EXHIBIT 10.14
CREDIT AGREEMENT
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GENESIS CRUDE OIL, L.P.,
as Borrower,
GENESIS ENERGY, L.L.C.,
as Guarantor,
GENESIS ENERGY, L.P.,
as Guarantor,
CITICORP NORTH AMERICA, INC.,
as Administrative Agent and Collateral Agent,
CITICORP NORTH AMERICA, INC.,
as Arranger and Book Manager,
and CERTAIN FINANCIAL INSTITUTIONS,
as Lenders
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$150,000,000
Dated as of December 19, 2001
TABLE OF CONTENTS
Page
Article I - Definitions and References 1
Section 1.1. Defined Terms 1
Section 1.2. Exhibits and Schedules; Additional Definitions 26
Section 1.3. Amendment of Defined Instruments 27
Section 1.4. References and Titles 27
Section 1.5. Calculations and Determinations 27
Section 1.6. Joint Preparation; Construction of Indemnities
and Releases 28
Article II - The Loans and Letters of Credit 28
Section 2.1. Commitments to Lend; Notes 28
Section 2.2. Requests for New Loans 29
Section 2.3. Continuations and Conversions of Existing Loans 30
Section 2.4. Use of Proceeds 31
Section 2.5. Optional Prepayments of Loans 31
Section 2.6. Mandatory Prepayments 31
Section 2.7. Letters of Credit 32
Section 2.8. Requesting Letters of Credit 33
Section 2.9. Reimbursement and Participations 34
Section 2.10. No Duty to Inquire 35
Section 2.11. LC Collateral 36
Section 2.12. Interest Rates and Fees; Reduction in Commitment 38
Section 2.13. Borrowing Base Reporting 39
Article III - Payments to Lenders 39
Section 3.1. General Procedures 39
Section 3.2. Capital Reimbursement 40
Section 3.3. Increased Cost of LIBOR Loans or Letters of
Credit 41
Section 3.4. Notice; Change of Applicable Lending Office 41
Section 3.5. Availability 42
Section 3.6. Funding Losses 42
Section 3.7. Reimbursable Taxes 42
Section 3.8. Replacement of Lenders 44
Article IV - Conditions Precedent to Credit 44
Section 4.1. Documents to Be Delivered 44
Section 4.2. Additional Conditions Precedent 46
Article V - Representations and Warranties 47
Section 5.1. No Default 47
Section 5.2. Organization and Good Standing 47
Section 5.3. Authorization 48
Section 5.4. No Conflicts or Consents 48
Section 5.5. Enforceable Obligations 48
Section 5.6. Initial Financial Statements 48
Section 5.7. Other Obligations and Restrictions 49
Section 5.8. Full Disclosure 49
Section 5.9. Litigation 49
Section 5.10. Labor Disputes and Acts of God 49
Section 5.11. ERISA Plans and Liabilities 50
Section 5.12. Compliance with Laws 50
Section 5.13. Environmental Laws 50
Section 5.14. Names and Places of Business 52
Section 5.15. Borrower's Subsidiaries 52
Section 5.16. Title to Properties; Licenses 53
Section 5.17. Government Regulation 53
Section 5.18. Insider 53
Section 5.19. Solvency 53
Section 5.20. Credit Arrangements 54
Section 5.21. Real Property 54
Article VI - Affirmative Covenants 54
Section 6.1. Payment and Performance 54
Section 6.2. Books, Financial Statements and Reports 54
Section 6.3. Other Information and Inspections 57
Section 6.4. Notice of Material Events and Change of
Address 57
Section 6.5. Maintenance of Properties 58
Section 6.6. Maintenance of Existence and Qualifications 58
Section 6.7. Payment of Trade Liabilities, Taxes, Etc 58
Section 6.8. Insurance 58
Section 6.9. Performance on Borrower's Behalf 59
Section 6.10. Interest 59
Section 6.11. Compliance with Agreements and Law 59
Section 6.12. Environmental Matters; Environmental Reviews 59
Section 6.13. Evidence of Compliance 60
Section 6.14. Agreement to Deliver Security Documents 60
Section 6.15. Perfection and Protection of Security
Interests and Liens 60
Section 6.16. Bank Accounts; Offset 61
Section 6.17. Guaranties of Subsidiaries 61
Section 6.18. Compliance with Agreements 61
Section 6.19. Rents 62
Section 6.20. Operating Practices 62
Section 6.21. Evaluation 62
Article VII - Negative Covenants 63
Section 7.1. Indebtedness 63
Section 7.2. Limitation on Liens 63
Section 7.3. Hedging Contracts 65
Section 7.4. Limitation on Mergers, Issuances of Securities 65
Section 7.5. Limitation on Sales of Property 66
Section 7.6. Limitation on Dividends and Redemptions 67
Section 7.7. Limitation on Investments and New Businesses 67
Section 7.8. Limitation on Credit Extensions 68
Section 7.9. Transactions with Affiliates 68
Section 7.10. Prohibited Contracts 68
Section 7.11. Current Ratio 68
Section 7.12. Leverage Ratio 69
Section 7.13. Interest Coverage Ratio 69
Section 7.14. Capital Expenditures 69
Section 7.15. Open Position Certain Permitted Financial
Instruments; NYMEX Transactions 70
Section 7.16. Redelivery of Borrowing Base Report 71
Article VIII - Events of Default and Remedies 71
Section 8.1. Events of Default 71
Section 8.2. Remedies 75
Article IX - The Agents 75
Section 9.1. Authorization and Action 75
Section 9.2. Agents' Reliance, Etc. 75
Section 9.3. Administrative Agent and Affiliates 76
Section 9.4. Lender Party Credit Decision 76
Section 9.5. Indemnification 76
Section 9.6. Successor Agents 77
Article X - Miscellaneous 78
Section 10.1. Waivers and Amendments; Acknowledgment 78
Section 10.2. Survival of Agreements; Cumulative Nature 80
Section 10.3. Notices 80
Section 10.4. Payment of Expenses; Indemnity 81
Section 10.5. Joint and Several Liability Parties in
Interest Assignments; Replacement Notes 82
Section 10.6. Confidentiality 85
Section 10.7. Governing Law; Submission to Process 85
Section 10.8. Limitation on Interest 86
Section 10.9. Termination; Limited Survival 87
Section 10.10. Severability 87
Section 10.11. Counterparts 87
Section 10.12. Waiver of Jury Trial, Punitive Damages, Etc. 87
Schedules and Exhibits:
Schedule 1 - Lender Schedule
Schedule 2 - Disclosure Schedule
Schedule 3 - Security Schedule
Schedule 4 - Insurance Schedule
Schedule 5 - Borrowing Base Procedures
Schedule 6 - Real Property
Schedule 7 - Mortgages
Exhibit A - Form of Promissory Note
Exhibit B - Form of Borrowing Notice
Exhibit C - Form of Continuation/Conversion Notice
Exhibit D - Forms of Letter of Credit
Exhibit E - Form of Letter of Credit Application and Agreement
Exhibit F - Form of Certificate Accompanying Financial
Statements
Exhibit G - Form of Borrowing Base Report
Exhibit H - Form of Environmental Compliance Certificate
Exhibit I - Form of Assignment and Acceptance Agreement
Exhibit J - Form of Solvency Certificate
CREDIT AGREEMENT
THIS CREDIT AGREEMENT is made as of December 19, 2001, by
and among GENESIS CRUDE OIL, L.P. ("Borrower"), a Delaware
limited partnership, GENESIS ENERGY, L.L.C. ("General Partner"),
a Delaware limited liability company, GENESIS ENERGY, L.P.
("Genesis Energy, L.P."), a Delaware limited partnership, and
CITICORP NORTH AMERICA, INC., as administrative agent and
collateral agent (in such capacity, "Administrative Agent" and
"Collateral Agent" ), CITICORP NORTH AMERICA, INC., as arranger
and book manager (in such capacity, "Lead Arranger and Book
Manager"), and the Lenders referred to below.
W I T N E S S E T H:
In consideration of the mutual covenants and agreements
contained herein and in consideration of the loans which may
hereafter be made by Lenders to, and the Letters of Credit that
may hereafter be issued by the LC Issuer for the account of,
Borrower, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties hereto do hereby agree as follows:
ARTICLE I - Definitions and References
Section 1.1. Defined Terms. As used in this Agreement,
each of the following terms has the meaning given to such term
in this Section 1.1 or in the sections and subsections referred
to below:
"Acceptable Issuer" means any national or state bank or
trust company which is organized under the laws of the United
States of America or any state thereof or any branch licensed to
operate under the laws of the United States of America or any
state thereof, which is a branch of a bank organized under any
country which is a member of the Organization for Economic
Cooperation and Development, in each case which has capital,
surplus and undivided profits of at least $500,000,000 and whose
commercial paper is rated at least P-1 by ▇▇▇▇▇'▇ or A-1 by S&P.
"Account" shall have the meaning given that term in the
UCC.
"Account Debtor" means any Person who is or who may become
obligated under, with respect to, or on account of, an Account.
"Administrative Agent" means Citicorp North America, Inc.,
as Administrative Agent hereunder, and its successors in such
capacity.
"Affiliate" means, as to any Person, each other Person that
directly or indirectly (through one or more intermediaries or
otherwise) controls, is controlled by, or is under common
control with, such Person. Notwithstanding anything to the
contrary contained herein, for the purposes of this Agreement,
none of Citicorp North America, Inc., Citibank, N.A., ▇▇▇▇▇▇▇
▇▇▇▇▇ Barney Holdings Inc. or Salomon Brothers Holding Company
Inc. shall be deemed to be an Affiliate of any Restricted
Person. A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or
indirectly, power
(a) to vote 20% or more of the securities (on a fully
diluted basis) having ordinary voting power for the
election of directors or managing general partners; or
(b) to direct or cause the direction of the
management and policies of such Person whether by contract
or otherwise.
"Agent" means each of Administrative Agent and Collateral
Agent.
"Agreement" means this Credit Agreement, as it may be
amended in accordance with the terms hereof.
"Applicable Lending Office" means, with respect to each
Lender, such Lender's Domestic Lending Office in the case of
Base Rate Loans and such Lender's LIBOR Lending Office in the
case of LIBOR Loans.
"Applicable Leverage Level" means the level set forth below
that corresponds to the ratio of (i) Consolidated Funded
Indebtedness to (ii) the Consolidated EBITDA for the applicable
period of four Fiscal Quarters (the "Leverage Ratio"):
Applicable
Leverage Level Leverage Ratio
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Level I greater than or equal to 5.00 to 1.00
Level II greater than or equal to 4.50 to 1.00
but less than 5.00 to 1.00
Level III greater than or equal to 4.00 to 1.00
but less than 4.50 to 1.00
Level IV greater than or equal to 3.50 to 1.00
but less than 4.00 to 1.00
Level V greater than or equal to 3.00 to 1.00
but less than 3.50 to 1.00
Level VI less than 3.00 to 1.00
On the date hereof the Applicable Leverage Level shall be Level
III. The Leverage Ratio shall be determined quarterly after the
date hereof from time to time by Administrative Agent within two
(2) Business Days after Administrative Agent's receipt of
Genesis Energy, L.P.'s Consolidated financial statements for the
immediate preceding Fiscal Quarter beginning with its receipt of
the financial statements for the quarter ended December 31, 2001
based upon: (i) Consolidated Funded Indebtedness as of the end
of such Fiscal Quarter, and (ii) the Consolidated EBITDA for the
four Fiscal Quarters ending with such Fiscal Quarter. The
Applicable Leverage Level shall become effective upon such
determination of the Leverage Ratio by Administrative Agent and
shall remain effective until the next such determination by
Administrative Agent of the Leverage Ratio.
"Approved Eligible Receivables" means each Eligible
Receivable (other than Eligible Exchange Balances) (a) from a
Person whose Debt Rating is either at least Baa3 by ▇▇▇▇▇'▇ or
at least BBB- by S&P; (b) fully and unconditionally guaranteed
as to payment by a Person whose Debt Rating is either at least
Baa3 by ▇▇▇▇▇'▇ or at least BBB- by S&P; (c) from any other
Person Currently Approved by Majority Lenders; or (d) fully
covered by a letter of credit from an Acceptable Issuer.
"Base Rate" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all
times be equal to the highest of:
(a) the rate of interest announced publicly by
Citibank in New York, New York, from time to time, as
Citibank's base rate;
(b) the sum (adjusted to the nearest 1/4 of 1% or, if
there is no nearest 1/4 of 1%, to the next higher 1/4 of
1%) of (i) 1/2 of 1% per annum, plus (ii) the rate obtained
by dividing (A) the latest three-week moving average of
secondary market morning offering rates in the United
States for three-month certificates of deposit of major
United States money market banks, such three-week moving
average (adjusted to the basis of a year of 360 days) being
determined weekly on each Monday (or, if such day is not a
Business Day, on the next succeeding Business Day) for the
three-week period ending on the previous Friday by Citibank
on the basis of such rates reported by certificate of
deposit dealers to and published by the Federal Reserve
Purchaser of New York or, if such publication shall be
suspended or terminated, on the basis of quotations for
such rates received by Citibank from three New York
certificate of deposit dealers of recognized standing
selected by Citibank, by (B) a percentage equal to 100%
minus the average of the daily percentages specified during
such three-week period by the Board of Governors of the
Federal Reserve System (or any successor) for determining
the maximum reserve requirement (including, but not limited
to, any emergency, supplemental or other marginal reserve
requirement) for Citibank with respect to liabilities
consisting of or including (among other liabilities) three-
month U.S. dollar non-personal time deposits in the United
States, plus (iii) the average during such three-week
period of the annual assessment rates estimated by Citibank
for determining the then current annual assessment payable
by Citibank to the Federal Deposit Insurance Corporation
(or any successor) for insuring U.S. dollar deposits of
Citibank in the United States; and
(c) 1/2 of one percent per annum above the Federal
Funds Rate.
"Base Rate Loan" means a Loan which does not bear interest
at the LIBOR Rate.
"Base Rate Margin" means (i) from the date hereof through
but not including the six-month anniversary of the date hereof,
..50% per annum, and (ii) on and after the six-month anniversary
of the date hereof, the percent per annum set forth below based
on the Applicable Leverage Level in effect on such date.
Applicable
Leverage Level Base Rate Margin
-------------- ----------------
Level I 1.25%
Level II 1.00%
Level III 0.75%
Level IV 0.50%
Level V 0.25%
Level VI 0.00%
Changes in the applicable Base Rate Margin will occur
automatically without prior notice as changes in the Applicable
Leverage Level occur. Administrative Agent will give notice
promptly to Borrower and Lenders of changes in the Base Rate
Margin.
"Borrower" means Genesis Crude Oil, L.P., a Delaware
limited partnership.
"Borrowing" means a borrowing of new Loans of a single Type
pursuant to Section 2.2 or a Continuation or Conversion of all
or a portion of an existing Loan (whether alone or as a
combination with a new Loan) into a single Type (and, in the
case of LIBOR Loans, with the same Interest Period) pursuant to
Section 2.3.
"Borrowing Base" means the remainder of (a) minus (b) below
as of the date of determination (without duplication):
(a) the sum of the following as of the date of
determination:
(i) 100% of Eligible Cash Equivalents; plus
(ii) 90% of Approved Eligible Receivables; plus
(iii) the lesser of (A) 85% of Other Eligible
Receivables or (B) one third (1/3) of the sum of the
amounts of clauses (a)(i) plus (a)(ii); plus
(iv) 85% of Eligible Margin Deposits; plus
(v) 95% of Hedged Eligible Inventory plus 100%
of Other Eligible Inventory Value; plus
(vi) 80% of Eligible Exchange Balances; plus
(vii) 100% of all Paid but Unexpired Letters
of Credit
MINUS
(b) the following as of the date of determination:
(i) 100% of First Purchase Crude Payables; plus
(ii) 100% of Other Priority Claims; plus
(iii) The Estimate Adjustment Amount as
provided in Section 2.13.
"Borrowing Notice" means a written or telephonic request,
or a written confirmation, made by Borrower which meets the
requirements of Section 2.2.
"Business Day" means any day, other than a Saturday, Sunday
or day which shall be in New York City a legal holiday or day on
which banking institutions are required or authorized to close.
Any Business Day in any way relating to LIBOR Loans (such as the
day on which an Interest Period begins or ends) must also be a
day on which commercial banks settle payments in London.
"Capital Expenditures" means, for any Person for any
period, the sum of, without duplication, (a) all expenditures
made, directly or indirectly, by such Person or any of its
Subsidiaries during such period for equipment, fixed assets,
real property or improvements, or for replacements or
substitutions therefor or additions thereto, that have been or
should be, in accordance with GAAP, reflected as additions to
property, plant or equipment on a Consolidated balance sheet of
such Person or have a useful life of more than one year plus (b)
the aggregate principal amount of all Indebtedness (including
obligations under Capitalized Leases) assumed or incurred in
connection with any such expenditures. For purposes of this
definition, the purchase price of equipment that is purchased
simultaneously with the trade-in of existing equipment or with
insurance proceeds shall be included in Capital Expenditures
only to the extent of the gross amount of such purchase price
less the credit granted by the seller of such equipment for the
equipment being traded in at such time or the amount of such
proceeds, as the case may be.
"Capital Lease" means a lease with respect to which the
lessee is required concurrently to recognize the acquisition of
an asset and the incurrence of a liability in accordance with
GAAP.
"Capital Lease Obligation" means, with respect to any
Person and a Capital Lease, the amount of the obligation of such
Person as the lessee under such Capital Lease which would, in
accordance with GAAP, appear as a liability on a balance sheet
of such Person.
"Cash Equivalents" means Investments in:
(a) marketable obligations, maturing within 12 months
after acquisition thereof, issued or unconditionally
guaranteed by the United States of America or an
instrumentality or agency thereof and entitled to the full
faith and credit of the United States of America;
(b) demand deposits and time deposits (including
certificates of deposit) maturing within 12 months from the
date of deposit thereof, (i) with any office of any Lender
or (ii) with a domestic office of any national or state
bank or trust company which is organized under the Laws of
the United States of America or any state therein, which
has capital, surplus and undivided profits of at least
$500,000,000, and whose long-term certificates of deposit
are rated at least Aa3 by ▇▇▇▇▇'▇ or AA- by S&P;
(c) repurchase obligations with a term of not more
than seven days for underlying securities of the types
described in subsection (a) above entered into with (i) any
Lender or (ii) any other commercial bank meeting the
specifications of subsection (b) above;
(d) open market commercial paper, maturing within 270
days after acquisition thereof, which are rated at least P-
1 by ▇▇▇▇▇'▇ or A-l by S&P; and
(e) money market or other mutual funds substantially
all of whose assets comprise securities of the types
described in subsections (a) through (d) above.
"Change of Control" means the occurrence of any of the
following events: (i) any Person or group of Persons acting in
concert as a partnership or other group (a "Group of Persons")
other than General Partner and the other holders of partnership
interests in Genesis Energy, L.P. as of the date hereof shall be
the legal or beneficial owner (within the meaning of Rule 13d-3
under the Securities Exchange Act of 1934, as amended) of 25% or
more of the combined voting power of the then total partnership
interests (including all securities which are convertible into
partnership interests) of Genesis Energy, L.P., or (ii) Genesis
Energy, L.P. shall cease to be the sole legal and beneficial
owner (as defined above) of at least ninety percent (90%) of the
limited partnership interests of Borrower (including all
securities which are convertible into limited partner
interests), or (iii) the General Partner shall cease to be the
sole general partner of Genesis Energy, L.P., the Borrower,
Genesis Pipeline Texas, L.P. and Genesis Pipeline USA L.P. or
(iv) Salomon shall own, directly or indirectly, less than 100%
of the combined voting power of the equity interests in the
General Partner.
"Citibank" means Citibank, N.A., a national banking
association.
"Citibank LC Collateral Account" means an account held by
Administrative Agent for the benefit of Citibank and the Lenders
in accordance with the terms hereof.
"Citibank LC Loan" shall have the meaning set forth in
Section 2.7(b).
"Citibank LC Loan Rate" means the related LIBOR Rate plus
..125%.
"Citibank Letter of Credit" means each Letter of Credit
which, upon the request of the Borrower pursuant to Section
2.7(B), is issued by Citibank.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, together with all rules and regulations
promulgated with respect thereto.
"Collateral" means all property of any kind which is
subject to a Lien in favor of Lenders (or in favor of Collateral
Agent for the benefit of Lenders) or which, under the terms of
any Security Document, is purported to be subject to such a
Lien, in each case granted or created to secure all or part of
the Obligations.
"Collateral Agent" has the meaning set forth in the
Security Documents.
"Commitment Fee Rate" means, on any day (i) from the date
hereof through but not including the six-month anniversary of
the date hereof, 0.50% per annum, and (ii) on and after the six-
month anniversary of the date hereof, the rate per annum set
forth below based on the Applicable Leverage Level on such date.
Applicable Leverage Level Commitment Fee Rate
------------------------------- -------------------
Level I 0.750%
Level II, Level III or Level IV 0.500%
Level V or Level VI 0.375%
Changes in the applicable Commitment Fee Rate will occur
automatically without prior notice as changes in the Applicable
Leverage Level occur. Administrative Agent will give notice
promptly to Borrower and Lenders of changes in the Commitment
Fee Rate.
"Commitment Period" means the period from and including the
date hereof until December 31, 2003 (or, if earlier, the day on
which (i) the obligation of Lenders to make Loans hereunder and
the obligations of LC Issuer to issue Letters of Credit
hereunder have terminated, (ii) the obligation of LC Issuer to
issue Letters of Credit hereunder has terminated, or (iii) the
Notes first become due and payable in full, whichever shall
first occur).
"Consolidated" refers to the consolidation of any Person,
in accordance with GAAP, with its properly consolidated
subsidiaries. References herein to a Person's Consolidated
financial statements, financial position, financial condition,
liabilities, etc. refer to the consolidated financial
statements, financial position, financial condition,
liabilities, etc. of such Person and its properly consolidated
subsidiaries.
"Consolidated EBITDA" means, for any period, the sum of (1)
the Consolidated Net Income of Borrower and its Consolidated
Subsidiaries during such period, plus (2) all interest expense
which was deducted in determining such Consolidated Net Income
for such period, plus (3) all income taxes (including any
franchise taxes to the extent based upon net income) which were
deducted in determining such Consolidated Net Income, plus (4)
all depreciation, amortization (including amortization of good
will and debt issue costs) and other non-cash charges (including
any provision for the reduction in the carrying value of assets
recorded in accordance with GAAP) which were deducted in
determining such Consolidated Net Income, minus (5) all non-cash
items of income which were included in determining such
Consolidated Net Income.
"Consolidated Funded Indebtedness" means as of any date,
the sum of the following (without duplication): (i) all
Indebtedness which is classified as "long-term indebtedness" on
a consolidated balance sheet of Borrower and its Consolidated
Subsidiaries prepared as of such date in accordance with GAAP
and any current maturities and other principal amount in respect
of such Indebtedness due within one year but which was
classified as "long-term indebtedness" at the creation thereof,
(ii) indebtedness for borrowed money of Borrower and its
Consolidated Subsidiaries outstanding under a revolving credit
or similar agreement providing for borrowings (and renewals and
extensions thereof) over a period of more than one year,
notwithstanding the fact that any such borrowing is made within
one year of the expiration of such agreement, and (iii)
Indebtedness in respect of Capital Leases of Borrower and its
Consolidated Subsidiaries. For purposes of the definition of
Consolidated Funded Indebtedness, all such Indebtedness and
indebtedness for borrowed money shall be calculated on an
average daily basis for the relevant period.
"Consolidated Net Income" means, for any period, Borrower's
and its Subsidiaries' gross revenues for such period, including
any cash dividends or distributions actually received from any
other Person during such period, minus Borrower's and its
Subsidiaries' expenses and other proper charges against income
(including taxes on income to the extent imposed), determined on
a Consolidated basis after eliminating earnings or losses
attributable to outstanding minority interests (other than the
minority interest in Borrower held by the General Partner) and
excluding the net earnings of any Person other than a Subsidiary
in which Borrower or any of its Subsidiaries has an ownership
interest. Consolidated Net Income shall not include (i) any
gain or loss from the sale of assets, (ii) any extraordinary
gains or losses (it being understood that (x) up to $2,000,000
of any penalty assessed by any Tribunal in connection with the
Pipeline Release, and (y) up to $800,000 incurred by Borrower in
connection with employee severance costs during the first Fiscal
Quarter of 2002 shall be considered to be "extraordinary losses"
for the purposes of this clause (ii)) or (iii) any non-cash
gains or losses resulting from ▇▇▇▇ to market activity as a
result of the implementation of SFAS 133.
"Consolidated Net Worth" means the remainder of all
Consolidated assets, as determined in accordance with GAAP, of
Borrower and its Subsidiaries minus the sum of (a) Borrower's
Consolidated liabilities, as determined in accordance with GAAP,
and (b) all outstanding Minority Interests (other than the
minority interest in Borrower held by the General Partner).
The effect of any increase or decrease in net worth in any
period as a result of items of income or loss not reflected in
the determination of net income but reflected in the
determination of comprehensive income (to the extent provided
under GAAP as in effect on the date hereof) shall be excluded in
determining Consolidated Net Worth. "Minority Interests" means
the book value of any equity interests in any of Borrower's
Subsidiaries which equity interests are owned by a Person other
than Borrower or a Wholly Owned Subsidiary of Borrower
"Continuation/Conversion Notice" means a written or
telephonic request, or a written confirmation, made by Borrower
which meets the requirements of Section 2.3.
"Continue", "Continuation", and "Continued" shall refer to
the continuation pursuant to Section 2.3 hereof of a LIBOR Loan
as a LIBOR Loan from one Interest Period to the next Interest
Period.
"Convert", "Conversion", and "Converted" shall refer to a
conversion pursuant to Section 2.3 or Article III of one Type of
Loan into another Type of Loan.
"Current Trading Month" has the meaning given that term in
Section 7.15.
"Currently Approved by Majority Lenders" means such Person
(including a limit on the maximum credit exposure to any such
Person), storage location, pipeline, form of Letter of Credit or
other matter as the case may be, as reflected in the most recent
written notice given by Administrative Agent to Borrower as
being approved by Majority Lenders. Each such written notice
will supersede and revoke each prior notice.
"Debt Coverage Ratio" shall have the meaning given that
term in Section 7.12.
"Debt Rating" means with respect to a Person, the rating
then in effect by a Rating Agency for the long term senior
unsecured non-credit enhanced debt of such Person.
"Default" means any Event of Default and any default, event
or condition which would, with the giving of any requisite
notices and the passage of any requisite periods of time,
constitute an Event of Default.
"Default Rate" means (A) in the case of any Loan other than
an Over-Advance Loan, at the time in question, (i) two percent
(2%) per annum plus the applicable LIBOR Rate Margin plus the
LIBOR Rate then in effect for any LIBOR Loan (up to the end of
the applicable Interest Period) or (ii) two percent (2%) per
annum plus the applicable Base Rate Margin plus the Base Rate
for each Base Rate Loan; and (B) in the case of any Loan that is
an Over-Advance Loan, (i) two percent (2%) per annum plus the
applicable Over-Advance LIBOR Rate Margin plus the LIBOR Rate
then in effect for any LIBOR Loan (up to the end of the
applicable Interest Period) or (ii) two percent (2%) per annum
plus the applicable Over-Advance Base Rate Margin plus the Base
Rate for each Base Rate Loan; provided, however, the Default
Rate shall never exceed the Highest Lawful Rate.
"Default Rate Period" means (i) any period during which an
Event of Default, other than pursuant to Section 8.1(a) or (b)
or Section 8.1(i)(i)(ii)(iii), is continuing, provided that such
period shall not begin until notice of the commencement of the
Default Rate has been given to Borrower by Administrative Agent
upon the instruction by Majority Lenders and (ii) any period
during which any other Event of Default is continuing unless
Borrower has been notified otherwise by Administrative Agent
upon the instruction by Majority Lenders.
"Disclosure Schedule" means Schedule 2 hereto.
"Dollars" and "$" means the lawful currency of the United
States of America, except where otherwise specified.
"Domestic Lending Office" means, with respect to any
Lender, the office of such Lender specified as its "Domestic
Lending Office" in the Lender Schedule hereto, or such other
office as such Lender may from time to time specify to Borrower
and Administrative Agent; with respect to LC Issuer, the office,
branch, or agency through which it issues Letters of Credit;
and, with respect to Administrative Agent, the office, branch,
or agency through which it administers this Agreement.
"Eligible Cash Equivalents" means Cash Equivalents in which
Borrower has lawful and absolute title, which are free from any
express or implied at law Lien, trust or other beneficial
interest, in which Collateral Agent holds a fully perfected
first-priority security interest (subject only to the ▇▇▇▇▇▇▇
▇▇▇▇) prior to the rights of, and enforceable as such against,
any other Persons pursuant to an account agreement satisfactory
to Collateral Agent and which remain under the sole dominion and
control of Collateral Agent.
"Eligible Exchange Balances" means each Approved Eligible
Receivable (including for this purpose only either the right to
receive Petroleum Inventory in kind or to receive money) arising
from the trading, lending, borrowing or exchange of Petroleum
Inventory, net of any netted obligations or other offsets or
counterclaims determined in accordance with prices set forth in
the applicable exchange contracts, based on current value at the
Market Price, in which Borrower has lawful and absolute title,
which is not subject to any Lien in favor of any Person (other
than Permitted Inventory Liens), and which is subject to a fully
perfected first-priority security interest (subject only to
Permitted Inventory Liens) in favor of Collateral Agent pursuant
to the Loan Documents prior to the rights of, and enforceable as
such against, any other Persons minus without duplication the
amount of any Permitted Inventory Lien on any Petroleum
Inventory receivable in kind.
