EXHIBIT 10.13.1
FIRST AMENDMENT AND LIMITED WAIVER
This FIRST AMENDMENT AND LIMITED WAIVER (this "Amendment"), dated as of
March 30, 1999, is by and among TRAILER BRIDGE, INC. (the "Borrower"), the
lenders listed on the signature pages hereto (the "Banks"), and BANKBOSTON,
N.A., as agent for the Banks (the "Agent").
WHEREAS, the Borrower, the Banks and the Agent are parties to that
certain Revolving Credit and Term Loan Agreement, dated as of August 28, 1998
(as amended and in effect from time to time, the "Credit Agreement"); and
WHEREAS, the Borrower has requested, and the Banks and the Agent have
agreed, subject to the terms and conditions set forth herein, to waive certain
provisions of the Credit Agreement and to amend certain provisions of the Credit
Agreement as set forth herein;
NOW, THEREFORE, the parties hereto hereby agree as follows:
Section 1. CERTAIN DEFINED TERMS. Capitalized terms which are used
herein without definition and which are defined in the Credit Agreement shall
have the same meanings herein as in the Credit Agreement.
Section 2. LIMITED WAIVER. Sections 10.2, 10.3 and 10.4 of the Credit
Agreement require the Borrower to comply with certain financial covenants. The
Borrower has requested that the Majority Banks waive compliance, as at December
31, 1998 and for the applicable periods then ended, with the covenants contained
in Section Section 10.2, 10.3 and 10.4 of the Credit Agreement. Upon
satisfaction of the conditions precedent contained in Section 6 hereof, the
Majority Banks hereby waive compliance, as at December 31, 1998 and for the
applicable periods then ended only, with each of the covenants contained in
Section Section 10.2, 10.3 and 10.4 of the Credit Agreement. This waiver is
limited to its express terms and shall not extend to any matters not
specifically addressed hereby.
Section 3. AMENDMENTS TO CREDIT AGREEMENT. (a) Section 1.1 of the
Credit Agreement is hereby amended by (i) deleting the definition of
"Applicable Margin" in its entirety in Section 1.1 of the Credit Agreement and
inserting the following new definition in lieu thereof:
"Applicable Margin. For each period commencing on an Adjustment Date
through the date immediately preceding the next Adjustment Date (each a "Rate
Adjustment Period"), the Applicable Margin shall be the applicable margin set
forth below with respect to the Leverage Ratio, as determined for the period
ending on the fiscal quarter ended immediately preceding the applicable Rate
Adjustment Period.
Eurodollar Rate
Leverage Base Rate Loans Loans Commitment
Level Ratio Applicable Margin Applicable Margin Fee Rate
V > 3.25:1.00 0.75% 2.00% 0.500%
IV > 2.75:1.00 and 0.50% 1.75% 0.500%
< 3.25:1.00
III > 2.25:1.00 and 0.25% 1.50% 0.500%
< 2.75:1.00
II > 1.75:1.00 and 0.00% 1.25% 0.375%
< 2.25:1.00
I < 1.75:1.00 0.00% 1.00% 0.250%
For the purposes of this definition of Applicable Margin, the symbol "<" shall
mean "less than" and the symbol ">" shall mean "greater than or equal to".
Notwithstanding the foregoing, (a) if the Borrower fails to deliver any
Compliance Certificate in accordance with Section 8.4(d) hereof, then, for the
period commencing on the next Adjustment Date to occur subsequent to such
failure through the date immediately following the date on which such Compliance
Certificate is delivered, the Applicable Margin shall be the highest Applicable
Margin set forth above and (b) during the period beginning on the Term Out Date
and ending on the Maturity Date, the Applicable Margin shall be increased by
0.25% above the amounts set forth in the table above."
