C. Consolidated Fixed Charge Coverage Ratio as of the
Determination Date was _____ to 1.00 calculated as follows:
G-1
(i) Consolidated EBITDA (for the $__________
Four Quarter Period
ending on (or most
recently ended prior
to) the Determination
Date):
(ii) capital expenditures (for the $__________
Four Quarter Period
ending on (or most
recently ended prior to)
the Determination Date):
(iii) (i) MINUS (ii): $__________
(iv) Consolidated Fixed Charges (for $__________
the Four Quarter
Period ending on (or
most recently ended
prior to) the
Determination Date):
(v) (iii) divided by (iv): __________
Required: Equal or greater than 1.35 to 1.00.
[See Section 8.1(c) of the Agreement]
D. Working Asset Coverage Ratio as of the Determination Date
was _____ to 1.00 calculated as follows:
(i) Consolidated Working Assets as $__________
of the Determination
Date:
(ii) Obligations of the Borrower $__________
under the Agreement
as of the
Determination Date:
(iii) trade accounts payable as of $__________
the Determination
Date
(iv) (ii) PLUS (iii): $__________
(v) (i) divided by (iv): __________
G-2
Required: Equal or greater than 1.125 to 1.00.
[See Section 8.1(d) of the Agreement]
2. No Default
A. _______ Since __________ (the date of the last similar
certification), (a) the Borrower has not defaulted in the keeping,
observance, performance or fulfillment of its obligations pursuant to
any of the Loan Documents; and (b) no Default or Event of Default
specified in ARTICLE IX of the Agreement has occurred and is
continuing.
B. If a Default or Event of Default has occurred since __________
(the date of the last similar certification), the Borrower proposes to
take the following action with respect to such Default or Event of
Default:______________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
_________.
(NOTE, if no Default or Event of Default has
occurred, insert "Not Applicable").
C. The Borrower and its Subsidiaries are current with all trade
payables, except trade payables contested in good faith in the ordinary
course of business.
D. As of the Determination Date, the Borrower and its Subsidiaries
are in full compliance with the established sublimits and terms of the
Letters of Credit issued pursuant to the Agreement.
The Determination Date is the date of the last required financial
statements submitted to the Lender in accordance with SECTION 7.1 of the
Agreement.
IN WITNESS WHEREOF, I have executed this Certificate this _____ day of
__________, 19___.
By:________________________________
Authorized Representative
Name:______________________________
Title:_____________________________
▇-▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇ AGREEMENT
THIS GUARANTY AGREEMENT (the "Guaranty") is entered into as of this ___ day
of _________, 199_, by and among the undersigned Subsidiaries of World Fuel
Services Corporation, a Florida corporation (individually a "Guarantor" and
collectively the "Guarantors"), and NATIONSBANK, N.A. (SOUTH), a national
banking association and successor in interest by merger to The Citizens and
Southern National Bank of Florida, N.A., as Lender (the "Lender"). Unless the
context otherwise requires, all terms used herein without definition shall have
the respective definitions provided therefor in the Credit Agreement (as defined
below).