"Eligible Inventory" means inventories of Petroleum
Inventory in which Borrower has lawful and absolute title
(specifically excluding, however, tank bottoms), which are not
subject to any Lien in favor of any Person (other than Permitted
Inventory Liens and the ▇▇▇▇▇▇▇ ▇▇▇▇), which are subject to a
fully perfected first priority security interest (subject only
to Permitted Inventory Liens and the ▇▇▇▇▇▇▇ ▇▇▇▇) in favor of
Collateral Agent pursuant to the Loan Documents prior to the
rights of, and enforceable as such against, any other Person,
which are otherwise satisfactory to Majority Lenders in their
reasonable business judgment and which are located in storage
locations (including pipelines) which are either (a) owned by a
Restricted Person or (b) Currently Approved by Majority Lenders
minus without duplication the amount of any Permitted Inventory
Lien on any such inventory. Eligible Inventory shall
specifically exclude inventory to be delivered in the current or
next succeeding trading month.
"Eligible Margin Deposit" means net equity value of
investments by Borrower in margin deposit accounts with
commodities brokers on nationally recognized exchanges subject
to a perfected security interest in favor of Collateral Agent
and a three-party agreement among Borrower, Administrative Agent
and the depository institution, in form and substance
satisfactory to Collateral Agent.
"Eligible Receivables" means, at the time of any
determination thereof (and without duplication), each Account
and, with respect to each determination made on or after the
20th day of each calendar month and prior to the first day of
the next calendar month, each amount which will be, in the good
faith estimate reasonably determined by Borrower, an Account of
the Borrower with respect to sales and deliveries of Petroleum
Inventory during such calendar month or deliveries of Petroleum
Inventory during the next calendar month under firm written
purchase and sale agreements, in either event as to which the
following requirements have been fulfilled (or as to future
Accounts, will be fulfilled as of the date of such sales and
deliveries of Petroleum Inventory), to the reasonable
satisfaction of Administrative Agent:
(i) Borrower has lawful and absolute title to such
Account;
(ii) such Account is a valid, legally enforceable
obligation of an Account Debtor payable in Dollars, arising
from the sale and delivery of Petroleum Inventory to such
Person in the United States of America in the ordinary
course of business of Borrower, to the extent of the
volumes of Petroleum Inventory delivered to such Person
prior to the date of determination;
(iii) there has been excluded from such Account
(A) any portion that is subject to any dispute, rejection,
loss, non-conformance, counterclaim or other claim or
defense on the part of any Account Debtor or to any claim
on the part of any Account Debtor denying liability under
such Account, and (B) the amount of any account payable or
other liability owed by Borrower to the Account Debtor on
such Account, whether or not a specific netting agreement
may exist, excluding, however, any portion of any such
account payable or other liability which is at the time in
question covered by a Letter of Credit;
(iv) Borrower has the full and unqualified right to
assign and grant a security interest in such Account to
Collateral Agent as security for the Obligation;
(v) such Account (A) is evidenced by an invoice
rendered to the Account Debtor, or (B) represents the
uninvoiced amount in respect of volumes of Petroleum
Inventory scheduled to be delivered by Borrower in the
current or next-following calendar month, is governed by a
purchase and sale agreement, exchange agreement or other
written agreement, and in either event such Account is not
evidenced by any promissory note or other instrument;
(vi) such Account is not subject to any Lien in favor
of any Person and is subject to a fully perfected first
priority security interest (subject only the ▇▇▇▇▇▇▇ ▇▇▇▇)
in favor of Collateral Agent pursuant to the Loan
Documents, prior to the rights of, and enforceable as such
against, any other Person except for a Lien in respect of
First Purchase Crude Payables;
(vii) such Account is due not more than 30 days
following the last day of the calendar month in which the
Petroleum Inventory delivery occurred and is not more than
30 days past due (except that Accounts of a single Account
Debtor in excess of $250,000 which are not Approved
Eligible Receivables shall be excluded from Eligible
Receivables if not paid on or before the third Business Day
after the due date);
(viii) such Account is not payable by an Account
Debtor with more than twenty percent (20%) of its Accounts
to Borrower that are outstanding more than 30 days from the
invoice date;
(ix) the Account Debtor in respect of such Account (A)
is located, is conducting significant business or has
significant assets in the United States of America or is a
Person Currently Approved by Majority Lenders, (B) is not
an Affiliate of Borrower, and (C) is not the subject of any
event of the type described in Section 8.1(i);
(x) the Account Debtor in respect of such Account is
not a governmental authority, domestic or foreign; and
(xi) such Account is not the obligation of an Account
Debtor that Administrative Agent or Majority Lenders
determine in good faith that there is a legitimate concern
over the timing or collection of such receivable.
"Eligible Transferee" means a Person which either (a) is a
Lender or an Affiliate of a Lender, or (b) is consented to as an
Eligible Transferee by Administrative Agent and, so long as no
Default or Event of Default is continuing, by Borrower, which
consents in each case will not be unreasonably withheld
(provided that no Person organized outside the United States may
be an Eligible Transferee if Borrower would be required to pay
withholding taxes on interest or principal owed to such Person).
"Enron Payment" means the payment due from Enron Reserve
Acquisition Corporation to Borrower payable on December 20,
2001.
"Environmental Laws" means any and all Laws relating to the
environment, health or safety, or to emissions, discharges,
releases or threatened releases of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or
wastes or Hazardous Materials into the environment including
ambient air, surface water, ground water, or land, or otherwise
relating to the manufacture, processing, distribution use,
treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or
hazardous substances or wastes.
"ERISA" means the Employee Retirement Income Security Act
of 1974, as amended from time to time, together with all rules
and regulations promulgated with respect thereto.
"ERISA Affiliate" means each Restricted Person and all
members of a controlled group of corporations and all trades or
businesses (whether or not incorporated) under common control
that, together with such Restricted Person, are treated as a
single employer under Section 414 of the Code.
"ERISA Plan" means any employee pension benefit plan
subject to Title IV of ERISA maintained at any time by any ERISA
Affiliate with respect to which any Restricted Person has a
fixed or contingent liability.
"Event of Default" has the meaning given to such term in
Section 8.1.
"Existing Credit Agreement" means that certain Credit
Agreement, dated as of June 6, 2000, by and between Genesis
Crude Oil, L.P., as Borrower, and BNP Paribas, as Lender.
"Facility Usage" means, at the time in question, the
aggregate amount of outstanding Loans and LC Obligations at such
time.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/1000th of one
percent) equal to the weighted average of the rates on overnight
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 (i) if the
day for which such rate is to be determined is not a Business
Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if such
rate is not so published for any day, the Federal Funds Rate for
such day shall be the average rate quoted to Administrative
Agent on such day on such transactions as determined by
Administrative Agent.
"First Purchase Crude Payables" means the unpaid amount of
any payable obligation related to the purchase of Petroleum
Inventory by Borrower which Administrative Agent determines will
be secured by a statutory Lien, including but not limited to the
statutory Liens, if any, created under the laws of Texas, New
Mexico, Wyoming, Kansas, Oklahoma or any other state to the
extent such payable obligation is not at the time in question
covered by a Letter of Credit.
"Fiscal Quarter" means a three-month period ending on March
31, June 30, September 30 or December 31 of any year.
"Fiscal Year" means a twelve-month period ending on
December 31 of any year.
"Fixed Charges" means, with respect to any period, the sum
(without duplication) of the following (in each case,
eliminating all offsetting debits and credits between Genesis
Energy, L.P. and its Subsidiaries and all other items required
to be eliminated in the course of the preparation of
Consolidated financial statements of Genesis Energy, L.P. and
its Subsidiaries in accordance with GAAP): (a) all interest and
commitment fees in respect of Indebtedness of Genesis Energy,
L.P. or any of its Subsidiaries (including imputed interest on
Capital Lease Obligations) which are accrued during such period
and whether expensed in such period or capitalized; plus (b) all
fees, expenses and charges in respect of letters of credit
issued for the account of Genesis Energy, L.P. or any of its
Subsidiaries, which are accrued during such period and whether
expensed in such period or capitalized; plus (c) payments of
principal in respect of Indebtedness of Genesis Energy, L.P. or
its Subsidiaries (including the principal component of payments
under Capital Leases) paid or payable in such period (other than
payments of principal of Loans which are available to be
reborrowed hereunder).
"Floating Price Contract" has the meaning given that term
in Section 7.15.
"GAAP" means those generally accepted accounting principles
and practices which are recognized as such by the Financial
Accounting Standards Board (or any generally recognized
successor) and which, in the case of Borrower and its
Consolidated Subsidiaries, are applied for all periods after the
date hereof in a manner consistent with the manner in which such
principles and practices were applied to the Initial Financial
Statements. If any change in any accounting principle or
practice is required by the Financial Accounting Standards Board
(or any such successor) in order for such principle or practice
to continue as a generally accepted accounting principle or
practice, all reports and financial statements required
hereunder with respect to Borrower or with respect to Borrower
and its Consolidated Subsidiaries may be prepared in accordance
with such change, but all calculations and determinations to be
made hereunder may be made in accordance with such change only
after notice of such change is given to each Lender, and
Majority Lenders agree to such change insofar as it affects the
accounting of Borrower or of Borrower and its Consolidated
Subsidiaries.
"General Partner" means Genesis Energy, L.L.C., a Delaware
limited liability company.
"Genesis Energy, L.P." means Genesis Energy, L.P., a
Delaware limited partnership.
"Guarantors" means Genesis Energy, L.L.C., Genesis Energy,
L.P., Genesis Pipeline USA, L.P., and Genesis Pipeline Texas,
L.P. and any other Person who has guaranteed some or all of the
Obligations and who has been accepted by Administrative Agent as
a Guarantor or any Subsidiary of Genesis Energy, L.L.C. which
now or hereafter executes and delivers a guaranty to Collateral
Agent pursuant to Section 6.17.
"Hazardous Materials" means any substances designated,
classified, regulated or defined under any Environmental Law,
whether as pollutants, contaminants, or chemicals, or as
industrial, toxic or hazardous substances or wastes, or
otherwise.
"Hedged Eligible Inventory" means Eligible Inventory with
respect to which the price risk has been (a) hedged for delivery
within the next 190 days by either
(i) a contract on the NYMEX arranged through brokers
approved by Administrative Agent and with whom a three-
party agreement among Borrower, Collateral Agent and such
broker has been entered in form and substance satisfactory
to Collateral Agent; or
(ii) a contract for a specified price for physical
delivery of such inventory to a counterparty whose Account
would qualify as an Approved Eligible Receivable;
or (b) otherwise hedged in a manner satisfactory to Majority
Lenders. The value of Hedged Eligible Inventory shall be the
volume of the inventory times the prices fixed in such hedge,
minus all storage, transportation and other applicable costs.
"Hedging Contract" means (a) any agreement providing for
options, swaps, floors, caps, collars, forward sales or forward
purchases involving interest rates, commodities or commodity
prices, equities, currencies, bonds, or indexes based on any of
the foregoing, (b) any option, futures or forward contract
traded on an exchange, and (c) any other derivative agreement or
other similar agreement or arrangement.
"Highest Lawful Rate" means, with respect to each Lender
Party to whom Obligations are owed, the maximum nonusurious rate
of interest that such Lender Party is permitted under applicable
Law to contract for, take, charge, or receive with respect to
such Obligations. All determinations herein of the Highest
Lawful Rate, or of any interest rate determined by reference to
the Highest Lawful Rate, shall be made separately for each
Lender Party as appropriate to assure that the Loan Documents
are not construed to obligate any Person to pay interest to any
Lender Party at a rate in excess of the Highest Lawful Rate
applicable to such Lender Party.
"Indebtedness" of any Person means its Liabilities (without
duplication) in any of the following categories:
(a) Liabilities for borrowed money,
(b) Liabilities constituting an obligation to pay the
deferred purchase price of property or services,
(c) Liabilities evidenced by a bond, debenture, note
or similar instrument,
(d) Liabilities (other than reserves for taxes and
reserves for contingent obligations) which (i) would under
GAAP be shown on such Person's balance sheet as a liability
and (ii) are payable more than one year from the date of
creation or incurrence thereof,
(e) Liabilities arising under Hedging Contracts (on a
net basis to the extent netting is provided for in the
applicable Hedging Contract),
(f) Liabilities constituting principal under Capital
Leases,
(g) Liabilities arising under conditional sales or
other title retention agreements,
(h) Liabilities owing under direct or indirect
guaranties of Liabilities of any other Person or otherwise
constituting obligations to purchase or acquire or to
otherwise protect or insure a creditor against loss in
respect of Liabilities of any other Person (such as
obligations under working capital maintenance agreements,
agreements to keep-well, or agreements to purchase
Liabilities, assets, goods, securities or services), but
excluding endorsements in the ordinary course of business
of negotiable instruments in the course of collection,
(i) Liabilities consisting of an obligation to
purchase or redeem securities or other property, if such
Liabilities arises out of or in connection with the sale or
issuance of the same or similar securities or property (for
example, repurchase agreements, mandatorily redeemable
preferred stock and sale/leaseback agreements),
(j) Liabilities with respect to letters of credit or
applications or reimbursement agreements therefor,
(k) Liabilities with respect to banker's acceptances,
or
(l) Liabilities with respect to obligations to
deliver goods or services in consideration of advance
payments therefor;
provided, however, that the "Indebtedness" of any Person shall
not include Liabilities that were incurred in the ordinary
course of business by such Person on ordinary trade terms to
vendors, suppliers or other Persons providing goods and services
for use by such Person in the ordinary course of its business,
unless and until such Liabilities are outstanding more than 120
days after the date the respective goods are delivered or the
respective services are rendered, other than Liabilities
contested in good faith by appropriate proceedings, if required,
and for which adequate reserves are maintained on the books of
such Person in accordance with GAAP.
"Injection Station" means each injection station owned or
leased by any Restricted Person or any of its Subsidiaries as
set forth on Part III of Schedule 6.
"Initial Financial Statements" means (i) the audited
Consolidated financial statements of Borrower as of December 31,
2000, (ii) the unaudited balance sheet and income statement of
each Subsidiary of Borrower as of December 31, 2000, and (iii)
the unaudited balance sheet and income statement of Borrower and
each Subsidiary of Borrower as of September 30, 2001.
"Insurance Schedule" means Schedule 4 attached hereto.
"Interest Coverage Ratio" means, at any date of
determination, the ratio of (c) Consolidated EBITDA to (b)
interest payable on, and amortization of debt discount in
respect of, all Indebtedness, in each case, of or by Borrower
and its Subsidiaries for the then most recently ended
Measurement Period.
"Interest Payment Date" means (a) with respect to each Base
Rate Loan, the last day of each March, June, September and
December beginning December 31, 2001, and (b) with respect to
each LIBOR Loan, the last day of the Interest Period that is
applicable thereto.
"Interest Period" means, with respect to each particular
LIBOR Loan in a Borrowing, the period specified in the Borrowing
Notice or Continuation/Conversion Notice applicable thereto,
beginning on and including the date specified in such Borrowing
Notice or Continuation/Conversion Notice (which must be a
Business Day), and ending one, two or three months thereafter,
as Borrower may elect in such notice; provided that: (a) any
Interest Period which would otherwise end on a day which is not
a Business Day shall be extended to the next succeeding Business
Day unless such Business Day falls in another calendar month, in
which case such Interest Period shall end on the next preceding
Business Day; (b) any Interest Period which begins on the last
Business Day in 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
in a calendar month; and (c) notwithstanding the foregoing, no
Interest Period may be selected that would end after the last
day of the Commitment Period.
"Investment" means any investment made, directly or
indirectly in any Person, whether by acquisition of shares of
capital stock, indebtedness or other obligations or securities
or by loan, advance, capital contribution or otherwise and
whether made in cash, by the transfer of property or by any
other means.
"Law" means any statute, law, regulation, ordinance, rule,
treaty, judgment, code, order, decree, permit, policy or
guidance, concession, franchise, license, agreement or other
governmental restriction of the United States or any state or
political subdivision thereof or of any foreign country or any
department, state, province or other political subdivision
thereof, in each case, now or hereafter in effect and as
amended.
"LC Application" means any application for a Letter of
Credit hereafter made by Borrower to LC Issuer.
"LC Collateral" has the meaning given to such term in
Section 2.11(a).
"LC Conditions" has the meaning set forth in Section
2.7(A).
"LC Issuer" means Citicorp North America, Inc., in its
capacity as the issuer of Letters of Credit hereunder, and its
successors in such capacity. Administrative Agent may, with the
consent of Borrower and the Lender in question, appoint any
Lender hereunder as an LC Issuer in place of or in addition to
Citicorp North America, Inc.
"LC Obligations" means, at the time in question, the sum of
all Matured LC Obligations plus the maximum amounts which LC
Issuer or Citibank, if applicable, might then or thereafter be
called upon to advance under all Letters of Credit then
outstanding.
"Lender Parties" means Administrative Agent, the Collateral
Agent, LC Issuer and all Lenders.
"Lender Schedule" means Schedule 1 hereto.
"Lenders" means each signatory hereto (other than Borrower
and any other Restricted Person that is a party hereto),
including Citicorp North America, Inc., in its capacity as a
Lender hereunder rather than as Administrative Agent and
Collateral Agent and LC Issuer, and the successors and each
permitted assign of each such party as holder of a Note.
"Letter of Credit" means any letter of credit issued by LC
Issuer hereunder and each Citibank Letter of Credit.
"Letter of Credit Fee Rate" means, on any day (i) from the
date hereof through but not including the six-month anniversary
of the date hereof, 3.00% per annum, and (ii) on and after the
six-month anniversary of the date hereof, the rate per annum set
forth below based on the Applicable Leverage Level on such date.
Applicable
Leverage Level LC Fee Rate
-------------- -----------
Level I 4.5%
Level II 4.0%
Level III 3.5%
Level IV 3.0%
Level V 2.75%
Level VI 2.25%
Changes in the applicable Letter of Credit Fee Rate will occur
automatically without prior notice as changes in the Applicable
Leverage Level occur. Administrative Agent will give notice
promptly to Borrower and Lenders (and, if applicable, Citibank)
of changes in the Letter of Credit Fee Rate.
"Leverage Ratio" means the ratio of (i) Consolidated Funded
Indebtedness to (ii) Consolidated EBITDA for the Measurement
Period most recently ended prior to the date of determination
for which financial statements contemplated by Section 6.2(a) or
(b) are available, it being understood that, for the purposes of
Section 7.12, if, since the beginning of the Measurement Period
ending on the date for which Consolidated EBITDA is determined,
any Restricted Person shall have made any asset disposition or
acquisition, shall have consolidated or merged with or into any
Person (other than another Restricted Person), or shall have
made any disposition or acquisition of a Restricted Person,
Consolidated EBITDA shall be calculated giving pro forma effect
thereto as if the disposition, acquisition, consolidation or
merger had occurred on the first day of such period. Such pro
forma effect shall be determined (i) in good faith by the chief
financial officer of Borrower and (ii) without giving effect to
any anticipated or proposed change in operations, revenues,
expenses or other items included in the computation of
Consolidated EBITDA, except with the consent of Majority
Lenders.
"Liabilities" means, as to any Person, all indebtedness,
liabilities and obligations of such Person, whether matured or
unmatured, liquidated or unliquidated, primary or secondary,
direct or indirect, absolute, fixed or contingent, and whether
or not required to be considered pursuant to GAAP.
"LIBOR Lending Office" means, with respect to any Lender,
the office of such Lender specified as its "LIBOR Lending
Office" on the Lender Schedule hereto (or, if no such office is
specified, its Domestic Lending Office), or such other office of
such Lender as such Lender may from time to time specify to
Borrower and Administrative Agent.
"LIBOR Loan" means a Loan that bears interest at a rate
based upon the LIBOR Rate.
"LIBOR Rate" means, as applicable to any LIBOR Loan within
a Borrowing and with respect to the related Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to
the nearest 1/16th of 1%) as determined on the basis of offered
rates for deposits in U.S. dollars, for a period of time
comparable to such Interest Period which appears on Telerate
Page 3750 (or any successor page) as of 11:00 a.m. London time
on the day that is two Business Days preceding the first day of
such LIBOR Loan; provided, however, if the rate described above
does not appear on the Telerate system on any applicable
interest determination date, the LIBOR Rate shall be the rate
(rounded upwards as described above, if necessary) for deposits
in dollars for a period substantially equal to such Interest
Period on the Reuters Page "LIBO" (or such other page as may
replace the LIBO Page on that service for the purpose of
displaying such rates), as of 11:00 a.m. (London time), on the
date that is two Business Days prior to the beginning of such
Interest Period; provided, however, if more than one rate is
specified on Reuters Screen LIBO Page, the applicable rate shall
be the arithmetic mean of all such rates (rounded upwards, if
necessary, to the nearest 1/1000 of 1%). If both the Telerate
and Reuters system are unavailable, then the LIBOR Rate for that
date will be determined on the basis of the offered rates for
deposits in U.S. dollars for a period of time comparable to such
Interest Period which are offered by four major banks in the
London interbank market at approximately 11:00 a.m. London time,
on the day that is two (2) Business Days preceding the first day
of such LIBOR Loan as selected by Administrative Agent. The
principal London office of each of the four major London banks
will be requested to provide a quotation of its U.S. dollar
deposit offered rate. If at least two such quotations are
provided, the rate for that date will be the arithmetic mean of
the quotations. If fewer than two quotations are provided as
requested, the rate for that date will be determined on the
basis of the rates quoted for loans in U.S. dollars to leading
European banks for a period of time comparable to such Interest
Period offered by major banks in New York City at approximately
11:00 a.m. New York City time, on the day that is two Business
Days preceding the fist day of such LIBOR Loan. In the event
that Administrative Agent is unable to obtain any such quotation
as provided above, it will be deemed that the LIBOR Rate
pursuant to such LIBOR Loan cannot be determined. In the event
that the Board of Governors of the Federal Reserve System shall
impose a Reserve Percentage with respect to LIBOR deposits of
any Lender, then for any period during which such Reserve
Percentage shall apply, the LIBOR Rate shall be equal to the
amount determined above divided by an amount equal to 1 minus
the Reserve Percentage. "Reserve Percentage" means the maximum
aggregate reserve requirement (including all basic,
supplemental, marginal, special, emergency and other reserves)
which is imposed on member banks of the Federal Reserve System
against "Euro-currency Liabilities" as defined in Regulation D.
Without limiting the effect of the foregoing, the Reserve
Percentage shall reflect any other reserves required to be
maintained by such member banks with respect to (a) any category
of liabilities which includes deposits by reference to which the
LIBOR Rate is to be determined, or (b) any category of
extensions of credit or other assets which include LIBOR Loans.
The LIBOR Rate for any LIBOR Loan shall change whenever the
Reserve Percentage changes.
"LIBOR Rate Margin" means (i) from the date hereof through
but not including the six-month anniversary of the date hereof,
3.00% per annum, and (ii) on and after the six-month anniversary
of the date hereof, the percent per annum set forth below based
on the Applicable Leverage Level in effect on such date.
Applicable
Leverage Level LIBOR Rate Margin
-------------- -----------------
Level I 4.50%
Level II 4.00%
Level III 3.50%
Level IV 3.00%
Level V 2.75%
Level VI 2.25%
Changes in the applicable LIBOR Rate Margin will occur
automatically without prior notice as changes in the Applicable
Leverage Level occur. Administrative Agent will give notice
promptly to Borrower and Lenders of changes in the LIBOR Rate
Margin.
"Lien" means, with respect to any property or assets, any
right or interest therein of a creditor to secure Liabilities
owed to it or any other arrangement with such creditor which
provides for the payment of such Liabilities out of such
property or assets or which allows such creditor to have such
Liabilities satisfied out of such property or assets prior to
the general creditors of any owner thereof, including any lien,
mortgage, security interest, pledge, deposit, production
payment, rights of a vendor under any title retention or
conditional sale agreement or lease substantially equivalent
thereto, tax lien, mechanic's or materialman's lien, or any
other charge or encumbrance for security purposes, whether
arising by Law or agreement or otherwise, but excluding any
right of offset which arises without agreement in the ordinary
course of business. "Lien" also means any filed financing
statement, any registration of a pledge (such as with an issuer
of uncertificated securities), or any other arrangement or
action which would serve to perfect a Lien described in the
preceding sentence, regardless of whether such financing
statement is filed, such registration is made, or such
arrangement or action is undertaken before or after such Lien
exists.
"Loans" has the meaning given to such term in Section 2.1.
"Loan Documents" means this Agreement, the Notes, the
Security Documents, the Letters of Credit, the LC Applications,
and all other agreements, certificates, documents, instruments
and writings at any time delivered in connection herewith or
therewith (exclusive of term sheets and commitment letters).
"Maintenance Capital Expenditures" means, for any period,
all amounts properly classified as capital expenditures under
GAAP for maintenance of or repair or replacement of existing
assets during such period or that are incurred to maintain
existing operations.
"Majority Lenders" means Lenders whose aggregate Percentage
Shares equal or exceed sixty-six and two-thirds percent (66
2/3%).
"Market Price" means on each day a spot price for the
inventory of Petroleum Inventory being valued, determined by
published prices and methodology approved by Administrative
Agent from time to time, based on an index gravity and grade of
Petroleum Inventory at a delivery point reflecting as nearly as
practical the actual gravity, grade, and location of the
Petroleum Inventory being valued, adjusted to reflect any
differences in gravity and grade between the index Petroleum
Inventory and the actual inventory and to reflect transportation
costs or other appropriate location price differential from the
actual location to the index location.
"Material Adverse Change" means a material and adverse
change in the business, condition (financial or otherwise),
operations, performance, properties or prospects, from the state
of affairs presented in the Initial Financial Statements or as
represented or warranted in any Loan Document, to (a) Genesis
Energy, L.P., (b) Genesis Energy, L.P. and its Subsidiaries,
considered as a whole, (c) Borrower's ability to timely pay the
Obligations, or (d) the enforceability of the material terms of
any Loan Document. Notwithstanding anything to the contrary
contained herein, neither (i) the non-receipt by Borrower of the
Enron Payment, (ii) the elimination by Borrower of its commodity
trading operation nor (iii) any other matter disclosed in item
5.6 of the Disclosure Schedule shall be considered a Material
Adverse Change.
"Material Market Open Position Loss" means a cumulative
amount of net losses resulting from Open Positions (other than
Open Positions permitted under Section 7.15) of all Restricted
Persons on a ▇▇▇▇ to market basis during any period of 12
consecutive months in excess of $250,000.
"Matured LC Obligations" means all amounts paid by LC
Issuer or Citibank, as applicable on drafts or demands for
payment drawn or made under any Letter of Credit and all other
amounts due and owing to LC Issuer or Citibank, as applicable
under any LC Application for any Letter of Credit, to the extent
the same have not been repaid to LC Issuer (with the proceeds of
Loans or otherwise) or cash collateralized pursuant to Section
2.7(B)(iii).
"Maximum Drawing Amount" means at the time in question the
sum of the maximum amounts which LC Issuer might then or
thereafter be called upon to advance under all Letters of Credit
then outstanding.
"Measurement Period" means, at any date of determination,
the most recently completed four consecutive Fiscal Quarters of
Borrower ending on or prior to such; provided that, (a) for
purposes of a determination on March 31, 2002, Measurement
Period shall mean the Fiscal Quarter most recently ended
multiplied by four; (b) for purposes of a determination on June
30, 2002, Measurement Period shall mean the two fiscal quarters
most recently ended multiplied by two; and (c) for purposes of a
determination on September 30, 2002, Measurement Period shall
mean the three fiscal quarters most recently ended multiplied by
4/3.
"Maximum Facility Amount" means the amount of $150,000,000,
as such amount may be reduced from time to time as provided in
Section 2.6 or Section 2.12.
"Maximum Loan Amount" means $45,000,000.
"Moody's" means ▇▇▇▇▇'▇ Investor Service, Inc., or its
successor.
"Net Cash Proceeds" means, with respect to any sale, lease,
transfer or other disposition of any asset or the incurrence or
issuance of any Indebtedness or the sale or issuance of any
equity interests (including, without limitation, any capital
contribution) by any Person, or any extraordinary receipt
received by or paid to or for the account of any Person, the
aggregate amount of cash received from time to time (whether as
initial consideration or through payment or disposition of
deferred consideration) by or on behalf of such Person in
connection with such transaction after deducting therefrom only
(without duplication) (a) reasonable and customary brokerage
commissions, underwriting fees and discounts, legal fees,
finder's fees and other similar fees and commissions, (b) the
amount of taxes payable in connection with or as a result of
such transaction and (c) the amount of any Indebtedness secured
by a Lien on such asset that, by the terms of the agreement or
instrument governing such Indebtedness, is required to be repaid
upon such disposition, in each case to the extent, but only to
the extent, that the amounts so deducted are, at the time of
receipt of such cash, actually paid or payable to a Person that
is not an Affiliate of such Person or any Restricted Person or
any Affiliate of any Restricted Person and are properly
attributable to such transaction or to the asset that is the
subject thereof; provided, however, that in the case of taxes
that are deductible under clause (b) above but for the fact
that, at the time of receipt of such cash, such taxes have not
been actually paid or are not then payable, such Restricted
Person or such Subsidiary may deduct an amount (the "Reserved
Amount") equal to the amount reserved in accordance with GAAP
for such Restricted Person's or such Subsidiary's reasonable
estimate of such taxes, other than taxes for which such
Restricted Person or such Subsidiary is indemnified, provided
further, however, that, at the time such taxes are paid, an
amount equal to the amount, if any, by which the Reserved Amount
for such taxes exceeds the amount of such taxes actually paid
shall constitute "Net Cash Proceeds" of the type for which such
taxes were reserved for all purposes hereunder.