(ii) deleting the definition of "Debt Service Coverage Ratio" in its
entirety in Section 1.1 of the Credit Agreement and inserting the following new
definition in lieu thereof:
"Debt Service Coverage Ratio. (a) As of June 30, 1999, the ratio of (i)
Consolidated Operating Cash Flow for the fiscal quarter ending on such
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date to (ii) Consolidated Total Debt Service of the Borrower and its
Subsidiaries for such fiscal quarter; (b) as of September 30, 1999, the ratio of
(i) Consolidated Operating Cash Flow for the period of two (2) consecutive
fiscal quarters ending on such date to (ii) Consolidated Total Debt Service of
the Borrower and its Subsidiaries for such period of two (2) fiscal quarters;
(c) as of December 31, 1999, the ratio of (i) Consolidated Operating Cash Flow
for the period of three (3) consecutive fiscal quarters ending on such date to
(ii) Consolidated Total Debt Service of the Borrower and its Subsidiaries for
such period of three (3) fiscal quarters; and (d) as of March 31, 2000 and as of
the end of each fiscal quarter ending at any time thereafter, as applicable, the
ratio of (i) Consolidated Operating Cash Flow for the period of four (4)
consecutive fiscal quarters ending on such date to (ii) Consolidated Total Debt
Service of the Borrower and its Subsidiaries for such period of four (4) fiscal
quarters."
(iii) deleting the definition of "Interest Coverage Ratio" in its
entirety in Section 1.1 of the Credit Agreement and inserting the following new
definition in lieu thereof:
"Interest Coverage Ratio. (a) As of June 30, 1999, the ratio of (i)
Earnings Before Interest and Taxes for the fiscal quarter ending on such date to
(ii) Consolidated Total Interest Expense of the Borrower and its Subsidiaries
payable in cash for such fiscal quarter; (b) as of September 30, 1999, the ratio
of (i) Earnings Before Interest and Taxes for the period of two (2) consecutive
fiscal quarters ending on such date to (ii) Consolidated Total Interest Expense
of the Borrower and its Subsidiaries payable in cash for such period of two (2)
fiscal quarters; (c) as of December 31, 1999, the ratio of (i) Earnings Before
Interest and Taxes for the period of three (3) consecutive fiscal quarters
ending on such date to (ii) Consolidated Total Interest Expense of the Borrower
and its Subsidiaries payable in cash for such period of three (3) fiscal
quarters; and (d) as of March 31, 2000 and as of the end of each fiscal quarter
ending at any time thereafter, as applicable, the ratio of (i) Earnings Before
Interest and Taxes for the period of four (4) consecutive fiscal quarters ending
on such date to (ii) Consolidated Total Interest Expense of the Borrower and its
Subsidiaries payable in cash for such period of four (4) fiscal quarters."
(b) Section 10.2 of the Credit Agreement is hereby deleted in
its entirety and the following new Section 10.2 is hereby inserted in lieu
thereof:
"10.2 Interest Coverage Ratio. The Borrower will not permit the
Interest Coverage Ratio as determined at the end of each fiscal quarter
of the Borrower commencing with the fiscal quarter ending June 30, 1999
to be less than 2.50:1.00."
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(c) Section 10.3 of the Credit Agreement is hereby deleted in its
entirety and the following new Section 10.3 is hereby inserted in lieu thereof:
"10.3 Debt Service Coverage Ratio. The Borrower will not permit
the Debt Service Coverage Ratio as determined at the end of each fiscal
quarter of the Borrower commencing with the fiscal quarter ending June
30, 1999 to be less than 1.30:1.00."
(d) Section 10.4 of the Credit Agreement is hereby deleted in its
entirety and the following new Section 10.4 is hereby inserted in lieu thereof:
"10.4 Consolidated Tangible Net Worth. The Borrower will not,
at any time, permit Consolidated Tangible Net Worth to be less than the
sum of $28,000,000 plus, on a cumulative basis, 50% of positive
Consolidated Net Income for each fiscal year commencing with the fiscal
year ending December 31, 1999 and prior to such date of determination
(with no deduction for any year in which there is a net loss)."