W I T N E S S E T H:
WHEREAS, World Fuel Services Corporation (the "Borrower") and the Lender
have entered into that certain Amended and Restated Credit Agreement, dated as
of February 21, 1997, whereby the Lender has made available to the Borrower a
Revolving Credit Facility (as at any time hereafter amended, restated, modified
or supplemented, the "Credit Agreement"); and
WHEREAS, the Credit Agreement requires the execution of this Guaranty by
any Subsidiary of the Borrower acquired or created after the date thereof, and
WHEREAS, the Guarantors will substantially benefit from the loans and
advances made or to be made by the Lender and the letters of credit issued or to
be issued by the Issuing Bank to the Borrower under the Credit Agreement;
NOW, THEREFORE, in consideration of the premises and conditions herein set
forth, it is hereby agreed as follows:
2. Guarantors hereby absolutely and unconditionally guaranty, jointly and
severally, to the Lender, with full power to satisfy, discharge, release,
foreclose, assign and transfer the within Guaranty, the due performance and full
and prompt payment, whether at maturity or by acceleration or otherwise, of any
and all Borrower's Liabilities (as hereinafter defined) (hereinafter
collectively referred to as the "Guarantors' Obligations"); PROVIDED, HOWEVER,
that the liability of any Guarantor hereunder with respect to the Guarantors'
Obligations shall not exceed at any time the Maximum Amount (as hereinafter
defined). The "Maximum Amount" means the greater of (x) the aggregate amount of
(a) all advances to or investments in such Guarantor made directly or indirectly
with the proceeds of Loans and Advances made to the Borrower under the Credit
Agreement plus (b) all Letters of Credit issued on behalf of such Guarantor
H-1
under the Credit Agreement, or (y) 95% of (a) the fair salable value of the
assets of such Guarantor as of the date hereof minus (b) the total liabilities
of such Guarantor (including contingent liabilities, but excluding liabilities
of such Guarantor under this Guaranty and the other Loan Documents executed by
such Guarantor) as of the date hereof; PROVIDED, FURTHER, that if the
calculation of the Maximum Amount in the manner provided above as of the date
payment is required of such Guarantor pursuant to this Guaranty would result in
a greater positive number, then the Maximum Amount shall be deemed to be such
greater positive number.
3. For purposes of this Guaranty, "Borrower's Liabilities" shall mean and
include any and all advances (including those made by the Lender to protect,
enlarge or preserve the priority, propriety, or amount of any lien in favor of
the Lender against mechanic's lien, equitable lien, or statutory claimants, or
otherwise), debts, obligations and liabilities of Borrower pursuant to the terms
of the Credit Agreement, the Notes and all other Loan Documents executed in
connection therewith heretofore, now, or hereafter made, incurred or created,
extended, renewed, replaced, refinanced or restructured, whether or not from
time to time decreased or extinguished and later increased, created or incurred,
whether voluntary or involuntary and, however arising, whether due or not,
absolute or contingent, liquidated or non-liquidated, determined or
undetermined, and whether Borrower may be liable individually or jointly with
others, or whether recovery upon such indebtedness may be or hereafter become
barred by any statute of limitations, or whether such indebtedness may be or
hereafter become otherwise unenforceable (collectively referred to hereinafter
as the "Borrower's Liabilities"). This is a continuing Guaranty relating to the
Borrower's Liabilities, and any other indebtedness arising under subsequent or
successive transactions which increase the Borrower's Liabilities, and said
Guaranty shall be irrevocable and remain outstanding until all the Borrower's
Liabilities are satisfied in full and the Lender shall have no further
obligation to make Loans and Advances and the Issuing Bank to issue Letters of
Credit under the Credit Agreement.
4. The obligations of the Guarantors hereunder are independent of the
obligations of Borrower, and a separate action or actions may be brought and
prosecuted against any Guarantor, whether such action is brought against
Borrower or whether Borrower be joined in any such action or actions.
5. Each Guarantor authorizes the Lender, without notice or demand and
without affecting such Guarantor's liability hereunder, from time to time to (a)
renew, amend, compromise, extend, accelerate or otherwise change the time for
payment of, or otherwise change the terms of the Borrower's Liabilities or any
part thereof, including increase or decrease of the rate of interest thereon;
(b) take and hold security for the payment of
H-2
this Guaranty and the Guarantors' Obligations and exchange, enforce, waive and
release any such security; (c) apply such security and direct the order or
manner of sale thereof as the Lender may determine; and (d) release or
substitute any one or more endorsers or guarantors of the Borrower's
Liabilities. The Lender may without notice assign this Guaranty in whole or in
part in connection with an assignment as permitted under the Credit Agreement.