"Note" has the meaning given to such term in Section 2.1.
"NYMEX" means the New York Mercantile Exchange.
"Obligations" means all Liabilities from time to time owing
by any Restricted Person to any Lender Party under or pursuant
to any of the Loan Documents, including all LC Obligations.
"Obligation" means any part of the Obligations.
"Offsetting Position" means any offsetting sale or purchase
agreement, an offsetting NYMEX contract, an offsetting physical
inventory position (excluding tank bottoms and pipeline linefill
inventory classified as a long term asset and working inventory
not held for resale), or an offsetting swap, collar or option
contract, in each case eliminating price risk and substantially
all basis risk.
"Open Position" means (i) any physical Petroleum Inventory
or (ii) any purchase or sale contract for Petroleum Inventory
that does not have an Offsetting Position.
"Other Eligible Inventory Value" means the following amount
of Eligible Inventory, other than Hedged Eligible Inventory:
(a) if the WTI Price is less than or equal to $30 per barrel,
80% of the product of the volume of such crude oil times the
Market Price, or (b) if the WTI Price is greater than $30 per
barrel the greater of (i) 70% of the product of the volume of
such crude oil times the Market Price or (ii) 80% of the product
of the volume of such crude oil times $30 per barrel; minus, in
each case, all storage, transportation and other applicable
costs. As used herein "WTI Price" means on each day the ▇▇▇▇▇'▇
Average Spot Price for West Texas intermediate crude oil
(Cushing, Oklahoma).
"Other Eligible Receivable" means any Eligible Receivable
which is not an Approved Eligible Receivable nor an Eligible
Exchange Balance. The portions of the aggregate of the Other
Eligible Receivables owed by any obligor and its Affiliates
exceeding ten percent (10%) of the sum of (i) Approved Eligible
Receivables plus (ii) Other Eligible Receivables, shall not be
included without the prior written approval of the Majority
Lenders.
"Other Priority Claims" means any account payable,
obligation or liability which Administrative Agent has
determined has or will have a Lien upon or claim against any
Cash Equivalent, account or inventory of Borrower senior or
equal in priority to the security interests in favor of
Collateral Agent for the benefit of Lenders, in each case to the
extent such Cash Equivalent, account or inventory of Borrower is
otherwise included in the determination of the Borrowing Base
and the included portion thereof has not already been reduced by
such Lien or claim.
"Over-Advance Base Rate Margin" (i) from the date hereof
through but not including the six-month anniversary of the date
hereof 1.25 % per annum, and (ii) on and after the six-month
anniversary of the date hereof, the percent per annum set forth
below based on the Applicable Leverage Level in effect on such
date.
Applicable
Leverage Level Over-Advance Base Rate Margin
-------------- -----------------------------
Level I 2.00%
Level II 1.75%
Level III 1.50%
Level IV 1.25%
Level V 1.00%
Level VI 0.75%
Changes in the applicable Over-Advance Base Rate Margin will
occur automatically without prior notice as changes in the
Applicable Leverage Level occur. Administrative Agent will give
notice promptly to Borrower and Lenders of changes in the Over-
Advance Base Rate Margin.
"Over-Advance Commitment Fee Rate" (i) from the date hereof
through but not including the six-month anniversary of the date
hereof, 1.250% per annum, and (ii) on and after the six-month
anniversary of the date hereof, the percent per annum set forth
below based on the Applicable Leverage Level in effect on such
date.
Applicable Over-Advance
Leverage Level Commitment Fee Rate
------------------------------- -------------------
Level I 1.500%
Level II, Level III or Level IV 1.250%
Level V or Level VI 1.125%
Changes in the applicable Over-Advance Commitment Fee Rate will
occur automatically without prior notice as changes in the
Applicable Leverage Level occur. Administrative Agent will give
notice promptly to Borrower and Lenders of changes in the Over-
Advance Commitment Fee Rate.
"Over-Advance Facility" means $30,000,000, as such amount
may be reduced pursuant to clause (c) or (d) of Section 2.6.
"Over-Advance LIBOR Rate Margin" (i) from the date hereof
through but not including the six-month anniversary of the date
hereof, 3.75% per annum, and (ii) on and after the six-month
anniversary of the date hereof, the percent per annum set forth
below based on the Applicable Leverage Level in effect on such
date.
Applicable
Leverage Level Over-Advance LIBOR Rate Margin
-------------- ------------------------------
Level I 5.25%
Level II 4.75%
Level III 4.25%
Level IV 3.75%
Level V 3.50%
Level VI 3.00%
Changes in the applicable Over-Advance LIBOR Rate Margin will
occur automatically without prior notice as changes in the
Applicable Leverage Level occur. Administrative Agent will give
notice promptly to Borrower and Lenders of changes in the Over-
Advance LIBOR Rate Margin.
"Over-Advance Loans" has the meaning set forth in Section
2.1.
"Paid but Unexpired Letters of Credit" means, on any day,
the maximum drawing amount of Letters of Credit on such day
where no underlying obligation exists on such day, or if the
amount of the Letter of Credit exceeds the underlying obligation
on such day, the amount of such excess. As used herein,
"underlying obligation" includes without limitation, all
existing and future obligations to the beneficiary of such
Letter of Credit in respect of Petroleum Inventory purchased or
received on or prior to such day or in respect of Petroleum
Inventory Borrower is then obligated to purchase or receive or
has then nominated to purchase or receive.
"Percentage Share" means, with respect to any Lender (a)
when used in Sections 2.1, 2.2 or 2.12, in any Borrowing Notice
or when no Loans are outstanding hereunder, the percentage set
forth opposite such Lender's name on the Lender Schedule hereto,
and (b) when used otherwise, the percentage obtained by dividing
(i) the sum of the unpaid principal balance of such Lender's
Loans at the time in question plus the Matured LC Obligations
which such Lender has funded pursuant to Section 2.9(c) plus the
portion of the Maximum Drawing Amount which such Lender might be
obligated to fund under Section 2.9(c), by (ii) the sum of the
aggregate unpaid principal balance of all Loans at such time
plus the aggregate amount of LC Obligations outstanding at such
time.
"Permitted Inventory Liens" means any Lien, and the amount
of any Liability secured thereby, on Petroleum Inventory which
would be a Permitted Lien under Section 7.2(ii)(b) (so long as
such Lien is inchoate) or Section 7.2(ii)(d).
"Permitted Investments" means:
(a) Cash Equivalents,
(b) Investments described in the Disclosure Schedule,
or
(c) Investments by General Partner or any of its
Subsidiaries in Borrower or any Wholly Owned Subsidiary of
General Partner which is a Guarantor.
"Permitted Lien" has the meaning given to such term in
Section 7.2.
"Person" means an individual, corporation, partnership,
limited liability company, association, joint stock company,
trust or trustee thereof, estate or executor thereof,
unincorporated organization or joint venture, Tribunal, or any
other legally recognizable entity.
"Petroleum Inventory" means crude oil, condensate, natural
gas liquids (N.L.'s), liquefied petroleum gases (LPG's) or any
blend thereof.
"Pipeline Release" means the spill of crude oil from the
Genesis Pipeline U.S.A., L.P. Mississippi System on December 20,
1999.
"Qualified Inventory Purchases" means purchases of
Petroleum Inventory (other than to comply with linefill
obligations) which is Hedged Eligible Inventory and which does
not exceed the limitation of Section 7.15(a)(i).
"Rating Agency" means either S&P or Moody's.
"Regulation D" means Regulation D of the Board of Governors
of the Federal Reserve System as from time to time in effect.
"Reimbursable Taxes" has the meaning set forth in Section
3.7(a).
"Restricted Person" means any of Genesis Energy, L.L.C. and
each Subsidiary of Genesis Energy, L.L.C., including but not
limited to Genesis Energy, L.P., Borrower and each Subsidiary of
Borrower.
"S&P" means Standard & Poor's Ratings Services (a division
of McGraw Hill, Inc.) or its successor.
"Salomon" means ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Holdings Inc.
"Salomon Facility" means the Master Credit Support
Agreement dated as of December 3, 1996 among Borrower, ▇▇▇▇▇▇▇
▇▇▇▇▇ Barney Holdings Inc. (f/k/a Salomon Inc.) and Basis
Petroleum, Inc., as amended from time to time prior to the date
hereof.
"Salomon Guaranty Exposure" means the maximum amount which
might then or thereafter be called upon to be paid under all
guaranties issued pursuant to the Salomon Facility then
outstanding plus all amounts paid under guaranties issued under
the Salomon Facility, to the extent the same have not been
repaid pursuant to the Salomon Facility.
"▇▇▇▇▇▇▇ ▇▇▇▇" means, collectively, all Liens placed on
property or assets of any Restricted Person arising under the
Salomon Facility as in effect on the date hereof.
"Salomon Obligations" means the obligations of any of the
Restricted Persons in respect of guaranties issued pursuant to
the Salomon Facility.
"Security Documents" means the instruments listed in the
Security Schedule and all other security agreements, deeds of
trust, mortgages, chattel mortgages, pledges, guaranties,
financing statements, continuation statements, extension
agreements and other agreements or instruments now, heretofore,
or hereafter delivered by any Restricted Person to Collateral
Agent in connection with this Agreement or any transaction
contemplated hereby to secure or guarantee the payment of any
part of the Obligations or the performance of any Restricted
Person's other duties and obligations under the Loan Documents.
"Security Schedule" means Schedule 3 hereto.
"Solvent" and "Solvency" mean, with respect to any Person
on a particular date, that on such date (a) the fair value of
the property of such Person is greater than the total amount of
liabilities, including, without limitation, contingent
liabilities, of such Person, (b) the present fair salable value
of the assets of such Person is not less than the amount that
will be required to pay the probable liability of such Person on
its debts as they become absolute and matured, (c) such Person
does not intend to, and does not believe that it will, incur
debts or liabilities beyond such Person's ability to pay such
debts and liabilities as they mature and (d) such Person is not
engaged in business or a transaction, and is not about to engage
in business or a transaction, for which such Person's property
would constitute an unreasonably small capital. The amount of
contingent liabilities at any time shall be computed as the
amount that, in the light of all the facts and circumstances
existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.
"Subsidiary" means, with respect to any Person, any
corporation, association, partnership, limited liability
company, joint venture, or other business or corporate entity,
enterprise or organization which is directly or indirectly
(through one or more intermediaries) controlled or owned more
than fifty percent by such Person, it being understood that for
all purposes of this Agreement and the other Loan Documents, (i)
Borrower is a Subsidiary of Genesis Energy, L.P. and General
Partner and (ii) Genesis Energy, L.P. is a Subsidiary of General
Partner.
"Termination Event" means (a) the occurrence with respect
to any ERISA Plan of (i) a reportable event described in
Sections 4043(c)(5) or (6) of ERISA or (ii) any other reportable
event described in Section 4043(c) of ERISA other than a
reportable event not subject to the provision for 30-day notice
to the Pension Benefit Guaranty Corporation pursuant to a waiver
by such corporation under Section 4043(a) of ERISA, or (b) the
withdrawal of any ERISA Affiliate from an ERISA Plan during a
plan year in which it was a "substantial employer" as defined in
Section 4001(a)(2) of ERISA, or (c) the cessation of operations
at a facility of any ERISA Affiliate in the circumstances
described in Section 4062(e) of ERISA, or (d) the imposition of
a lien under Section 302(f) of ERISA with respect to any ERISA
Plan, or (e) the adoption of an amendment to an ERISA Plan
requiring the provision of security to such plan pursuant to
Section 307 of ERISA, or (f) the filing of a notice of intent to
terminate any ERISA Plan or the treatment of any ERISA Plan
amendment as a termination under Section 4041 of ERISA, or (g)
the institution of proceedings to terminate any ERISA Plan by
the Pension Benefit Guaranty Corporation under Section 4042 of
ERISA, or (h) any other event or condition which might
constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer,
any ERISA Plan.
"Tribunal" means any government, any arbitration panel, any
court or any governmental department, commission, board, bureau,
agency or instrumentality of the United States of America or any
state, province, commonwealth, nation, territory, possession,
county, parish, town, township, village or municipality, whether
now or hereafter constituted or existing.
"Type" means, with respect to any Loans, the
characterization of such Loans as either Base Rate Loans or
LIBOR Loans.
"UCC" means the Uniform Commercial Code as in effect in the
State of New York.
"Wholly Owned Subsidiary" means any Subsidiary of a Person,
all of the issued and outstanding stock, limited liability
company membership interests, or partnership interests of which
(including all rights or options to acquire such stock or
interests) are directly or indirectly (through one or more
Subsidiaries) owned by such Person, excluding any general
partner interests owned, directly or indirectly, by General
Partner in any such Subsidiary that is a partnership, in each
case such general partner interests not to exceed three percent
(3%) of the aggregate ownership interests of any such
partnership and directors' qualifying shares if applicable.
Section 1.2. Exhibits and Schedules; Additional
Definitions. All Exhibits and Schedules attached to this
Agreement are a part hereof for all purposes. Reference is
hereby made to the Security Schedule for the meaning of certain
terms defined therein and used but not defined herein, which
definitions are incorporated herein by reference.
Section 1.3. Amendment of Defined Instruments. Unless the
context otherwise requires or unless otherwise provided herein
the terms defined in this Agreement which refer to a particular
agreement, instrument or document also refer to and include all
renewals, extensions, modifications, amendments and restatements
of such agreement, instrument or document, provided that nothing
contained in this section shall be construed to authorize any
such renewal, extension, modification, amendment or restatement.
Section 1.4. References and Titles. All references in
this Agreement to Exhibits, Schedules, articles, sections,
subsections and other subdivisions refer to the Exhibits,
Schedules, articles, sections, subsections and other
subdivisions of this Agreement unless expressly provided
otherwise. Exhibits and Schedules to any Loan Document shall be
deemed incorporated by reference in such Loan Document.
References to any document, instrument, or agreement (a) shall
include all exhibits, schedules, and other attachments thereto,
and (b) shall include all documents, instruments, or agreements
issued or executed in replacement thereof. Titles appearing at
the beginning of any subdivisions are for convenience only and
do not constitute any part of such subdivisions and shall be
disregarded in construing the language contained in such
subdivisions. The words "this Agreement," "this instrument,"
"herein," "hereof," "hereby," "hereunder" and words of similar
import refer to this Agreement as a whole and not to any
particular subdivision unless expressly so limited. The phrases
"this section" and "this subsection" and similar phrases refer
only to the sections or subsections hereof in which such phrases
occur. The word "or" is not exclusive, and the word "including"
(in its various forms) means "including without limitation."
Pronouns in masculine, feminine and neuter genders shall be
construed to include any other gender, and words in the singular
form shall be construed to include the plural and vice versa,
unless the context otherwise requires. Accounting terms have
the meanings assigned to them by GAAP, as applied the accounting
entity to which they refer. References to "days" shall mean
calendar days, unless the term "Business Day" is used. Unless
otherwise specified, references herein to any particular Person
also refer to its successors and permitted assigns.
Section 1.5. Calculations and Determinations. All
calculations under the Loan Documents of interest and of fees
shall be made on the basis of actual days elapsed (including the
first day but excluding the last) and a year of 360 days. Each
determination by a Lender Party of amounts to be paid under
Article III or any other matters which are to be determined
hereunder by a Lender Party (such as any LIBOR Rate, Business
Day, Interest Period, or Reserve Percentage) shall, in the
absence of manifest error, be conclusive and binding. Unless
otherwise expressly provided herein or unless Majority Lenders
otherwise consent all financial statements and reports furnished
to any Lender Party hereunder shall be prepared and all
financial computations and determinations pursuant hereto shall
be made in accordance with GAAP.
Section 1.6. Joint Preparation; Construction of
Indemnities and Releases. This Agreement and the other Loan
Documents have been reviewed and negotiated by sophisticated
parties with access to legal counsel and no rule of construction
shall apply hereto or thereto which would require or allow any
Loan Document to be construed against any party because of its
role in drafting such Loan Document. All indemnification and
release provisions of this Agreement shall be construed broadly
(and not narrowly) in favor of the Persons receiving
indemnification or being released.
ARTICLE II - The Loans and Letters of Credit
Section 2.1. Commitments to Lend; Notes. Subject to the
terms and conditions hereof, each Lender severally agrees to
make loans to Borrower (herein called such Lender's "Loans")
upon Borrower's request from time to time during the Commitment
Period, including, without limitation, Citibank LC Loans made
pursuant to and subject to Section 2.7(B), provided that (a)
subject to Sections 3.3, 3.4 and 3.6, all Lenders are requested
to make Loans of the same Type in accordance with their
respective Percentage Shares and as part of the same Borrowing,
(b) after giving effect to such Loans, other than the Citibank
LC Loan, the aggregate principal amount of outstanding Loans
will not exceed the Maximum Loan Amount, and (c) after giving
effect to such Loans, the Facility Usage does not exceed the
lesser of (i) the Maximum Facility Amount and (ii) the Borrowing
Base determined as of the date on which the requested Loans are
to be made, provided further that, at all times prior to the
termination of the Salomon Facility and all Salomon Guaranty
Exposure and the payment in full of all Salomon Obligations,
after giving effect to such Loans, the Facility Usage plus the
Salomon Guaranty Exposure does not exceed the sum of (A) the
Borrowing Base determined as of the date on which the requested
Loans are to be made and (B) the Over-Advance Facility on such
date. Notwithstanding anything to the contrary contained in
this Section 2.1 or elsewhere in this Agreement, so long as no
Default has occurred and is continuing, Borrower shall have the
ability to request Loans (and each Lender hereby agrees to make
such Loans in accordance with its Percentage Share and as part
of the same Borrowing) in an amount such that, after giving
effect to such Loans, the Facility Usage shall exceed the
Borrowing Base (determined as of the date on which the requested
Loans are to be made) by an aggregate principal amount of up to
the Over-Advance Facility (such outstanding Loans in excess of
the Borrowing Base, the "Over-Advance Loans"); provided that at
no time shall the Facility Usage exceed the Maximum Facility
Amount. The aggregate amount of all Loans in any Borrowing must
be equal to $100,000 or any higher integral multiple of
$100,000. Borrower may have no more than five Borrowings of
LIBOR Loans outstanding at any time. The obligation of Borrower
to repay to each Lender the aggregate amount of all Loans made
by such Lender, other than the Citibank LC Loan, together with
interest accruing in connection therewith, shall be evidenced by
a single promissory note (herein called such Lender's "Note")
made by Borrower payable to the order of such Lender in the form
of Exhibit A with appropriate insertions. The amount of
principal owing on any Lender's Note at any given time shall be
the aggregate amount of all Loans theretofore made by such
Lender minus all payments of principal theretofore received by
such Lender on such Note. Interest on each Note shall accrue
and be due and payable as provided herein and therein. Each
Note shall be due and payable as provided herein and therein,
and shall be due and payable in full on the last day of the
Commitment Period. Subject to the terms and conditions of this
Agreement, Borrower may borrow, repay, and reborrow hereunder.
The Citibank LC Loan shall bear interest at the Citibank LC Loan
Rate and shall be immediately payable upon the making of any
draft or demand for payment by the beneficiary of the Citibank
Letter of Credit.
Section 2.2. Requests for New Loans. Borrower must give
to Administrative Agent written notice (or telephonic notice
promptly confirmed in writing) of any requested Borrowing of
Loans (other than Citibank LC Loans) to be funded by Lenders.
Each such notice constitutes a "Borrowing Notice" hereunder and
must:
(a) specify (i) the aggregate amount of any such
Borrowing of Base Rate Loans and the date on which such
Base Rate Loans are to be advanced, or (ii) the aggregate
amount of any such Borrowing of LIBOR Loans, the date on
which such LIBOR Loans are to be advanced (which shall be
the first day of the Interest Period which is to apply
thereto), and the length of the applicable Interest Period;
and
(b) be received by Administrative Agent not later
than 11:00 a.m., New York City time, on (i) the day on
which any such Base Rate Loans are to be made, or (ii) the
third Business Day preceding the day on which any such
LIBOR Loans are to be made.
Each such written request or confirmation must be made in the
form and substance of the "Borrowing Notice" attached hereto as
Exhibit B, duly completed. Each such telephonic request shall
be deemed a representation, warranty, acknowledgment and
agreement by Borrower as to the matters which are required to be
set out in such written confirmation. Upon receipt of any such
Borrowing Notice, Administrative Agent shall give each Lender
prompt notice of the terms thereof. If all conditions precedent
to such new Loans have been met, each Lender will on the date
requested promptly remit to Administrative Agent at
Administrative Agent's office in New York City the amount of
such Lender's Loan in immediately available funds, and upon
receipt of such funds, unless to its actual knowledge any
conditions precedent to such Loans have been neither met nor
waived as provided herein, Administrative Agent shall promptly
make such Loans available to Borrower. Unless Administrative
Agent shall have received prompt notice from a Lender that such
Lender will not make available to Administrative Agent such
Lender's new Loan, Administrative Agent may in its discretion
assume that such Lender has made such Loan available to
Administrative Agent in accordance with this section and
Administrative Agent may if it chooses, in reliance upon such
assumption, make such Loan available to Borrower. If and to the
extent such Lender shall not so make its new Loan available to
Administrative Agent, such Lender and Borrower severally agree
to pay or repay to Administrative Agent within three days after
demand therefor the amount of such Loan together with interest
thereon, for each day from the date such amount was made
available to Borrower until the date such amount is paid or
repaid to Administrative Agent, with interest at (i) the Federal
Funds Rate, if such Lender is making such payment and (ii) the
interest rate applicable at the time to the other new Loans made
on such date, if Borrower is making such repayment. If neither
such Lender nor Borrower pays or repays to Administrative Agent
such amount within such three-day period, Administrative Agent
shall be entitled to recover from Borrower, on demand, in lieu
of the interest provided for in the preceding sentence, interest
thereon at the Default Rate, calculated from the date such
amount was made available to Borrower. The failure of any
Lender to make any new Loan to be made by it hereunder shall not
relieve any other Lender of its obligation hereunder, if any, to
make its new Loan, but no Lender shall be responsible for the
failure of any other Lender to make any new Loan to be made by
such other Lender.
Section 2.3. Continuations and Conversions of Existing
Loans. Borrower may make the following elections with respect
to Loans already outstanding: (i) to Convert, in whole or in
part, Base Rate Loans to LIBOR Loans, (ii) to Convert, in whole
or in part, LIBOR Loans to Base Rate Loans on the last day of
the Interest Period applicable thereto and (iii) to Continue, in
whole or in part, LIBOR Loans beyond the expiration of such
Interest Period by designating a new Interest Period to take
effect at the time of such expiration. In making such
elections, Borrower may combine existing Loans made pursuant to
separate Borrowings into one new Borrowing or divide existing
Loans made pursuant to one Borrowing into separate new
Borrowings, provided that Borrower may have no more than five
Borrowings of LIBOR Loans outstanding at any time. To make any
such election, Borrower must give to Administrative Agent
written notice (or telephonic notice promptly confirmed in
writing) of any such Conversion or Continuation of existing
Loans, with a separate notice given for each new Borrowing.
Each such notice constitutes a "Continuation/Conversion Notice"
hereunder and must:
(a) specify the existing Loans which are to be
Continued or Converted;
(b) specify (i) the aggregate amount of any Borrowing
of Base Rate Loans into which such existing Loans are to be
Continued or Converted and the date on which such
Continuation or Conversion is to occur, or (ii) the
aggregate amount of any Borrowing of LIBOR Loans into which
such existing Loans are to be Continued or Converted, the
date on which such Continuation or Conversion is to occur
(which shall be the first day of the Interest Period which
is to apply to such LIBOR Loans), and the length of the
applicable Interest Period; and
(c) be received by Administrative Agent not later
than 11:00 a.m., New York City time, on (i) the day on
which any such Continuation or Conversion to Base Rate
Loans is to occur, or (ii) the third Business Day preceding
the day on which any such Continuation or Conversion to
LIBOR Loans is to occur.
Each such written request or confirmation must be made in the
form and substance of the Continuation/Conversion Notice
attached hereto as Exhibit C, duly completed. Each such
telephonic request shall be deemed a representation, warranty,
acknowledgment and agreement by Borrower as to the matters which
are required to be set out in such written confirmation. Upon
receipt of any such Continuation/Conversion Notice,
Administrative Agent shall give each Lender prompt notice of the
terms thereof. Each Continuation/Conversion Notice shall be
irrevocable and binding on Borrower. During the continuance of
any Default, Borrower may not make any election to Convert
existing Loans into LIBOR Loans or Continue existing Loans as
LIBOR Loans beyond the expiration of their respective and
corresponding Interest Period then in effect. If (due to the
existence of a Default or for any other reason) Borrower fails
to timely and properly give any Continuation/Conversion Notice
with respect to a Borrowing of existing LIBOR Loans at least
three days prior to the end of the Interest Period applicable
thereto, such LIBOR Loans, to the extent not prepaid at the end
of such Interest Period, shall automatically be Converted into
Base Rate Loans at the end of such Interest Period. No new
funds shall be repaid by Borrower or advanced by any Lender in
connection with any Continuation or Conversion of existing Loans
pursuant to this section, and no such Continuation or Conversion
shall be deemed to be a new advance of funds for any purpose;
such Continuations and Conversions merely constitute a change in
the interest rate applicable to already outstanding Loans.
Section 2.4. Use of Proceeds. Borrower shall use the
proceeds of all Loans to repay loans outstanding under the
Existing Credit Agreement, to make Qualified Inventory
Purchases, and for working capital purposes. Borrower shall use
all Letters of Credit solely for the purposes specified in
Section 2.7(A)(iv). In no event shall any Loan or any Letter of
Credit be used (i) to fund distributions by Genesis Energy,
L.P., (ii) directly or indirectly by any Person for personal,
family, household or agricultural purposes, (iii) for the
purpose, whether immediate, incidental or ultimate, of
purchasing, acquiring or carrying any "margin stock" (as such
term is defined in Regulation U promulgated by the Board of
Governors of the Federal Reserve System) or (iv) to extend
credit to others directly or indirectly for the purpose of
purchasing or carrying any such margin stock. Borrower
represents and warrants that Borrower is not engaged
principally, or as one of Borrower's important activities, in
the business of extending credit to others for the purpose of
purchasing or carrying such margin stock.
Section 2.5. Optional Prepayments of Loans. Borrower may,
upon three Business Days' notice to Administrative Agent (and
Administrative Agent will promptly give notice to the other
Lenders), from time to time and without premium or penalty
prepay the Loans, in whole or in part, so long as the aggregate
amounts of all partial prepayments of principal on the Loans
equals $100,000 or any higher integral multiple of $100,000.
Each prepayment of principal under this section shall be
accompanied by all interest then accrued and unpaid on the
principal so prepaid. Any principal or interest prepaid
pursuant to this section shall be in addition to, and not in
lieu of, all payments otherwise required to be paid under the
Loan Documents at the time of such prepayment.
Section 2.6. Mandatory Prepayments. (a) If at any time
the Facility Usage exceeds the sum of the Borrowing Base
(whether due to a reduction in the Borrowing Base in accordance
with this Agreement, or otherwise) and the Over-Advance
Facility, Borrower shall within one Business Day following
demand therefor by the Administrative Agent prepay the principal
of the Loans in an amount at least equal to such excess.
(b) If at any time prior to the termination of the
Salomon Facility and all Salomon Guaranty Exposure and the
payment in full of all Salomon Obligations, the Facility Usage
plus the Salomon Guaranty Exposure exceeds the sum of the
Borrowing Base (whether due to a reduction in the Borrowing Base
in accordance with this Agreement, or otherwise) and the Over-
Advance Facility, Borrower shall within one Business Day notify
the Administrative Agent and prepay the principal of the Loans
in an amount at least equal to such excess.
(c) On the date of receipt of the Net Cash Proceeds by
Borrower or any of its Subsidiaries from the sale, lease,
transfer or other disposition of any assets of Borrower or any
of its Subsidiaries (other than any sale, lease, transfer or
other disposition of assets pursuant to clause (a), (b) or (c)
of Section 7.5), (i) Borrower shall prepay an aggregate
principal amount of Over-Advance Loans and, after all Over-
Advance Loans have been repaid in full, other Loans in an amount
equal to the amount of such Net Cash Proceeds; and (ii) each of
the Over-Advance Facility, the Maximum Loan Amount and the
Maximum Facility Amount shall be permanently reduced by an
amount equal to the amount of such Net Cash Proceeds; provided
that at no time shall the Maximum Loan Amount be reduced to less
than $15,000,000.
(d) On the date of receipt of the Enron Payment by
Borrower or any of its Subsidiaries, (i) Borrower shall prepay
an aggregate principal amount of Over-Advance Loans and, after
all Over-Advance Loans have been repaid in full, other Loans in
an amount equal to the amount of such Enron Payment received by
Borrower or such Subsidiary; and (ii) each of the Over-Advance
Facility, the Maximum Loan Amount and the Maximum Facility
Amount shall be permanently reduced by an amount equal to the
amount of such Enron Payment received by Borrower or such
Subsidiary; provided that at no time shall the Maximum Loan
Amount be reduced to less than $15,000,000.