Section 4. AFFIRMATION BY THE BORROWER. The Borrower hereby ratifies
and confirms all of the Obligations, including, without limitation, the Loans.
The Borrower hereby confirms that the Obligations are and remain secured
pursuant to the Security Documents to which the Borrower is a party.
Section 5. REPRESENTATIONS AND WARRANTIES. The Borrower hereby
represents and warrants to the Banks and the Agent as follows:
(a) Representations and Warranties. The representations and warranties
contained in the Credit Agreement, the other Loan Documents or in any document
or instrument delivered pursuant to or in connection therewith were true and
correct as of the date as of which they were made and are true and correct on
the date hereof (except to the extent of changes resulting from transactions
contemplated or permitted by the Credit Agreement and the other Loan Documents
and changes occurring in the ordinary course of business that singly or in the
aggregate are not materially adverse, and to the extent that such
representations and warranties relate expressly to an earlier date).
(b) Enforceability. The execution and delivery by the Borrower of this
Amendment, and the performance by the Borrower of this Amendment and the Credit
Agreement, as amended hereby, are within the corporate powers of the Borrower
and have been duly authorized by all necessary corporate action on the part of
the Borrower. Each of this Amendment and
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the Credit Agreement, as amended hereby, are valid and legally binding obliga-
tions of the Borrower, enforceable in accordance with their terms, except as
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or affecting the enforcement of creditors' rights in general.
(c) No Default. No Default or Event of Default has occurred and is
continuing and no Default or Event of Default will exist as a result of the
execution and delivery of this Amendment or after the consummation of the
transactions contemplated hereby.
Section 6. EFFECTIVENESS. This Amendment shall become effective upon
satisfaction of each of the following conditions precedent:
(a) Delivery. The Borrower and the Majority Banks shall have executed
and delivered this Amendment.
(b) Proceedings and Documents. All proceedings in connection with the
transactions contemplated by this Amendment and all documents incident hereto
shall be satisfactory in form and substance to the Agent and the Banks, and the
Agent shall have received all information and such counterpart originals or
certified or other copies of all such documents as the Agent may reasonably
request.
Section 7. MISCELLANEOUS PROVISIONS. (a) Except as otherwise expressly
provided by this Amendment, all of the terms, conditions and provisions of the
Credit Agreement and the other Loan Documents shall remain the same. It is
declared and agreed by each of the parties hereto that the Credit Agreement, as
amended hereby, shall continue in full force and effect, and that this Amendment
and the Credit Agreement shall be read and construed as one instrument. Each of
the Notes and the other Loan Documents are hereby deemed to be amended to
reflect the amendments to the Credit Agreement contained herein.
(b) Except as otherwise expressly provided by this Amendment, the
waiver contained in Section 2 hereof shall not, by implication or otherwise,
limit, impair, constitute a waiver of or otherwise affect any rights or remedies
of the Agent or the Banks under the Credit Agreement or the other Loan
Documents, nor alter, modify, amend or in any way affect any of the terms,
obligations or covenants contained in the Credit Agreement or the other Loan
Documents.
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(c) This Amendment is intended to take effect as an agreement under
seal and shall be construed according to and governed by the laws of The
Commonwealth of Massachusetts.
(d) This Amendment may be executed in any number of counterparts, and
all such counterparts shall together constitute but one instrument. In making
proof of this Amendment it shall not be necessary to produce or account for more
than one counterpart signed by each party hereto by and against which
enforcement hereof is sought.
(e) The Borrower hereby agrees to pay to the Agent, on demand by the
Agent, all reasonable out-of-pocket costs and expenses incurred or sustained by
the Agent in connection with the preparation of this Amendment (including
reasonable legal fees).
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IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first above written.
TRAILER BRIDGE, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Title: Chairman & CEO
BANKBOSTON, N.A.,
individually and as Agent
By: /s/ ▇▇▇▇ ▇. Pattinson
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Title: Director