6. Each Guarantor waives any right to require the Lender to (a) proceed
against Borrower; (b) proceed against or exhaust any security held from
Borrower; or (c) pursue any other remedy in the Lender's power whatsoever. Each
Guarantor waives any defense arising by reason of any disability or other
defense of Borrower or by reason of the cessation from any cause whatsoever of
the liability of the Borrower to the Lender. Until all the Borrower's
Liabilities shall have been paid in full and the Lender shall have no further
obligation to make Loans and Advances and the Issuing Bank to issue Letters of
Credit under the Credit Agreement, each Guarantor waives any right to endorse
any remedy which the Lender now has or may hereafter have against the Borrower,
and waives any benefit of, and any right to participate in, any security now or
hereafter held by the Lender as collateral security for the Borrower's
Liabilities. Each Guarantor waives all presentments, demands for performance,
notices of non-performance, protests, notices of dishonor, notices of acceptance
of this Guaranty and of the existence, creation, or incurring of new or
additional indebtedness; any defense or circumstance which might otherwise
constitute a legal or equitable discharge of a guarantor or a surety; and all
rights under any state or federal statute dealing with or affecting the rights
of creditors. Each Guarantor covenants to cause Borrower to maintain and
preserve the enforceability of any instruments now or hereafter executed in
favor of the Lender, and to take no action of any kind which might be the basis
for a claim that such Guarantor has any defense hereunder in connection with the
above-mentioned Loan Documents, other than payment in full of the Borrower's
Liabilities. Each Guarantor waives any right or claim of right to cause a
marshaling of Borrower's assets or to require the Lender to proceed against the
Guarantors or any other guarantor of the Borrower's Liabilities in any
particular order. No delay on the part of the Lender in the exercise of any
right, power or privilege under the Loan Documents or under this Guaranty shall
operate as a waiver of any such privilege, power or right.
7. Until the Borrower's Liabilities are paid in full and the Lender is
under no further obligation to make Loans and Advances and the Issuing Bank to
issue Letters of Credit under the Credit Agreement, any indebtedness of Borrower
now or hereafter held by any Guarantor is hereby subordinated to the Borrower's
Liabilities; and such indebtedness of Borrower to any Guarantor, if the Lender
so requests, shall be collected,
H-3
enforced and received by such Guarantor as trustee for the Lender and be paid
over to the Lender on account of the Borrower's Liabilities, but without
reducing or affecting in any manner the liability of such Guarantor under the
other provisions of this Guaranty. Each Guarantor, at the request of the Lender,
shall execute such further documents in favor of the Lender to further evidence
and support the purpose of this Section 6. Each Guarantor hereby irrevocably
waives and releases any right or rights of subrogation or contribution existing
at law, by contract or otherwise to recover all or a portion of any payment made
hereunder from the Borrower or any other guarantor.
8. Upon the default of Borrower with respect to any of its obligations or
liabilities to the Lender in connection with the Loan Documents, or in case
Borrower or any Guarantor shall become insolvent or make an assignment for the
benefit of creditors, or if a petition in bankruptcy or for corporate
reorganization or for an arrangement be filed by or against Borrower or any
Guarantor (and if such petition is filed against Borrower or any Guarantor and
is not stayed or dismissed within sixty (60) days), or in the event of the
appointment of a receiver for Borrower or any Guarantor of their properties, or
in the event a judgment is obtained or warrant of attachment is issued against
Borrower or any Guarantor (which judgment or warrant is not satisfied or bonded
or removed within sixty (60) days), all or any part of the Guarantors'
Obligations shall, without notice or demand, at the option of the Lender, become
immediately due and payable and shall be paid forthwith, jointly and severally,
by Guarantors without any offset of any kind whatsoever, without the Lender
first being required to make demand upon the Borrower or pursue any of its
rights against Borrower, or against any other person, including other guarantors
(whether or not party to this Guaranty).
9. Notwithstanding any provision herein or in any instrument now or
hereafter executed in connection with this Guaranty or the Guarantors'
Obligations hereunder, the total liability for payments in the nature of
interest shall not exceed the limits now imposed by the usury laws of the State
of Florida governing the provisions of this Guaranty or in any instrument now or
hereafter executed in connection with this Guaranty or the Guarantors'
Obligations hereunder.
10. Each Guarantor acknowledges that the Lender has been induced by this
Guaranty to make and to continue to make Loans and Advances to the Borrower and
the Issuing Bank to issue and continue to issue Letters of Credit on behalf of
the Borrower and its Subsidiaries under the Credit Agreement, and this Guaranty
shall, without further reference or assignment, pass to, and may be relied upon
and enforced by, any successor or participant or assignee of the Lender in and
to any of Borrower's Liabilities.