Section 2.7. Letters of Credit. (A) Subject to the terms
and conditions hereof, Borrower may request LC Issuer to issue,
amend, or extend the expiration date of, one or more Letters of
Credit, provided that:
(i) after taking such Letter of Credit into account,
the Facility Usage does not exceed the lesser of (i) the
Maximum Facility Amount at such time or (ii) the sum of the
Borrowing Base and the Over-Advance Facility at such time,
and, at all times prior to the termination of the Salomon
Facility and all Salomon Guaranty Exposure and the payment
in full of all Salomon Obligations, after taking such
Letter of Credit into account, the Facility Usage plus the
Salomon Guaranty Exposure does not exceed the sum of the
Borrowing Base and the Over-Advance Facility at such time;
(ii) the expiration date of such Letter of Credit is
prior to the earlier of (i) (A) 210 days after date of
issuance with respect to Letters of Credits which, in the
aggregate, do not result in outstanding LC Obligations at
any one time in excess of $3,000,000, or (B) 70 days after
date of issuance with respect to all other Letters of
Credit, and (ii) the end of the Commitment Period;
(iii) the issuance of such Letter of Credit will
be in compliance with all applicable governmental
restrictions, policies, and guidelines and will not subject
LC Issuer to any cost which is not reimbursable under
Article III;
(iv) such Letter of Credit is related to the purchase
or exchange by Borrower of Petroleum Inventory and is in
the Form of Exhibit D hereto or such other form and terms
as shall be acceptable to LC Issuer in its sole and
absolute discretion and Currently Approved by Majority
Lenders; and
(v) all other conditions in this Agreement to the
issuance of such Letter of Credit have been satisfied.
LC Issuer will honor any such request if the foregoing
conditions (i) through (v) (the "LC Conditions") have been met
as of the date of issuance, amendment or extension of such
Letter of Credit.
(B) Subject to the terms and conditions hereof,
Borrower may request LC Issuer to cause Citibank to issue,
amend, or extend the expiration date of, one or more Letters of
Credit which are Citibank Letters of Credit which shall bear the
same pricing terms as the Letter of Credit, provided that (i)
the LC Conditions have been met as of the date of issuance,
amendment or extension of such Citibank Letter of Credit; (ii)
upon the issuance of each Citibank Letter of Credit, Borrower
shall be deemed to have requested a Loan pursuant to Section 2.2
(each such Loan, a "Citibank LC Loan") in an aggregate principal
amount equal to the face amount of such Citibank Letter of
Credit, and each Lender irrevocably agrees to make available to
LC Issuer its Percentage Share of each such Citibank LC Loan;
(iii) the proceeds of each Citibank LC Loan shall be promptly
deposited by LC Issuer into the Citibank LC Collateral Account
and held as collateral security for LC Obligations relating to
the applicable Citibank Letter of Credit; (iv) for the purposes
of the first sentence of Section 2.1, the amount of such
Citibank LC Loan shall be considered (except that no amount of
Citibank LC Loans shall be included in the definition of
"Maximum Loan Amount"), but the amount of the face value of such
Citibank Letter of Credit shall not be considered; and (v) all
amounts deposited into the Citibank LC Collateral Account shall
be applied as described in Section 2.11(d).
Section 2.8. Requesting Letters of Credit. Borrower must
make written application for any Letter of Credit at least two
Business Days before the date on which Borrower desires for LC
Issuer to issue such Letter of Credit or Citibank to issue a
Citibank Letter of Credit. By making any such written
application, unless otherwise expressly stated therein, Borrower
shall be deemed to have represented and warranted that the LC
Conditions will be met as of the date of issuance of such Letter
of Credit. Each such written application for a Letter of Credit
must be made in writing in the form and substance of Exhibit E,
the terms and provisions of which are hereby incorporated herein
by reference (or in such other form as may mutually be agreed
upon by LC Issuer and Borrower). If all LC Conditions for a
Letter of Credit have been met as on any Business Day before
11:00 a.m, New York City time, LC Issuer will issue or cause
Citibank to issue such Letter of Credit on the same Business Day
at LC Issuer's office in New York City. If the LC Conditions
are met on any Business Day on or after 11:00 a.m, New York City
time, LC Issuer will issue or cause Citibank to issue such
Letter of Credit on the next succeeding Business Day at LC
Issuer's office in New York City. If any provisions of any LC
Application conflict with any provisions of this Agreement, the
provisions of this Agreement shall govern and control.
Section 2.9. Reimbursement and Participations.
(a) Reimbursement. Borrower promises to pay to LC
Issuer, or to LC Issuer's order, on demand, the full amount of
each Matured LC Obligation together with interest thereon (i) at
the Base Rate plus the Base Rate Margin in effect on such date
to and including the second Business Day after the Matured LC
Obligation is incurred and (ii) at the Default Rate on each day
thereafter. If the beneficiary of any Citibank Letter of Credit
makes a draft or other demand for payment thereunder, the
Administrative Agent shall immediately withdraw from the
Citibank LC Collateral Account an amount equal to the amount of
such draft or demand and shall immediately apply the proceeds
thereof to repay to Citibank the amount of the resulting Matured
LC Obligation; and, upon such payment, the a corresponding
amount of the Citibank LC Loan, together with all accrued
interest, shall become due and payable without demand or notice
to the Borrower.
(b) Participation by Lenders. LC Issuer irrevocably
agrees to grant and hereby grants to each Lender, and, to induce
LC Issuer to issue Letters of Credit hereunder, each Lender
irrevocably agrees to accept and purchase and hereby accepts and
purchases from LC Issuer, on the terms and conditions
hereinafter stated and for such Lender's own account and risk an
undivided interest equal to such Lender's Percentage Share of LC
Issuer's obligations and rights under each Letter of Credit
(other than a Citibank Letter of Credit) issued hereunder and
the amount of each Matured LC Obligation paid by LC Issuer
thereunder. Each Lender unconditionally and irrevocably agrees
with LC Issuer that, if a Matured LC Obligation is paid under
any Letter of Credit (other than a Citibank Letter of Credit)
for which LC Issuer is not reimbursed in full by Borrower in
accordance with the terms of this Agreement and the related LC
Application (including any reimbursement by means of concurrent
Loans or by the application of LC Collateral), such Lender shall
(in all circumstances and without set-off or counterclaim) pay
to LC Issuer on demand, in immediately available funds at LC
Issuer's address for notices hereunder, such Lender's Percentage
Share of such Matured LC Obligation (or any portion thereof
which has not been reimbursed by Borrower). Each Lender's
obligation to pay LC Issuer pursuant to the terms of this
subsection is irrevocable and unconditional. If any amount
required to be paid by any Lender to LC Issuer pursuant to this
subsection is paid by such Lender to LC Issuer within three
Business Days after the date such payment is due, LC Issuer
shall in addition to such amount be entitled to recover from
such Lender, on demand, interest thereon calculated from such
due date at the Federal Funds Rate. If any amount required to
be paid by any Lender to LC Issuer pursuant to this subsection
is not paid by such Lender to LC Issuer within three Business
Days after the date such payment is due, LC Issuer shall in
addition to such amount be entitled to recover from such Lender,
on demand, interest thereon calculated from such due date at the
Base Rate.
(c) Distributions to Participants. Whenever LC Issuer
has in accordance with this section received from any Lender
payment of such Lender's Percentage Share of any Matured LC
Obligation, if LC Issuer thereafter receives any payment of such
Matured LC Obligation or any payment of interest thereon
(whether directly from Borrower or by application of LC
Collateral or otherwise, and excluding only interest for any
period prior to LC Issuer's demand that such Lender make such
payment of its Percentage Share), LC Issuer will distribute to
such Lender its Percentage Share of the amounts so received by
LC Issuer; provided, however, that if any such payment received
by LC Issuer must thereafter be returned by LC Issuer, such
Lender shall return to LC Issuer the portion thereof which LC
Issuer has previously distributed to it. Whenever LC Issuer
has, in accordance with this section, made any payment to
Citibank with respect to any Matured LC Obligation relating to a
Citibank Letter of Credit, if Citibank thereafter receives any
payment of such Matured LC Obligation or any payment of interest
thereon (whether directly from Borrower or otherwise, and
excluding only interest for any period prior to LC Issuer's
payment to Citibank), LC Issuer will cause Citibank to redeposit
such amounts so received by Citibank into the Citibank LC
Collateral Account; provided, however, that if any such payment
received by Citibank must thereafter be returned by Citibank, LC
Issuer shall return to Citibank such amount previously
redeposited by Citibank.
(d) Calculations. A written advice setting forth in
reasonable detail the amounts owing under this section,
submitted by LC Issuer to Borrower or any Lender from time to
time, shall be conclusive, absent manifest error, as to the
amounts thereof.
Section 2.10. No Duty to Inquire.
(a) Drafts and Demands. LC Issuer is authorized and
instructed to accept and pay drafts and demands for payment
under any Letter of Credit without requiring, and without
responsibility for, any determination as to the existence of any
event giving rise to said draft, either at the time of
acceptance or payment or thereafter. LC Issuer is under no duty
to determine the proper identity of anyone presenting such a
draft or making such a demand (whether by tested telex or
otherwise) as the officer, representative or agent of any
beneficiary under any Letter of Credit, and payment by LC Issuer
to any such beneficiary when requested by any such purported
officer, representative or agent is hereby authorized and
approved. Borrower releases each LC Issuer from, and agrees to
hold each LC Issuer harmless and indemnified against, any
liability or claim in connection with or arising out of the
subject matter of this section, which indemnity shall apply
whether or not any such liability or claim is in any way or to
any extent caused, in whole or in part, by any negligent act or
omission of any kind by any LC Issuer, provided only that no LC
Issuer shall be entitled to indemnification for that portion, if
any, of any liability or claim which is proximately caused by
its own individual gross negligence or willful misconduct, as
determined in a final judgment.
(b) Extension of Maturity. If the maturity of any
Letter of Credit is extended by its terms or by Law or
governmental action, if any extension of the maturity or time
for presentation of drafts or any other modification of the
terms of any Letter of Credit is made at the request of
Borrower, or if the amount of any Letter of Credit is increased
at the request of Borrower, this Agreement shall be binding upon
all Restricted Persons with respect to such Letter of Credit as
so extended, increased or otherwise modified, with respect to
drafts and property covered thereby, and with respect to any
action taken by LC Issuer, LC Issuer's correspondents
(including, without limitation, Citibank), or any Lender Party
in accordance with such extension, increase or other
modification.
(c) Transferees of Letters of Credit. If any Letter of
Credit provides that it is transferable, LC Issuer shall have no
duty to determine the proper identity of anyone appearing as
transferee of such Letter of Credit, nor shall LC Issuer be
charged with responsibility of any nature or character for the
validity or correctness of any transfer or successive transfers,
and payment by LC Issuer to any purported transferee or
transferees as determined by LC Issuer is hereby authorized and
approved, and Borrower releases each LC Issuer from, and agrees
to hold each LC Issuer harmless and indemnified against, any
liability or claim in connection with or arising out of the
foregoing, which indemnity shall apply whether or not any such
liability or claim is in any way or to any extent caused, in
whole or in part, by any negligent act or omission of any kind
by any LC Issuer, provided only that no LC Issuer shall be
entitled to indemnification for that portion, if any, of any
liability or claim which is proximately caused by its own
individual gross negligence or willful misconduct, as determined
in a final judgment.
(d) Citibank as LC Issuer. For purposes of this Section
2.10, Citibank shall be considered an LC Issuer with respect to
any Citibank Letter of Credit.
Section 2.11. LC Collateral.
(a) LC Obligations in Excess of Borrowing Base. If,
after the making of all mandatory prepayments required under
Section 2.6, the outstanding LC Obligations will exceed the sum
of the Borrowing Base and the Over-Advance Facility, then in
addition to prepayment of the entire principal balance of the
Loans Borrower will immediately pay to LC Issuer an amount equal
to such excess. If at any time prior to the termination of the
Salomon Facility and all Salomon Guaranty Exposure and the
payment in full of all Salomon Obligations, after the making of
all mandatory prepayments required under Section 2.6, the
outstanding Facility Usage plus the Salomon Guaranty Exposure
exceeds the sum of the Borrowing Base and the Over-Advance
Facility, then in addition to prepayment of the entire principal
balance of the Loans Borrower will immediately pay to LC Issuer
an amount equal to such excess. LC Issuer will hold such
amounts as collateral security for the remaining LC Obligations
(all such amounts held as collateral security for LC Obligations
being herein collectively called "LC Collateral") and the other
Obligations, and such collateral may be applied from time to
time to pay Matured LC Obligations or any other Obligations
which are then due and payable. Neither this subsection nor the
following subsection shall, however, limit or impair any rights
which LC Issuer may have under any other document or agreement
relating to any Letter of Credit, LC Collateral or LC
Obligation, including any LC Application, or any rights which
any Lender Party may have to otherwise apply any payments by
Borrower and any LC Collateral under Section 3.1.
(b) Acceleration of LC Obligations. If the Obligations
or any part thereof become immediately due and payable pursuant
to Section 8.1 then, unless all Lenders otherwise specifically
elect to the contrary (which election may thereafter be
retracted by all Lenders at any time), all LC Obligations shall
become immediately due and payable without regard to whether or
not actual drawings or payments on the Letters of Credit have
occurred, and Borrower shall be obligated to pay to LC Issuer
immediately an amount equal to the aggregate LC Obligations
which are then outstanding to be held as LC Collateral.
(c) Investment of LC Collateral. Pending application
thereof, all LC Collateral may be invested by LC Issuer in such
Cash Equivalents as LC Issuer may choose in its sole discretion.
All interest on (and other proceeds of) such Investments shall
be reinvested or applied to Matured LC Obligations or other
Obligations which are due and payable. When all Obligations
have been satisfied in full, including all LC Obligations, all
Letters of Credit have expired or been terminated, and all of
Borrower's reimbursement obligations in connection therewith
have been satisfied in full, LC Issuer shall release any
remaining LC Collateral. Borrower hereby assigns and grants to
LC Issuer for the benefit of Lenders a continuing security
interest in all LC Collateral paid by it to LC Issuer, all
Investments purchased with such LC Collateral, and all proceeds
thereof to secure its Matured LC Obligations and its Obligations
under this Agreement, each Note, and the other Loan Documents,
and Borrower agrees that such LC Collateral, Investments and
proceeds shall be subject to all of the terms and conditions of
the Security Documents. Borrower further agrees that LC Issuer
shall have all of the rights and remedies of a secured party
under the UCC with respect to such security interest and that an
Event of Default under this Agreement shall constitute a default
for purposes of such security interest.
(d) Investment of Citibank LC Collateral Account Funds.
Pending application thereof, all funds deposited into the
Citibank LC Collateral Account may be invested by LC Issuer in
such Cash Equivalents as LC Issuer may choose in its sole
discretion. Provided no Default shall have occurred and be
continuing, interest on funds held in the Citibank LC Collateral
Account will be paid to the Borrower at the Federal Funds Rate;
or, at any time when a Default shall have occurred and be
continuing, may be reinvested or applied first, to Matured LC
Obligations relating to Citibank Letters of Credit and second,
to other Obligations which are due and payable. Upon the
expiration or termination of any Citibank Letter of Credit, and
provided that the beneficiary thereunder has not made a draft or
demand for payment thereunder, LC Issuer shall promptly apply
the proceeds in the Citibank LC Collateral Account securing such
Citibank Letter of Credit to the repayment of the Citibank LC
Loan that was made with respect thereto. Borrower hereby
assigns and grants to LC Issuer for the benefit of Citibank and
the Lenders a continuing security interest in all amounts
deposited into the Citibank LC Collateral Account, all
Investments purchased with such funds, and all proceeds thereof
to secure first, its Matured LC Obligations relating to Citibank
Letters of Credit and second, its other Obligations under this
Agreement, each Note, and the other Loan Documents, and Borrower
agrees that such funds, Investments and proceeds shall be
subject to all of the terms and conditions of the Security
Documents. Borrower further agrees that LC Issuer shall have
all of the rights and remedies of a secured party under the UCC
with respect to such security interest and that an Event of
Default under this Agreement shall constitute a default for
purposes of such security interest.
(e) Payment of LC Collateral. When Borrower is required
to provide LC Collateral for any reason and fails to do so on
the day when required, LC Issuer or Agents may without prior
notice to Borrower or any other Restricted Person provide such
LC Collateral (whether by application of proceeds of other
Collateral, by transfers from other accounts maintained with LC
Issuer, or otherwise) using any available funds of Borrower or
any other Person also liable to make such payments, and LC
Issuer or Agents will give notice thereof to Borrower promptly
after such application or transfer. Any such amounts which are
required to be provided as LC Collateral and which are not
provided on the date required shall, for purposes of each
Security Document, be considered past due Obligations owing
hereunder, and LC Issuer is hereby authorized to exercise its
respective rights under each Security Document to obtain such
amounts.
Section 2.12. Interest Rates and Fees; Reduction in
Commitment.
(a) Interest Rates. Unless the Default Rate shall
apply, (i) each Base Rate Loan that is not an Over-Advance Loan
shall bear interest on each day outstanding at the Base Rate
plus the Base Rate Margin in effect on such day; (ii) each LIBOR
Loan that is not an Over-Advance Loan shall bear interest on
each day during the related Interest Period at the related LIBOR
Rate plus the LIBOR Rate Margin in effect on such day; (iii)
each Base Rate Loan that is an Over-Advance Loan shall bear
interest on each day outstanding at the Base Rate plus the Over-
Advance Base Rate Margin in effect on such day; and (iv ) each
LIBOR Loan that is an Over-Advance Loan shall bear interest on
each day during the related Interest Period at the related LIBOR
Rate plus the Over-Advance LIBOR Rate Margin in effect on such
day. During a Default Rate Period, all Loans shall bear interest
on each day outstanding at the applicable Default Rate. The
interest rate shall change whenever the applicable Base Rate,
Base Rate Margin, Over-Advance Base Rate Margin, LIBOR Rate,
LIBOR Rate Margin or Over-Advance LIBOR Rate Margin changes.
Notwithstanding anything to the contrary contained in this
Section 2.12(a) or elsewhere in this Agreement, all Citibank LC
Loans shall bear interest on each day outstanding at the
Citibank LC Loan Rate. In no event shall the interest rate on
any Loan exceed the Highest Lawful Rate.
(b) Commitment Fees. In consideration of each Lender's
commitment to make Loans (other than Over-Advance Loans),
Borrower will pay to Administrative Agent for the account of
each Lender a commitment fee determined on a daily basis equal
to the Commitment Fee Rate in effect on such day multiplied by
such Lender's Percentage Share of the unused portion of the
difference between the Maximum Facility Amount and the Over-
Advance Facility on each day during the Commitment Period,
determined for each such day by deducting from the amount of the
difference between the Maximum Facility Amount and the Over-
Advance Facility at the end of such day the Facility Usage
(determined without the inclusion of the Over-Advance Facility.
In consideration of each Lender's commitment to make Over-
Advance Loans, Borrower will pay to Administrative Agent for the
account of each Lender a commitment fee determined on a daily
basis equal to the Over-Advance Commitment Fee Rate in effect on
such day multiplied by such Lender's Percentage Share of the
unused portion of the Over-Advance Facility on each day during
the Commitment Period, determined for each such day by deducting
from the amount of the Over-Advance Facility at the end of such
day the Over-Advance Loans. The commitment fees described in
this Section 2.12(b) shall be due and payable in arrears on the
last day of each Fiscal Quarter and at the end of the Commitment
Period. Borrower shall have the right from time to time to
permanently reduce the Maximum Facility Amount, provided that
(i) notice of such reduction is given not less than two Business
Days prior to such reduction, (ii) the resulting Maximum
Facility Amount is not less than the Facility Usage, and (iii)
each partial reduction shall be in multiples of $100,000.
Borrower shall have the right from time to time to permanently
reduce the Over-Advance Facility, provided that (i) notice of
such reduction is given not less than two Business Days prior to
such reduction, (ii) the resulting Over-Advance Facility is not
less than the Over-Advance Loans outstanding at such time, and
(iii) each partial reduction shall be in multiples of $100,000.
(c) Letter of Credit Fees. In consideration of LC
Issuer's issuance of any Letter of Credit and Citibank's
issuance of any Citibank Letter of Credit, Borrower agrees to
pay to Administrative Agent, (i) with respect to the issuance of
any Citibank Letter of Credit, for the account of Citibank, and
(ii) with respect to all other Letters of Credit, for the
account of all Lenders in accordance with their respective
Percentage Shares, a letter of credit fee equal to the Letter of
Credit Fee Rate applicable each day times the face amount of
such Letter of Credit. Such fee will be calculated on the face
amount of each Letter of Credit outstanding on each day at the
above applicable rates and will be payable in arrears on the
last day of each Fiscal Quarter. In addition, Borrower will pay
to LC Issuer a minimum administrative issuance fee equal to the
greater of $150 or one-eighth percent (0.125%) of the face
amount of each Letter of Credit and such other fees and charges
customarily charged by the LC Issuer in respect of any issuance,
amendment or negotiation of any Letter of Credit in accordance
with the LC Issuer's published schedule of such charges
effective as of the date of such amendment or negotiation;
provided that, with respect to the issuance of any Citibank
Letter of Credit, all such fees shall be paid to Administrative
Agent for the account of Citibank.
(d) Administrative Agent's Fees. In addition to all
other amounts due to Administrative Agent under the Loan
Documents, Borrower will pay fees to Administrative Agent as
described in a letter agreement of even date herewith between
Administrative Agent and Borrower.
Section 2.13. Borrowing Base Reporting. The Borrowing
Base Reports are subject to the procedures set forth on Schedule
5. Notwithstanding anything to the contrary contained in this
Agreement, Administrative Agent shall have the right to conduct
a field examination of the Borrower's operations from time to
time and, if it deems such action necessary, shall have the
right to adjust the Borrowing Base to reflect the result of such
field examination.
ARTICLE III - Payments to Lenders
Section 3.1. General Procedures. Borrower will make each
payment which it owes under the Loan Documents to Administrative
Agent for the account of the Lender Party to whom such payment
is owed in lawful money of the United States of America, (unless
otherwise expressly provided in this Agreement), without set-
off, deduction or counterclaim, and in immediately available
funds. Each such payment must be received by Administrative
Agent not later than 12:00 noon, New York City time, on the date
such payment becomes due and payable. Any payment received by
Administrative Agent after such time will be deemed to have been
made on the next following Business Day. Should any such
payment become due and payable on a day other than a Business
Day, the maturity of such payment shall be extended to the next
succeeding Business Day, and, in the case of a payment of
principal or past due interest, interest shall accrue and be
payable thereon for the period of such extension as provided in
the Loan Document under which such payment is due. Each payment
under a Loan Document shall be due and payable at the place
provided therein and, if no specific place of payment is
provided, shall be due and payable at the place of payment of
Administrative Agent's Note. When Administrative Agent collects
or receives money on account of the Obligations, Administrative
Agent shall distribute all money so collected or received, and
each Lender Party shall apply all such money so distributed, as
follows:
(a) first, for the payment of all Obligations which
are then due (and if such money is insufficient to pay all
such Obligations, first to any reimbursements due Agents
under Section 6.9 or 10.4 and then to the partial payment
of all other Obligations then due in proportion to the
amounts thereof, or as Lender Parties shall otherwise
agree);
(b) then for the prepayment of amounts owing under
the Loan Documents (other than principal on the Notes) if
so specified by Borrower;
(c) then for the prepayment of principal on the
Notes, together with accrued and unpaid interest on the
principal so prepaid, and then held as LC Collateral
pursuant to Section 2.11(c); and
(d) last, for the payment or prepayment of any other
Obligations.
All payments applied to principal or interest on any Note shall
be applied first to any interest then due and payable, then to
principal then due and payable, and last to any prepayment of
principal and accrued interest thereon in compliance with
Sections 2.5 and 2.6, as applicable. All distributions of
amounts described in any of subsections (b), (c) or (d) above
shall be made by Administrative Agent pro rata to each Lender
▇▇▇▇▇ then owed Obligations described in such subsection in
proportion to all amounts owed to all Lender Parties which are
described in such subsection; provided that if any Lender then
owes payments to LC Issuer for the purchase of a participation
under Section 2.9(c) or to Agents under Section 9.5, any amounts
otherwise distributable under this section to such Lender shall
be deemed to belong to LC Issuer or Agents, respectively, to the
extent of such unpaid payments, and Agents shall apply such
amounts to make such unpaid payments rather than distribute such
amounts to such Lender. Notwithstanding anything to the
contrary contained herein, at anytime when Borrower shall repay
or prepay principal of Loans, such repayment or prepayment shall
be applied first to outstanding Over-Advance Loans and then to
other Loans.
Section 3.2. Capital Reimbursement. If either (a) the
introduction or implementation of or the compliance with or any
change in or in the interpretation of any Law, or (b) the
introduction or implementation of or the compliance with any
request, directive or guideline from any central bank or other
governmental authority (whether or not having the force of Law)
affects or would affect the amount of capital required or
expected to be maintained by any Lender Party or any corporation
controlling any Lender ▇▇▇▇▇, then, within five Business Days
after demand by such Lender Party, Borrower will pay to
Administrative Agent for the benefit of such Lender Party, from
time to time as specified by such Lender Party, such additional
amount or amounts which such Lender Party shall reasonably
determine to be appropriate to compensate such Lender Party or
any corporation controlling such Lender Party in light of such
circumstances, to the extent that such Lender Party reasonably
determines that the amount of any such capital would be
increased or the rate of return on any such capital would be
reduced by or in whole or in part based on the existence of the
face amount of such Lender Party's Loans, Letters of Credit,
participations in Letters of Credit or commitments under this
Agreement.
Section 3.3. Increased Cost of LIBOR Loans or Letters of
Credit. If any applicable Law (whether now in effect or
hereinafter enacted or promulgated, including, without
limitation, Regulation D) or any interpretation or
administration thereof by any governmental authority charged
with the interpretation or administration thereof (whether or
not having the force of Law):
(a) shall change the basis of taxation of payments to
any Lender Party of any principal, interest, or other
amounts attributable to any LIBOR Loan or Letter of Credit
or otherwise due under this Agreement in respect of any
LIBOR Loan or Letter of Credit (other than a change in the
rate of taxation); or
(b) shall change, impose, modify, apply or deem
applicable any reserve, special deposit or similar
requirements in respect of any LIBOR Loan or any Letter of
Credit (excluding those for which such Lender Party is
fully compensated pursuant to adjustments made in the
definition of LIBOR Rate) or against assets of, deposits
with or for the account of, or credit extended by, such
Lender Party; or
(c) shall impose on any Lender Party or the interbank
eurocurrency deposit market any other condition affecting
any LIBOR Loan or Letter of Credit, the result of which is
to increase the cost to any Lender Party of funding or
maintaining any LIBOR Loan or of issuing any Letter of
Credit or to reduce the amount of any sum receivable by any
Lender Party in respect of any LIBOR Loan or Letter of
Credit by an amount deemed by such Lender Party to be
material,
then such Lender Party shall promptly notify Administrative
Agent and Borrower in writing of the happening of such event and
of the amount required to compensate such Lender Party for such
event (on an after-tax basis, taking into account any taxes on
such compensation), whereupon (i) Borrower shall, within five
Business Days after demand therefor by such Lender Party, pay
such amount to Administrative Agent for the account of such
Lender Party and (ii) Borrower may elect, by giving to
Administrative Agent and such Lender Party not less than three
Business Days' notice, to Convert all (but not less than all) of
any such LIBOR Loans into Base Rate Loans.
Section 3.4. Notice; Change of Applicable Lending Office.
A Lender Party shall notify Borrower of any event occurring
after the date of this Agreement that will entitle such Lender
Party to compensation under Section 3.2, 3.3 or 3.5 hereof as
promptly as practicable, after such Lender Party obtains actual
knowledge thereof; provided that such Lender Party will
designate a different Applicable Lending Office for the Loans
affected by such event if such designation will avoid the need
for, or reduce the amount of, such compensation and will not, in
the sole opinion of such Lender Party, be disadvantageous to
such Lender Party, except that such Lender Party shall have no
obligation to designate an Applicable Lending Office located in
the United States of America. Each Lender Party will furnish to
Borrower a certificate setting forth the basis and amount of
each request by such Lender Party for compensation under Section
3.2, 3.3 or 3.5 hereof.
Section 3.5. Availability. If (a) any change in
applicable Laws, or in the interpretation or administration
thereof of or in any jurisdiction whatsoever, domestic or
foreign, shall make it unlawful or impracticable for any Lender
▇▇▇▇▇ to fund or maintain LIBOR Loans or to issue or participate
in Letters of Credit, or shall materially restrict the authority
of any Lender Party to purchase or take offshore deposits of
dollars (i.e., "eurodollars"), or (b) any Lender Party
determines that matching deposits appropriate to fund or
maintain any LIBOR Loan are not available to it, or (c) any
Lender Party determines that the formula for calculating the
LIBOR Rate does not fairly reflect the cost to such Lender Party
of making or maintaining loans based on such rate, then, upon
notice by such Lender Party to Borrower and Administrative
Agent, Borrower's right to elect LIBOR Loans from such Lender
Party (or, if applicable, to obtain Letters of Credit) shall be
suspended to the extent and for the duration of such illegality,
impracticability or restriction and all LIBOR Loans of such
Lender Party which are then outstanding or are then the subject
of any Borrowing Notice and which cannot lawfully or practicably
be maintained or funded shall immediately become or remain, or
shall be funded as, Base Rate Loans of such Lender Party.
Borrower agrees to indemnify each Lender Party and hold it
harmless against all costs, expenses, claims, penalties,
liabilities and damages which may result from any such change in
Law, interpretation or administration. Such indemnification
shall be on an after-tax basis, taking into account any taxes
imposed on the amounts paid as indemnity.
Section 3.6. Funding Losses. In addition to its other
obligations hereunder, Borrower will indemnify each Lender Party
against, and reimburse each Lender Party on demand for, any loss
or expense incurred or sustained by such Lender Party (including
any loss or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by a Lender
Party to fund or maintain LIBOR Loans), as a result of (a) any
payment or prepayment (whether or not authorized or required
hereunder) of all or a portion of a LIBOR Loan on a day other
than the day on which the applicable Interest Period ends, (b)
any payment or prepayment, whether or not required hereunder, of
a Loan made after the delivery, but before the effective date,
of a Continuation/Conversion Notice, if such payment or
prepayment prevents such Continuation/Conversion Notice from
becoming fully effective, (c) the failure of any Loan to be made
or of any Continuation/Conversion Notice to become effective due
to any condition precedent not being satisfied or due to any
other action or inaction of any Restricted Person, or (d) any
Conversion (whether or not authorized or required hereunder) of
all or any portion of any LIBOR Loan into a Base Rate Loan or
into a different LIBOR Loan on a day other than the day on which
the applicable Interest Period ends. Such indemnification
shall be on an after-tax basis, taking into account any taxes
imposed on the amounts paid as indemnity.
Section 3.7. Reimbursable Taxes. Borrower covenants and
agrees that:
(a) Borrower will indemnify each Lender Party against
and reimburse each Lender Party for all present and future
stamp and other taxes, duties, levies, imposts, deductions,
charges, costs, and withholdings whatsoever imposed,
assessed, levied or collected on or in respect of this
Agreement or any LIBOR Loans or Letters of Credit (whether
or not legally or correctly imposed, assessed, levied or
collected), excluding, however, any taxes imposed on or
measured by the overall net income of Administrative Agent
or such Lender Party or any Applicable Lending Office of
such Lender Party (or franchise or equivalent taxes) by any
jurisdiction in which such Lender Party or any such
Applicable Lending Office is located (all such non-excluded
taxes, levies, costs and charges being collectively called
"Reimbursable Taxes" in this section). Borrower also will
indemnify each Lender Party for taxes of any kind imposed
on the amounts paid pursuant to this Section 3.7.
(b) All payments on account of the principal of, and
interest on, each Lender Party's Loans and Note, and all
other amounts payable by Borrower to any Lender Party
hereunder, shall be made in full without set-off or
counterclaim and shall be made free and clear of and
without deductions or withholdings of any nature by reason
of any Reimbursable Taxes, all of which will be for the
account of Borrower. In the event of Borrower is required
by Law to make any such deduction or withholding from any
payment to any Lender Party, Borrower shall pay on the due
date of such payment, by way of additional interest, such
additional amounts as are needed to cause the amount
receivable by such Lender Party after such deduction or
withholding (including after deduction or withholding on
such additional amounts) to equal the amount which would
have been receivable in the absence of such deduction or
withholding. If Borrower should make any deduction or
withholding as aforesaid, Borrower shall within 60 days
thereafter forward to such Lender Party an official receipt
or other official document evidencing payment of such
deduction or withholding.
(c) If Borrower is ever required to pay any
Reimbursable Tax with respect to any LIBOR Loan, Borrower
may elect, by giving to Administrative Agent and such
Lender Party not less than three Business Days' notice, to
Convert all (but not less than all) of any such LIBOR Loan
into a Base Rate Loan if such conversion will reduce the
amount of taxes Borrower is required to pay, but such
election shall not diminish Borrower's obligation to pay
all Reimbursable Taxes.
(d) Notwithstanding the foregoing provisions of this
section, any Lender Party organized under the laws of a
jurisdiction outside of the United States shall not be
entitled to make any indemnification or reimbursement
pursuant to this Section 3.7 with respect to any taxes
imposed by the United States of America if such Lender
Party does not have the Prescribed Forms on file with
Administrative Agent (with copies provided to Borrower) for
the applicable year establishing that such Lender Party is
exempt from or entitled to a reduced rate of United States
withholding tax on payments pursuant to this Agreement or
any other Loan Document (other than if such failure to have
the Prescribed Forms on file is due to a change in the
applicable Law, or in the interpretation or application
thereof, occurring after the date such Lender Party becomes
a party to this Agreement); provided, that if the
Prescribed Forms provided by a Lender Party at the time
such Lender Party first becomes a party to this Agreement
indicate a United States interest withholding tax rate in
excess of zero, such Lender Party shall not be entitled to
any indemnification or reimbursement for United States
withholding tax only to the extent of such rate; and
provided, further, that if Borrower shall so deduct or
withhold any such taxes, it shall provide a statement to
Administrative Agent and such Lender Party, setting forth
the amount of such taxes so deducted or withheld, the
applicable rate and any other information or documentation
which such Lender Party may reasonably request for
assisting such Lender Party to obtain any allowable credits
or deductions for the taxes so deducted or withheld in the
jurisdiction or jurisdictions in which such Lender Party is
subject to tax. As used in this section, "Prescribed
Forms" means Internal Revenue Service Forms W-8BEN or W-
8ECI or any successor or other form prescribed by the
Internal Revenue Service.
Section 3.8. Replacement of Lenders. If any Lender Party
seeks reimbursement for increased costs under Sections 3.2
through 3.7, then within ninety days thereafter (provided no
Event of Default then exists) Borrower shall have the right
(unless such Lender Party withdraws its request for additional
compensation) to replace such Lender Party by requiring such
Lender Party to assign its Loans and Notes and its commitments
hereunder to an Eligible Transferee reasonably acceptable to
Administrative Agent and to Borrower, provided that: (i) all
Obligations of Borrower owing to such Lender Party being
replaced (including such increased costs and any breakage costs
with respect to any outstanding LIBOR Loans), but excluding
principal and accrued interest on the Notes being assigned)
shall be paid in full to such Lender Party concurrently with
such assignment, and (ii) the replacement Eligible Transferee
shall purchase the Note being assigned by paying to such Lender
Party a price equal to the principal amount thereof plus accrued
and unpaid interest and accrued and unpaid commitment fees
thereon. In connection with any such assignment Borrower,
Administrative Agent, such Lender Party and the replacement
Eligible Transferee shall otherwise comply with Section 10.5.
Notwithstanding the foregoing rights of Borrower under this
section, however, Borrower may not replace any Lender Party
which seeks reimbursement for increased costs under Section 3.2
through 3.7 unless Borrower is at the same time replacing all
Lender Parties which are then seeking such compensation.
ARTICLE IV - Conditions Precedent to Credit
Section 4.1. Documents to Be Delivered. No Lender has any
obligation to make its first Loan, and LC Issuer has no
obligation to issue the first Letter of Credit unless the
following conditions precedent have been satisfied and, as
applicable, Administrative Agent shall have received all of the
following, at Administrative Agent's office in New York City
duly executed and delivered and in form, substance and date
satisfactory to Administrative Agent:
(a) This Agreement and any other documents that
Lenders are to execute in connection herewith.
(b) Each Note.
(c) Each Security Document listed in the Security
Schedule.
(d) Certain certificates including:
(i) An "Omnibus Certificate" of the secretary
and of the president of General Partner, which shall
contain the names and signatures of the officers and
other approved persons of General Partner authorized
to execute Loan Documents and which shall certify to
the truth, correctness and completeness of the
following exhibits attached thereto: (1) a copy of
resolutions duly adopted by the Board of Directors of
General Partner and in full force and effect at the
time this Agreement is entered into, authorizing the
execution of this Agreement and the other Loan
Documents delivered or to be delivered in connection
herewith and the consummation of the transactions
contemplated herein and therein, (2) a copy of the
charter documents of each Restricted Person and all
amendments thereto, certified by the appropriate
official of such Restricted Person's jurisdiction of
organization, and (3) a copy of any bylaws or
agreement of limited partnership of each Restricted
Person; and
(ii) A certificate of the president and of the
chief financial officer of General Partner, regarding
satisfaction of Section 4.2(a) through (d).
(e) A certificate (or certificates) of the due
formation, valid existence and good standing of each
Restricted Person in its respective jurisdiction of
organization, issued by the appropriate authorities of such
jurisdiction, and certificates of each Restricted Person's
good standing and due qualification to do business, issued
by appropriate officials in any jurisdictions in which such
Restricted Person owns property subject to Security
Documents.
(f) Documents similar to those specified in
subsections (d)(i) and (e) of this section with respect to
each Guarantor and the execution by it of its guaranty of
Borrower's Obligations.
(g) A favorable opinion of (i) Jenkens & ▇▇▇▇▇▇▇▇▇, a
Professional Corporation, special Texas counsel to
Restricted Persons, dated as of the date hereof, and (ii)
local counsel for the states of Alabama, Florida,
Louisiana, Mississippi and Oklahoma satisfactory to
Administrative Agent.
(h) The Initial Financial Statements.
(i) Certificates or binders evidencing Restricted
Persons' insurance in effect on the date hereof.
(j) Copies of such permits and approvals regarding
the property and business of Restricted Persons as
Administrative Agent may request.
(k) A certificate signed by the chief executive
officer of General Partner in form and detail acceptable to
Administrative Agent confirming the insurance that is in
effect as of the date hereof and certifying that such
insurance is customary for the businesses conducted by
Restricted Persons and is in compliance with the
requirements of this Agreement.
(l) Payment of all commitment, facility, agency and
other fees required to be paid to any Lender pursuant to
any Loan Documents or any commitment agreement heretofore
entered into.
(m) General Partner shall have delivered to
Administrative Agent a certificate by the chief financial
officer of General Partner, certifying the Initial
Financial Statements delivered pursuant to clause (h) above
and reflecting compliance with each event specified in
Sections 7.11 through 7.14, inclusive.
(n) Certificates, in substantially the form of
Exhibit J hereto, attesting to the Solvency of each
Restricted Person before and after giving effect to the
transactions contemplated by this Agreement, from the chief
financial officer of General Partner.
(o) To the extent available, copies of (i) the
Commercial Finance Examination Report prepared by Evergreen
Collateral Consulting, Inc., (ii) the Evaluation prepared
by ▇▇▇▇▇▇ and Click, Inc. and (iii) the Environmental
Assessment prepared by E.Vironment, in each case, either
(A) addressed to Administrative Agent and the Lender
Parties and expressly stating that Administrative Agent and
the Lender Parties may rely on such report or (B)
accompanied by a reliance letter from Evergreen Collateral
Consulting, Inc., ▇▇▇▇▇▇ and Click, Inc. or E.Vironment, as
the case may be, addressed to Administrative Agent and the
Lender Parties and expressly stating that Administrative
Agent and the Lender Parties may rely on such report.
(p) Administrative Agent and the Lender Parties shall
be satisfied that (i) the Total Commitment under and as
defined in the Existing Credit Agreement has been
terminated, and all loans and notes with respect thereto
have been repaid in full, together with interest thereon,
all letters of credit issued thereunder have been
terminated and all other amounts (including premiums) owing
pursuant to the Existing Credit Agreement have been repaid
in full and all documents with respect to the Existing
Credit Agreement and all guarantees with respect thereto
have been terminated (except as to indemnification
provisions which may survive to the extent provided
therein) and are of no further force and effect; and (ii)
the creditors in respect of the Existing Credit Agreement
have terminated and released any and all security interests
and Liens on the assets owned by Borrower and its
Subsidiaries.
Section 4.2. Additional Conditions Precedent. No Lender
has any obligation to make any Loan (including its first), and
LC Issuer has no obligation to issue any Letter of Credit
(including its first), unless the following conditions precedent
have been satisfied (and the delivery by the Borrower of a
Borrowing Notice or the election by the Borrower to make a
Conversion shall constitute a representation by the Borrower
that these conditions have been satisfied):
(a) All representations and warranties made by any
Restricted Person in any Loan Document shall be true on and
as of the date of such Loan or the date of issuance of such
Letter of Credit as if such representations and warranties
had been made as of the date of such Loan or the date of
issuance of such Letter of Credit except to the extent that
such representation or warranty was made as of a specific
date or updated, modified or supplemented as of a
subsequent date with the consent of Majority Lenders.
(b) No Default shall exist at the date of such Loan
or the date of issuance of such Letter of Credit.
(c) No Material Adverse Change shall have occurred
to, and no event or circumstance shall have occurred that
could reasonably be expected to cause a Material Adverse
Change to, Genesis Energy's, General Partner's or
Borrower's Consolidated financial condition or businesses
since the date of the Initial Financial Statements.
(d) Each Restricted Person shall have performed and
complied with all agreements and conditions required in the
Loan Documents to be performed or complied with by it on or
prior to the date of such Loan or the date of issuance of
such Letter of Credit.
(e) The making of such Loan or the issuance of such
Letter of Credit shall not be prohibited by any Law and
shall not subject any Lender or any LC Issuer to any
penalty or other onerous condition under or pursuant to any
such Law.
(f) Each Restricted Person shall be Solvent.
(g) Administrative Agent shall have received all
documents and instruments which Administrative Agent has
then requested, in addition to those described in Section
4.1 (including opinions of legal counsel for Restricted
Persons and Administrative Agent; corporate documents and
records; documents evidencing governmental authorizations,
consents, approvals, licenses and exemptions; and
certificates of public officials and of officers and
representatives of Borrower and other Persons), as to (i)
the accuracy and validity of or compliance with all
representations, warranties and covenants made by any
Restricted Person in this Agreement and the other Loan
Documents, (ii) the satisfaction of all conditions
contained herein or therein, and (iii) all other matters
pertaining hereto and thereto. All such additional
documents and instruments shall be satisfactory to
Administrative Agent in form, substance and date.
ARTICLE V - Representations and Warranties
To confirm each Lender's understanding concerning
Restricted Persons and Restricted Persons' businesses,
properties and obligations and to induce each Lender to enter
into this Agreement and to extend credit hereunder, General
Partner, Genesis Energy, L.P. and Borrower represent and warrant
to each Lender that:
Section 5.1. No Default. No Restricted Person is in
default in the performance of any of the covenants and
agreements contained in any Loan Document. No event has
occurred and is continuing which constitutes a Default.
Section 5.2. Organization and Good Standing. Each
Restricted Person is duly organized, validly existing and in
good standing under the Laws of its jurisdiction of
organization, having all powers required to carry on its
business and enter into and carry out the transactions
contemplated hereby. Each Restricted Person is duly qualified,
in good standing, and authorized to do business in all other
jurisdictions wherein the character of the properties owned or
held by it or the nature of the business transacted by it makes
such qualification necessary except where the failure to so
qualify would not cause a Material Adverse Change.
Section 5.3. Authorization. Each Restricted Person has
duly taken all action necessary to authorize the execution and
delivery by it of the Loan Documents to which it is a party and
to authorize the consummation of the transactions contemplated
thereby and the performance of its obligations thereunder.
Borrower is duly authorized to borrow funds hereunder.
Section 5.4. No Conflicts or Consents. The execution and
delivery by the various Restricted Persons of the Loan Documents
to which each is a party, the performance by each of its
obligations under such Loan Documents, and the consummation of
the transactions contemplated by the various Loan Documents, do
not and will not (i) conflict with any provision of (1) any Law,
(2) the organizational documents of any Restricted Person or any
of its Affiliates, or (3) any agreement, judgment, license,
order or permit applicable to or binding upon any Restricted
Person or any of its Affiliates, (ii) result in the acceleration
of any Indebtedness owed by any Restricted Person or any of its
Affiliates, or (iii) result in or require the creation of any
Lien upon any assets or properties of any Restricted Person or
any of its Affiliates except as expressly contemplated in the
Loan Documents. Except as expressly contemplated in the Loan
Documents or disclosed in the Disclosure Schedule, no permit,
consent, approval, authorization or order of, and no notice to
or filing, registration or qualification with, any Tribunal or
third party is required in connection with the execution,
delivery or performance by any Restricted Person of any Loan
Document or to consummate any transactions contemplated by the
Loan Documents.
Section 5.5. Enforceable Obligations. This Agreement is,
and the other Loan Documents when duly executed and delivered
will be, legal, valid and binding obligations of each Restricted
Person which is a party hereto or thereto, enforceable in
accordance with their terms except as such enforcement may be
limited by bankruptcy, insolvency or similar Laws of general
application relating to the enforcement of creditors' rights.
Section 5.6. Initial Financial Statements. Borrower has
heretofore delivered to each Lender true, correct and complete
copies of the Initial Financial Statements. The Initial
Financial Statements fairly present Borrower's Consolidated
financial position at the date thereof and the Consolidated
results of Borrower's operations for the periods thereof, and in
the case of the annual Initial Financial Statements,
Consolidated cash flows for the period thereof. Since the date
of the annual Initial Financial Statements, no Material Adverse
Change has occurred, except as reflected in the quarterly
Initial Financial Statements or in the Disclosure Schedule. All
Initial Financial Statements other than pro forma financial
statements were prepared in accordance with GAAP. All Initial
Financial Statements that are pro forma financial statements
were prepared in accordance with GAAP with such pro forma
adjustments as have been disclosed in the Disclosure Schedule.
Section 5.7. Other Obligations and Restrictions. No
Restricted Person has any outstanding Liabilities of any kind
(including contingent obligations, tax assessments, and unusual
forward or long-term commitments) which are, in the aggregate,
material to Borrower or material with respect to Borrower's
Consolidated financial condition and not shown in the Initial
Financial Statements, disclosed in the Disclosure Schedule or
otherwise permitted under Section 7.1. Except as shown in the
Initial Financial Statements or disclosed in the Disclosure
Schedule, no Restricted Person is subject to or restricted by
any franchise, contract, deed, charter restriction, or other
instrument or restriction which could cause a Material Adverse
Change.
Section 5.8. Full Disclosure. No certificate, statement
or other information delivered herewith or heretofore by any
Restricted Person to any Lender in connection with the
negotiation of this Agreement or in connection with any
transaction contemplated hereby contains any untrue statement of
a material fact or omits to state any material fact necessary to
make the statements contained herein or therein, in light of the
circumstances under which they were made, not misleading as of
the date made or deemed made. All written information furnished
after the date hereof by or on behalf of any Restricted Person
to Administrative Agent or any Lender Party in connection with
this Agreement and the other Loan Documents and the transactions
contemplated hereby and thereby will be true, complete and
accurate in every material respect in light of the circumstances
in which made, or based on reasonable estimates on the date as
of which such information is stated or certified. There is no
fact known to any Restricted Person that is not shown in the
Initial Financial Statements or disclosed in the Disclosure
Schedule which could reasonably be expected to cause a Material
Adverse Change.
Section 5.9. Litigation. Except as disclosed in the
Initial Financial Statements or in the Disclosure Schedule: (i)
there are no actions, suits or legal, equitable, arbitrative or
administrative proceedings pending, or to the knowledge of any
Restricted Person threatened, against any Restricted Person or
affecting any Collateral (including, without limitation, any
which challenge or otherwise pertain to any Restricted Person's
title to any Collateral) before any Tribunal which could
reasonably be expected to cause a Material Adverse Change, and
(ii) there are no outstanding judgments, injunctions, writs,
rulings or orders by any such Tribunal against any Restricted
Person or any Restricted Person's stockholders, partners,
directors or officers or affecting any Collateral which could
reasonably be expected to cause a Material Adverse Change.
Section 5.10. Labor Disputes and Acts of God. Except as
disclosed in the Disclosure Schedule, neither the business nor
the properties of any Restricted Person has been affected by any
fire, explosion, accident, strike, lockout or other labor
dispute, drought, storm, hail, earthquake, embargo, act of God
or of the public enemy or other casualty (whether or not covered
by insurance), which could reasonably be expected to cause a
Material Adverse Change.
Section 5.11. ERISA Plans and Liabilities. All currently
existing ERISA Plans are listed in the Disclosure Schedule.
Except as disclosed in the Initial Financial Statements or in
the Disclosure Schedule, no Termination Event has occurred with
respect to any ERISA Plan and all ERISA Affiliates are in
compliance with ERISA in all material respects. No ERISA
Affiliate is required to contribute to, or has any other
absolute or contingent liability in respect of, any
"multiemployer plan" as defined in Section 4001 of ERISA.
Except as set forth in the Disclosure Schedule: (i) no
"accumulated funding deficiency" (as defined in Section 412(a)
of the Code) exists with respect to any ERISA Plan, whether or
not waived by the Secretary of the Treasury or his delegate, and
(ii) the amount of unfunded benefit liabilities as defined in
Section 4001(a)(18) of ERISA of each ERISA Plan does not exceed
$250,000.
Section 5.12. Compliance with Laws. Except as set forth
in the Disclosure Schedule, each Restricted Person has all
permits, licenses and authorizations required in connection with
the conduct of its businesses, except where the failure to have
such permits, licenses and authorizations would not result in a
Material Adverse Change. Each Restricted Person is in
compliance with the terms and conditions of all such permits,
licenses and authorizations, and is also in compliance with all
other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and
timetables contained in any Law or in any regulation, code,
plan, order, decree, judgment, injunction, notice or demand
letter issued, entered, promulgated or approved thereunder, and
no Restricted Person is aware of any facts or circumstances that
could reasonably be expected to result in non-compliance as
described in this section 5.12, except where the failure to be
in compliance would not result in a Material Adverse Change.
Without limiting the foregoing, each Restricted Person (i) has
filed and maintained all tariffs applicable to its business with
each applicable commission, (ii) and all such tariffs are in
compliance with all Laws administered or promulgated by each
applicable commission and (iii) has imposed charges on its
customers in compliance with such tariffs or otherwise in
compliance with law. As used herein, "commission" includes the
Federal Energy Regulatory Commission, the Texas Railroad
Commission and each other US federal, Canadian federal, state,
provincial, or local governmental department, commission, board,
bureau, agency or instrumentality having jurisdiction over any
Restricted Person or its properties.
Section 5.13. Environmental Laws. As used in this
section: "CERCLA" means the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended,
"CERCLIS" means the Comprehensive Environmental Response,
Compensation and Liability Information System List of the
Environmental Protection Agency, and "Release" has the meaning
given such term in 42 U.S.C. Sec. 9601(22). Without limiting
the provisions of Section 5.12 and except as set forth in the
Disclosure Schedule:
(a) No notice, notification, demand, request for
information, citation, summons or order has been issued, no
complaint has been filed and, to the knowledge of any
Restricted Person, none are threatened, no penalty has been
assessed and, to the knowledge of any Restricted Person,
none are threatened, and no investigation or review is
pending or threatened by any Tribunal or any other Person
with respect to any of the following (i) any alleged
generation, treatment, storage, recycling, transportation,
disposal, or Release of any Hazardous Materials, either by
any Restricted Person or on any property owned or operated
by any Restricted Person, (ii) any remedial action which
might be needed to respond to any such alleged generation,
treatment, storage, recycling, transportation, disposal, or
Release, (iii) any alleged failure by any Restricted Person
to have, or to be in compliance with, any permit, license
or authorization required in connection with the conduct of
its business or with respect to any such generation,
treatment, storage, recycling, transportation, disposal, or
Release, or (iv) any allegation of any non-compliance with
any Environmental Law.
(b) No Restricted Person otherwise has any known
material contingent liability in connection with any
alleged generation, treatment, storage, recycling,
transportation, disposal, or Release of any Hazardous
Materials.
(c) No Restricted Person has handled any Hazardous
Materials, other than as a generator, on any properties now
or previously owned or leased by any Restricted Person to
an extent that such handling has caused, or could cause, a
Material Adverse Change.
(d) Except as disclosed in the Disclosure Schedule:
(i) no PCBs are or have been present at any
properties now or previously owned, operated or leased
by any Restricted Person;
(ii) no asbestos is or has been present at any
properties now or previously owned, operated or leased
by any Restricted Person;
(iii) there are no underground storage tanks,
active or abandoned, at any properties now or
previously owned, operated or leased by any Restricted
Person; and
(iv) no Hazardous Materials have been Released
at, on or under any properties now or previously
owned, operated or leased by any Restricted Person.
(e) No Restricted Person has transported or arranged
for the transportation or disposition of any Hazardous
Material to any location which is listed on the National
Priorities List under CERCLA, any location listed for
possible inclusion on the National Priorities List by the
Environmental Protection Agency in CERCLIS, nor any
location listed on any similar state list or which is the
subject of federal, state or local enforcement actions or
other investigations which may lead to claims against any
Restricted Person for clean-up costs, remedial work,
damages to natural resources or for personal injury claims,
including, but not limited to, claims under CERCLA.
(f) No property now or previously owned, operated or
leased by any Restricted Person is listed or proposed for
listing on the National Priority list promulgated pursuant
to CERCLA, in CERCLIS, nor on any similar state list of
sites.
(g) There are no Liens arising under or pursuant to
any Environmental Laws on any of the real properties or
properties owned, operated or leased by any Restricted
Person, and no government actions of which Borrower is
aware have been taken or are threatened which could subject
any of such properties to such Liens; nor would any
Restricted Person be required to place any notice or
restriction relating to the presence of Hazardous Materials
at any properties owned by it in any deed to such
properties.
(h) There have been no environmental investigations,
studies, audits, tests, reviews or other analyses for
surface water, ground water, soil contamination or natural
resource damages relating to the Release of Hazardous
Materials conducted by or which are in the possession of
any Restricted Person in relation to any properties or
facility now or previously owned, operated or leased by any
Restricted Person which have not been made available to
Administrative Agent.
(i) Except as set forth on the Disclosure Schedule,
(i) all Restricted Persons are conducting their businesses
in material compliance with all applicable Environmental
Laws, and all past non-compliance with such Environmental
Laws has been resolved without ongoing obligations or
costs; and (ii) no Restricted Person has filed any notice
under any Law indicating that any such Person is
responsible for the improper release into the environment,
or the improper storage or disposal, of any material amount
of any Hazardous Materials or that any Hazardous Materials
have been improperly released, or are improperly stored or
disposed of, upon any property of any such Person.
(j) The Disclosure Schedule sets out (i) the amounts
expended by Restricted Persons through November 13, 2001 to
pay (x) vendors, (y) spill claimants, and (z) clean up
costs incurred in connection with the Pipeline Release
(collectively, the "Spill Costs"), (ii) the estimated
amount of additional Spill Costs which will be incurred by
the Restricted Persons in the future, (iii) the amount of
insurance payments received by Restricted Persons through
November 13, 2001 to pay for Spill Costs, and (iv) the
estimated amount of future insurance payments that the
Restricted Persons anticipate receiving to pay for Spill
Costs.
Section 5.14. Names and Places of Business. No Restricted
Person has, during the preceding five years, had, been known by,
or used any other trade or fictitious name, except as disclosed
in the Disclosure Schedule. Except as otherwise indicated in
the Disclosure Schedule, the chief executive office and
principal place of business of each Restricted Person are (and
since the dates of initial formation of such Restricted Persons
have been) located at the address of Borrower set out in Section
10.3. Except as indicated in the Disclosure Schedule or
otherwise disclosed in writing to the Administrative Agent, no
Restricted Person has any other office or place of business.
Section 5.15. Borrower's Subsidiaries. Borrower does not
presently have any Subsidiary or own any stock in any other
corporation or association except those listed in the Disclosure
Schedule or disclosed to Administrative Agent in writing.
Neither Borrower nor any Restricted Person is a member of any
general or limited partnership, limited liability company, joint
venture or association of any type whatsoever except those
listed in the Disclosure Schedule or disclosed to Administrative
Agent in writing. Borrower owns, directly or indirectly, the
equity interest in each of its Subsidiaries which is indicated
in the Disclosure Schedule or as disclosed to Administrative
Agent in writing.
Section 5.16. Title to Properties; Licenses. Each
Restricted Person has good and defensible title to all of its
material properties and assets, free and clear of all Liens
other than Permitted Liens and of all material impediments to
the use of such properties and assets in such Restricted
Person's business. Each Restricted Person possesses all
licenses, permits, franchises, patents, copyrights, trademarks
and trade names, and other intellectual property (or otherwise
possesses the right to use such intellectual property without
violation of the rights of any other Person) which are necessary
to carry out its business as presently conducted and as
presently proposed to be conducted hereafter, except to the
extent that such failure to possess could not reasonably be
expected to cause a Material Adverse Change, and no Restricted
Person is in violation in any material respect of the terms
under which it possesses such intellectual property or the right
to use such intellectual property.
Section 5.17. Government Regulation. Neither Borrower nor
any other Restricted Person owing Obligations is subject to
regulation under the Public Utility Holding Company Act of 1935,
the Federal Power Act, the Investment Company Act of 1940 (as
any of the preceding acts have been amended) or any other Law
which regulates the incurring by such Person of Indebtedness,
including Laws relating to common contract carriers or the sale
of electricity, gas, steam, water or other public utility
services.
Section 5.18. Insider. No Restricted Person, nor any
Person having "control" (as that term is defined in 12 U.S.C.
Sec. 375b(9) or in regulations promulgated pursuant thereto) of
any Restricted Person, is a "director" or an "executive officer"
or "principal shareholder" (as those terms are defined in 12
U.S.C. Sec. 375b(8) or (9) or in regulations promulgated
pursuant thereto) of any Lender, of a bank holding company of
which any Lender is a Subsidiary or of any Subsidiary of a bank
holding company of which any Lender is a Subsidiary.
Section 5.19. Solvency. Upon giving effect to the
issuance of the Notes, the execution of this Agreement and the
other Loan Documents by Borrower and each Guarantor and the
consummation of the transactions contemplated hereby and
thereby, (i) Borrower and each Guarantor will be solvent (as
such term is used in applicable bankruptcy, liquidation,
receivership, insolvency or similar Laws), and the sum of
Borrower's and each Guarantor's absolute and contingent
liabilities, including the Obligations or guarantees thereof,
shall not exceed the fair market value of such Restricted
Person's assets, and (ii) Borrower's and each Guarantor's
capital should be adequate for the businesses in which such
Restricted Person is engaged and intends to be engaged. Neither
Borrower nor any Restricted Person has incurred (whether under
the Loan Documents or otherwise), nor does any Restricted Person
intend to incur or believe that it will incur, debts which will
be beyond its ability to pay as such debts mature.