11. Each Guarantor hereby warrants and represents to the
H-4
Lender, that: (a) it is a duly organized and validly existing corporation under
the laws of the state of its incorporation; (b) it is qualified to do business
in each state in which qualification is necessary; (c) it has the power to
execute this Guaranty; (d) that the execution of this Guaranty has been duly
authorized; and (e) that this Guaranty is a binding and valid corporate
obligation.
12. Each Guarantor acknowledges that the liabilities of said Guarantor
shall be independent of the Obligations of Borrower, and separate or joint
actions may be instituted by the Lender, against such Guarantors; and said
actions may be instituted against Borrower and any of the Guarantors, or
separately against any of the Guarantors. Any action taken by the Lender
pursuant to the provisions herein contained or contained in the Credit
Agreement, the Notes or the Loan Documents, shall not release the party to this
Guaranty until all of the Borrower's Liabilities are paid in full and the Lender
shall have no further obligation to make Loans and Advances and the Issuing Bank
to issue Letters of Credit under the Credit Agreement.
13. The Guarantors will upon demand pay to the Lender, jointly and
severally, the amount of any and all reasonable expenses, including the
reasonable fees and expenses of its counsel and of any experts and agents, which
it may reasonably incur in connection with enforcement of this Guaranty or the
failure by any Guarantor to perform or observe any of the provisions hereof. The
Guarantors agree to indemnify and hold harmless the Lender from and against any
and all claims, demands, losses, judgments and liabilities (including
liabilities for penalties) of whatsoever kind or nature, growing out of or
resulting from this Guaranty or the exercise by the Lender of any right or
remedy granted to it hereunder or under the other Loan Documents, other than
such items arising out of the bad faith, gross negligence or willful misconduct
on the part of the Lender. If and to the extent that the obligations of the
Guarantors under this Section 12 are unenforceable for any reason, Guarantors
hereby agree to make the maximum contribution to the payment and satisfaction of
such obligations which is permissible under applicable law.
14. If claim is ever made upon the Lender for repayment or recovery of any
amount or amounts received in payment or on account of the Guarantors'
Obligations and the Lender repays all or part of said amount by reason of (a)
any judgment, decree or order of any court or administrative body having
jurisdiction over such payee or any of its property, or (b) any settlement or
compromise of any such claim effected by the Lender with any such claimant
(including the original obligor), then and in such event each Guarantor agrees
that any such judgment, decree, order, settlement or compromise shall be binding
upon it, notwithstanding any revocation hereof or the cancellation of any Notes
H-5
or other instrument evidencing any Guarantied Obligations or any security
therefor, and the Guarantors shall be and remain jointly and severally liable to
the Lender for the amount so repaid or recovered to the same extent as if such
amount had never originally been received by the Lender.
15. All notices required to be given hereunder shall be in writing, and
shall be given by certified mail, return receipt requested, and shall be deemed
given when they shall have been deposited in the United States Mail, with
sufficient postage prepaid thereon to carry them to their addressed destination,
addressed to the party for whom it is intended, as follows:
For a Guarantor: such Guarantor
c/o World Fuel Services Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
For Lender: NationsBank, N.A.
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
Independence Center, 15th Floor
Charlotte, North Carolina 28255
Attention: Corporate Credit Support
16. Whenever the text of this instrument so requires, the use of any gender
shall be deemed to include all genders, and the use of the singular shall
include the plural, and in such event, wherever the word "Guarantor" is used
herein, then such word shall be deemed to be "Guarantors" or either or any of
them.
17. This Guaranty shall be binding upon each Guarantor, successors, legal
representatives and assigns of each Guarantor.
18. This Guaranty shall, for all purposes, be governed by and construed in
accordance with the laws of the State of Florida.
19. THE LENDER AND EACH GUARANTOR KNOWINGLY, INTENTIONALLY AND VOLUNTARILY
HEREBY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN CONNECTION WITH ANY
MATTER DIRECTLY OR INDIRECTLY RELATING TO THIS GUARANTY OR ANY OTHER LOAN
DOCUMENT.