Section 5.20. Credit Arrangements. Except as set forth on
the Disclosure Schedule, no Affiliate of any Restricted Person
is party to or subject to any credit agreement, loan agreement,
indenture, purchase agreement, guaranty or other arrangement
providing for or otherwise relating to any Indebtedness or any
extension of credit (or commitment for any extension of credit)
that creates by a covenant of such Affiliate or otherwise, any
limitation or restriction any action of any Restricted Person or
any obligation that any Restricted Person be caused to take any
action.
Section 5.21. Real Property. Set forth on Part I of
Schedule 6 hereto is a complete and accurate list of all real
property owned by any Restricted Person or any of its
Subsidiaries (other than Injection Stations), showing as of the
date hereof the street address, county or other relevant
jurisdiction, state, record owner and book and estimated fair
value thereof. Each Restricted Person or such Subsidiary has
good, marketable and insurable fee simple title to such real
property, free and clear of all Liens, other than Permitted
Liens and other Liens created or permitted by the Loan
Documents. Set forth on Part II of Schedule 6 hereto is a
complete and accurate list of all leases of real property under
which any Restricted Person or any of its Subsidiaries is the
lessee(other than Injection Stations), showing as of the date
hereof the street address, county or other relevant
jurisdiction, state, lessor, lessee, expiration date and annual
rental cost thereof. Each such lease is the legal, valid and
binding obligation of the lessor thereof, enforceable in
accordance with its terms.
ARTICLE VI - Affirmative Covenants
To conform with the terms and conditions under which each
Lender is willing to have credit outstanding to Borrower, and to
induce each Lender to enter into this Agreement and extend
credit hereunder, General Partner, Genesis Energy, L.P. and
Borrower covenant and agree that until the full and final
payment of the Obligations and the termination of this
Agreement, unless Majority Lenders, or all Lenders as required
under Section 10.1, have previously agreed otherwise:
Section 6.1. Payment and Performance. Each Restricted
Person will pay all amounts due under the Loan Documents, to
which it is a party, in accordance with the terms thereof and
will observe, perform and comply with every covenant, term and
condition expressed in the Loan Documents to which it is a
party.
Section 6.2. Books, Financial Statements and Reports.
Each Restricted Person will at all times maintain full and
accurate books of account and records. Borrower will maintain
and will cause its Subsidiaries to maintain a standard system of
accounting, will maintain its Fiscal Year, and will furnish the
following statements and reports to each Lender at Restricted
Person's expense:
(a) As soon as available, and in any event within one
hundred twenty (120) days after the end of each Fiscal Year
(i) complete Consolidated financial statements of Borrower
together with all notes thereto, prepared in reasonable
detail in accordance with GAAP, together with an
unqualified opinion, based on an audit using generally
accepted auditing standards, by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, or
other independent certified public accountants selected by
General Partner and acceptable to Majority Lenders, stating
that such Consolidated financial statements have been so
prepared and (ii) supporting unaudited balance sheets and
statements of income of each other Restricted Person.
These financial statements shall contain a Consolidated
balance sheet as of the end of such Fiscal Year and
Consolidated statements of earnings for such Fiscal Year.
Such Consolidated financial statements shall set forth in
comparative form the corresponding figures for the
preceding Fiscal Year. In addition, within ninety (90)
days after the end of each Fiscal Year, Borrower will
furnish a certificate signed by such accountants (i)
stating that they have read this Agreement, (ii) containing
calculations showing compliance (or non-compliance) at the
end of such Fiscal Year with the requirements of Sections
7.11 through 7.14 inclusive, and (iii) further stating that
in making their examination and reporting on the
Consolidated financial statements described above they
obtained no knowledge of any Default existing at the end of
such Fiscal Year, or, if they did so conclude that a
Default existed, specifying its nature and period of
existence.
(b) As soon as available, and in any event within
sixty (60) days after the end of each Fiscal Quarter of
each Fiscal Year (i) Borrower's Consolidated balance sheet
as of the end of such Fiscal Quarter and Consolidated
statements of Borrower's earnings and cash flows for such
Fiscal Quarter and for the period from the beginning of the
then current Fiscal Year to the end of such Fiscal Quarter,
and (ii) supporting balance sheets and statements of income
of each other Restricted Person, all in reasonable detail
and prepared in accordance with GAAP, subject to changes
resulting from normal year-end adjustments. In addition,
Borrower will, together with each such set of financial
statements and each set of financial statements furnished
under subsection (a) of this section, furnish a certificate
in the form of Exhibit F signed by the chief financial
officer, principal accounting officer or treasurer of
General Partner stating that such financial statements are
accurate and complete in all material respects (subject to
normal year-end adjustments), stating that he has reviewed
the Loan Documents, containing calculations showing
compliance (or non-compliance) at the end of such Fiscal
Quarter with the requirements of Sections 7.11 through
7.14, inclusive and stating that no Default exists at the
end of such Fiscal Quarter or at the time of such
certificate or specifying the nature and period of
existence of any such Default.
(c) Promptly upon their becoming available, copies of
all financial statements, reports, notices and proxy
statements sent by Genesis Energy, L.P. to its unit holders
and all registration statements, periodic reports and other
statements and schedules filed by Genesis Energy, L.P. with
any securities exchange, the Securities and Exchange
Commission or any similar governmental authority.
(d) As soon as available, and in any event within one
hundred twenty (120) days after the end of each Fiscal
Year, a business and financial plan for Borrower (in form
reasonably satisfactory to Administrative Agent), prepared
or caused to be prepared by a senior financial officer
thereof, setting forth for the first year thereof,
quarterly financial projections and budgets for Genesis
Energy, L.P., and thereafter yearly financial projections
during the Commitment Period.
(e) On or about the twenty-sixth (26th) (but no later
than the twenty-eighth (28th)) day of each calendar month a
Borrowing Base Report in the form of Exhibit G duly
completed by an authorized officer of General Partner and
conforming with the requirements of Section 2.13, and on or
before the last day of each calendar month, a statement
reconciling the Borrowing Base Report delivered on or about
the 26th day of the preceding calendar month with actual
results for the preceding calendar month.
(f) As soon as available, and in any event within
thirty (30) days after the end of each calendar month, a
report setting forth for such month aggregate volumes and
margins for all marketing activities of Restricted Persons.
(g) As soon as available, and in any event within
thirty (30) days after the end of each Fiscal Year, an
environmental compliance certificate signed by the
president or chief executive officer of General Partner in
the form attached hereto as Exhibit H. Further, if
requested by Administrative Agent, Restricted Persons shall
permit and cooperate with an environmental and safety
review made in connection with the operations of Restricted
Persons' properties one time during each Fiscal Year, by
consultants selected by Administrative Agent which review
shall, if requested by Administrative Agent, be arranged
and supervised by environmental legal counsel for
Administrative Agent, all at Restricted Persons' cost and
expense. The consultant shall render a verbal or written
report, as specified by Administrative Agent, based upon
such review at Restricted Persons' cost and expense and a
copy thereof will be provided to Restricted Persons.
(h) Concurrently with the annual renewal of
Restricted Persons' insurance policies, Restricted Persons
shall at their own cost and expense, if requested by
Administrative Agent in writing, cause a certificate or
report to be issued by Administrative Agent's professional
insurance consultants or other insurance consultants
satisfactory to Administrative Agent certifying that
Restricted Persons' insurance for the next succeeding year
after such renewal (or for such longer period for which
such insurance is in effect) complies with the provisions
of this Agreement and the Security Documents.
(i) As soon as available, and in any event within
thirty (30) days after the end of each calendar month, a
Consolidated statement of Borrower's earnings for such
calendar month in form satisfactory to Administrative
Agent.
(j) As soon as available, and in any event within
thirty (30) days after the end of each calendar month, a
report on a ▇▇▇▇ to market basis of all Floating Price
Contracts as of the close of business on the last day of
such month, and together with such report a complete list
of all net realized losses on any Floating Price Contracts
for the prior twelve months in form reasonably satisfactory
to Administrative Agent.
Section 6.3. Other Information and Inspections. Each
Restricted Person will furnish to each Lender any information
which Administrative Agent or any Lender may from time to time
request concerning any covenant, provision or condition of the
Loan Documents or any matter in connection with Restricted
Persons' businesses and operations. Each Restricted Person will
permit representatives appointed by Administrative Agent
(including independent accountants, auditors, agents, attorneys,
appraisers and any other Persons) to visit and inspect during
normal business hours any of such Restricted Person's property,
including its books of account, other books and records, and any
facilities or other business assets, and to make extra copies
therefrom and photocopies and photographs thereof, and to write
down and record any information such representatives obtain, and
each Restricted Person shall permit Administrative Agent or its
representatives to investigate and verify the accuracy of the
information furnished to Administrative Agent or any Lender in
connection with the Loan Documents and to discuss all such
matters with its officers, employees and, upon prior notice to
Borrower, its representatives. Without limitation of the
foregoing, within one hundred twenty (120) days after the end of
each Fiscal Year, and in addition once during each Fiscal Year,
if requested by Administrative Agent at the instruction of
Majority Lenders, Borrower shall permit commercial financial
examiners appointed by Administrative Agent to conduct a
commercial finance examination of the business and assets of
Restricted Persons and in connection with such examination to
have full access to and the right to examine, audit, make
abstracts and copies from, and inspect Restricted Persons'
records, files, books of account and all other documents,
instruments and agreements to which a Restricted Person is a
party. Borrower shall pay all reasonable costs and expenses of
Administrative Agent associated with any such examination.
Section 6.4. Notice of Material Events and Change of
Address. Each Restricted Person will notify each Lender Party,
not later than five (5) Business Days after any executive
officer of Restricted Persons has knowledge thereof, stating
that such notice is being given pursuant to this Agreement, of:
(a) the occurrence of any Material Adverse Change;
(b) the occurrence of any Default;
(c) the acceleration of the maturity of any
Indebtedness owed by any Restricted Person or of any
default by any Restricted Person under any indenture,
mortgage, agreement, contract or other instrument to which
any of them is a party or by which any of them or any of
their properties is bound, if such acceleration or default
could cause a Material Adverse Change;
(d) the occurrence of any Termination Event;
(e) Under any Environmental Law, any claim of
$250,000 or more, any notice of potential liability which
might exceed such amount, or any other material adverse
claim asserted against any Restricted Person or with
respect to any Restricted Person's properties taken as a
whole; and
(f) the filing of any suit or proceeding, or the
assertion in writing of a claim against any Restricted
Person or with respect to any Restricted Person's
properties in which an adverse decision could reasonably be
expected to cause a Material Adverse Change.
Upon the occurrence of any of the foregoing, Restricted Persons
will take all necessary or appropriate steps to remedy promptly
any such Material Adverse Change, Default, acceleration,
default, or Termination Event to protect against any such
adverse claim, to defend any such suit or proceeding, and to
resolve all controversies on account of any of the foregoing.
Restricted Persons will also notify Administrative Agent and
Administrative Agent's counsel in writing at least twenty
Business Days prior to the date that any Restricted Person
changes its name or the location of its chief executive office
or principal place of business or the place where it keeps its
books and records concerning the Collateral, furnishing with
such notice any necessary financing statement amendments or
requesting Administrative Agent and its counsel to prepare the
same.
Section 6.5. Maintenance of Properties. Each Restricted
Person will maintain, preserve, protect, and keep all Collateral
and all other material property used or useful in the conduct of
its business in good condition (ordinary wear and tear excepted)
and in compliance with all applicable Laws, and will from time
to time make all repairs, renewals and replacements needed to
enable the business and operations carried on in connection
therewith to be promptly and advantageously conducted at all
times.
Section 6.6. Maintenance of Existence and Qualifications.
Each Restricted Person will maintain and preserve its existence
and its rights and franchises in full force and effect and will
qualify to do business in all states or jurisdictions where
required by applicable Law, except where the failure so to
qualify will not cause a Material Adverse Change.
Section 6.7. Payment of Trade Liabilities, Taxes, Etc.
Each Restricted Person will (a) timely file all required tax
returns including any extensions; (b) timely pay all taxes,
assessments, and other governmental charges or levies imposed
upon it or upon its income, profits or property; (c) within one
hundred twenty (120) days after the date such goods are
delivered or such services are rendered, pay all Liabilities
owed by it on ordinary trade terms to vendors, suppliers and
other Persons providing goods and services used by it in the
ordinary course of its business; (d) pay and discharge when due
all other Liabilities now or hereafter owed by it, other than
royalty payments suspended in the ordinary course of business;
and (e) maintain appropriate accruals and reserves for all of
the foregoing in accordance with GAAP. Each Restricted Person
may, however, delay paying or discharging any of the foregoing
so long as it is in good faith contesting the validity thereof
by appropriate proceedings, if necessary, and has set aside on
its books adequate reserves therefor which are required by GAAP.
Section 6.8. Insurance. Each Restricted Person shall at
all times maintain insurance for its property in accordance with
the Insurance Schedule which insurance shall be by financially
sound and reputable insurers. Each Restricted Person will
maintain any additional insurance coverage as described in the
respective Security Documents. If any portion of any real
estate on which a Lien is granted for purposes of securing the
Obligations is located in an area identified by the Federal
Emergency Management Agency as an area having special flood
hazards and in which flood insurance has been made available
under the National Flood Insurance Act of 1968 (and any
amendment or successor act thereto), then Borrower shall
maintain, or cause to be maintained, with an insurer reasonably
acceptable to Agent, flood insurance in an amount sufficient to
comply with all applicable rules and regulations promulgated
pursuant to such Act. Upon demand by Administrative Agent any
insurance policies covering Collateral shall be endorsed (a) to
provide for payment of losses to Administrative Agent as its
interests may appear, (b) to provide that such policies may not
be canceled or reduced or affected in any material manner for
any reason without fifteen days prior notice to Administrative
Agent, and (c) to provide for any other matters specified in any
applicable Security Document or which Administrative Agent may
reasonably require. Each Restricted Person shall at all times
maintain insurance against its liability for injury to persons
or property in accordance with the Insurance Schedule, which
insurance shall be by financially sound and reputable insurers.
Without limiting the foregoing, each Restricted Person shall at
all time maintain liability insurance in accordance with the
Insurance Schedule.
Section 6.9. Performance on Borrower's Behalf. If any
Restricted Person fails to pay any taxes, insurance premiums,
expenses, attorneys' fees or other amounts it is required to pay
under any Loan Document, Agents may pay the same after notice of
such payment by Administrative Agent is given to Borrower.
Borrower shall immediately reimburse Agent for any such payments
and each amount paid by Agents shall constitute an Obligation
owed hereunder which is due and payable on the date such amount
is paid by Agents.
Section 6.10. Interest. Borrower hereby promises to each
Lender to pay interest at the Default Rate on all Obligations
(including Obligations to pay fees or to reimburse or indemnify
any Lender) which Borrower has in this Agreement promised to pay
to such Lender and which are not paid when due. Such interest
shall accrue from the date such Obligations become due until
they are paid.
Section 6.11. Compliance with Agreements and Law. Each
Restricted Person will perform all material obligations it is
required to perform under the terms of each indenture, mortgage,
deed of trust, security agreement, lease, and franchise, and
each agreement, contract or other instrument or obligation to
which it is a party or by which it or any of its properties is
bound. Each Restricted Person will conduct its business and
affairs in compliance with all Laws applicable thereto and will
maintain in good standing all licenses that may be necessary or
appropriate to carry on its business.
Section 6.12. Environmental Matters; Environmental
Reviews.
(a) Each Restricted Person will comply in all material
respects with all Environmental Laws now or hereafter applicable
to such Restricted Person as well as all contractual obligations
and agreements with respect to environmental remediation or
other environmental matters and shall obtain, at or prior to the
time required by applicable Environmental Laws, all
environmental, health and safety permits, licenses and other
authorizations necessary for its operations and will maintain
such authorizations in full force and effect, conduct any
investigation, study, sampling and testing, and undertake any
cleanup, removal, remedial or other action necessary to remove
and clean up all Hazardous Materials from any of its properties,
in accordance with the requirements of all Environmental Laws.
(b) Each Restricted Person will promptly furnish to
Administrative Agent all written notices of violation, orders,
claims, citations, complaints, penalty assessments, suits or
other proceedings received by any Restricted Person, or of which
it has notice, pending or threatened against any Restricted
Person, the potential liability of which exceeds $250,000 or
would cause a Material Adverse Change if resolved adversely
against any Restricted Person, by any governmental authority
with respect to any alleged violation of or non-compliance with
any Environmental Laws or any permits, licenses or
authorizations in connection with its ownership or use of its
properties or the operation of its business.
(c) Each Restricted Person will promptly furnish to
Administrative Agent all requests for information, notices of
claim, demand letters, and other notifications, received by any
Restricted Person in connection with its ownership or use of its
properties or the conduct of its business, relating to potential
responsibility with respect to any investigation or clean-up of
Hazardous Material at any location, the potential liability of
which exceeds $250,000 or would cause a Material Adverse Change
if resolved adversely against any Restricted Person.
Section 6.13. Evidence of Compliance. Subject to the last
sentence of Section 6.3, each Restricted Person will furnish to
each Lender at such Restricted Person's expense all evidence
which Administrative Agent from time to time reasonably requests
in writing as to the accuracy and validity of or compliance with
all representations, warranties and covenants made by any
Restricted Person in the Loan Documents, the satisfaction of all
conditions contained therein, and all other matters pertaining
thereto.
Section 6.14. Agreement to Deliver Security Documents.
Restricted Persons will deliver to further secure the
Obligations whenever requested by Administrative Agent, in its
sole and absolute discretion, deeds of trust, mortgages, flood
hazard certification, title searches, title insurance, chattel
mortgages, surveys, security agreements, financing statements
and other Security Documents in form and substance reasonably
satisfactory to Administrative Agent for the purpose of
granting, confirming, and perfecting first and prior liens or
security interests in any real or personal property now owned or
hereafter acquired by any Restricted Person.
Section 6.15. Perfection and Protection of Security
Interests and Liens. Each Restricted Person will from time to
time deliver to Collateral Agent any financing statements,
continuation statements, extension agreements and other
documents, properly completed and executed (and acknowledged
when required) by Restricted Persons in form and substance
reasonably satisfactory to Collateral Agent, which Collateral
Agent requests for the purpose of perfecting, confirming, or
protecting any Liens or other rights in Collateral securing any
Obligations.
Section 6.16. Bank Accounts; Offset. To secure the
repayment of the Obligations, each Restricted Person hereby
grants to each Lender a security interest, a lien, and a right
of offset, each of which shall be in addition to all other
interests, liens, and rights of any Lender at common Law, under
the Loan Documents, or otherwise, and each of which shall be
upon and against (a) any and all moneys, securities or other
property (and the proceeds therefrom) of such Restricted Person
now or hereafter held or received by or in transit to any Lender
from or for the account of such Restricted Person, whether for
safekeeping, custody, pledge, transmission, collection or
otherwise, (b) any and all deposits (general or special, time or
demand, provisional or final) of such Restricted Person with any
Lender, and (c) any other credits and claims of such Restricted
Person at any time existing against any Lender, including claims
under certificates of deposit. At any time and from time to
time during the continuance of any Event of Default, each Lender
is hereby authorized to foreclose upon, or to offset against the
Obligations then due and payable (in either case without notice
to any Restricted Person), any and all items hereinabove
referred to. The remedies of foreclosure and offset are
separate and cumulative, and either may be exercised
independently of the other without regard to procedures or
restrictions applicable to the other.
Section 6.17. Guaranties of Subsidiaries. Each Subsidiary
of General Partner (other than Borrower) now existing or
created, acquired or coming into existence after the date hereof
shall, promptly upon request by Administrative Agent, execute
and deliver to Administrative Agent an absolute and
unconditional guaranty of the timely repayment of the
Obligations and the due and punctual performance of the
obligations of Borrower hereunder, which guaranty shall be
reasonably satisfactory to Administrative Agent in form and
substance. Each Subsidiary of General Partner (other than
Borrower) existing on the date hereof shall duly execute and
deliver such a guaranty prior to the making of any Loan
hereunder. General Partner will cause each of its Subsidiaries
to deliver to Administrative Agent, simultaneously with its
delivery of such a guaranty, written evidence satisfactory to
Administrative Agent and its counsel that such Subsidiary has
taken all corporate, limited liability company or partnership
action necessary to duly approve and authorize its execution,
delivery and performance of such guaranty and any other
documents which it is required to execute.
Section 6.18. Compliance with Agreements. Each Restricted
Person shall observe, perform or comply with any agreement with
any Person or any term or condition of any instrument, if such
agreement or instrument is materially significant to such
Restricted Person or to Restricted Persons on a Consolidated
basis or materially significant to any Guarantor, unless any
such failure to so observe, perform or comply is remedied within
the applicable period of grace (if any) provided in such
agreement or instrument or unless such failure to so observe,
perform or comply would not reasonably be expected to cause a
Material Adverse Change.
Section 6.19. Rents. By the terms of the various Security
Documents, certain Restricted Persons are and will be assigning
to Collateral Agent, for the benefit of Lender Parties, all of
the "Rents" (as defined therein) accruing to the property
covered thereby. Notwithstanding any such assignments, so long
as no Default has occurred and is continuing, (i) such
Restricted Persons may continue to receive and collect from the
payors of such Rents all such Rents, subject, however, to the
Liens created under the Security Documents, which Liens are
hereby affirmed and ratified, and free and clear of such Liens,
use the proceeds of the Rents, and (ii) the Collateral Agent
will not notify the obligors of such Rents or take any other
action to cause proceeds thereof to be remitted to the
Collateral Agent. Upon the occurrence of a Default, Collateral
Agent may exercise all rights and remedies granted under the
Security Documents, including the right to obtain possession of
all Rents then held by such Restricted Persons or to receive
directly from the payors of such Rents all other Rents until
such time as such Default is no longer continuing. If
Collateral Agent shall receive any Rent proceeds from any payor
at any time other than during the continuance of a Default, then
it shall notify Borrower thereof and (i) upon request and
pursuant to the instructions of Borrower, it shall, if no
Default is then continuing, remit such proceeds to the Borrower
and (ii) at the request and expense of Borrower, execute and
deliver a letter to such payors confirming Restricted Persons'
right to receive and collect Rents until otherwise notified by
Collateral Agent. In no case shall any failure, whether
purposed or inadvertent, by Collateral Agent to collect directly
any such Rents constitute in any way a waiver, remission or
release of any of its rights under the Security Documents, nor
shall any release of any Rents by Collateral Agent to such
Restricted Persons constitute a waiver, remission, or release of
any other Rents or of any rights of Collateral Agent to collect
other Rents thereafter.
Section 6.20. Operating Practices. Each Restricted Person
shall operate its business in a manner that is consistent with
the policies and procedures approved by the board of directors
of General Partner and in effect on, and delivered to
Administrative Agent and Lenders prior to, the date hereof, and
revisions thereto referred to in the following sentence.
Borrower shall review such policies and procedures at least
annually, and shall promptly recommend to the board of directors
of General Partner such revisions to such policies and
procedures as may be recommended by Restricted Persons' or, upon
consultation with Borrower and its consultants and at the
request of Administrative Agent, Administrative Agent's third
party consultants, with respect to adequate internal controls,
and Borrower shall promptly provide a report to Lenders
regarding such policies and procedures, including such policies
and procedures which the board of directors of General Partner
could adopt and has adopted.
Section 6.21. Evaluation. Within 45 days of the date
hereof, Borrower shall engage an independent advisor reasonably
acceptable to Administrative Agent to evaluate the business
plans of Borrower and its Subsidiaries, with the nature and
scope of such evaluation to be reasonably satisfactory to the
Administrative Agent.
ARTICLE VII - Negative Covenants
To conform with the terms and conditions under which each
Lender is willing to have credit outstanding to Borrower, and to
induce each Lender to enter into this Agreement and make the
Loans, General Partner, Genesis Energy, L.P. and Borrower
covenant and agree that until the full and final payment of the
Obligations and the termination of this Agreement, unless
Majority Lenders, or all Lenders as required under Section 10.1,
have previously agreed otherwise:
Section 7.1. Indebtedness. No Restricted Person will in
any manner owe or be liable for Indebtedness except:
(a) the Obligations;
(b) Indebtedness of Borrower arising under Hedging
Contracts (i) permitted under Section 7.3 or (ii)
consisting of options, swaps, collars and similar
instruments that relate to Petroleum Inventory and are
either referred to in Section 7.15(a) or permitted by
Section 7.15(b) or (c );
(c) Indebtedness of any Restricted Person owing to
another Restricted Person;
(d) guaranties by General Partner, Genesis Energy,
L.P., Borrower or any other Guarantor of trade payables of
any Restricted Person incurred and paid in the ordinary
course of business on ordinary trade terms;
(e) Indebtedness of any Restricted Person owing in
connection with deferred payments of insurance premiums,
provided that all such Indebtedness of all Restricted
Persons shall not exceed $1,500,000 in any Fiscal Year;
(f) prior to February 28, 2002, but not thereafter,
outstanding Salomon Obligations, provided that the Facility
Usage plus the Salomon Guaranty Exposure does not exceed
the sum of the Borrowing Base and the Over-Advance Facility
at any time; and
(g) other Indebtedness of Borrower not to exceed in
the aggregate principal amount of $250,000 at any one time
outstanding.
Section 7.2. Limitation on Liens. No Restricted Person
will create, assume or permit to exist (i) any Lien upon any
Accounts, inventory, cash or investment securities which
constitute Collateral except (A) Permitted Inventory Liens, (B)
Liens created pursuant to the Security Documents and, prior to
February 28, 2002, but not thereafter, Liens existing on the
date of this Agreement securing outstanding Salomon Obligations,
(C) statutory Liens in respect of First Purchase Crude Payables,
(D) Liens of the type described in clause (e) below in
connection with any Eligible Margin Deposit to secure Hedging
Contracts permitted under Section 7.1 with the broker that is
the holder of such Eligible Margin Deposit, (E) Liens of the
type described in clauses (a), (c) and (f) below, and (F) any
other Liens expressly permitted to encumber such Collateral
under any Security Document covering such Collateral or (ii) any
Lien upon any of the properties or assets other than such
Collateral which it now owns or hereafter acquires except the
following (Liens, to the extent permitted by this Section,
herein called "Permitted Liens"):
(a) Liens created pursuant to this Agreement or the
Security Documents and Liens existing on the date of this
Agreement and listed in the Disclosure Schedule.
(b) Liens imposed by any governmental authority for
taxes, assessments or charges not yet due or the validity
of which is being contested in good faith and by
appropriate proceedings, if necessary, for which adequate
reserves are maintained on the books of any Restricted
Person in accordance with GAAP;
(c) pledges or deposits of cash or securities under
worker's compensation and automobile insurance policies,
unemployment insurance and employee medical insurance or
other social security legislation not to exceed for all
such items in the aggregate $1,000,000;
(d) carriers', warehousemen's, mechanics',
materialmen's, repairmen's, landlord's, or other like Liens
(including, without limitation, Liens on property of any
Restricted Person in the possession of storage facilities,
pipelines or barges) arising in the ordinary course of
business for amounts which are not more than 60 days past
due or the validity of which is being contested in good
faith and by appropriate proceedings, if necessary, and for
which adequate reserves are maintained on the books of any
Restricted Person in accordance with GAAP;
(e) Liens under or with respect to accounts with
brokers or counterparties with respect to Hedging Contracts
consisting of cash, commodities or futures contracts,
options, securities, instruments, and other like assets
securing only Hedging Contracts permitted under Section
7.1;
(f) deposits of cash or securities to secure the
performance of bids, trade contracts (other than for
borrowed money), leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a
like nature incurred in the ordinary course of business;
(g) easements, rights-of-way, restrictions and other
similar encumbrances incurred in the ordinary course of
business and encumbrances consisting of zoning
restrictions, easements, licenses, restrictions on the use
of real property or minor imperfections in title thereto
which, in the aggregate, are not material in amount, and
which do not in any case materially detract from the value
of the property subject thereto or interfere with the
ordinary conduct of the business of any Restricted Person;
(h) Liens in respect of purchase money obligations
and Capital Leases relating to Indebtedness permitted under
Section 7.1(g), and Liens in respect of operating leases;
(i) rights reserved to or vested in any governmental
authority by the terms of any right, power, franchise,
grant, license or permit, or by any provision of law, to
revoke or terminate any such right, power, franchise,
grant, license or permit or to condemn or acquire by
eminent domain or similar process;
(j) rights reserved to or vested by Law in any
governmental authority to in any manner, control or
regulate in any manner any of the properties of any
Restricted Person or the use thereof or the rights and
interests of any Restricted Person therein, in any manner
under any and all Laws;
(k) rights reserved to the grantors of any properties
of any Restricted Person, and the restrictions, conditions,
restrictive covenants and limitations, in respect thereto,
pursuant to the terms, conditions and provisions of any
rights-of-way agreements, contracts or other agreements
therewith; and
(l) inchoate Liens in respect of pending litigation
or with respect to a judgment which has not resulted in an
Event of Default under Section 8.1.
Section 7.3. Hedging Contracts. No Restricted Person will
be a party to or in any manner be liable on any Hedging
Contract, except:
(a) Hedging Contracts entered into by a Restricted
Person with the purpose and effect of fixing interest rates
on a principal amount of indebtedness of such Restricted
Person that is accruing interest at a variable rate,
provided that (i) the aggregate notional amount of such
contracts never exceeds one hundred percent (100%) of the
anticipated outstanding principal balance of the
indebtedness to be hedged by such contracts or an average
of such principal balances calculated using a generally
accepted method of matching interest swap contracts to
declining principal balances, (ii) the floating rate index
of each such contract generally matches the index used to
determine the floating rates of interest on the
corresponding indebtedness to be hedged by such contract
and (iii) each such contract is with a counterparty or has
a guarantor of the obligation of the counterparty who
(unless such counterparty is a Lender or an Affiliate of
any Lender at the time such contract is entered into) at
the time the contract is made has long-term unsecured and
unenhanced debt obligations rated A or A2 or better,
respectively, by either Rating Agency or is otherwise
acceptable to Majority Lenders.
(b) Hedging Contracts relating to Petroleum Inventory
which are referred to in Section 7.15(a) or permitted by
Section 7.15(b) or (c).
Section 7.4. Limitation on Mergers, Issuances of
Securities. Except as expressly provided in this section, no
Restricted Person will (a) enter into any transaction of merger
or consolidation or amalgamation, or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution), (b)
acquire any business or property from, or capital stock of, or
be a party to any acquisition of, any Person except for
purchases of inventory and other property to be sold or used in
the ordinary course of business and Investments permitted under
Section 7.7 hereof or (c) sell, transfer, lease, exchange,
alienate or otherwise dispose of, in one transaction or a series
of transactions, any part of its business or property, whether
now owned or hereafter acquired, except for sales or transfers
not prohibited by under Section 7.5 hereof. No Subsidiary of
Genesis Energy, L.P. will issue any additional shares of its
capital stock or other securities or any options, warrants or
other rights to acquire such additional shares or other
securities except a direct Subsidiary of a Restricted Person may
issue additional shares or other securities to such Restricted
Person, to Genesis Energy, L.P. or to General Partner so long as
(i) such Subsidiary is a Wholly Owned Subsidiary of Genesis
Energy, L.P. after giving effect thereto and (ii) such share and
securities shall be pledged to the Collateral Agent for the
benefit of the Lenders pursuant to Security Documents acceptable
to the Administrative Agent. No Subsidiary of Borrower which is
a partnership will allow any diminution of Borrower's interest
(direct or indirect) therein.
Section 7.5. Limitation on Sales of Property. No
Restricted Person will sell, transfer, lease, exchange, alienate
or dispose of any Collateral or any of its material assets or
properties or any material interest therein except:
(a) equipment which is worthless or obsolete or no
longer necessary or useful to the proper conduct of its
business or which is replaced by equipment of equal
suitability and value;
(b) inventory (including pipeline linefill) which is
sold in the ordinary course of business on ordinary trade
terms;
(c) sales or transfers, subject to the Security
Documents, by a Person (other than Borrower) that is a
Subsidiary of a Restricted Person to such Restricted Person
or to a Wholly Owned Subsidiary of such Restricted Person
that is a Guarantor;
(d) sale of any or all of the real and personal
property associated with the Texas System between and
including Neches, Texas and Gate Plant D located on the
▇▇▇▇▇▇ Junction to ▇▇▇▇▇▇▇ segment in Houston, Texas,
including any gathering or branch lines extending from the
trunk lines so long as (A) the purchase price paid to
Borrower for such asset shall be no less than the fair
market value of such asset at the time of such sale, (B)
the purchase price for such asset shall be paid to Borrower
solely in cash, and (C) the Net Cash Proceeds from any such
sale shall be applied as set forth in Section 2.6(c); and
(e) the sale of any other asset by Borrower or any
Subsidiary so long as (A) the purchase price paid to
Borrower or such Subsidiary for such asset shall be no less
than the fair market value of such asset at the time of
such sale, (B) the purchase price for such asset shall be
paid to Borrower or such Subsidiary solely in cash, (C) the
aggregate purchase price paid to Borrower and all of its
Subsidiaries for such asset and all other assets sold by
Borrower and its Subsidiaries during the same Fiscal Year
pursuant to this clause (e) shall not exceed $2,000,000,
(D) the consent (not to be unreasonably withheld) of the
Majority Lenders is obtained in connection with any such
sale, and (E) the Net Cash Proceeds from any such sale
shall be applied as set forth in Section 2.6(c).
No Restricted Person will sell, transfer or otherwise dispose of
capital stock of or interest in any of its Subsidiaries except
to Borrower or a Wholly Owned Subsidiary of Borrower which shall
pledge such capital stock or interest to the Collateral Agent
for the benefit of the Lenders pursuant to Security Documents
acceptable to the Collateral Agent.. No Restricted Person will
discount, sell, pledge or assign any notes payable to it,
accounts receivable or future income. So long as no Default
then exists, Collateral Agent will, at Borrower's request and
expense, execute a release, satisfactory to Borrower and
Collateral Agent, of any Collateral so sold, transferred,
leased, exchanged, alienated or disposed of pursuant to this
Section.
Section 7.6. Limitation on Dividends and Redemptions. No
Restricted Person will declare or pay any dividends on, or make
any other distribution in respect of, any class of its capital
stock or any partnership, limited liability company or other
interest in it, nor will any Restricted Person directly or
indirectly make any capital contribution of any nature to or
purchase, redeem, acquire or retire any shares of the capital
stock of or partnership or limited liability company interests
in any Restricted Person (whether such interests are now or
hereafter issued, outstanding or created), or cause or permit
any reduction or retirement of the capital stock of any
Restricted Person, while any Loan or commitment hereunder is
outstanding; provided that Genesis Energy L.P. shall be
permitted to make distributions to its general and limited
partners to the extent required, as of the date hereof, by its
agreement of limited partnership if, at the time such
distribution is made: (i) no Default exists, or would exist
after giving effect to such distribution, (ii) the Borrower is
not aware of any event or circumstance that exists, or is likely
to occur in the future, that would result in a Default, (iii)
all commitments under the Over-Advance Facility have been
terminated and no amount is outstanding under the Over-Advance
Facility, and (iv) for each day of the Fiscal Quarter
immediately preceding such distribution, the Borrowing Base
shall have exceeded the Facility Usage, plus any applicable
Salomon Guaranty Exposure, by at least the sum of $20,000,000
plus the amount of the distribution. No such distribution shall
be made until 5 Business Days after the Chief Financial Officer
of the Borrower delivers to the Administrative Agent a
certificate that the above conditions have been satisfied.
Section 7.7. Limitation on Investments and New Businesses.
No Restricted Person will (a) make any expenditure or commitment
or incur any obligation or enter into or engage in any
transaction except in the ordinary course of business, (b)
engage directly or indirectly in any business or conduct any
operations except in connection with or incidental to its
present businesses and operations, or (c) make any acquisitions
of or capital contributions to or other Investments in any
Person, or make any acquisitions of material properties or
assets of another Person other than Permitted Investments. All
transactions permitted under the foregoing subsections (a)
through (c), inclusive, are subject to Section 7.5. General
Partner will not engage in any business other than the ownership
of Genesis Energy, L.P. and Borrower. Genesis Energy, L.P. will
not engage in any business other than the ownership of the
Borrower.
Section 7.8. Limitation on Credit Extensions. Except for
Permitted Investments and Hedging Contracts permitted under
Section 7.3(b) hereof, no Restricted Person will extend credit,
make advances or make loans other than normal and prudent
extensions of credit to customers buying goods and services in
the ordinary course of business or to another Restricted Person
in the ordinary course of business, which extensions shall not
be for longer periods than those extended by similar businesses
operated in a normal and prudent manner.
Section 7.9. Transactions with Affiliates. No Restricted
Person will engage in any material transaction with any of its
Affiliates except: (a) transactions among Borrower and Wholly
Owned Subsidiaries of Borrower, subject to the other provisions
of this Agreement, and (b) transactions entered into in the
ordinary course of business of such Restricted Person on terms
which are no less favorable to such Restricted Person than those
which would have been obtainable at the time in arm's-length
transactions with Persons other than such Affiliates.
Section 7.10. Prohibited Contracts. Except as expressly
provided for in the Loan Documents and as described in the
Disclosure Schedule, no Restricted Person will, directly or
indirectly, enter into, create, or otherwise allow to exist any
contract or other consensual restriction on the ability of any
Subsidiary of Genesis Energy, L.P., including but not limited to
Borrower and any Subsidiary of Borrower to: (a) pay dividends
or make other distributions to Borrower or Genesis Energy, L.P.,
(b) redeem equity interests held in it by Borrower or Genesis
Energy, L.P., (c) repay loans and other indebtedness owing by it
to Borrower or Genesis Energy, L. P., or (d) transfer any of its
assets to Borrower or Genesis Energy, L.P. No Restricted Person
will enter into any "take-or-pay" contract or other contract or
arrangement for the purchase of goods or services which
obligates it to pay for such goods or service regardless of
whether they are delivered or furnished to it other than
contracts for pipeline capacity or for services in either case
reasonably anticipated to be utilized in the ordinary course of
business. No Restricted Person will amend or permit any
amendment to any contract or lease which releases, qualifies,
limits, makes contingent or otherwise detrimentally affects the
rights and benefits of Collateral Agent or any Lender under or
acquired pursuant to any Security Documents. No ERISA Affiliate
will incur any obligation to contribute to any "multiemployer
plan" as defined in Section 4001 of ERISA that is subject to
Title IV of ERISA. No Restricted Person will amend or modify or
permit any amendment or modification of any of the agreements
evidencing or relating to the Salomon Facility or extend the
term of the commitments thereunder.
Section 7.11. Current Ratio. The ratio of (i) the sum of
Borrower's Consolidated current assets plus the unutilized
amount available for Loans hereunder pursuant to Section 2.1 to
(ii) Borrower's Consolidated current liabilities will never be
less than 1.0 to 1.0. For purposes of this section, Borrower's
Consolidated current liabilities will be calculated without
including any payments of principal on the Notes which are
required to be repaid within one year from the time of
calculation.
Section 7.12. Leverage Ratio. Borrower will not permit
the Leverage Ratio on the last day of any Fiscal Quarter set
forth below to be greater than the ratio set forth opposite such
Fiscal Quarter below:
Fiscal Quarter Ending Ratio
--------------------- ---------
March 31, 2002 4.00:1.00
June 30, 2002 3.00:1.00
September 30, 2002 3.00:1.00
December 31, 2002 3.00:1.00
Thereafter 2.00:1.00
Section 7.13. Interest Coverage Ratio. Borrower will not
permit the Interest Coverage Ratio on the last day of any Fiscal
Quarter set forth below to be less than the ratio set forth
opposite such Fiscal Quarter below:
Fiscal Quarter Ending Ratio
--------------------- ---------
March 31, 2002 2.00:1.00
June 30, 2002 2.50:1.00
September 30, 2002 2.50:1.00
December 31, 2002 2.50:1.00
Thereafter 3.00:1.00
Section 7.14. Capital Expenditures. Borrower will not,
and will not permit any of its Subsidiaries to, make any Capital
Expenditures, except that (i) during any Fiscal Quarter set
forth below, Borrower and its Subsidiaries may make Capital
Expenditures in an aggregate amount not to exceed the amount set
forth opposite such Fiscal Quarter below and (ii) any permitted
Capital Expenditures not made in any Fiscal Quarter shall be
carried over to future Fiscal Quarters:
Fiscal Quarter Ending Amount
--------------------- --------
March 31, 2002 $750,000
June 30, 2002 $375,000
September 30, 2002 $375,000
December 31, 2002 $ 0
Thereafter $ 0
Section 7.15. Open Position ; Certain Permitted Financial
Instruments; NYMEX Transactions.
(a) Open Position. No Restricted Person shall at any
time have any Open Positions; provided, however, that Borrower
may have:
(i) Physical inventories of Petroleum Inventory (A)
consisting of tank bottoms and pipeline linefill
requirements of up to 200,000 barrels in the aggregate at
any time, (B) excess inventory of up to 200,000 barrels in
the aggregate at any time resulting from crude gathering
receipts in excess of scheduled quantities, provided that
Borrower shall establish an Offsetting Position with
respect to such quantities within five business days
following identification of such inventory, but in any
event not later than the 20th day following the month in
which such excess volumes were received.
(ii) Floating Price Contracts to purchase or sell
Petroleum Inventory in the Current Trading Month; provided
that, such Floating Price Contracts either (A) have an
Offsetting Position by the 26th day of the month preceding
the month of receipt or delivery, or (B) are scheduled to
be stored in pipelines Currently Approved by Majority
Lenders and are hedged in the delivery month with NYMEX
contracts; and further provided that such Floating Price
Contracts relating to the sale of Petroleum Inventory for
the Current Trading Month do not exceed purchases by more
than 10,000 barrels per day.
(iii) Floating Price Contracts to purchase or sell
Petroleum Inventory to be received or delivered after the
Current Trading Month, but within the twelve months
following the Current Trading Month provided that (A) such
contracts are at the then market price and (B) at any point
in time the sum of (x) net realized losses relating to such
contracts and (y) ▇▇▇▇ to market exposure relating to such
contracts does not, at any time, exceed $1,000,000.
As used herein, "Current Trading Month" means (i) with respect
to the first twenty-five days of any calendar month, the next
following calendar month and (ii) with respect to the period
from the 26th day of a calendar month through the last day of
such month, the second calendar month next following such month
(for example, for the period from January 26th through February
25th, the Current Trading Month is March), "Floating Price
Contract" means (i) a purchase or sale contract based upon a
daily index such as a posted price or NYMEX price from time to
time in effect during the delivery month and (ii) a NYMEX spread
transaction in which the length of time between the offsetting
purchase and sale obligations do not exceed twelve months,
(b) Certain Permitted Financial Instruments. No
Restricted Person will write (i.e. sell) or otherwise
participate in any swap, collar or similar agreement relating to
Petroleum Inventory, or write (i.e. sell) any option, unless,
with respect thereto, (i) such Restricted Person has an
Offsetting Position in crude volumes and (ii) the counter-party
(or guarantor to the obligations of such counter-party) at the
time such financial instrument is made (A) has one or more long
term unsecured and unenhanced debt obligations rated A or A2 or
better, respectively, by either Rating Agency, or (B) is a
Lender, a "Lender" as such term is defined in the Revolver
Agreement, or an Affiliate of a Lender or "Lender", or (C) is
listed in the Disclosure Schedule.
(c) NYMEX Transactions. No Restricted Person will
convert a NYMEX position to a physical position by way of an
"exchange for physicals" or an "alternative delivery procedure"
unless the credit extended in connection with such physical
position would comply with the credit requirements of the
definition of "Approved Eligible Receivables"
..
Section 7.16. Redelivery of Borrowing Base Report. If, at
any time, the amount of any component of the Borrowing Base,
listed in item "(a)" of the definition thereof, shall decrease,
or if any contract related to such item is modified, sold or
exchanged in any way that would negatively affect the Borrowing
Base, the Borrower shall immediately (i) notify Administrative
Agent of the occurrence of such event, (ii) deliver to
Administrative Agent a revised Borrowing Base Report
satisfactory to Administrative Agent, which Administrative Agent
shall thereafter furnish to Lenders, and (iii) make any
prepayment as may be required under Section 2.6 resulting from
such reduced Borrowing Base.
ARTICLE VIII - Events of Default and Remedies
Section 8.1. Events of Default. Each of the following
events constitutes an Event of Default under this Agreement:
(a) Any Restricted Person fails to pay the principal
component of any Loan or any reimbursement obligation with
respect to any Letter of Credit when due and payable,
whether at a date for the payment of a fixed installment or
as a contingent or other payment becomes due and payable or
as a result of acceleration or otherwise;
(b) Any Restricted Person fails to pay any Obligation
(other than the Obligations in subsection (a) above) when
due and payable, whether at a date for the payment of a
fixed installment or as a contingent or other payment
becomes due and payable or as a result of acceleration or
otherwise, within three Business Days after the same
becomes due;
(c) Any event defined as a "default" or "event of
default" under, or otherwise constituting a breach of, any
Loan Document occurs, and the same is not remedied within
the applicable period of grace (if any) provided in such
Loan Document;
(d) Any Restricted Person fails to duly observe,
perform or comply with any covenant, agreement or provision
of Section 6.4 or Article VII;
(e) Any Restricted Person fails (other than as
referred to in subsections (a), (b), (c) or (d) above) to
duly observe, perform or comply with any covenant,
agreement, condition or provision of any Loan Document to
which it is a party, and such failure remains unremedied
for a period of thirty (30) days after notice of such
failure is given by Administrative Agent to Borrower;
(f) Any representation or warranty previously,
presently or hereafter made in writing by or on behalf of
any Restricted Person in connection with any Loan Document
shall prove to have been false or incorrect in any material
respect on any date on or as of which made, or any Loan
Document at any time ceases to be valid, binding and
enforceable as warranted in Section 5.5 for any reason
other than its release or subordination by Administrative
Agent;
(g) Any Restricted Person shall default in the
payment when due of any principal of or interest on any of
its other Indebtedness in excess of $250,000 in the
aggregate (other than Indebtedness the validity of which is
being contested in good faith by appropriate proceedings
and for which adequate reserves with respect thereto are
maintained on the books of such Restricted Person in
accordance with GAAP), or any event specified in any note,
agreement, indenture or other document evidencing or
relating to any such Indebtedness shall occur if the effect
of such event is to cause, or (with the giving of any
notice or the lapse of time or both) to permit the holder
or holders of such Indebtedness (or a trustee or agent on
behalf of such holder or holders) to cause, such
Indebtedness to become due, or to be prepaid in full
(whether by redemption, purchase, offer to purchase or
otherwise), prior to its stated maturity;
(h) Either (i) any "accumulated funding deficiency"
(as defined in Section 412(a) of the Code) in excess of
$250,000 exists with respect to any ERISA Plan, whether or
not waived by the Secretary of the Treasury or his
delegate, or (ii) any Termination Event occurs with respect
to any ERISA Plan and the amount of unfunded benefit
liabilities as defined in Section 4001(a)(18) of ERISA of
such ERISA Plan exceeds $250,000 (or in the case of a
Termination Event involving the withdrawal of a substantial
employer, the withdrawing employer's proportionate share of
such excess exceeds such amount);
(i) General Partner or any other Restricted Person:
(i) has entered against it of a judgment, decree
or order for relief by a Tribunal of competent
jurisdiction in an involuntary proceeding commenced
under any applicable bankruptcy, insolvency or other
similar Law of any jurisdiction now or hereafter in
effect, including the federal Bankruptcy Code, as from
time to time amended, or has any such proceeding
commenced against it, in each case, which remains
undismissed for a period of sixty days; or
(ii) commences a voluntary case under any
applicable bankruptcy, insolvency or similar Law now
or hereafter in effect, including the federal
Bankruptcy Code, as from time to time amended; or
applies for or consents to the entry of an order for
relief in an involuntary case under any such Law; or
makes a general assignment for the benefit of
creditors; or is generally unable to pay (or admits in
writing its inability to so pay) its debts as such
debts become due; or takes corporate or other action
to authorize any of the foregoing; or
(iii) has entered against it the appointment
of or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar
official of all or a substantial part of its assets in
a proceeding brought against or initiated by it, and
such appointment or taking possession is neither made
ineffective nor discharged within sixty days after the
making thereof, or such appointment or taking
possession is at any time consented to, requested by,
or acquiesced to by it; or
(iv) has entered against it the appointment of or
taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official
of any part of the Collateral in a proceeding brought
against or initiated by it, and such appointment or
taking possession is neither made ineffective nor
discharged within sixty days after the making thereof,
or such appointment or taking possession is at any
time consented to, requested by, or acquiesced to by
it; or
(v) has entered against it a final judgment for
the payment of money in excess of $250,000 (in each
case not covered by insurance satisfactory to
Administrative Agent in its discretion), unless the
same is discharged within thirty days after the date
of entry thereof or an appeal or appropriate
proceeding for review thereof is taken within such
period and a stay of execution pending such appeal is
obtained; or
(vi) suffers a writ or warrant of attachment or
any similar process to be issued by any Tribunal
against all or any substantial part of its assets or
any part of the Collateral, and such writ or warrant
of attachment or any similar process is not stayed or
released within thirty days after the entry or levy
thereof or after any stay is vacated or set aside;
(j) Any Change in Control occurs;
(k) Any Material Market Open Position Loss occurs;
(l) Any Security Document shall for any reason (other
than pursuant to the terms hereof and thereof) cease to
create a valid and perfected first priority Lien (subject
only to the ▇▇▇▇▇▇▇ ▇▇▇▇) in any asset having a value in
excess of $100,000;
(m) During any twelve-month period, there shall have
occurred a default in payment (and such default remains
unremedied for five Business Days) of one or more Eligible
Receivables (other than the Enron Payment) in an amount
exceeding $500,000 individually or $750,000 in the
aggregate;
(n) The beneficiary of any Letter of Credit shall
make a draft or other demand for payment thereunder;
(o) An "Event of Default" (as defined in the Salomon
Facility) shall have occurred and be continuing;
(p) Within 30 days from the date hereof, Borrower
shall fail to deliver to Administrative Agent all of the
reports referred to in Section 4.1(o);
(q) Borrower shall fail to deliver to Administrative
Agent on or prior to January 15, 2002, evidence reasonably
satisfactory to it that the obligation of Salomon to issue
or substitute any Guaranty under and as defined in the
Salomon Facility has been terminated in accordance with the
terms of the Salomon Facility (including, without
limitation, Sections 2.1 and 8.6 thereof);
(r) On or prior to February 28, 2002, Borrower shall
fail to cause all Salomon Obligations to be terminated and
the Salomon Guaranty Exposure to be zero by obtaining full
and complete releases of Salomon from all outstanding
Guaranties (as defined in the Salomon Facility) and all
related liabilities and obligations;
(s) Within 45 days from the date hereof, Borrower
shall fail to deliver mortgages (and all other agreements
or instruments required by Administrative Agent in
connection therewith) in connection with the properties
identified on Schedule 7 hereto; or
(t) A Material Adverse Change shall occur.
Upon the occurrence of an Event of Default described
in subsection (i)(i), (i)(ii) or (i)(iii) of this
section with respect to any Restricted Person, all of
the Obligations shall thereupon be immediately due and
payable, without demand, presentment, notice of demand
or of dishonor and nonpayment, protest, notice of
protest, notice of intention to accelerate,
declaration or notice of acceleration, or any other
notice or declaration of any kind, all of which are
hereby expressly waived by Borrower and each other
Restricted Person who at any time ratifies or approves
this Agreement. Upon any such acceleration, any
obligation of any Lender to make any further Loans and
any obligation of LC Issuer to issue Letters of Credit
hereunder shall be permanently terminated. During the
continuance of any other Event of Default,
Administrative Agent at any time and from time to time
may (and upon written instructions from Majority
Lenders, Administrative Agent shall), without notice
to Borrower or any other Restricted Person, do either
or both of the following: (1) terminate any
obligation of Lenders to make Loans hereunder and any
obligation of LC Issuer to issue Letters of Credit
hereunder, and (2) declare any or all of the
Obligations immediately due and payable, and all such
Obligations shall thereupon be immediately due and
payable, without demand, presentment, notice of demand
or of dishonor and nonpayment, protest, notice of
protest, notice of intention to accelerate,
declaration or notice of acceleration, or any other
notice or declaration of any kind, all of which are
hereby expressly waived by Borrower and each other
Restricted Person who at any time ratifies or approves
this Agreement.
Section 8.2. Remedies. If any Default shall occur and be
continuing, each Lender Party and Agents may protect and enforce
their rights under the Loan Documents by any appropriate
proceedings, including proceedings for specific performance of
any covenant or agreement contained in any Loan Document, and
each Lender Party and Agents may enforce the payment of any
Obligations due it or enforce any other legal or equitable right
which it may have. All rights, remedies and powers conferred
upon Lender Parties and Agents under the Loan Documents shall be
deemed cumulative and not exclusive of any other rights,
remedies or powers available under the Loan Documents or at Law
or in equity.
ARTICLE IX - The Agents
Section 9.1. Authorization and Action. Each Lender Party
(in its capacities as a Lender and the LC Issuer (if
applicable)) hereby appoints and authorizes each Agent to take
such action as agent on its behalf and to exercise such powers
and discretion under this Agreement and the other Loan Documents
as are delegated to such Agent by the terms hereof and thereof,
together with such powers and discretion as are reasonably
incidental thereto. As to any matters not expressly provided
for by the Loan Documents (including, without limitation,
enforcement or collection of the Notes), no Agent shall be
required to exercise any discretion or take any action, but
shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the
instructions of the Majority Lenders, and such instructions
shall be binding upon all Lender Parties and all holders of
Notes; provided, however, that no Agent shall be required to
take any action that exposes such Agent to personal liability or
that is contrary to this Agreement or applicable law. Each
Agent agrees to give to each Lender Party prompt notice of each
notice given to it by Borrower pursuant to the terms of this
Agreement.
Section 9.2. Agents' Reliance, Etc. Neither any Agent nor
any of their respective directors, officers, agents or employees
shall be liable for any action taken or omitted to be taken by
it or them under or in connection with the Loan Documents,
except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the
foregoing, each Agent: (a) may treat the payee of any Note as
the holder thereof until, in the case of Administrative Agent,
Administrative Agent receives and accepts an Assignment and
Acceptance entered into by the Lender that is the payee of such
Note, as assignor, and an Eligible Transferee, as assignee, or,
in the case of any other Agent, such Agent has received notice
from Administrative Agent that it has received and accepted such
Assignment and Acceptance, in each case as provided in Section
10.5(c); (b) may consult with legal counsel (including counsel
for any Restricted Person), independent public accountants and
other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or
experts; (c) makes no warranty or representation to any Lender
Party and shall not be responsible to any Lender Party for any
statements, warranties or representations (whether written or
oral) made in or in connection with the Loan Documents; (d)
shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or
conditions of any Loan Document on the part of any Restricted
Person or to inspect the property (including the books and
records) of any Restricted Person; (e) shall not be responsible
to any Lender Party for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the
perfection or priority of any lien or security interest created
or purported to be created under or in connection with, any Loan
Document or any other instrument or document furnished pursuant
thereto; and (f) shall incur no liability under or in respect of
any Loan Document by acting upon any notice, consent,
certificate or other instrument or writing (which may be by
telegram, telecopy or telex) believed by it to be genuine and
signed or sent by the proper party or parties.
Section 9.3. Administrative Agent and Affiliates. With
respect to the Loans made by it and the Notes issued to it,
Administrative Agent shall have the same rights and powers under
the Loan Documents as any other Lender Party and may exercise
the same as though it were not an Agent; and the term "Lender
Party" or "Lender Parties" shall, unless otherwise expressly
indicated, include Administrative Agent in its individual
capacity. Administrative Agent and its Affiliates may accept
deposits from, lend money to, act as trustee under indentures
of, accept investment banking engagements from and generally
engage in any kind of business with, any Restricted Person, any
of its Subsidiaries and any Person that may do business with or
own securities of any Restricted Person or any such Subsidiary,
all as if Administrative Agent were not an Agent and without any
duty to account therefor to the Lender Parties.
Section 9.4. Lender Party Credit Decision. Each Lender
Party acknowledges that it has, independently and without
reliance upon any Agent or any other Lender Party and based on
the Initial Financial Statements and the financial statements
referred to in Section 6.2 and such other documents and
information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender
Party also acknowledges that it will, independently and without
reliance upon any Agent or any other Lender Party and based on
such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or
not taking action under this Agreement.
Section 9.5. Indemnification. (a) Each Lender Party
severally agrees to indemnify each Agent (to the extent not
promptly reimbursed by Borrower) from and against such Lender
Party's Percentage Share of any and all liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature
whatsoever that may be imposed on, incurred by, or asserted
against such Agent in any way relating to or arising out of the
Loan Documents or any action taken or omitted by such Agent
under the Loan Documents (collectively, the "Indemnified
Costs"); provided, however, that no Lender Party shall be liable
for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses
or disbursements resulting from such Agent's gross negligence or
willful misconduct as found in a final, non-appealable judgment
by a court of competent jurisdiction. Without limitation of the
foregoing, each Lender Party agrees to reimburse each Agent
promptly upon demand for its Percentage Share of any costs and
expenses (including, without limitation, fees and expenses of
counsel) payable by Borrower under Section 10.4, to the extent
that such Agent is not promptly reimbursed for such costs and
expenses by Borrower. In the case of any investigation,
litigation or proceeding giving rise to any Indemnified Costs,
this Section 9.5 applies whether any such investigation,
litigation or proceeding is brought by any Lender Party or any
other Person.
(b) Each Lender Party severally agrees to indemnify
the LC Issuer (to the extent not promptly reimbursed by
Borrower) from and against such Lender Party's Percentage Share
of any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against such LC Issuer in
any way relating to or arising out of the Loan Documents or any
action taken or omitted by such LC Issuer under the Loan
Documents; provided, however, that no Lender Party shall be
liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses
or disbursements resulting from such LC Issuer's gross
negligence or willful misconduct as found in a final, non-
appealable judgment by a court of competent jurisdiction.
Without limitation of the foregoing, each Lender Party agrees to
reimburse such LC Issuer promptly upon demand for its Percentage
Share of any costs and expenses (including, without limitation,
fees and expenses of counsel) payable by Borrower under Section
10.4, to the extent such LC Issuer is not promptly reimbursed
for such costs and expenses by Borrower. For the purposes of
this clause (B), "LC Issuer" shall include Citibank in
connection with the issuance of any Citibank Letter of Credit.