H-6
IN WITNESS WHEREOF, the parties hereto have caused this Guaranty to be duly
executed by their duly authorized officers, all as of the day and year first
above written.
[GUARANTOR]:
By:________________________
Name:___________________
Title:__________________
[GUARANTOR]:
By:________________________
Name:___________________
Title:__________________
SIGNATURE PAGE 1 0F 2
H-7
LENDER:
NATIONSBANK, N.A. (SOUTH)
By:_______________________
Name:_____________________
Title:____________________
SIGNATURE PAGE 2 OF 2
H-8
SCHEDULE 6.4
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SUBSIDIARIES AND INVESTMENTS IN OTHER PERSONS
WHOLLY OWNED SUBSIDIARIES
Advance Petroleum, Inc., A Florida corporation
Advance Aviation Services, Inc., a Florida corporation (1)
Air Terminaling, Inc., a Florida corporation (1)
Cherokee Group, Inc., A Florida corporation
International Petroleum Corporation, a Florida corporation
International Petroleum Corporation Of La, a Louisiana corporation
International Petroleum Corporation Of Lafayette, a Louisiana corporation (1)
International Petroleum Corporation Of Maryland, a Maryland corporation
International Petroleum Corp. Of Georgia, a Georgia corporation (1)
International Petroleum Corp. Of Delaware, a Delaware corporation
International Petroleum Corp. Of Pennsylvania, a Pennsylvania corporation (1)
International Environmental Services, Inc., a Florida corporation (1)
Petroservicios de Mexico, a Mexican corporation
Petroservicios de Costa Rica S.A., a Costa Rican corporation
Resource Recovery Of America, Inc., a Florida corporation
Resource Recovery Mid South, Inc., a Virginia corporation (1)
Resource Recovery Atlantic, Inc., A Delaware corporation (1)
Trans-Tec Services, Inc., a Delaware corporation
Trans-Tec Services (UK) Ltd., a United Kingdom corporation
Trans-Tec Services (Singapore) PTE. LTD., a Singapore corporation
World Fuel International S.A., a Costa Rican corporation
World Fuel Services, Inc., A Texas corporation
World Fuel Services, Ltd., a United Kingdom corporation
World Fuel Services (Singapore) PTE., Ltd. a Singapore corporation
(1) INACTIVE
50/50 JOINT VENUTURE
--------------------
Petrosur, an Ecquadorian partnership
S-1
SCHEDULE 6.6
Indebtedness
None
S-2
SCHEDULE 6.7
Liens
None
S-3
SCHEDULE 6.8
Tax Matters
None
S-4
SCHEDULE 6.10
Litigation
None
S-5
SCHEDULE 6.18
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HAZARDOUS MATERIALS
The Company has exited several environmental businesses which handled hazardous
wastes. These wastes were transported to various disposal facilities and/or
treated by the Company. The Company may be held liable as a potentially
responsible party for the cleanup of such disposal facilities in certain cases
pursuant to current Federal and State laws and regulations.
The Company is currently responsible to Federal and Florida environmental
agencies for cleanup costs at the Mulberry, Florida site formerly operated by
its subsidiary, Resource Recovery of America, which has been sold by the
Company. Under the terms of the sale, the Company contractually transferred to
the buyer the responsibility for the state cleanup. However, the buyer has been
unwilling to fund expenses incurred to date. The site also qualified under the
state reimbursement program, which the Company anticipates will cover the cost
of the cleanup. The Company is actively involved in the coordination of cleanup
requirements by the EPA and the state to assure the Company's compliance.
The Company intends to pay an estimated $1,000,000 over the next several years
to cleanup contamination which was present at the Company's Delaware used oil
recycling facility when it was acquired by the Company. The cleanup costs will
be capitalized as part of the cost of the site, up to the fair market value of
the site.
S-6
SCHEDULE 7.6
INDEBTEDNESS
Promissory notes issued in connection with the
acquisition of the Trans-Tec group of companies 9.00% $2,057,753
Equipment notes:
Polar Tank Trailers 7.00% - 8.52% 172,328
▇▇▇▇ Tractors 6.76% - 8.52% 369,878
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Total Indebtedness $2,599,959
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S-7