Section 9.6. Successor Agents. Any Agent may resign at
any time by giving written notice thereof to the Lender Parties
and Borrower and may be removed at any time with or without
cause by the Majority Lenders. Upon any such resignation or
removal, the Majority Lenders shall have the right to appoint a
successor Agent. If no successor Agent shall have been so
appointed by the Majority Lenders, and shall have accepted such
appointment, within 30 days after the retiring Agent's giving of
notice of resignation or the Majority Lenders' removal of the
retiring Agent, then the retiring Agent may, on behalf of the
Lender Parties, appoint a successor Agent, which shall be a
commercial bank organized under the laws of the United States or
of any State thereof and having a combined capital and surplus
of at least $250,000,000. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent and, in the
case of a successor Collateral Agent, upon the execution and
filing or recording of such financing statements, or amendments
thereto, and such amendments or supplements to the mortgages
hereunder, and such other instruments or notices, as may be
necessary or desirable, or as the Majority Lenders may request,
in order to continue the perfection of the Liens granted or
purported to be granted by the Security Documents, such
successor Agent shall succeed to and become vested with all the
rights, powers, discretion, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from
its duties and obligations under the Loan Documents. Upon the
acceptance of any appointment as Agent hereunder by a successor
Agent and, in the case of a successor Collateral Agent, upon the
execution and filing or recording of such financing statements,
or amendments thereto, and such amendments or supplements to the
mortgages hereunder, and such other instruments or notices, as
may be necessary or desirable, or as the Majority Lenders may
request, in order to continue the perfection of the Liens
granted or purported to be granted by the Security Documents,
such successor Agent shall succeed to and become vested with all
the rights, powers, discretion, privileges and duties of the
retiring Agent, other than with respect to funds transfers and
other similar aspects of the administration of Borrowings,
issuances of Letters of Credit and payments by the Borrower, and
the retiring Agent shall be discharged from its duties and
obligations under this Agreement other than as aforesaid. If
within 45 days after written notice is given of the retiring
Agent's resignation or removal under this Section 9.6 no
successor Agent shall have been appointed and shall have
accepted such appointment, then on such 45th day (a) the
retiring Agent's resignation or removal shall become effective,
(b) the retiring Agent shall thereupon be discharged from its
duties and obligations under the Loan Documents and (c) the
Majority Lenders shall thereafter perform all duties of the
retiring Agent under the Loan Documents until such time, if any,
as the Majority Lenders appoint a successor Agent as provided
above. After any retiring Agent's resignation or removal
hereunder as Agent shall have become effective, the provisions
of this Article VII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Agent under this
Agreement.
ARTICLE X - Miscellaneous
Section 10.1. Waivers and Amendments; Acknowledgment.
(a) Waivers and Amendments. No failure or delay
(whether by course of conduct or otherwise) by any Lender in
exercising any right, power or remedy which such Lender Party
may have under any of the Loan Documents shall operate as a
waiver thereof or of any other right, power or remedy, nor shall
any single or partial exercise by any Lender Party of any such
right, power or remedy preclude any other or further exercise
thereof or of any other right, power or remedy. No waiver of
any provision of any Loan Document and no consent to any
departure therefrom shall ever be effective unless it is in
writing and signed as provided below in this section, and then
such waiver or consent shall be effective only in the specific
instances and for the purposes for which given and to the extent
specified in such writing. No notice to or demand on any
Restricted Person shall in any case of itself entitle any
Restricted Person to any other or further notice or demand in
similar or other circumstances. This Agreement and the other
Loan Documents set forth the entire understanding between the
parties hereto with respect to the transactions contemplated
herein and therein and supersede all prior discussions and
understandings with respect to the subject matter hereof and
thereof, and no waiver, consent, release, modification or
amendment of or supplement to this Agreement or the other Loan
Documents shall be valid or effective against any party hereto
unless the same is in writing and signed by (i) if such party is
Borrower, by Borrower, (ii) if such party is any Agent or LC
Issuer, by such party, and (iii) if such party is a Lender, by
such Lender or by Agents on behalf of Lenders with the written
consent of Majority Lenders (which consent has already been
given as to the termination of the Loan Documents as provided in
Section 10.9). Notwithstanding the foregoing or anything to the
contrary herein, Administrative Agent shall not, without the
prior consent of each individual Lender, execute and deliver on
behalf of such Lender any waiver or amendment which would: (1)
waive any of the conditions specified in Article IV (provided
that Administrative Agent may in its discretion withdraw any
request it has made under Section 4.2(f)), (2) increase the
Percentage Share of any such Lender or the maximum amount any
such Lender is committed to fund in respect of Letter of Credit
Obligations and Loans or subject such Lender to any additional
obligations, (3) reduce any fees payable to such Lender
hereunder, or the principal of, or interest on, such Lender's
Note, (4) change any date fixed for any payment of any such
fees, principal or interest, (5) amend the definition herein of
"Borrowing Base" or any of the terms used in that definition,
(6) amend the definition herein of "Majority Lenders" or
otherwise change the aggregate amount of Percentage Shares which
is required for Administrative Agent, Lenders or any of them to
take any particular action under the Loan Documents, (7) release
Borrower from its obligation to pay such Lender's Note or any
Guarantor from its guaranty of such payment, except a release of
a Guarantor that has ceased to be a Subsidiary of Borrower or
General Partner in a transaction permitted under this Agreement,
(8) release any Collateral, except such releases relating to
sales of property permitted under Section 7.5 or (9) permit a
Restricted Person to make an acquisition of or other Investments
in any Person other than Permitted Investments.
(b) Acknowledgments and Admissions. Borrower hereby
represents, warrants, acknowledges and admits that (i) it has
been advised by counsel in the negotiation, execution and
delivery of the Loan Documents to which it is a party, (ii) it
has made an independent decision to enter into this Agreement
and the other Loan Documents to which it is a party, without
reliance on any representation, warranty, covenant or
undertaking by Agents or any other Lender Party, whether
written, oral or implicit, other than as expressly set out in
this Agreement or in another Loan Document delivered on or after
the date hereof, (iii) there are no representations, warranties,
covenants, undertakings or agreements by any Lender Party or
Agents as to the Loan Documents except as expressly set out in
this Agreement or in another Loan Document delivered on or after
the date hereof, (iv) no Lender Party or Agents has any
fiduciary obligation toward Borrower with respect to any Loan
Document or the transactions contemplated thereby, (v) the
relationship pursuant to the Loan Documents between Borrower and
the other Restricted Persons, on one hand, and each Lender Party
and Agents, on the other hand, is and shall be solely that of
debtor and creditor, respectively, (vi) no partnership or joint
venture exists with respect to the Loan Documents between any
Restricted Person and any Lender Party or Agents, (vii)
Administrative Agent is not Borrower's Administrative Agent, but
Administrative Agent for Lenders, (viii) should an Event of
Default or Default occur or exist, each Lender Party will
determine in its sole discretion and for its own reasons what
remedies and actions it will or will not exercise or take at
that time, (ix) without limiting any of the foregoing, Borrower
is not relying upon any representation or covenant by any Lender
Party, or any representative thereof, and no such representation
or covenant has been made, that any Lender Party will, at the
time of an Event of Default or Default, or at any other time,
waive, negotiate, discuss, or take or refrain from taking any
action permitted under the Loan Documents with respect to any
such Event of Default or Default or any other provision of the
Loan Documents, and (x) all Lender Parties have relied upon the
truthfulness of the acknowledgments in this section in deciding
to execute and deliver this Agreement and to become obligated
hereunder.
(c) Representation by Lenders. Each Lender hereby
represents that it will acquire its Note for its own account in
the ordinary course of its commercial lending business; however,
the disposition of such Lender's property shall at all times be
and remain within its control and, in particular and without
limitation, such Lender may sell or otherwise transfer its Note,
any participation interest or other interest in its Note, or any
of its other rights and obligations under the Loan Documents
subject to compliance with Sections 10.5(b) through (f),
inclusive, and applicable Law.
(d) Joint Acknowledgment. This written Agreement and
the other Loan Documents represent the final agreement between
the parties and may not be contradicted by evidence of prior,
contemporaneous, or subsequent oral agreements of the parties.
There are no unwritten oral agreements between the parties.
Section 10.2. Survival of Agreements; Cumulative Nature.
All of Restricted Persons' various representations, warranties,
covenants and agreements in the Loan Documents shall survive the
execution and delivery of this Agreement and the other Loan
Documents and the performance hereof and thereof, including the
making or granting of the Loans and the delivery of the Notes
and the other Loan Documents, and shall further survive until
all of the Obligations are paid in full to each Lender Party and
all of Lender Parties' obligations to Borrower are terminated.
All statements and agreements contained in any certificate or
other instrument delivered by any Restricted Person to any
Lender Party under any Loan Document shall be deemed
representations and warranties by Borrower or agreements and
covenants of Borrower under this Agreement. The
representations, warranties, indemnities, and covenants made by
Restricted Persons in the Loan Documents, and the rights,
powers, and privileges granted to Lender Parties in the Loan
Documents, are cumulative, and, except for expressly specified
waivers and consents, no Loan Document shall be construed in the
context of another to diminish, nullify, or otherwise reduce the
benefit to any Lender Party of any such representation,
warranty, indemnity, covenant, right, power or privilege. In
particular and without limitation, no exception set out in this
Agreement to any representation, warranty, indemnity, or
covenant herein contained shall apply to any similar
representation, warranty, indemnity, or covenant contained in
any other Loan Document, and each such similar representation,
warranty, indemnity, or covenant shall be subject only to those
exceptions which are expressly made applicable to it by the
terms of the various Loan Documents.
Section 10.3. Notices. All notices, requests, consents,
demands and other communications required or permitted under any
Loan Document shall be in writing, unless otherwise specifically
provided in such Loan Document (provided that Agents may give
telephonic notices to the other Lender Parties), and shall be
deemed sufficiently given or furnished if delivered by personal
delivery, by facsimile or other electronic transmission, by
delivery service with proof of delivery, or by registered or
certified United States mail, postage prepaid, to Borrower and
Restricted Persons at the address of Borrower specified on the
signature pages hereto and to each Lender Party at its address
specified on the signature pages hereto (unless changed by
similar notice in writing given by the particular Person whose
address is to be changed). Any such notice or communication
shall be deemed to have been given (a) in the case of personal
delivery or delivery service, as of the date of first attempted
delivery during normal business hours at the address provided
herein, (b) in the case of facsimile or other electronic
transmission, upon receipt, or (c) in the case of registered or
certified United States mail, three days after deposit in the
mail; provided, however, that no Borrowing Notice or
Continuation/Conversion Notice shall become effective until
actually received by Administrative Agent.
Section 10.4. Payment of Expenses; Indemnity.
(a) Payment of Expenses. Whether or not the
transactions contemplated by this Agreement are consummated,
Borrower will promptly (and in any event, within 30 days after
any invoice or other statement or notice) pay: (i) all
transfer, stamp, mortgage, documentary or other similar taxes,
assessments or charges levied by any governmental or revenue
authority in respect of this Agreement or any of the other Loan
Documents or any other document referred to herein or therein,
(ii) all reasonable costs and expenses incurred by or on behalf
of Agents (including attorneys' fees, consultants' fees and
engineering fees, travel costs and miscellaneous expenses) in
connection with (1) the negotiation, preparation, execution and
delivery of the Loan Documents, and any and all consents,
waivers or other documents or instruments relating thereto, (2)
the filing, recording, refiling and re-recording of any Loan
Documents and any other documents or instruments or further
assurances required to be filed or recorded or refiled or re-
recorded by the terms of any Loan Document, (3) the borrowings
hereunder and other action reasonably required in the course of
administration hereof, (4) monitoring or confirming (or
preparation or negotiation of any document related to) any
Restricted Person's compliance with any covenants or conditions
contained in this Agreement or in any Loan Document, and (iii)
all reasonable costs and expenses incurred by or on behalf of
any Lender Party or Agent (including attorneys' fees,
consultants' fees and accounting fees) in connection with the
defense or enforcement of any of the Loan Documents (including
this section), any attempt to cure any breach thereunder by any
Restricted Person or the defense of any Lender Party or Agent's
exercise of its rights thereunder. In addition to the
foregoing, until all Obligations have been paid in full,
Borrower will also pay or reimburse Agent for all reasonable
out-of-pocket costs and expenses of Agent or its agents or
employees in connection with the continuing administration of
the Loans and the related due diligence of Agent, including
travel and miscellaneous expenses and fees and expenses of
Agent's outside counsel, reserve engineers and consultants
engaged in connection with the Loan Documents.
(b) Indemnity. Borrower agrees to indemnify each Lender
Party and Agent, upon demand, from and against any and all
liabilities, obligations, claims, losses, damages, penalties,
fines, actions, judgments, suits, settlements, costs, expenses
or disbursements (including reasonable fees of attorneys,
accountants, experts and advisors) of any kind or nature
whatsoever (in this section collectively called "liabilities and
costs") which to any extent (in whole or in part) may be imposed
on, incurred by, or asserted against such Lender Party or Agent
growing out of, resulting from or in any other way associated
with any of the Collateral, the Loan Documents and the
transactions and events (including the enforcement or defense
thereof) at any time associated therewith or contemplated
therein whether arising in contract or in tort or otherwise and
including any violation or noncompliance with any Environmental
Laws by any Lender Party, Agent or any other Person or any
liabilities or duties of any Lender Party, Agent or any other
Person with respect to the actual or alleged presence of
Hazardous Materials found in or released into the environment).
The foregoing indemnification shall apply whether or not such
liabilities and costs are in any way or to any extent owed, in
whole or in part, under any claim or theory of strict liability
or caused, in whole or in part, by any negligent act or omission
of any kind by any Lender Party or Agent,
provided only that no Lender Party or Agent shall be entitled
under this section to receive indemnification for that portion,
if any, of any liabilities and costs which is proximately caused
by its own individual gross negligence or willful misconduct, as
determined in a final judgment. If any Person (including
Borrower or any of its Affiliates) ever alleges such gross
negligence or willful misconduct by any Lender Party or Agent,
the indemnification provided for in this section shall
nonetheless be paid upon demand, subject to later adjustment or
reimbursement, until such time as a court of competent
jurisdiction enters a final judgment as to the extent and effect
of the alleged gross negligence or willful misconduct. As used
in this section the term "Lender Party" and "Agent" shall refer
not only to each Person designated as such in Section 1.1 but
also to each director, officer, agent, attorney, employee,
representative and Affiliate of such Persons.
Section 10.5. Joint and Several Liability Parties in
Interest Assignments; Replacement Notes.
(a) All Obligations which are incurred by two or more
Restricted Persons shall be their joint and several obligations
and liabilities. All grants, covenants and agreements contained
in the Loan Documents shall bind and inure to the benefit of the
parties thereto and their respective successors and permitted
assigns; provided, however, that no Restricted Person may assign
or transfer any of its rights or delegate any of its duties or
obligations under any Loan Document without the prior consent of
all Lenders. Neither Borrower nor any Affiliates of Borrower
shall directly or indirectly purchase or otherwise retire any
Obligations owed to any Lender nor will any Lender accept any
offer to do so, unless each Lender shall have received
substantially the same offer with respect to the same Percentage
Share of the Obligations owed to it. If Borrower or any
Affiliate of Borrower at any time purchases some but less than
all of the Obligations owed to all Lender Parties, such
purchaser shall not be entitled to any rights of any Lender
under the Loan Documents unless and until Borrower or its
Affiliates have purchased all of the Obligations.
(b) No Lender shall sell any participation interest in
its commitment hereunder or any of its rights under its Loans or
under the Loan Documents to any Person unless the agreement
between such Lender and such participant at all times provides:
(i) that such participation exists only as a result of the
agreement between such participant and such Lender and that such
transfer does not give such participant any right to vote as a
Lender or any other direct claims or rights against any Person
other than such Lender, (ii) that such participant is not
entitled to payment from any Restricted Person under Sections
3.2 through 3.6 of amounts in excess of those payable to such
Lender under such sections (determined without regard to the
sale of such participation), and (iii) unless such participant
is an Affiliate of such Lender, that such participant shall not
be entitled to require such Lender to take any action under any
Loan Document or to obtain the consent of such participant prior
to taking any action under any Loan Document, except for actions
which would require the consent of all Lenders under subsection
(a) of Section 10.1. No Lender selling such a participation
shall, as between the other parties hereto and such Lender, be
relieved of any of its obligations hereunder as a result of the
sale of such participation. Each Lender which sells any such
participation to any Person (other than an Affiliate of such
Lender) shall give prompt notice thereof to Administrative Agent
and Borrower; provided, however, that no liability shall arise
if any Lender fails to give such notice to Borrower.
(c) Except for sales of participations under the
immediately preceding subsection, no Lender shall make any
assignment or transfer of any kind of its commitments or any of
its rights under its Loans or under the Loan Documents, except
for assignments to an Eligible Transferee, or, subject to the
provisions of subsection (g) below, to an Affiliate and then
only if such assignment is made in accordance with the following
requirements:
(i) Each such assignment shall apply to all
Obligations owing to the assignor Lender hereunder and to
the unused portion of the assignor Lender's commitments, so
that after such assignment is made the assignor Lender
shall have a fixed (and not a varying) Percentage Share in
its Loans and Note and be committed to make that Percentage
Share of all future Loans, the assignee shall have a fixed
Percentage Share in such Loans and Note and be committed to
make that Percentage Share of all future Loans, and the
Percentage Share of the Maximum Loan Amount of each of the
assignor and assignee shall equal or exceed $10,000,000.
(ii) The parties to each such assignment shall execute
and deliver to Administrative Agent, for its acceptance and
recording in the "Register" (as defined below in this
section), an Assignment and Acceptance in the form of
Exhibit I, appropriately completed, together with the Note
subject to such assignment and a processing fee payable by
such assignor Lender (and not at Borrower's expense) to
Administrative Agent of $3,500. Upon such execution,
delivery, and payment and upon the satisfaction of the
conditions set out in such Assignment and Acceptance, then
(i) Borrower shall issue new Notes to such assignor and
assignee upon return of the old Notes to Borrower, and (ii)
as of the "Settlement Date" specified in such Assignment
and Acceptance the assignee thereunder shall be a party
hereto and a Lender hereunder and Administrative Agent
shall thereupon deliver to Borrower and each Lender a
revised Schedule 1 hereto showing the revised Percentage
Shares of such assignor Lender and such assignee Lender and
the Percentage Shares of all other Lenders.
(iii) Each assignee Lender organized under the
laws of a jurisdiction outside of the United States shall
(to the extent it has not already done so) provide
Administrative Agent and Borrower with the "Prescribed
Forms" referred to in Section 3.7(d).
(d) Any Lender may at any time pledge all or any portion
of its Loan and Note (and related rights under the Loan
Documents including any portion of its Note) to any of the
twelve (12) Federal Reserve Banks organized under Section 4 of
the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge
or enforcement thereof shall release any such Lender from its
obligations under any of the Loan Documents; provided that all
related costs, fees and expenses in connection with any such
pledge shall be for the sole account of such Lender.
(e) By executing and delivering an Assignment and
Acceptance, each assignee Lender thereunder will be confirming
to and agreeing with Borrower, Administrative Agent and each
other Lender Party that such assignee understands and agrees to
the terms hereof, including Article IX hereof.
(f) Administrative Agent shall maintain a copy of each
Assignment and Acceptance and a register for the recordation of
the names and addresses of Lenders and the Percentage Shares of,
and principal amount of the Loans owing to, each Lender from
time to time (in this section called the "Register"). The
entries in the Register shall be conclusive, in the absence of
manifest error, and Borrower and each Lender Party may treat
each Person whose name is recorded in the Register as a Lender
Party hereunder for all purposes. The Register shall be
available for inspection by Borrower or any Lender Party at any
reasonable time and from time to time upon reasonable prior
notice.
(g) Any Lender may assign or transfer its commitment or
its rights under its Loans or under the Loan Documents to (i)
any Affiliate that is wholly-owned direct or indirect subsidiary
of such Lender or of any Person that wholly owns, directly or
indirectly, such Lender, or (ii) if such Lender is a fund that
invests in bank loans, any other fund that invests in bank loans
and is advised or managed by (A) the same investment advisor as
any Lender or (B) any Affiliate of such investment advisor that
is a wholly-owned direct or indirect subsidiary of any Person
that wholly owns, directly or indirectly, such investment
advisor, subject to the following additional conditions:
(x) any right of such Lender assignor and such
assignee to vote as a Lender, or any other direct claims or
rights against any other Persons, shall be uniformly
exercised or pursued in the manner that such Lender
assignor would have so exercised such vote, claim or right
if it had not made such assignment or transfer;
(y) such assignee shall not be entitled to payment
from any Restricted Person under Sections 3.2 through 3.7
of amounts in excess of those payable to such Lender
assignor under such sections (determined without regard to
such assignment or transfer); and
(z) if such Lender assignor assigns or transfers to
such assignee any of such Lender's commitment, such
assignee may become primarily liable for such commitment,
but such assignment or transfer shall not relieve or
release such Lender from such commitment.
(h) Upon receipt of an affidavit reasonably satisfactory
to Borrower of an officer of any Lender as to the loss, theft,
destruction or mutilation of its Note or any Security Document
which is not of public record, and, in the case of any such
loss, theft, destruction or mutilation, upon cancellation of
such Note or such Security Document, Borrower will execute and
deliver, in lieu thereof, a replacement Note in the same
principal amount thereof and otherwise of like tenor (or each
Restricted Person a party to any such Security Document will
execute and deliver a replacement Security Document of like
tenor).
Section 10.6. Confidentiality. Each Lender Party agrees
(on behalf of itself and each of its Affiliates, and each of its
and their directors, officers, agents, attorneys, employees, and
representatives) that it (and each of them) will take all
reasonable steps to keep confidential any non-public information
supplied to it by or at the direction of any Restricted Person
so identified when delivered, provided, however, that this
restriction shall not apply to (a) information which has at the
time in question entered the public domain, (b) information
which is required to be disclosed by Law (whether valid or
invalid) of any Tribunal, (c) any disclosure to any Lender
Party's Affiliates, auditors, attorneys, or agents, (d) any
disclosure to any other Lender Party or to any purchaser or
prospective purchaser of participations or other interests in
any Loan or Loan Document (provided each such Person first
agrees to hold such information in confidence on the terms
provided in this section), or (e) any disclosure in the course
of enforcing its rights and remedies during the existence of an
Event of Default.
Section 10.7. Governing Law; Submission to Process.
Except to the extent that the Law of another jurisdiction is
expressly elected in a Loan Document, the Loan Documents shall
be deemed contracts and instruments made under the Laws of the
State of New York and shall be construed and enforced in
accordance with and governed by the Laws of the State of New
York and the Laws of the United States of America, without
regard to principles of conflicts of law. Borrower hereby
agrees that any legal action or proceeding against Borrower with
respect to this Agreement, the Notes or any of the Loan
Documents may be brought in the courts of the State of New York
or of the United States of America for the Southern District of
New York as Lender Parties may elect, and, by execution and
delivery hereof, Borrower accepts and consents for itself and in
respect to its property, generally and unconditionally, the non-
exclusive jurisdiction of the aforesaid courts. Borrower agrees
that Section 5-1401 and 5-1402 of the General Obligations Law of
the State of New York shall apply to the Loan Documents and
waives any right to stay or to dismiss any action or proceeding
brought before said courts on the basis of forum non conveniens.
In furtherance of the foregoing, Borrower hereby irrevocably
designates and appoints CT Corporation system, ▇▇▇ ▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇, as agent of Borrower to receive
service of all process brought against Borrower with respect to
any such proceeding in any such court in New York, such service
being hereby acknowledged by Borrower to be effective and
binding service in every respect. Copies of any such process so
served shall also be sent by registered mail to Borrower at its
address set forth below, but the failure of Borrower to receive
such copies shall not affect in any way the service of such
process as aforesaid. Borrower shall furnish to Lender Parties
a consent of CT Corporation System agreeing to act hereunder
prior to the effective date of this agreement. Nothing herein
shall affect the right of Lender Parties to serve process in any
other manner permitted by Law of shall limit the right of Lender
Parties to bring proceedings against Borrower in the courts of
any other jurisdiction. If for any reason Ct Corporation System
shall resign or otherwise cease to act as Borrower's agent,
Borrower hereby irrevocably agrees to (a) immediately designate
and appoint a new agent acceptable to Administrative Agent to
serve in such capacity and, in such event, such new agent shall
be deemed to be substituted for Ct corporation System for all
purposes hereof and (b) promptly deliver to Agent the written
consent (in form and substance satisfactory to Administrative
Agent) of such new agent agreeing to serve in such capacity.
Section 10.8. Limitation on Interest. Lender Parties,
Restricted Persons and any other parties to the Loan Documents
intend to contract in strict compliance with applicable usury
Law from time to time in effect. In furtherance thereof such
Persons stipulate and agree that none of the terms and
provisions contained in the Loan Documents shall ever be
construed to create a contract to pay, for the use, forbearance
or detention of money, interest in excess of the maximum amount
of interest permitted to be contracted for, charged, or received
by applicable Law from time to time in effect. Neither any
Restricted Person nor any present or future guarantors,
endorsers, or other Persons hereafter becoming liable for
payment of any Obligation shall ever be liable for unearned
interest thereon or shall ever be required to pay interest
thereon in excess of the maximum amount that may be lawfully
contracted for, charged, or received under applicable Law from
time to time in effect, and the provisions of this section shall
control over all other provisions of the Loan Documents which
may be in conflict or apparent conflict herewith. Lender
Parties expressly disavow any intention to contract for, charge,
or receive excessive unearned interest or finance charges in the
event the maturity of any Obligation is accelerated. If (a) the
maturity of any Obligation is accelerated for any reason, (b)
any Obligation is prepaid and as a result any amounts held to
constitute interest are determined to be in excess of the legal
maximum, or (c) any Lender or any other holder of any or all of
the Obligations shall otherwise collect moneys which are
determined to constitute interest which would otherwise increase
the interest on any or all of the Obligations to an amount in
excess of that permitted to be contracted for, charged or
received by applicable Law then in effect, then all sums
determined to constitute interest in excess of such legal limit
shall, without penalty, be promptly applied to reduce the then
outstanding principal of the related Obligations or, at such
Lender's or holder's option, promptly returned to Borrower or
other payor thereof upon such determination. In determining
whether or not the interest paid or payable, under any specific
circumstance, exceeds the maximum amount permitted under
applicable Law, Lender Parties and Restricted Persons (and any
other payors thereof) shall to the greatest extent permitted
under applicable Law, (i) characterize any non-principal payment
as an expense, fee or premium rather than as interest, (ii)
exclude voluntary prepayments and the effects thereof, and (iii)
amortize, prorate, allocate, and spread the total amount of
interest throughout the entire contemplated term of the
instruments evidencing the Obligations in accordance with the
amounts outstanding from time to time thereunder and the maximum
legal rate of interest from time to time in effect under
applicable Law in order to lawfully charge the maximum amount of
interest permitted under applicable Law.
Section 10.9. Termination; Limited Survival. In its sole
and absolute discretion Borrower may at any time that no
Obligations are owing or outstanding elect in a written notice
delivered to Administrative Agent to terminate this Agreement.
Upon receipt by Administrative Agent of such a notice, if no
Obligations are then owing or outstanding this Agreement and all
other Loan Documents shall thereupon be terminated and the
parties thereto released from all prospective obligations
thereunder. Notwithstanding the foregoing or anything herein to
the contrary, any waivers or admissions made by any Restricted
Person in any Loan Document, any Obligations under Sections 3.2
through 3.6, and any obligations which any Person may have to
indemnify or compensate any Lender Party or Agent shall survive
any termination of this Agreement or any other Loan Document.
At the request and expense of Borrower, Administrative Agent
shall prepare and execute all necessary instruments to reflect
and effect such termination of the Loan Documents.
Administrative Agent is hereby authorized to execute all such
instruments on behalf of all Lenders, without the Joinder of or
further action by any Lender.
Section 10.10. Severability. If any term or provision of
any Loan Document shall be determined to be illegal or
unenforceable all other terms and provisions of the Loan
Documents shall nevertheless remain effective and shall be
enforced to the fullest extent permitted by applicable Law.
Section 10.11. Counterparts. This Agreement may be
separately executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which
when so executed shall be deemed to constitute one and the same
Agreement.
Section 10.12. Waiver of Jury Trial, Punitive Damages,
Etc. Restricted Persons and Lender Parties mutually hereby
knowingly, voluntarily, and intentionally waive the right to a
trial by jury in respect of any claim based hereon, arising out
of, under or in connection with, this agreement or any other
Loan Documents contemplated to be executed in connection
herewith or any course of conduct, course of dealings,
statements (whether verbal or written) or actions of any party.
This waiver constitutes a material inducement for Lenders to
enter into this Agreement and the other Loan Documents and make
the Loans. Borrower and each Lender Party hereby further (a)
irrevocably waives, to the maximum extent not prohibited by Law,
any right it may have to claim to recover in any such litigation
any "Special Damages," as defined below, (b) certifies that no
party hereto nor any representative or agent or counsel for any
party hereto has represented, expressly or otherwise, or implied
that such party would not, in the event of litigation, seek to
enforce the foregoing waivers, and (c) acknowledges that it has
been induced to enter into this Agreement, the other Loan
Documents and the transactions contemplated hereby and thereby
by, among other things, the mutual waivers and certifications
contained in this section. As used in this section, "Special
Damages" includes all special, consequential, exemplary, or
punitive damages (regardless of how named), but does not include
any payments or funds which any party hereto has expressly
promised to pay or deliver to any other party hereto.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
IN WITNESS WHEREOF, this Agreement is executed as of the
date first written above.
BORROWER: GENESIS CRUDE OIL, L.P.
By: GENESIS ENERGY, L.L.C.,
its general partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Chief Financial
Officer, General
Counsel & Secretary
GUARANTORS: GENESIS ENERGY, L.P.
By: GENESIS ENERGY, L.L.C.,
its general partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Chief Financial
Officer, General
Counsel & Secretary
GENESIS ENERGY, L.L.C.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Chief Financial
Officer, General
Counsel & Secretary
Address for Borrower and
Guarantors:
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
CITICORP NORTH AMERICA, INC.,
Administrative Agent, Collateral
Agent, LC Issuer and a Lender
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
--------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
Address:
Citicorp North America, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